Item 1.01. Entry into a Material Definitive Agreement.

On August 17, 2021, Sunnova Energy Corporation (the "Issuer"), a wholly owned subsidiary of Sunnova Energy International Inc. ("Sunnova"), issued $400 million aggregate principal amount of 5.875% senior notes due 2026 (the "Notes"), under an indenture, dated as of August 17, 2021 (the "Indenture"), among the Issuer, the Guarantors (as defined below) and Wilmington Trust, National Association, as trustee for the Notes. The Notes were issued in a private offering exempt from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), to persons reasonably believed to be qualified institutional buyers in accordance with Rule 144A under the Securities Act and to persons outside of the United States pursuant to Regulation S under the Securities Act, at an issue price equal to 98.76% of the principal amount thereof.

The Issuer will allocate an amount equal to the net proceeds from the offering to finance or refinance, in whole or in part, existing or new eligible green projects as described in Sunnova's recently launched new green financing framework, and pending such use, will maintain or apply the net proceeds in accordance with the Issuer's normal liquidity practices.

The Notes are unsecured senior obligations of the Issuer, guaranteed by the Guarantors, and will mature on September 1, 2026. Each Note will bear interest at a rate per annum of 5.875%, payable semi-annually in arrears on March 1 and September 1 of each year, commencing on March 1, 2022. Interest will be payable to holders of record on the immediately preceding February 15 and August 15, as the case may be. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.

The following is a brief description of the terms of the Notes and the Indenture.

Ranking

The Notes will be the Issuer's senior unsecured obligations and will rank:





     •    senior in right of payment to any of Sunnova's and its consolidated
          subsidiaries' future indebtedness that is expressly subordinated in right
          of payment to the notes;




     •    equal in right of payment to any of Sunnova's and its consolidated
          subsidiaries' existing and future unsecured indebtedness that is not so
          subordinated;




     •    effectively junior in right of payment to any of Sunnova's and its
          consolidated subsidiaries' future secured indebtedness to the extent of
          the value of the assets securing such indebtedness; and




     •    structurally junior to all existing and future indebtedness and other
          liabilities of Sunnova's non-guarantor subsidiaries.

Guarantees

The Notes will initially be guaranteed on a senior unsecured basis by Sunnova and Sunnova Intermediate Holdings, LLC, a wholly owned subsidiary of the Issuer (collectively, the "Guarantors").

Optional Redemption

At any time prior to September 1, 2023, the Issuer may on any one or more occasions redeem all or any part of the Notes upon not less than 10 nor more than 60 days' notice, at a redemption price equal to 100% of the principal amount of the Notes redeemed, plus the Applicable Redemption Premium (as defined in the Indenture) as of, and accrued and unpaid interest, if any, to, but excluding, the date of redemption.

On or after September 1, 2023, the Issuer may on any one or more occasions redeem all or any part of the Notes, upon not less than 10 nor more than 60 days' notice, at the redemption prices (expressed as a percentage of principal amount of the Notes) set forth below, plus accrued and unpaid interest, if any, to, but excluding, the applicable redemption date, if redeemed during the twelve-month period beginning on September 1 of the years indicated below:





     Redemption Year Price
2023                    102.938 %
2024                    101.469 %
2025 and thereafter     100.000 %

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Change of Control Triggering Event; Asset Sales

If a specified change of control triggering event occurs, each holder of Notes will have the right to require the Issuer to repurchase that holder's Notes for a payment in cash equal to 101% of the aggregate principal amount of Notes repurchased, plus accrued and unpaid interest, if any, on the Notes repurchased to, but excluding, the date of purchase. In connection with certain asset sales, the Issuer will be required to use the net cash proceeds of the asset sale to make an offer to purchase the Notes at 100% of the principal amount, together with any accrued and unpaid interest to, but excluding, the date of purchase.

Certain Covenants

The Indenture, among other things, limits Sunnova's ability and the ability of Sunnova's restricted subsidiaries, including the Issuer, to:





  •   incur or guarantee additional indebtedness;




  •   create liens securing indebtedness;




  •   pay dividends on or redeem or repurchase stock or subordinated debt;




  •   make specified types of investments and acquisitions;




        •    enter into or permit to exist contractual limits on the ability of
             their subsidiaries to pay dividends to them;




  •   enter into transactions with affiliates; and




  •   sell assets or merge with other companies.

The Indenture also requires Sunnova to maintain a cash asset coverage ratio (as defined therein) of not less than 2.0x as of the end of each quarter.

Certain of these covenants are subject to termination when and if the Notes are rated investment grade by at least two of S&P Global Ratings, a division of S&P Global, Inc., Moody's Investors Service, Inc. and Fitch Ratings Ltd.

The foregoing description of the Indenture is not complete and is qualified in its entirety by reference to the full text of the Indenture and the Form of 5.875% Senior Note due 2026, which are filed as Exhibits 4.1 and 4.2, respectively, to this Current Report on Form 8-K and are incorporated into this Item 1.01 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 set forth in Item 1.01 of this Current Report on Form 8-K is incorporated into this Item 2.03 by reference.

Item 9.01. Financial Statements and Exhibits.




(d) Exhibits



Exhibit     Description

4.1           Indenture, dated August 17, 2021, among Sunnova Energy Corporation,
            Sunnova Energy International Inc., Sunnova Intermediate Holdings, LLC
            and Wilmington Trust, National Association.

4.2           Form of 5.875% Senior Note due 2026 (included in Exhibit 4.1).

104         Cover Page Interactive Data File (embedded within the inline XBRL
            Document).

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