Solaris Energy Infrastructure, Inc.SEI
Solaris Energy Infrastructure, Inc. Debt Disclosure
Debt
The following table summarizes our outstanding debt as of December 31, 2025 and 2024. Additional information regarding the Company’s material debt arrangements is provided below.
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Stateline term loan | $ | 186.0 | $ | — | |||||||
| Term loan (extinguished in 2025) | — | 325.0 | |||||||||
| Less: unamortized debt financing costs | (2.0) | (9.3) | |||||||||
| Total debt, net of debt financing costs | $ | 184.0 | $ | 315.7 | |||||||
| Less: current portion of long-term debt | (4.0) | (8.1) | |||||||||
| Long-term debt | $ | 180.0 | $ | 307.6 | |||||||
Stateline Term Loan
On May 23, 2025, Stateline entered into a Loan and Security Agreement (the “Stateline Term Loan”) with Stonebriar Commercial Finance LLC (“Stonebriar”), as lender, administrative agent, and collateral agent. The Company, through its subsidiary Solaris LLC, is the primary beneficiary of Stateline and therefore consolidates Stateline, including the Stateline Term Loan, in its consolidated financial statements. Refer to Note 3. “Variable Interest Entities” for additional information on the consolidation of Stateline.
The Stateline Term Loan provides for a delayed draw term loan facility with a maximum principal amount equal to the lesser of (i) $550.0 million and (ii) 80% of the total cost of the Equipment Collateral (as defined in the Stateline Term Loan). Advances under the facility are permitted through March 31, 2027. As of December 31, 2025, initial advances totaling $186.0 million had been drawn.
Each advance is initially evidenced by an interim note and subsequently converts into a converted note upon the occurrence of a specified conversion date (the “Conversion Date”). The Conversion Date for each advance is defined as the earliest of:
•The first day of the calendar quarter following the 90-day anniversary of “Go-Live” date (as defined in the Rental Agreement) of the applicable Equipment Collateral,
•April 1, 2027, or
•A mutually agreed-upon date by Stateline and Stonebriar.
Interest on interim notes accrues from the date of each advance at a variable rate (the “Floating Rate”) equal to 5.94% plus the greater of (i) the applicable Secured Overnight Financing Rate (“SOFR”) or (ii) 4.31%. The Floating Rate resets monthly on the first day of each calendar month, with interest payable monthly in arrears.
Upon conversion, each interim note becomes a converted note bearing interest at a fixed rate of 9.85% per annum, subject to a one-time adjustment based on then-prevailing U.S. Treasury rates and SOFR as of the business day prior to the Conversion Date. Once established, the fixed rate remains in effect for the 72-month term of the converted note. Interest on converted notes is payable monthly in arrears beginning in the month following the Conversion Date.
Principal repayments on converted notes begin in the month following the Conversion Date. Principal is amortized such that 80% is payable in equal monthly installments over the 72-month term, with the remaining 20% due as a balloon payment at maturity. Prepayments are permitted with at least 10 days’ prior notice to the lender. If made before March 31, 2028, prepayments are subject to a make-whole provision. Thereafter, prepayments are subject to a prepayment fee. Partial prepayments require lender consent.
The Stateline Term Loan includes customary affirmative and negative covenants, including restrictions on additional indebtedness, liens, asset sales, and distributions. Beginning in the fiscal quarter ending March 31, 2027, Stateline is required to comply quarterly with the following financial covenants (as defined in the Stateline Term Loan):
•Fixed charge coverage ratio of not less than 1.35 to 1.00
•Leverage ratio of not more than 3.50 to 1.00, and
•Minimum liquidity of not less than $5.0 million through December 31, 2026, and not less than $10.0 million thereafter.
The Stateline Term Loan is secured by the Equipment Collateral, related supply and power contracts, and proceeds thereof. The loan is non-recourse to the Company and secured solely by the assets of Stateline.
Debt financing costs of $5.8 million were incurred in connection with the Stateline Term Loan. Of this amount, $2.1 million was deducted from the carrying value of the initial advances and is being amortized as interest expense over the term of the loans using the effective interest method. The remaining $3.7 million was deferred as other non-current assets and will be allocated proportionally upon additional advances.
Interest expense recognized in connection with the Stateline Term Loan was $5.9 million for the year ended December 31, 2025, all of which was capitalized as part of the cost of qualifying assets under ASC 835-20, Interest. As of December 31, 2025, $4.0 million of the outstanding principal balance was classified as current debt in the consolidated balance sheet.
The carrying amount of the Stateline Term Loan approximates its fair value as of December 31, 2025, due to its recent origination and variable interest rate that reflects current market conditions. The fair value measurement is classified as Level 2 under ASC 820, Fair Value Measurement.
