MAXN.PNG

JWCA advises Maxeon Solar Technologies on its $204 million convertible exchange

May 2024 | read press release

Transaction Background

Maxeon Solar Technologies (“Maxeon” or “the Company”) engaged J. Wood Capital to advise on the refinancing of its $200mm 6.50% convertible senior notes due July 2025

Maxeon's objectives were to:

  • Address upcoming maturity to allow company to focus on business execution

  • Extend 2025 convertible into new 3.5-year maturity despite high debt-to-market cap ratio and limited stock borrow

JWCA acted as financial advisor to Maxeon providing the following support for the Company:

  • Analyzed range of capital structure transactions to help Company assess tradeoff between leverage and dilution

  • Helped design highly customized secured 2nd-lien convertible security, including inputs on pricing, economic terms, and security package

Results

Maxeon addressed ~99.25% of its 2025 maturity by refinancing $198.5mm into a combination of:

  • $139.0mm Tranche A adjustable-rate convertible 2nd Lien senior secured notes due January 2028 that are exchangeable into MAXN common shares at any time at the company’s election at the conversion price

  • $65.1mm Tranche B adjustable-rate convertible 2nd Lien senior secured notes due January 2028

  • 9.925mm warrants

Extends July 2025 debt maturity profile to January 2028 (~3.5 years)

In conjunction with the convertible exchange, Maxeon’s largest shareholder, Zhonghuan Singapore Investment and Development (“TZE”), invested $195mm in new capital into the company including:

  • $97.5mm 9% convertible 1st Lien senior secured notes due June 2029

  • $25mm additional investment into TZE’s existing $207mm 7.5% 1st Lien senior secured notes due August 2027.  As part of this investment, the terms of the notes were amended to an 8.5% coupon and August 2029 maturity date

  • $100mm forward purchase agreement by TZE where it will purchase MAXN equity at 75% of he daily VWAP  for 10 consecutive trading days ending on the day immediately prior to the receipt of regulatory approvals

Provides management meaningful runway to continue growing the business