Plug Power Inc. (“Plug Power”) (NASDAQ: PLUG) today announced the
pricing of $200.0 million aggregate principal amount of 3.75%
Convertible Senior Notes due 2025 (the “notes”) in a private
offering (the “offering”) to qualified institutional buyers
pursuant to Rule 144A under the Securities Act of 1933, as amended
(the “Securities Act”). Plug Power also granted the initial
purchasers of the notes a 13-day option to purchase up to an
additional $30.0 million aggregate principal amount of the notes.
The sale of the notes to the initial purchasers is expected to
close on May 18, 2020, subject to customary closing conditions, and
is expected to result in approximately $193.4 million (or
approximately $222.5 million if the initial purchasers exercise
their option to purchase additional notes in full) in net proceeds
to Plug Power after deducting the initial purchasers’ discount and
estimated offering expenses payable by Plug Power.
The notes will be senior, unsecured obligations of Plug Power.
The notes will bear interest at a rate of 3.75% per year. Interest
will be payable semi-annually in arrears on June 1 and December 1
of each year, beginning on December 1, 2020. The notes will mature
on June 1, 2025, unless earlier repurchased, redeemed or converted.
Plug Power may not redeem the notes prior to June 5, 2023; on or
after June 5, 2023, Plug Power may redeem the notes only upon the
occurrence of certain events and during certain periods.
Holders of the notes will have the right to require Plug Power to
repurchase all or a portion of their notes upon the occurrence of a
fundamental change (as defined in the indenture governing the
notes) at a purchase price of 100% of their principal amount plus
any accrued and unpaid interest to, but excluding, the relevant
fundamental change repurchase date.
The notes will be convertible at an initial conversion rate of
198.6196 shares of Plug Power’s common stock per $1,000 principal
amount of notes (equivalent to an initial conversion price of
approximately $5.03 per share, which represents a conversion
premium of approximately 22.5% to the last reported sale price of
$4.11 per share of Plug Power’s common stock on The Nasdaq Capital
Market on May 13, 2020).
Prior to the close of business on the business day immediately
preceding December 1, 2024, the notes will be convertible at the
option of the noteholders only upon the satisfaction of specified
conditions and during certain periods. On or after December 1, 2024
until the close of business on the second scheduled trading day
immediately preceding the maturity date, the notes will be
convertible at the option of the noteholders at any time regardless
of these conditions. Conversions of the notes will be settled in
cash, shares of Plug Power’s common stock, or a combination
thereof, at Plug Power’s election.
In connection with the pricing of the notes, Plug Power entered
into capped call transactions with one of the initial purchasers of
the notes and another financial institution (the “option
counterparties”). The capped call transactions are expected
generally to reduce or offset the potential dilution to Plug
Power’s common stock upon any conversion of notes and/or to offset
any cash payments Plug Power is required to make in excess of the
principal amount of converted notes, as the case may be, with such
reduction and/or offset subject to a cap based on the cap
price. The cap price of the capped call transactions will
initially be approximately $6.58 per share, which represents a
premium of approximately 60% over the last reported sale price of
Plug Power’s common stock of $4.11 per share on May 13, 2020, and
is subject to certain adjustments under the terms of the capped
call transactions.
Plug Power expects that, in connection with establishing their
initial hedges of the capped call transactions, the option
counterparties or their respective affiliates will purchase shares
of Plug Power’s common stock and/or enter into various derivative
transactions with respect to the common stock concurrently with or
shortly after the pricing of the notes. This activity could
increase (or reduce the size of any decrease in) the market price
of the common stock or the notes at that time. In addition,
Plug Power expects that the option counterparties or their
respective affiliates may modify their hedge positions by entering
into or unwinding various derivatives with respect to the common
stock and/or by purchasing or selling shares of the common stock or
other securities of Plug Power in secondary market transactions
from time to time prior to the maturity of the notes (and are
likely to do so during any observation period related to a
conversion of the notes). This activity could also cause or
avoid an increase or a decrease in the market price of the common
stock or the notes, which could affect the ability of holders of
notes to convert the notes and, to the extent the activity occurs
during any observation period related to a conversion of the notes,
it could affect the number of shares of common stock and value of
the consideration that holders of notes will receive upon
conversion of the notes.
Contemporaneously with the pricing of the notes, Plug Power
entered into separate and individually negotiated transactions with
certain holders of its 5.50% Convertible Senior Notes due 2023 (the
“2023 notes”) to repurchase approximately $66.3 million in
aggregate principal amount of the 2023 notes for approximately
$90.9 million in cash, representing the principal amount exchanged
and accrued and unpaid interest thereon, and approximately 9.4
million shares of Plug Power’s common stock, representing the
conversion value in excess thereof (collectively, the “notes
repurchase transactions”). The notes repurchase transactions are
expected to close concurrently with the closing of the offering of
notes, subject to customary closing conditions. In connection with
the issuance of the 2023 notes, Plug Power entered into capped call
transactions (the “existing capped call transactions”) with certain
financial institutions (the “existing option counterparties”). Plug
Power intends to enter into agreements with the existing option
counterparties concurrently with or shortly after the closing of
the offering of notes to terminate a portion of the existing capped
call transactions in a notional amount corresponding to the
principal amount of such 2023 notes repurchased. Plug Power intends
to use proceeds that it receives from any such terminations for
working capital and other general corporate purposes. The
repurchase of the 2023 notes and the unwind of the existing capped
call transactions described above, and the potential related market
activities by exchanging holders of the 2023 notes and the existing
option counterparties, as applicable, could increase (or reduce the
size of any decrease in) or decrease (or reduce the size of any
increase in) the market price of Plug Power’s common stock, which
may affect the trading price of the notes at that time. Plug Power
cannot predict the magnitude of such market activity or the overall
effect it will have on the price of the notes or the common
stock.
