Plug Power Inc. Announces Private Offering of $200 Million of Convertible Senior Notes

LATHAM, N.Y. , May 13, 2020 (GLOBE NEWSWIRE) -- 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.