Plug Power, Inc. (NASDAQ:PLUG) shares slipped on Wednesday after the hydrogen technology company announced a new warrant inducement agreement with a key institutional investor.
The deal allows the immediate exercise of all outstanding warrants issued earlier this year, providing the company with roughly $370 million in gross proceeds before expenses.
Under the agreement, the investor will exercise existing warrants covering 185.43 million shares at $2.00 per share and, in exchange, will receive new warrants to purchase the same number of shares.
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According to Benzinga Pro, PLUG stock has gained over 80% in the past year. Investors can gain exposure to the stock via the ALPS Clean Energy ETF (NYSE:ACES).
These new warrants carry an exercise price of $7.75 — about double Plug Power's last closing price — and will become exercisable once shareholders approve an increase in authorized shares.
The new warrants will remain valid until March 20, 2028, and may be cash-settled after Feb. 28, 2026, if shares are unavailable for issuance.
If fully exercised for cash, the company could raise up to an additional $1.4 billion.
Plug Power said the proceeds from this transaction will be used for general corporate purposes and working capital.
The securities are being offered under an automatic shelf registration statement filed with the U.S. Securities and Exchange Commission (SEC) in May 2025.
Alongside the financing news, Plug Power outlined a staged leadership transition on Tuesday.
Jose Luis Crespo will become president on Oct. 10 and is expected to take over as CEO after Plug Power files its 2025 annual report, likely in March 2026. Current CEO Andy Marsh will remain in his position until then, after which he will transition to the role of executive chair. Meanwhile, George McNamee has been named lead director, effective Oct. 10.
The company's shares traded lower following the announcement as investors weighed both the near-term dilution risks and the long-term fundraising potential tied to the new warrants. Plug Power, headquartered in Slingerlands, New York, said it remains focused on expanding its hydrogen ecosystem and sustaining its position as a leader in the hydrogen economy.
LUG Price Action: Plug shares were down 8.27% at $3.55 at the time of publication on Wednesday. A hefty 98.7 million shares have changed hands so far. The stock sits 22.6% below its 52-week high but is trading well above its 50-day moving average, up 86.8%.
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