SAN JOSE, Calif. and
SINGAPORE, July 10, 2020 /PRNewswire/ -- Maxeon Solar
Technologies, Pte. Ltd. (Maxeon), currently a wholly owned
subsidiary of SunPower Corp. (NASDAQ:SPWR), announced the pricing
of an offering of $185,000,000
aggregate principal amount of its 6.50% green convertible senior
notes due 2025 in a private offering to qualified institutional
buyers pursuant to Rule 144A under the Securities Act of 1933, as
amended, on July 9, 2020. The
issuance and sale of the notes are scheduled to settle on
July 17, 2020, subject to customary
closing conditions. Maxeon also granted the initial purchasers of
the notes an option to purchase, for settlement within a period of
13 days from, and including, the date notes are first issued, up to
an additional $15,000,000 principal
amount of notes.
The notes will be senior, unsecured obligations of Maxeon and
will accrue regular interest at a rate of 6.50% per annum, payable
semi-annually in arrears on January
15 and July 15 of each year,
beginning on January 15, 2021.
Additional interest may accrue on the notes in certain
circumstances. The notes will mature on July
15, 2025, unless earlier repurchased, redeemed or
converted.
When the notes are initially issued, they will not be
convertible. If SunPower's previously announced proposed spin-off
of Maxeon occurs within three months after the notes are first
issued, and certain conditions relating to the physical delivery
forward transaction described below are satisfied, then noteholders
will have the right to convert their notes in certain circumstances
and during specified periods. The initial conversion price will be
established following the proposed spin-off, if it occurs, and will
represent a premium of approximately 15.00% over the average of the
volume-weighted average price per ordinary share of Maxeon over the
note valuation period of 15 consecutive trading days beginning on,
and including, the fifth trading day after the date on which
Maxeon's ordinary shares are distributed to SunPower's common
stockholders in the proposed spin-off and such ordinary shares
begin to trade "regular way." However, the initial conversion price
will not be less than approximately $4.60 per ordinary share of Maxeon. Maxeon will
settle conversions by paying or delivering, as applicable, cash,
ordinary shares of Maxeon or a combination of cash and ordinary
shares of Maxeon, at Maxeon's election.
If the proposed spin-off does not occur within three months
after the notes are first issued, if Maxeon determines on any
earlier date that it will not consummate the proposed spin-off, or
if certain conditions relating to the physical delivery forward
transaction described below are not satisfied by November 16, 2020, then Maxeon will be required
to redeem all outstanding notes at a cash redemption price equal to
101% of their principal amount, plus accrued and unpaid interest,
if any. The notes will be also redeemable, in whole or in part, at
a cash redemption price equal to their principal amount, plus
accrued and unpaid interest, if any, at Maxeon's option at any
time, and from time to time, on or after July 17, 2023 and on or before the 60th scheduled
trading day immediately before the maturity date, but only if the
last reported sale price per ordinary share of Maxeon exceeds 130%
of the conversion price for a specified period of time. In
addition, the notes will be redeemable, in whole and not in part,
at a cash redemption price equal to their principal amount, plus
accrued and unpaid interest, if any, at Maxeon's option in
connection with certain changes in tax law. If a fundamental
change, as defined in the indenture for the notes, occurs, then
noteholders may require Maxeon to repurchase their notes for cash.
The repurchase price will be equal to the principal amount of the
notes to be repurchased, plus accrued and unpaid interest, if any,
to, but excluding, the applicable repurchase date.
The gross proceeds of the offering will be deposited into an
escrow account until consummation of the proposed spin-off. Maxeon
estimates that the net proceeds from the offering will be
approximately $177.2 million (or
approximately $191.7 million if the
initial purchasers fully exercise their option to purchase
additional notes), after deducting the initial purchasers'
discounts and commissions and estimated offering expenses. If the
proposed spin-off is consummated, Maxeon intends to use a portion
of the net proceeds from the offering to:
- fund the aggregate forward purchase price for the forward stock
purchase transaction described below;
- repay some or all of a promissory note for a principal amount
of $100.0 million to SunPower that
was issued in exchange for certain intellectual property necessary
for the operation of the Maxeon business; and
- general corporate purposes.
