Green Plains Inc. announced the pricing of its underwritten public offerings of $175.0 million of common stock at a price to the public of $23.00 per share and the pricing of $200.0 million aggregate principal amount of its 2.25% convertible senior notes due 2027. The aggregate gross proceeds to the company from the offerings, before deducting the underwriting discounts and commissions and other offering expenses, are expected to be approximately $375.0 million, reflecting an increase from the previously announced $150.0 million of common stock and $150.0 million aggregate principal amount of notes.
The company has also granted the underwriters in the common stock offering a 30-day option to purchase up to an additional 1,141,500 shares of its common stock on the same terms and conditions and to the underwriters in the convertible notes offering a 30-day option to purchase up to an additional $30.0 million aggregate principal amount of notes solely to cover over-allotments.
The company expects to use approximately $156.3 million of the net proceeds of the convertible notes offering to repurchase approximately $135.5 million aggregate principal amount of its 4.125% convertible notes due 2022 (the “2022 notes”), in privately negotiated transactions concurrently with this offering. The company intends to use the balance of the net proceeds from the notes offering and the net proceeds from the common stock offering to repay the 2022 notes remaining outstanding at their maturity date and for general corporate purposes.
The notes will bear interest at a rate of 2.25% per year, payable on March 15 and September 15 of each year, beginning September 15, 2021, and mature on March 15, 2027. The notes will be general senior, unsecured obligations of the company. On and after March 15, 2024, and prior to the maturity date, the company may redeem, for cash, all, but not less than all, of the notes if the last reported sale price of the company’s common stock equals or exceeds 140% of the applicable conversion price on (i) at least 20 trading days during a 30 consecutive trading day period ending on the trading day immediately prior to the date the company delivers notice of the redemption; and (ii) the trading day immediately before the date of the redemption notice. The redemption price will equal 100% of the principal amount of the notes to be redeemed, plus any accrued and unpaid interest to, but excluding, the redemption date. In addition, upon the occurrence of a “fundamental change” (as defined in the indenture for the notes), holders of the notes will have the right, at their option, to require the company to repurchase their notes for cash at a price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date.
The notes will be convertible, at the option of the holders, into consideration consisting of, at the company’s election, cash, shares of the company’s common stock, or a combination of cash and stock (and cash in lieu of fractional shares). However, before September 15, 2026, the notes will not be convertible unless certain conditions are satisfied. The initial conversion rate will be 31.6206 shares of the company’s common stock per $1,000 principal amount of notes (equivalent to an initial conversion price of approximately $31.62 per share of the company’s common stock), representing an approximately 37.5% premium over the offering price of the company’s common stock. The conversion rate will be subject to adjustment upon the occurrence of certain events. In addition, the company may be obligated to increase the conversion rate for any conversion that occurs in connection with certain corporate events, including the company’s calling the notes for redemption.
The offerings are expected to close on March 1, 2021, subject to customary closing conditions. The closing of each offering is not contingent on the closing of the other offering.
Jefferies and BofA Securities are acting as joint book-running managers for both the common stock and convertible notes offerings. Roth Capital Partners, Stephens Inc., Truist Securities, Inc. and Craig-Hallum Capital Group are acting as co-managers of the common stock offering and BMO Capital Markets Corp. and Truist Securities, Inc. are acting as co-managers of the convertible notes offering.