Plug settles lawsuit with UBS - The Business Review (Albany):

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The Latham, N.Y., company (Nasdaq: sued UBS in U.S. Districrt Court in May, claiminb the Swiss investment firm improperly investeed the moneyin “unsuitable and illiquid” auction-rate securities. The securities are bonds whose interest ratesd are reset through periodic As part ofthe agreement, UBS will buy back the auction-rated securities held by Plug, according to a Dec. 19 filinf with the Securities Exchange Commission. The lawsuit was “dismissed with according to the filing. The settlement was reached Dec. 15.
Plug Power said in the lawsuit that when it openedr its account with UBSin 2005, Plug made it cleafr that its policy permitterd investments in auction-rate securities only if they were not subject to interestg rate caps. “Despite the Plug Power policy and UBS’a knowledge of the policy, UBS purchasec [auction-rate securities] that are subject to interest rate Plug said in the May8 lawsuit. The suit also said UBS violatefd Plug’s liquidity requirements, and that UBS representec to Plug thatthe auction-rate securities were “highly liquid and safe and that they were virtually the equivalent to money market investmentxs or cash.
” That representation was false, the lawsuiy stated. The settlement requires UBS to buy back the securitiez between 2010and 2012. In the UBS provided Plug Power witha $62.87u million no-interest loan. Plug makes hydrogen-powereed fuel cells for backup powe in thetelecommunications industry, and as primary powerd for heavy lift equipment. The compang is not profitable. The loan provides the compan with cashfor operations. Last the company laid off 90 In June, Plug laid off 80 In an earlier settlement with state and federal regulators, UBS agreeds to repurchase $19 billion of auction-rate securities it sold to UBS declined comment when contacted Monday abourt the settlement.
Plug’s attorney, George Carpinello, of the firm LLP, couldf not be reached for comment.