Revolving Credit Facility
On October 2, 2024, the Company entered into a revolving credit facility with Bank of America, N.A., acting as agent for the participating lenders. The facility provides for borrowings up to the lesser of $75.0 million or a borrowing base determined by a percentage of eligible accounts receivable and eligible inventory, subject to reserves and other adjustments. At the Company’s option, and provided certain conditions are met, the facility may be increased by up to an additional $50.0 million. Additionally, up to $10.0 million of the facility is available for the issuance of letters of credit. The facility matures on October 2, 2029, with provisions for earlier termination under certain conditions.
Borrowings under the facility bear interest, at Solaris’s option, at a rate equal to either (i) Term SOFR (as defined in the revolving facility) plus an applicable margin or (ii) the Base Rate (as defined in the revolving credit facility) plus an applicable margin. Contingent reimbursement obligations under letters of credit issued bear interest at the Base Rate. The margin applicable to revolving loans is 0.50% for Base Rate loans and 1.50% for Term SOFR loans. The applicable margin may increase by up to 0.50% based on the ratio of Solaris’s average daily availability during the most recent prior fiscal quarter to the size of the borrowing base during the most recent prior fiscal quarter.
The revolving credit facility includes customary covenants, including limitations on additional indebtedness, liens, and certain dispositions, investments and restricted payments. It also includes a springing financial covenant that requires Solaris to maintain a ratio, calculated using data from the four most recent fiscal quarters, of consolidated EBITDA minus unfinanced capital expenditures to fixed charges (which include principal and interest payments and the payments of certain dividends and distributions) of at least 1.00 to 1.00 as of the last day of each fiscal quarter while a Covenant Trigger Period (as defined in the revolving facility) is in effect.
The facility is secured by substantially all of the assets of the Company. Bank of America holds (i) a first-priority security interest in accounts receivable, deposit accounts, securities accounts, commodity accounts, chattel paper, inventory, customer contracts, and payment intangibles and (ii) a second priority security interest in substantially all other assets owned by the Company.
As of December 31, 2025, no amounts had been drawn under the facility, and availability under the borrowing base was $59.9 million. Total debt financing costs of $1.3 million related to the facility, incurred in connection with the initial execution of the facility and subsequent amendments, are recorded as non-current assets in the consolidated balance sheets and are being amortized as interest expense over the term of the facility using the straight-line method. If drawn, proceeds may be used for working capital and other general corporate purposes.
Term Loan Extinguishment
On October 8, 2025, the Company fully repaid its Term Loan, which had an outstanding balance of $325.0 million as of December 31, 2024 and which had a principal balance of $320.9 million at the time of extinguishment. The repayment was funded with proceeds from the issuance of convertible notes.
The repayment extinguished the Term Loan in full and resulted in a loss on extinguishment of debt of $41.5 million, primarily consisting of $32.0 million prepayment penalty and write-off of $9.4 million of unamortized debt issuance costs, which was recognized in the consolidated statement of operations for the year ended December 31, 2025.
For additional information regarding the convertible notes issued in connection with the repayment of the Term Loan, see Note 12. “Convertible Notes.”
Payments of Debt Obligations Due by Period
The following table presents the Company’s expected future principal maturities of long-term debt (which consisted solely of the Stateline Term Loan) and convertible notes as of December 31, 2025.
| Year Ending December 31, | Principal Repayments of Long-Term Debt | Principal Repayments of Convertible Notes | ||||||||||||
| 2026 | $ | 4.0 | $ | — | ||||||||||
| 2027 | 23.4 | — | ||||||||||||
| 2028 | 24.8 | — | ||||||||||||
| 2029 | 24.8 | — | ||||||||||||
| 2030 | 24.8 | 155.0 | ||||||||||||
| Thereafter | 84.2 | 747.5 | ||||||||||||
| Total | $ | 186.0 | $ | 902.5 | ||||||||||
The expected maturities of the Stateline Term Loan are based solely on the outstanding principal balance of $186.0 million as of December 31, 2025 and assumed conversion dates in 2026 and 2027. Actual maturities may differ based on the timing of conversions and any prepayments. These estimates assume that the current advances convert in 2026 and 2027, with principal repayments commencing thereafter over a 72-month term for each converted note, of which 80% is amortized in equal monthly installments and 20% is due as a balloon payment at maturity.
Future draws under the Stateline Term Loan facility, which could total up to an additional $332.5 million based on the estimated total commitment utilization, are not reflected in the table above as they represent contingent future borrowings. Any such future borrowings would follow a similar maturity structure upon draw and conversion.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Mar 5, 2025 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.