- Company sells 14.6 million shares of common stock to NRG at
$2.39 per share for proceeds of $35 million
- Company enters into $40 million revolving construction / term
financing facility with NRG for project development
- Financing commitments support and reinforce existing strategic
relationship with NRG
FuelCell Energy, Inc. (Nasdaq:FCEL), a global leader in the design,
manufacture, operation and service of ultra-clean, efficient and
reliable fuel cell power plants, announced a broadening and
deepening of the existing relationship with NRG Energy (NYSE:NRG)
including a $35.0 million investment in FuelCell Energy common
stock by NRG Energy and the establishment of a new $40.0 million
revolving construction and term loan facility by NRG Energy for
FuelCell Energy to use for project development. NRG Energy now owns
approximately 17.0 million shares of the Company's common stock, or
6.0 percent, including 2.4 million shares owned prior to this
transaction.
"We believe that clean distributed power generation from fuel
cells will be one of the key technologies that drive our country
toward a cleaner energy future," said Mauricio Gutierrez, Chief
Operating Officer, NRG Energy, Inc. "We want to actively
participate in the construction of FuelCell Energy power plants in
order to promote choice and meet the specific needs of our existing
and future customers."
"The continuing support of NRG Energy is further validation of
our power generation solutions and our business model," said Chip
Bottone, Chief Executive Officer, FuelCell Energy, Inc. "We are
working closely with the NRG team and have developed a strong
pipeline of megawatt-class combined heat and power projects. These
agreements strengthen the Company's liquidity position and are
expected to accelerate deployment of multi-megawatt fuel cell
projects in the U.S."
FuelCell Energy sold 14,644,352 shares of its common stock to
NRG Energy in a private placement at a price of $2.39 per share,
the closing market price for the stock on July 29, 2014, for total
proceeds to the Company of $35.0 million. The transaction closed on
July 30, 2014. FuelCell Energy intends to use the net proceeds from
the offering for project development, project finance, working
capital support and general corporate purposes. The terms of the
equity transaction include a warrant giving NRG the right to
purchase an additional 2.0 million shares of common stock at a
price $3.35 per share. The warrant has a term of three years.
In addition to the common stock investment, NRG Energy has
extended a $40 million revolving construction and term financing
facility for the purpose of accelerating project development by
FuelCell Energy and its subsidiaries. The Company's project finance
subsidiaries may draw on the facility to finance the construction
of projects through the commercial operating date (COD) of the
power plants. The Company has the option to continue the financing
term for each project after COD for a maximum term of five years
per project. The interest rate is 8.5 percent per annum for
construction-period financing and 8.0 percent thereafter.
"A key advantage of this new credit facility is that it enables
FuelCell Energy to undertake project development and then sell the
fully operational power plants to long term project investors,"
said Michael Bishop, Chief Financial Officer, FuelCell Energy, Inc.
"This facility should help us accelerate the pace of adoption and
also improve our margins as the access to credit will allow us to
execute more quickly, thereby minimizing construction-period
financing and allowing us to optimize the ownership and financing
of projects once they are completed."
Draws under the credit facility are subject to traditional
project finance conditions precedent, including the existence of a
power purchase agreement (PPA) with the end-user of the power and
customary project documentation, economic performance and
compliance with applicable laws and regulations. Projects must be
located in the United States or pre-designated neighboring
countries including Canada and some Caribbean nations. FuelCell
Energy is expected to construct the projects and operate and
maintain them for the term of the corresponding PPAs pursuant to
arms'-length agreements with the project companies, whether or not
the project companies continue to be subsidiaries of FuelCell
Energy.
FuelCell Energy's stationary fuel cell power plants efficiently
and cleanly provide electricity and usable high quality heat near
the point of use through an electrochemical process. The power
plants are fuel flexible, capable of operating on clean natural
gas, on-site renewable biogas, or directed biogas. The combination
of near-zero pollutants, modest land-use needs and quiet operating
nature facilitates locating the Company's power plants in urban
locations.
About NRG
NRG is leading a customer-driven change in the U.S. energy
industry by delivering cleaner and smarter energy choices, while
building on the strength of the nation's largest and most diverse
competitive power portfolio. A Fortune 250 company, NRG creates
value through reliable and efficient conventional generation while
driving innovation in solar and renewable power, electric vehicle
ecosystems, carbon capture technology and customer-centric energy
solutions. NRG retail electricity providers serve almost 3 million
residential and commercial customers throughout the country. More
information is available at www.nrg.com.
About FuelCell Energy
Direct FuelCell® power plants are generating ultra-clean,
efficient and reliable power at more than 50 locations worldwide.
With more than 300 megawatts of power generation capacity installed
or in backlog, FuelCell Energy is a global leader in providing
ultra-clean baseload distributed generation to utilities,
industrial operations, universities, municipal water treatment
facilities, government installations and other customers around the
world. The Company's power plants have generated more than 2.6
billion kilowatt hours of ultra-clean power using a variety of
fuels including renewable biogas from wastewater treatment and food
processing, as well as clean natural gas. For more information,
please visit www.fuelcellenergy.com
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Direct FuelCell, DFC, DFC/T, DFC-H2 and FuelCell Energy, Inc.
are all registered trademarks of FuelCell Energy, Inc. DFC-ERG is a
registered trademark jointly owned by Enbridge, Inc. and FuelCell
Energy, Inc.
Cautionary Language
This news release contains forward-looking statements within the
meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, including, without limitation,
statements with respect to the Company's anticipated financial
results and statements regarding the Company's plans and
expectations regarding the continuing development,
commercialization and financing of its fuel cell technology and
business plans. All forward-looking statements are subject to risks
and uncertainties that could cause actual results to differ
materially from those projected. Factors that could cause such a
difference include, without limitation, changes to projected
deliveries and order flow, changes to production rate and product
costs, general risks associated with product development,
manufacturing, changes in the regulatory environment, customer
strategies, unanticipated manufacturing issues that impact power
plant performance, changes in critical accounting policies,
potential volatility of energy prices, rapid technological change,
competition, and the Company's ability to achieve its sales plans
and cost reduction targets, as well as other risks set forth in the
Company's filings with the Securities and Exchange Commission. The
forward-looking statements contained herein speak only as of the
date of this press release. The Company expressly disclaims any
obligation or undertaking to release publicly any updates or
revisions to any such statement to reflect any change in the
Company's expectations or any change in events, conditions or
circumstances on which any such statement is based.
CONTACT: FuelCell Energy, Inc.
Kurt Goddard, Vice President Investor Relations
203-830-7494
ir@fce.com
NRG Energy, Inc.
Karen Cleeve, Corporate Communications
609-524-4608
Chad Plotkin, Investor Relations
609-524-4526
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