Exhibit 99.1
Sunnova Announces Proposed Private Offering of $425 Million of Convertible Senior Notes
HOUSTON, August 15, 2022 (BUSINESSWIRE) – Sunnova Energy International Inc. (“Sunnova”) (NYSE: NOVA) today announced that it intends to offer, subject to market conditions, $425 million aggregate principal amount of convertible senior notes due 2028 (the “notes”) in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). Sunnova also intends to grant the initial purchasers of the notes the option to purchase up to an additional $75 million aggregate principal amount of the notes within a 13-day period beginning on, and including, the date on which the notes are first issued.
The notes will be senior, unsecured obligations of Sunnova and will accrue interest payable semiannually in arrears on February 15 and August 15 of each year, beginning on February 15, 2023. The notes will mature on February 15, 2028, unless earlier converted, redeemed or repurchased. The notes will be convertible into cash, shares of Sunnova’s common stock, par value $0.0001, or a combination of cash and shares of Sunnova’s common stock, at Sunnova’s election. The interest rate, initial conversion rate and other terms of the notes will be determined at the time of pricing of the offering.
Sunnova intends to use a portion of the net proceeds from the offering to pay the cost of the capped call transactions described below. Sunnova intends to use the remainder of the net proceeds from the offering for general corporate purposes, including, among other things, the funding of working capital, operating expenses, capital expenditures and the repayment of indebtedness.
In connection with the pricing of the notes, Sunnova expects to enter into capped call transactions (the “capped call transactions”) with one or more of the initial purchasers or their respective affiliates and/or other financial institutions (the “option counterparties”). The capped call transactions are expected generally to reduce the potential dilution to Sunnova’s common stock upon any conversion of notes and/or offset any cash payments Sunnova 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 exercise their option to purchase additional notes, Sunnova expects to enter into additional capped call transactions with the option counterparties.
In connection with establishing their initial hedges of the capped call transactions, Sunnova expects the option counterparties or their respective affiliates to purchase shares of Sunnova’s common stock and/or enter into various derivative transactions with respect to Sunnova’s common stock concurrently with or shortly after the pricing of the notes. These activities could increase (or reduce the size of any decrease in) the market price of Sunnova’s common stock or the notes at that time.
In addition, the option counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to Sunnova’s common stock and/or purchasing or selling Sunnova’s common stock or other securities of Sunnova in secondary market transactions following the pricing of the notes and prior to the maturity of the notes (and are likely to do so on each exercise date for the capped call transactions, which are expected to occur on each trading day during the 30 trading day period beginning on the 31st scheduled trading day prior to the maturity date of the notes, or following any termination of any portion of the capped call transactions in connection with any repurchase, redemption or early conversion of the notes). This activity could also cause or avoid an increase or a decrease in (or reduce the size of any decrease or increase in) the market price of Sunnova’s common stock or the notes, which could affect the ability of noteholders to convert the notes and, to the extent the activity occurs during any observation period related to a conversion of notes, it could affect the amount and value of the consideration that a noteholder will receive upon conversion of its notes.
Neither the notes, nor any shares of Sunnova’s common stock issuable upon conversion of the notes, have been, nor will be, registered under the Securities Act or any state securities laws and, unless so registered, such securities may not be offered or sold in the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and other applicable securities laws.