If the proposed spin-off is not consummated, Maxeon intends to
use the net proceeds from the offering, together with existing cash
on hand, to fund the mandatory redemption of the notes, as
described above. Maxeon intends to allocate an amount equal to the
net proceeds to finance or refinance, in whole or in part, existing
and new projects meeting specified eligibility criteria related to
environmental impact.
In connection with the issuance of the notes, Maxeon intends to
enter into:
- a privately negotiated forward-starting prepaid forward share
purchase transaction with one of the initial purchasers and/or its
affiliate, the prepaid forward counterparty, pursuant to which
Maxeon will repurchase approximately $40
million worth of ordinary shares of Maxeon, subject to
the conditions set forth in the agreement governing the prepaid
forward transaction; and
- a privately negotiated forward-starting physical delivery
forward transaction, together with the prepaid forward transaction,
the forward transactions, with one of the initial purchasers and/or
its affiliate, the physical delivery forward counterparty, together
with the prepaid forward counterparty, the forward counterparties,
with respect to approximately $60
million worth of ordinary shares of Maxeon, pursuant to
which the physical delivery forward counterparty will agree to
deliver the physical delivery Maxeon shares to Maxeon or a third
party-trustee designated by Maxeon for no consideration at or
around the maturity of the notes subject to the conditions set
forth in the agreement governing the physical delivery forward
transaction.
Both of the prepaid forward transaction and the physical
delivery forward transaction will become effective on the first day
of the note valuation period.
The number of ordinary shares of Maxeon to be repurchased under
the prepaid forward transaction will be determined based on the
arithmetic average of the volume-weighted average prices per
ordinary share of Maxeon over the note valuation period, subject to
a floor and Maxeon will prepay the forward purchase price in cash
using a portion of the net proceeds from the offering of the notes.
Under the terms of the prepaid forward transaction, Maxeon expects
that the prepaid forward counterparty will be obligated to deliver
the number of ordinary shares of Maxeon underlying the transaction
to Maxeon, or pay cash to the extent Maxeon fails to provide to
prepaid forward counterparty evidence of a valid shareholder
authorization, on or around the maturity date of the notes, subject
to the ability of the prepaid forward counterparty to elect to
settle all or a portion of the transaction early.
The number of ordinary shares of Maxeon underlying the physical
delivery forward transaction will be approximately $60 million worth of ordinary shares of Maxeon to
be issued and sold by Maxeon to one or more of the initial
purchasers or their affiliates, the underwriters, to be sold during
the note valuation period in a registered offering off of Maxeon's
registration statement on Form F-3 to be filed with the Securities
and Exchange Commission at prevailing market prices at the time of
sale or at negotiated prices. The underwriters will receive
all of the proceeds from the sale of such ordinary shares of
Maxeon. Maxeon will not receive any proceeds from the sale of such
ordinary shares of Maxeon. The offering of ordinary shares of
Maxeon in connection with the physical delivery forward transaction
is contingent upon the consummation of the offering of notes.
The forward transactions are generally expected to facilitate
privately negotiated derivative transactions that purchasers of the
notes may enter into with the forward counterparties or their
affiliates, including swaps, relating to ordinary shares of Maxeon
by which purchasers of the notes will establish short positions
relating to ordinary shares of Maxeon in order to hedge their
investments in the notes.
While the sales of ordinary shares of Maxeon during the note
valuation period in a registered offering would decrease the market
price of ordinary shares of Maxeon, the entry into the forward
transactions and the entry by the forward counterparties into
derivative transactions in respect of ordinary shares of Maxeon
with the purchasers of the notes could have the effect of
increasing, or reducing the size of any decrease in, the price of
ordinary shares of Maxeon during and/or shortly after, the note
valuation period.
