Cowen Group, Inc. Announces Closing of Offering of $105 Million of Shares of 5.625% Series A Cumulative Perpetual Convertible Preferred Stock

NEW YORK–(BUSINESS WIRE)–May 19, 2015–
Cowen Group, Inc. (NASDAQ:COWN) (“Cowen” or the “Company”) today
announced the closing of its previously announced offering of 105,000
shares of its 5.625% Series A Cumulative Perpetual Convertible Preferred
Stock (the “Convertible Preferred Stock”) in a private offering to
eligible purchasers.

The Convertible Preferred Stock has a liquidation preference of $1,000
per share. The Company will pay cumulative dividends, when and if
declared, in cash, on the Convertible Preferred Stock on a quarterly
basis in arrears at a rate of 5.625% per annum of the $1,000 liquidation
preference per share, and the Convertible Preferred Stock will be
convertible at the option of the holder into cash, shares of the
Company’s Class A common stock or a combination thereof, at the
Company’s election, in each case, based on an initial conversion rate of
152.2476 shares of the Company’s Class A common stock per share of the
Convertible Preferred Stock (which corresponds to an initial conversion
price of approximately $6.57 per share of the Company’s Class A common
stock). The conversion price represents a premium of approximately 17.5%
relative to the NASDAQ closing price of the Company’s Class A common
stock on May 13, 2015 of $5.59 per share. Additionally, at any time on
or after May 20, 2020, the Company may elect to cause all outstanding
shares of the Convertible Preferred Stock to be automatically converted
into shares of the Company’s Class A common stock, cash or a combination
thereof, at the Company’s election, in each case, based on the
then-applicable conversion rate, if the last reported sale price of the
Company’s Class A common stock equals or exceeds 150% of the
then-current conversion price on at least 20 trading days (whether or
not consecutive) during the period of 30 consecutive trading days
(including on the last trading day of such period) immediately prior to
such election.

In connection with the pricing of the Convertible Preferred Stock, the
Company entered into a capped call option transaction with an affiliate
of Nomura Securities International, Inc. (the “Option Counterparty”).

Nomura Securities International, Inc., SunTrust Robinson Humphrey, Inc.
and Cowen and Company, LLC acted as book-running managers for the
offering, and JMP Securities LLC acted as lead manager for the offering.

In connection with establishing its initial hedge of the capped call
option transaction, the Option Counterparty and/or its affiliates expect
to enter into various derivative transactions with respect to the
Company’s Class A common stock and/or purchase its Class A common stock
in secondary market transactions concurrently with or shortly after
pricing of the Convertible Preferred Stock. This activity could
increase, or reduce the size of any decrease in, the market price of the
Company’s Class A common stock at that time.

In addition, the Option Counterparty and/or its affiliates may modify
their hedge positions by entering into or unwinding various derivative
positions with respect to the Company’s Class A common stock and/or
purchasing or selling its Class A common stock or other securities of
the Company in secondary market transactions following the pricing of
the Convertible Preferred Stock (and are likely to do so on or around
any conversion of the Convertible Preferred Stock, including during the
related observation period for the Convertible Preferred Stock, if
applicable, and, whether or not the Convertible Preferred Stock has been
converted, during a specified valuation period following the expiration
of the capped call option transactions on May 20, 2020). This activity
could cause or avoid an increase or decrease in the market price of the
Company’s Class A common stock.

Of the net proceeds from the offering of Convertible Preferred Stock,
approximately $13.8 million was applied to pay the cost of the capped
call option transaction. The remainder of the net proceeds from the
offering will be used for general corporate purposes.

This press release does not constitute an offer to sell or the
solicitation of an offer to buy the Convertible Preferred Stock or any
other securities, nor will there be any sale of the Convertible
Preferred Stock or any other securities in any state or jurisdiction in
which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
state or jurisdiction.

The Convertible Preferred Stock was offered and sold only to qualified
institutional buyers pursuant to Rule 144A under the Securities Act of
1933, as amended (the “Securities Act”). The Convertible Preferred Stock
and any shares of Cowen Class A common stock issued upon conversion of
the Convertible Preferred Stock will not be registered under the
Securities Act or the securities laws of any state and may not be
offered or sold in the United States absent registration or an
applicable exemption from the registration requirements under the
Securities Act and applicable state securities laws or blue sky laws and
foreign securities laws.

About Cowen Group, Inc.

Cowen Group, Inc. is a diversified financial services firm and, together
with its consolidated subsidiaries, provides alternative asset
management, investment banking, research, and sales and trading services
through its two business segments: Ramius and its affiliates make up the
Company’s alternative investment segment, while Cowen and Company and
its affiliates make up the Company’s broker-dealer segment. Ramius
provides alternative asset management solutions to a global client base
and manages a significant portion of Cowen’s proprietary capital. Cowen
and Company
and its affiliates offer industry focused investment banking
for growth-oriented companies, domain knowledge-driven research and a
sales and trading platform for institutional investors. Founded in 1918,
the firm is headquartered in New York and has offices worldwide.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements. Forward-looking
statements provide the Company’s current expectations or forecasts of
future events. Forward-looking statements include statements about the
Company’s expectations, beliefs, plans, objectives, intentions,
assumptions and other statements that are not historical facts.
Forward-looking statements are subject to known and unknown risks and
uncertainties and are based on potentially inaccurate assumptions that
could cause actual results to differ materially from those expected or
implied by the forward-looking statements. The Company’s actual results
could differ materially from those anticipated in forward-looking
statements for many reasons, including the factors described in the
section entitled “Risk Factors” in the Company’s Annual Report on Form
10-K and “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” in the Company’s Annual Report on Form 10-K
and Quarterly Reports on Form 10-Q, as filed with the Securities and
Exchange Commission
. The Annual Report on Form 10-K and Quarterly
Reports on Form 10-Q are available at our website at www.cowen.com
and at the Securities and Exchange Commission website at www.sec.gov.
Unless required by law, the Company undertakes no obligation to publicly
update or revise any forward-looking statement to reflect circumstances
or events after the date of this press release.

Source: Cowen Group, Inc.

Cowen Group, Inc.
Stephen Lasota, 212-845-7919

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