Attached files
| file | filename |
|---|---|
| EX-99.5 - EXHIBIT 99.5 - Babcock & Wilcox Enterprises, Inc. | exhibit995april112018.htm |
| EX-99.4 - EXHIBIT 99.4 - Babcock & Wilcox Enterprises, Inc. | exhibit994april112018.htm |
| EX-99.3 - EXHIBIT 99.3 - Babcock & Wilcox Enterprises, Inc. | exhibit993april112018.htm |
| EX-99.2 - EXHIBIT 99.2 - Babcock & Wilcox Enterprises, Inc. | exhibit992april112018.htm |
| EX-99.1 - EXHIBIT 99.1 - Babcock & Wilcox Enterprises, Inc. | exhibit991april112018.htm |
| EX-10.1 - EXHIBIT 10.1 - Babcock & Wilcox Enterprises, Inc. | exhibit1011.htm |
| EX-8.1 - EXHIBIT 8.1 - Babcock & Wilcox Enterprises, Inc. | exhibit81april112018.htm |
| EX-4.1 - EXHIBIT 4.1 - Babcock & Wilcox Enterprises, Inc. | exhibit41april112018.htm |
| 8-K - 8-K - Babcock & Wilcox Enterprises, Inc. | form8-kapril112018.htm |
Execution Version
Exhibit 10.2
April 10, 2018
CONFIDENTIAL
TO: | Babcock & Wilcox Enterprises, Inc.. |
Re: Amended and Restated Equity Financing Commitment
Ladies and Gentlemen:
This letter agreement amends and restates in its entirety the prior letter agreement, dated as of March 1, 2018, between Babcock & Wilcox Enterprises, Inc., a Delaware corporation (the “Company”), and Vintage Capital Management LLC (“Vintage”) pursuant to which Vintage agreed to backstop the Company’s rights offering (the “Rights Offering”). Pursuant to the Rights Offering, the Company distributed to all of its common shareholders (“Common Shareholders”) at no charge one purchase right (each a “Right”) per share of common stock (“Common Stock”) of the Company outstanding and held of record as of March 15, 2018 (the “Record Date”).
The Company has advised each of the undersigned (collectively, the “Backstop Parties” and individually each a “Backstop Party”) that the Company intends to amend the Rights Offering. Pursuant to the amended terms of the Rights Offering, the Company is proposing to offer and sell in the aggregate a minimum number of shares of Common Stock resulting in gross cash proceeds to the Company of at least $245.0 million (the “Rights Offering Amount”) on the terms described in the attached Exhibit A (the “Term Sheet”). This letter agreement (including the Term Sheet, this “Letter Agreement”) sets forth the terms and conditions under which the Backstop Parties have agreed to provide the Backstop Commitments (defined below). Capitalized terms used herein but not defined herein have the meaning given to them in the Term Sheet.
It is contemplated that one or more additional letter agreements (together with this Letter Agreement, the “Backstop Agreements”) will be executed on or after the date hereof pursuant to which additional persons (each, an “Additional Backstop Party” and together with the Backstop Parties, collectively, the “Global Backstop Parties”) may, at the request and with the consent of the Company, provide additional backstop commitments on the same terms as set forth herein (together with the Backstop Commitments, the “Global Backstop Commitments”). To the extent that the aggregate amount of the Global Backstop Commitments are in excess of the Rights Offering Amount, the Company shall have the right in its discretion to determine the final allocation of each of the Global Backstop Commitments (which, in the case of each of the Global Backstop Parties, shall not be in excess of each of their respective individual original Global Backstop Commitments).
Each of the Backstop Parties, severally and not jointly, irrevocably commits and agrees as follows:
1.Each Backstop Party hereby commits (such commitment a “Backstop Commitment” and collectively the “Backstop Commitments”), subject solely to the conditions set forth in this Section 1, and on the terms described in Exhibit A, to purchase any shares of Common Stock that would have otherwise been issuable pursuant to any Rights that were not properly exercised during the Rights Offering and remain unexercised after the expiration of Offer Period, less any shares of Common Stock purchased by the Backstop Parties in the Rights Offering (such shares, in the aggregate, the “Unsubscribed Shares”) on the Closing Date up to a maximum aggregate amount for each Backstop Party not to exceed the amount set forth on Schedule 1 hereto as its Maximum Backstop Commitment Amount (for each Backstop Party, its “Maximum Backstop Commitment Amount”). Each of the Backstop Commitments is subject solely to (i) the receipt by such Backstop Party of written notice from the Company after the Commencement Date and after the expiration of the Offer Period but prior to the termination of the Backstop Commitments pursuant to Section 2 below that the Company is exercising its rights to require each Backstop Party to fund its Backstop Commitment and setting forth the amount of the Backstop Commitment to be funded, which, for each Backstop Party, shall not be excess of the Maximum Backstop Commitment Amount and (ii) the receipt by each Backstop Party of its pro rata portion of the Unsubscribed Shares as specified on Schedule 1 hereto simultaneously with the receipt by the Company of the proceeds of such Backstop Commitment.
2. This Letter Agreement, including the undersigned’s obligation to fund the Backstop Commitment, terminates upon the earliest to occur of (i) the receipt by the Company of gross cash proceeds from the Rights Offering from Participating Common Shareholders in an aggregate amount of at least the Rights Offering Amount, (ii) the date on which the Company provides written notice to the Backstop Parties that it is terminating this Letter Agreement, (iii) the date on which the Backstop Parties have provided the Company with the proceeds of the full amount of the Backstop Commitments on the terms set forth in this Letter Agreement and (iv) October 31, 2018. Upon any such termination of this Letter Agreement, any obligations hereunder will terminate and none of the parties hereto shall have any liability under this Letter Agreement whatsoever to any other party.
