Item 5.03 Amendments to Articles of Incorporation
or Bylaws.
On September 8, 2017 the Company filed
a Certificate of Designations, Preferences and Rights of the Series C Convertible Preferred Stock of FuelCell Energy, Inc. (the
“Certificate of Designations”) with the Secretary of State of the State of Delaware establishing the rights, preferences,
privileges, qualifications, restrictions, and limitations relating to the Series C Preferred Stock, as described below.
The following summary of certain terms and
provisions of the Series C Preferred Shares offered in the Offering is subject to, and qualified in its entirety by reference to,
the terms and provisions set forth in the Certificate of Designations.
The Series C Preferred Shares are convertible
into shares of Common Stock, subject to the requirements of Nasdaq Listing Rule 5635 (d), and the beneficial ownership limitations
as provided in the Certificate of Designations, at a conversion price equal to $1.84 per share of Common Stock, subject to adjustment
as provided in the Certificate of Designations, at any time after the Company obtains the valid Stockholder Ratification (as such
term is defined in the Certificate of Designations) at the option of the holder. The holders will be prohibited from converting
Series C Preferred Shares into shares of Common Stock if, as a result of such conversion, such holder, together with its affiliates,
would own more than 8.99% of the total number of shares of Common Stock then issued and outstanding.
Additionally, prior to the stockholder vote on a proposal to approve the issuances of the Common Stock underlying the Series C
Preferred Shares, the holders will be prohibited from converting Series C Preferred Shares into shares of Common Stock if such
conversion would cause the Company to issue pursuant to the terms of the Series C Preferred Shares a number of shares in excess
of the maximum number of shares permitted to be issued thereunder without breaching its obligations under the rules or regulations
of Nasdaq.
On November 1, 2017 and on the sixteenth
day and first day of each calendar month thereafter until March 1, 2019, subject to extension in certain circumstances (the “Maturity
Date”), inclusive, the Company will redeem the stated value of Preferred Stock in thirty three (33) equal installments (each
bimonthly amount, an “Installment Amount” and the date of each such payment, an “Installment Date”). The
holders will have the ability to defer installment payments, but not beyond the Maturity Date. In addition, during each period
commencing on the 11th trading day prior to an Installment Date and prior to the immediately subsequent Installment Date, the holders
may elect to convert the Series C Preferred Shares at then applicable installment conversion price, provided that the holders may
not elect to effect any such acceleration during such installment period if either (x) in the aggregate, all the accelerations
in such installment period exceeds the sum of three (3) other installment amounts, or (y) the number of Series C Preferred Shares
subject to prior accelerations exceeds in the aggregate twelve (12) Installment Amounts.
Subject to the requirements of Nasdaq Listing
Rule 5635(d), obtaining the Stockholder Ratification, and certain other equity conditions, the Company may elect to pay the Installment
Amounts in cash or shares of Common Stock or in a combination of cash and shares of Common Stock.
Installment Amounts paid in shares will
be that number of shares of Common Stock equal to (a) the applicable Installment Amount, to be paid in Common Stock divided by
(b) the least of (i) the then existing Conversion Price, (ii) 87.5% of the volume weighted average price (“VWAP”) of
the Common Stock on the trading day immediately prior to the applicable Installment Date, and (iii) 87.5% of the arithmetic average
of the two lowest VWAPs of the Common Stock during the ten consecutive Trading Day (as such term is defined in the Certificate
of Designations) period ending and including the Trading Day immediately prior to the applicable Installment Date as applicable,
provided that the Company meets standard equity conditions. The Company shall make such election no later than the eleventh (11th)
trading day immediately prior to the applicable Installment Date.
In the event of the Company’s liquidation,
dissolution, or winding up, prior to distribution to holders of securities ranking junior to the Series C Preferred Shares, holders
of Series C Preferred Shares will be entitled to receive the amount of cash, securities or other property equal to the greater
of (A) the stated value thereof on the date of such payment plus accrued dividends, if any and (B) the amount per share such holder
would receive if such holder converted such Series C Preferred Shares into common stock immediately prior to the date of such payment.
The holders of the Series C Preferred Shares
have no voting rights, except as required by law. Any amendment to the Company’s certificate of incorporation, bylaws or
certificate of designation that adversely affects the powers, preferences and rights of the Series C Preferred Shares requires
the approval of the holders of a majority of the Series C Preferred Shares then outstanding.
There is no established public trading market
for the Series C Preferred Shares, and the Company does not expect a market to develop for the Series C Preferred Shares. The Series
C Preferred Shares will not be listed on Nasdaq or any other exchange or trading market. The Company does not plan on making an
application to list the Series C Preferred Shares on Nasdaq, any other national securities exchange or any other nationally recognized
trading system.
The foregoing is only a brief description
of the material terms of the Certificate of Designations, does not purport to be a complete description of the rights and obligations
of the parties thereunder and is qualified in its entirety by reference to the Certificate of Designations that is filed as Exhibit
3.1 to this Current Report on Form 8-K and incorporated by reference herein.