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Get filing alertsOrmat completes $1B convertible notes offering, retires $286M of 2027 debt
Filed March 23, 2026 · Period ending March 17, 2026 · ~1 min read
Key Changes
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high
Raised $1 billion through convertible notes ($825M at 1.50%, $175M at 0%) due 2031, convertible at $140.40/share—representing 30% premium to current levels. Up to 9.3 million shares may be issued upon conversion.
Item 1.01 verify on EDGAR → -
high
Used $313M of proceeds plus 0.6M shares to retire $286M of 2027 Notes, reducing near-term debt from $477M to $191M and extending maturity profile by four years.
Item 8.01 verify on EDGAR → -
medium
Series B noteholders ($175M) can force repurchase at par on March 15, 2027, creating potential cash obligation in one year. Company cannot redeem notes before March 2029.
Item 1.01 verify on EDGAR → -
medium
Notes rank equal to existing unsecured debt but junior to secured obligations and all subsidiary debt. Cross-default triggered if company defaults on debt exceeding $100M.
Item 1.01 verify on EDGAR → -
low
Conversion restricted until November 2030 unless stock trades above $182.52 (130% of conversion price) for 20 of 30 consecutive days or certain corporate events occur.
Item 1.01 verify on EDGAR →
Summary
Ormat Technologies executed a significant capital structure refinancing, raising $1 billion through two series of convertible notes while simultaneously retiring 60% of its 2027 debt.
The transaction extends the company's debt maturity profile and provides financial flexibility, though at the cost of potential shareholder dilution—up to 9.3 million shares could be issued if notes convert, representing roughly 10% dilution at current share counts. The dual-series structure is notable: Series A carries a modest 1.50% coupon while Series B is zero-coupon, suggesting different investor appetites.
Both convert at $140.40/share, a 30% premium to the $108 stock repurchase price disclosed in the filing. However, Series B holders can force a $175 million repurchase in March 2027, creating a near-term liquidity test. Retail investors should monitor the stock price relative to the $182.52 threshold (130% of conversion price). Sustained trading above this level could trigger early conversion or company redemption after March 2029, forcing a decision on cash deployment versus equity dilution. The company's ability to handle the potential 2027 Series B put and maintain investment-grade operations will be key indicators of financial health.
Section-by-Section Diff
Event · Item 1.01 — Entry into a Material Definitive Agreement
Item 1.01 — Entry into a Material Definitive Agreement filed; see Key Changes for terms.
Added in current filing · verify on EDGAR →
The initial conversion rate for the Series A Notes will be 7.1225 shares of Common Stock for each $1,000 principal amount of Series A Notes (equivalent to an initial conversion price of approximately $140.40 per share of Common Stock), and the initial conversion rate for the Series B Notes will be 7.1225 shares of Common Stock for each $1,000 principal amount of Series B Notes (equivalent to an initial conversion price of approximately $140.40 per share of Common Stock).
Both note series convert at 7.1225 shares per $1,000 principal, representing a conversion price of approximately $140.40 per share. Notes are convertible into cash up to principal amount, with any excess settled in cash, stock, or a combination at the company's choice. Conversion is restricted until November 15, 2030 unless specific conditions are met, including stock price thresholds or corporate events.
Added in current filing · verify on EDGAR →
The Company may not redeem either series of Notes prior to March 20, 2029. The Company may redeem for cash all or any portion of either or both series of Notes, at the Company’s option, on or after March 20, 2029 and on or before the 61st scheduled trading day immediately preceding the maturity date, if the last reported sale price of the Common Stock has been at least 130% of the conversion price for the relevant series of Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed
Ormat cannot redeem the notes before March 20, 2029. After that date, redemption is permitted at par plus accrued interest if the stock price exceeds 130% of the conversion price for 20 out of 30 consecutive trading days. Additionally, Series B noteholders can require the company to repurchase their notes on March 15, 2027 at par, and all noteholders have repurchase rights upon a fundamental change event.
Added in current filing · verify on EDGAR →
The Company (1) used approximately $287.9 million of the net proceeds from the sale of the Notes, as well as approximately $25 million cash on hand, and issued approximately 0.6 million shares of Common Stock to repurchase approximately $285.9 million aggregate principal amount of the 2027 Notes through privately negotiated transactions entered into concurrently with the pricing of the offering, (2) used approximately $25 million of the net proceeds from the offering to repurchase concurrently with the closing of the offering, shares of Common Stock in privately negotiated transactions at a price per share equal to $108.00 and (3) expects to use the remainder of the net proceeds from the offering for general corporate purposes.
From net proceeds of approximately $975.7 million, Ormat used $287.9 million plus $25 million cash and 0.6 million shares to repurchase $285.9 million of existing 2027 Notes. An additional $25 million was used to buy back common stock at $108.00 per share. These transactions were designed to offset dilution from the 2027 Notes. The remaining proceeds will be used for general corporate purposes.
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The Notes are the Company’s senior unsecured obligations and rank senior in right of payment to any of the Company’s indebtedness that is expressly subordinated in right of payment to the Notes; equal in right of payment to any of the Company’s unsecured indebtedness that is not so subordinated, including the Company’s 2.50% Convertible Senior Notes due 2027 (the “2027 Notes”); effectively junior in right of payment to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities (including trade payables but excluding intercompany obligations and liabilities of a type not required to be reflected on a balance sheet of such subsidiaries in accordance with GAAP) of the Company’s subsidiaries.
