Plug Power Inc. (“Plug Power”) (NASDAQ: PLUG) today announced its
intention to offer, subject to market conditions and other factors,
$200 million aggregate principal amount of 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 expects to grant the initial purchasers of the notes a
13-day option to purchase up to an additional $30 million aggregate
principal amount of the notes.
The notes will be senior, unsecured obligations of Plug Power,
and interest will be payable semi-annually in arrears. The notes
will be convertible into cash, shares of Plug Power’s common stock
or a combination thereof, at Plug Power’s election. The interest
rate, conversion rate and other terms of the notes are to be
determined upon pricing of the offering.
Plug Power intends to use a portion of the net proceeds from the
offering of the notes to pay the cost of the capped call
transactions described below, and to fund the cash portion, if any,
of the repurchase of a portion of Plug Power’s existing 5.50%
Convertible Senior Notes due 2023 (the “2023 notes”) through
individually privately negotiated transactions (each, a “note
repurchase transaction”) concurrently with the offering of the
notes. The terms of each note repurchase transaction will depend on
several factors, including the market price of Plug Power’s common
stock and the trading price of the 2023 notes at the time of each
such note repurchase transaction. The consideration for any such
repurchases may include cash, shares of Plug Power’s common stock,
or a combination thereof. This activity could affect the market
price of Plug Power’s common stock and the initial conversion price
of the notes.
To the extent Plug Power effects the note repurchase
transactions, Plug Power intends to enter into agreements
concurrently with or shortly after the closing of the offering of
the notes to terminate a corresponding portion of the capped call
transactions it entered into in connection with the issuance of the
2023 notes.
In connection with the pricing of the notes, Plug Power expects
to enter into capped call transactions with one or more of the
initial purchasers of the notes or their respective affiliates
and/or other financial institutions (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 the 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. If the initial purchasers of the notes
exercise their option to purchase additional notes, Plug Power
expects to enter into additional capped call transactions with the
option counterparties.
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 Plug Power’s 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 following
the pricing of the notes and 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.
Plug Power expects to use the remainder of the net proceeds of
the offering of the notes 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.
In connection with the pricing of the notes, Plug Power also
expects to extend the maturity of the prepaid forward stock
purchase transaction (the “prepaid forward”) that Plug Power
previously entered into with a financial institution in connection
with the issuance of the 2023 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 will only be 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 proposed terms of the notes, the size
of the offering, including the option to purchase additional notes
to the initial purchasers, the extent, and potential effects, of
the capped call transactions, the repurchases of the 2023 notes,
the extension of the prepaid forwards, the potential dilution to
Plug Power’s common stock, the conversion price for the notes and
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
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