Neither Maxeon nor the forward counterparties will control how
such purchasers of notes may use such derivative transactions. In
addition, such purchasers may enter into other transactions
relating to ordinary shares of Maxeon or the notes in connection
with or in addition to such derivative transactions, including the
purchase or sale of ordinary shares of Maxeon. As a result, the
existence of the forward transactions, such derivative transactions
and any related market activity could cause more purchases or sales
of ordinary shares of Maxeon over the term of the forward
transactions than there otherwise would have been had Maxeon not
entered into the forward transactions, and such purchases or sales
could potentially increase (or reduce the size of any decrease in)
or decrease (or reduce the size of any increase in) the market
price of ordinary shares of Maxeon and/or the trading prices of the
notes.
In addition, in connection with the settlement or unwind of the
forward transactions, the forward counterparties may purchase
ordinary shares of Maxeon, and such purchases may have the effect
of increasing, or preventing a decline in, the market price of
ordinary shares of Maxeon.
The effect, if any, of any of these transactions and activities
on the market price of ordinary shares of Maxeon or the notes will
depend in part on market conditions and cannot be ascertained at
this time, but any of these activities could adversely affect the
value of ordinary shares of Maxeon, which could affect the value of
the notes, the value of ordinary shares of Maxeon, if any, holders
of notes would receive upon conversion of the notes and
noteholder's ability to convert the notes.
The offer and sale of the notes and any ordinary shares of
Maxeon issuable upon conversion of the notes have not been, and
will not be, registered under the Securities Act or any other
securities laws, and the notes and any such ordinary shares cannot
be offered or sold except pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act and any other applicable securities laws. This press
release does not constitute an offer to sell, or the solicitation
of an offer to buy, the notes or any ordinary shares issuable upon
conversion of the notes, nor will there be any sale of the notes or
any such ordinary shares, in any state or other jurisdiction in
which such offer, sale or solicitation would be unlawful.
About Maxeon Solar Technologies
Following the Maxeon spin-off, Maxeon will be one of the world's
leading global manufacturers and marketers of premium solar power
technology. Maxeon will continue the decades long SunPower
technological innovation legacy and will operate an
industry-leading sales and distribution channel across six
continents. Headquartered in Singapore, Maxeon manufactures its solar cells
in Malaysia and the Philippines, assembles solar cells into
panels in France, Mexico and China (through its joint venture, Huansheng),
and sells its products in over 100 countries.
About SunPower
As one of the world's most innovative and sustainable energy
companies, SunPower Corporation (NASDAQ: SPWR) provides a diverse
group of customers with complete solar solutions and services.
Residential customers, businesses, governments, schools and
utilities around the globe rely on SunPower's more than 30 years of
proven experience. From the first flip of the switch, SunPower
delivers maximum value and superb performance throughout the long
life of every solar system. Headquartered in Silicon Valley,
SunPower has dedicated, customer-focused employees
in Africa, Asia, Australia, Europe, North
and South America.
Forward Looking Statements
This press release includes forward-looking statements,
including statements regarding the completion of the offering and
the proposed spin-off, the expected amount and intended use and
allocation of the net proceeds and the effects of entering into the
prepaid forward transaction and the physical delivery forward
transaction described above. Forward-looking statements represent
Maxeon's current expectations regarding future events and are
subject to known and unknown risks and uncertainties that could
cause actual results to differ materially from those implied by the
forward-looking statements. Among those risks and uncertainties are
market conditions, the satisfaction of the closing conditions
related to the offering and risks relating to Maxeon's business,
including those described in Maxeon's registration statement on
Form 20-F that is on file with the SEC. Maxeon may not consummate
the offering described in this press release and, if the offering
is consummated, cannot provide any assurances that the proposed
spin-off will be consummated as currently contemplated or regarding
its ability to effectively apply the net proceeds as described
above. The forward-looking statements included in this press
release speak only as of the date of this press release, and Maxeon
does not undertake to update the statements included in this press
release for subsequent developments, except as may be required by
law.
© 2020 SunPower Corporation. All Rights Reserved. SUNPOWER,
MAXEON and the SUNPOWER logo are registered trademarks of SunPower
Corporation in the U.S. and other countries as well.
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SOURCE SunPower Corp.