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SEC Filings

TERRAFORM GLOBAL, INC. filed this Form 10-K on 06/15/2017
Entire Document

Additionally, covenant defaults may occur in the future under the indenture governing the Senior Notes in the event of further delays in the filing of our periodic reports with the SEC. There can be no assurance that we will be able to file our periodic reports (including our Form 10-Q for the quarter ended March 31, 2017 or any quarters thereafter) with the SEC within the periods currently required under the indenture governing the Senior Notes or that holders of the Senior Notes will agree to any required extension of financial statement filing dates on acceptable terms or at all. A default on the Senior Notes would permit the trustee or the holders of at least 25% in aggregate principal amount of notes outstanding to accelerate the Senior Notes. The Company would likely not have sufficient liquidity to meet this obligation, which could have a material adverse effect on our business, results of operations, financial condition and ability to pay dividends.
The risk of substantive consolidation of the Company with SunEdison and inclusion in the SunEdison Bankruptcy, as well as the risk of future covenant defaults under the indenture governing the Senior Notes, raise substantial doubt about the Company’s ability to continue as a going concern.
Credit Risk
Credit risk relates to the risk of loss resulting from non-performance or non-payment by offtake counterparties or SunEdison under the terms of their contractual obligations, thereby impacting the amount and timing of expected cash flows. We monitor and manage credit risk through credit policies that include a credit approval process and the use of credit mitigation measures such as having a diversified portfolio of offtake counterparties. However, there are a limited number of offtake counterparties under offtake agreements in each region that we operate, and this concentration may impact the overall exposure to credit risk, either positively or negatively, in that the offtake counterparties may be similarly affected by changes in economic, industry or other conditions. If any of these receivable balances in the future should be deemed uncollectible, it could have a material adverse effect on our forecasted cash flows.
Item 8. Financial Statements and Supplementary Data.
The financial statements and schedules are listed in Item 15. Financial Statements and Exhibits and are incorporated by reference herein.
Specifically, our selected quarterly financial data for each of the quarterly periods ended March 31, June 30, September 30 and December 31 in 2016 and 2015 are included in Item 15. Note 22 - Quarterly Financial Data.
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Pursuant to the terms of the MSA, SunEdison has historically provided the systems and personnel for our financial reporting and control processes (such as information technology, enterprise resource management and accounting systems) and, as a result, our financial reporting and control processes relied to a significant extent on SunEdison systems and personnel. SunEdison has not performed as obligated under the MSA, in particular with respect to financial reporting and control matters. As such, we engaged a dedicated staff during 2016 to improve financial reporting and internal controls; however, we remain dependent on SunEdison financial systems and IT support personnel.
We carried out an evaluation as of December 31, 2016, under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based upon that evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that our disclosure controls and procedures were not effective as of December 31, 2016, as a result of the material weaknesses in internal control over financial reporting described below.
Notwithstanding such material weakness in internal control over financial reporting, our management concluded that our consolidated financial statements in this Annual Report on Form 10-K present fairly, in all material respects, the Company’s financial position, results of operations and cash flows as of the dates, and for the periods presented, in conformity with generally accepted accounting principles (“U.S. GAAP”).
Management’s Report on Internal Control over Financial Reporting