Plug Power intends to use approximately $15.3 million of the net
proceeds from the offering to pay the cost of the capped call
transactions, approximately $90.9 million of the net proceeds from
the offering to finance the cash portion of the consideration Plug
Power delivers in connection with the notes repurchase transactions
and the remaining net proceeds from the offering to fund “eligible
green projects,” designed to contribute to selected sustainable
development goals as defined by the United Nations, and for working
capital and other general corporate purposes, which may include
potential acquisitions and strategic transactions. If the initial
purchasers of the notes exercise their option to purchase
additional notes, Plug Power expects to use a portion of the
proceeds from such sale to enter into additional capped call
transactions with the option counterparties.
In connection with the pricing of the notes, Plug Power extended
the maturity of the prepaid forward stock purchase transaction (the
“prepaid forward”) that Plug Power previously entered into with a
financial institution (the “forward counterparty”) in connection
with the issuance of the 2023 notes. The expiration date for
the prepaid forward will be June 1, 2025.
Plug Power expects that, in connection with the extension of the
maturity of the prepaid forward, the forward counterparty or its
affiliates will enter into one or more derivative transactions with
respect to Plug Power’s common stock with purchasers of the notes
concurrently with or after the pricing of the notes. The
prepaid forward is intended to allow investors to establish short
positions that generally correspond to (but may be greater than)
commercially reasonable initial hedges of their investment in the
notes. In the event of such greater initial hedges, investors
may offset such greater portion by purchasing the common stock on
the day of pricing of the notes. Facilitating investors’
hedge positions by extending the maturity of the prepaid forward,
particularly if investors purchase the common stock on the pricing
date, could increase (or reduce the size of any decrease in) the
market price of the common stock and effectively raise the
conversion price of the notes. In addition, Plug Power
expects that the forward counterparty or its affiliates may modify
their hedge position by entering into or unwinding one or more
derivative transactions with respect to the common stock and/or
purchasing or selling the common stock or other securities of Plug
Power in secondary market transactions at any time following the
pricing of the notes and prior to the maturity of the notes.
These activities could also cause or avoid an increase or a
decrease in the market price of the common stock or the notes.
The notes were only offered to qualified institutional buyers
pursuant to Rule 144A under the Securities Act. Neither the notes
nor the shares of Plug Power’s common stock potentially issuable
upon conversion of the notes, if any, have been, or will be,
registered under the Securities Act or the securities laws of any
other jurisdiction, and unless so registered, may not be offered or
sold in the United States except pursuant to an applicable
exemption from such registration requirements.
This announcement is neither an offer to sell nor a solicitation
of an offer to buy any of these securities and shall not constitute
an offer, solicitation or sale in any jurisdiction in which such
offer, solicitation or sale is unlawful.
Cautionary Language Concerning Forward-Looking
Statements
This press release contains “forward-looking statements” within
the meaning of the “safe harbor” provisions of the Private
Securities Litigation Reform Act of 1995, including but not limited
to, statements regarding the extent, and potential effects, of the
capped call transactions, the notes repurchase transactions, the
terminations of the existing capped call transactions and the
extension of the prepaid forward, the expected use of the proceeds
from the sale of the notes and other statements contained in this
press release that are not historical facts. These forward-looking
statements are made as of the date they were first issued and were
based on current expectations, estimates, forecasts and projections
as well as the beliefs and assumptions of management. Words such as
“expect,” “anticipate,” “should,” “believe,” “hope,” “target,”
“project,” “goals,” “estimate,” “potential,” “predict,” “may,”
“will,” “might,” “could,” “intend,” “shall” and variations of these
terms or the negative of these terms and similar expressions are
intended to identify these forward-looking statements.
Forward-looking statements are subject to a number of risks and
uncertainties, many of which involve factors or circumstances that
are beyond Plug Power’s control. Plug Power’s actual results could
differ materially from those stated or implied in forward-looking
statements due to a number of factors, including but not limited
to, risks detailed in Plug Power’s filings and reports with
the Securities and Exchange Commission (“SEC”), including
its Annual Report on Form 10-K for the year ended December 31,
2019, Quarterly Report on Form 10-Q for the quarter ended March 31,
2020 as well as other filings and reports that may be filed by Plug
Power from time to time with the SEC. Plug Power anticipates
that subsequent events and developments will cause its views to
change. Plug Power undertakes no intention or obligation
to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. These
forward-looking statements should not be relied upon as
representing Plug Power’s views as of any date subsequent to the
date of this press release.
Media Contact Ian MartoranaThe Bulleit
Group(415) 237-3681plugpowerPR@bulleitgroup.com SOURCE: PLUG
POWER
Plug Power (NASDAQ:PLUG)
Historical Stock Chart
From Aug 2024 to Sep 2024
Plug Power (NASDAQ:PLUG)
Historical Stock Chart
From Sep 2023 to Sep 2024