The new notes rank as senior unsecured debt, equal to the existing 2027 Notes but junior to any secured debt and subsidiary obligations. Events of default include payment failures, conversion failures, cross-defaults on debt exceeding $100 million, and bankruptcy events. Upon default, noteholders or the trustee can accelerate 100% of principal plus accrued interest.
Event · Item 2.03 — Creation of a Direct Financial Obligation
Ormat disclosed creation of a direct financial obligation, with details incorporated by reference from Item 1.01.
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Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. The information set forth in Item 1.01 above is incorporated by reference into this Item 2.03.
Ormat Technologies disclosed the creation of a direct financial obligation or off-balance sheet arrangement. The filing references Item 1.01 for full details, but that section is not included in the provided text, preventing assessment of the obligation's nature, amount, or terms.
Event · Item 3.02 — Unregistered Sales of Equity Securities
Item 3.02 — Unregistered Sales of Equity Securities filed; see Key Changes for terms.
Added in current filing · verify on EDGAR →
The Notes were issued to certain initial purchasers in reliance upon Section 4(a) (2) of the Securities Act of 1933, as amended (the “Securities Act”), in transactions not involving any public offering. The Notes were resold by the initial purchasers to persons whom the initial purchasers reasonably believe are “qualified institutional buyers,” as defined in, and in accordance with, Rule 144A under the Securities Act.
Ormat Technologies issued convertible notes through a private placement to initial purchasers, who then resold them to qualified institutional buyers under Rule 144A. This was not a public offering but a private transaction exempt from registration under the Securities Act.
Added in current filing · verify on EDGAR →
Initially, a maximum of 9,259,200 shares of Common Stock may be issued upon conversion of the Notes, based on the initial maximum conversion rate for each series of Notes of 9.2592 shares of Common Stock per $1,000 principal amount of Notes, which is subject to customary anti-dilution adjustment provisions.
The convertible notes may result in the issuance of up to 9,259,200 shares of common stock if fully converted, at an initial conversion rate of 9.2592 shares per $1,000 principal amount. This represents potential dilution to existing shareholders, though the actual conversion rate may adjust based on anti-dilution provisions.
Show 1 minor / wording change
Added in current filing · verify on EDGAR →
Any shares of Common Stock that may be issued upon conversion of the Notes will be issued in reliance upon Section 3(a) (9) of the Securities Act as involving an exchange by the Company exclusively with its security holders.
Shares issued upon conversion of the notes will be exempt from Securities Act registration under Section 3(a)(9), which covers exchanges exclusively with existing security holders. This means the conversion process will not require a separate registration statement.
Event · Item 8.01 — Other Events
Ormat priced $875M debt offering and agreed to repurchase ~$286M of 2027 Notes using cash and ~0.6M shares.
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On March 18, 2026, the Company issued a press release announcing that it had priced the above-referenced offering in an upsized amount of $725 million aggregate principal amount of Series A Notes and $150 million aggregate principal amount of Series B Notes.
Ormat priced a private debt offering totaling $875 million ($725M Series A + $150M Series B), which was upsized from the initially announced $750 million ($600M Series A + $150M Series B). The offering was conducted under Rule 144A.
Added in current filing · verify on EDGAR →
the Company entered into privately negotiated exchange agreements (the “Exchange Agreements”) with certain holders of its 2027 Notes, pursuant to which the Company agreed to repurchase approximately $285.9 million aggregate principal amount of its 2027 Notes using approximately $287.9 million of cash from the offering to repay the par amount, as well as approximately $25 million cash on hand, and issuing approximately 0.6 million shares of Common Stock for the remainder.
Ormat is repurchasing approximately $285.9 million of its existing 2027 Notes using proceeds from the new debt offering (~$287.9M), cash on hand (~$25M), and issuing ~0.6 million shares of common stock. This reduces near-term debt maturities and extends the maturity profile.
Event · Item 9.01 — Financial Statements and Exhibits
Item 9.01 — Financial Statements and Exhibits filed; see Key Changes for terms.
Added in current filing · verify on EDGAR →
Series A Notes Indenture, dated March 20, 2026, between Ormat Technologies, Inc. and U.S. Bank Trust Company, National Association, as trustee. 4.2 Form of 1.50% Series A Convertible Senior Note due 2031
Ormat entered into an indenture for Series A convertible senior notes bearing 1.50% interest and maturing in 2031. These notes are convertible into Ormat common stock under terms specified in the indenture, providing debt financing with potential equity dilution.
Added in current filing · verify on EDGAR →
Series B Notes Indenture, dated March 20, 2026, between Ormat Technologies, Inc. and U.S. Bank Trust Company, National Association, as trustee. 4.4 Form of 0.00% Series B Convertible Senior Note due 2031
Ormat entered into an indenture for Series B convertible senior notes with 0.00% interest (zero coupon) and maturing in 2031. These notes are also convertible into common stock, representing non-interest-bearing debt financing with conversion rights.
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Figures/quotes linked to EDGAR · Narrative written by AI · Jun 8, 2026 · How we verify