3. The obligation of any Backstop Party to fund its Backstop Commitment may not be assigned to any other person or entity without the prior written consent of the Company.
4. This Letter Agreement is binding on and solely to the benefit of and enforceable by the Backstop Parties and the Company, and nothing set forth in this Letter Agreement is be construed to confer upon or give to any other person any benefits, rights or remedies under or by reason of, or any rights to enforce or cause the Company to enforce, the Backstop Commitments or any provisions of this Letter Agreement.
2
5. Each Backstop Party hereby represents and warrants with respect to itself to the Company that (a) it has all corporate, limited liability company or limited partnership power and authority to execute, deliver and perform this Letter Agreement, (b) the execution, delivery and performance of this Letter Agreement by it has been duly and validly authorized and approved by all necessary corporate, limited liability company or limited partnership action, (c) this Letter Agreement has been duly and validly executed and delivered by it and constitutes a valid and legally binding obligation of such Backstop Party, (d) the execution, delivery and performance of this Letter Agreement by it does not and will not conflict with, violate the terms of or result in the acceleration of any obligation (i) under any material contract, material commitment or other material instrument to which it is a party or is bound, (ii) under its certificate incorporation or organization, bylaws or articles, membership agreement or limited partnership agreement, or (iii) result in the violation of any law or statute applicable to it or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority having jurisdiction over it, (e) no consent, approval, authorization, order, license, registration or qualification of or with any court or arbitrator or governmental or regulatory authority is required for the execution, delivery and performance of this Letter Agreement by it, and (f) it has available unrestricted cash or cash equivalents and/or uncalled capital commitments in excess of its Backstop Commitment.
6. This Letter Agreement is governed in all respects, including as to validity, interpretation and effect, by the laws of the State of Delaware, without giving effect to its principles or rules of conflict of laws, to the extent such principles are not mandatorily applicable by statute and would permit or require the application of the laws of another jurisdiction. The parties hereto hereby irrevocably submit to the jurisdiction of the Chancery Court of the State of Delaware (and in the absence of jurisdiction in the Chancery Court of the State of Delaware, the parties hereto consent to be subject to the exclusive jurisdiction of any federal court located in the State of Delaware or any other Delaware state court) solely in respect of the interpretation and enforcement of the provisions of this Letter Agreement, and irrevocably agree that all claims in respect of the interpretation and enforcement of the provisions of this Letter Agreement, or with respect to any action or proceeding hereunder, shall be heard and determined in the Chancery Court of the State of Delaware (and in the absence of jurisdiction in the Chancery Court of the State of Delaware, the parties hereto consent to be subject to the exclusive jurisdiction of any federal court located in the State of Delaware or any other Delaware state court), and that such jurisdiction of such courts with respect thereto shall be exclusive, except solely to the extent that all such courts shall lawfully decline to exercise such jurisdiction. Each party hereto hereby waives and agrees not to assert, as a defense in any action, suit or proceeding for the interpretation or enforcement hereof, that it is not subject to such jurisdiction. Each party hereto hereby waives and agrees not to assert, to the maximum extent permitted by law, as a defense in any action, suit or proceeding for the interpretation or enforcement hereof, that such action, suit or proceeding may not be brought or is not maintainable in such courts, that the venue thereof may not be appropriate or that this Letter Agreement may not be enforced in or by such courts. The parties hereto hereby consent to and grant any such court jurisdiction over the person of
3
such parties and over the subject matter of any such dispute. THE PARTIES HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) BROUGHT BY EITHER OF THEM AGAINST THE OTHER IN ANY MATTERS ARISING OUT OF OR IN ANY WAY CONNECTED WITH OR CONTEMPLATED BY THIS LETTER AGREEMENT.
7. This Letter Agreement constitutes the sole agreement, and supersedes all prior agreements, understandings and statements, written or oral, between the parties hereto with respect to the subject matter hereof. The terms of this Letter Agreement may not be modified or otherwise amended, or waived, except pursuant to a written agreement signed by the parties hereto. This Letter Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument.
[Rest of Page Left Intentionally Blank]
4
Very truly yours,
VINTAGE CAPITAL MANAGEMENT LLC
By: /s/ Brian Kahn
Name: Brian Kahn
Title: Managing Member
Name: Brian Kahn
Title: Managing Member
Acknowledged and agreed as of
the date first above written:
BABCOCK & WILCOX ENTERPRISES, INC.
the date first above written:
BABCOCK & WILCOX ENTERPRISES, INC.
By: /s/ Leslie C. Kass
Name: Leslie C. Kass
Title: President and Chief Executive Officer
Name: Leslie C. Kass
Title: President and Chief Executive Officer
[Signature Page to Equity Commitment Letter]
Schedule 1
Backstop Commitments
Backstop Party | Aggregate Backstop Commitment Percentage | Maximum Backstop Commitment Amount |
Vintage Capital Management LLC | 100% | $245.0 million |
Exhibit A
Term Sheet
Capitalized terms used in this Term Sheet but not defined herein shall have the meaning given to them in the Letter Agreement to which it is attached.
THIS TERM SHEET IS NOT AN OFFER OR A SOLICITATION WITH RESPECT TO ANY SECURITIES OF THE COMPANY. ANY SUCH OFFER OR SOLICITATION MUST COMPLY WITH ALL APPLICABLE SECURITIES LAWS.
Parties | Babcock & Wilcox Enterprises, Inc. (the “Company”). Each of the Global Backstop Parties. Each of the holders of Common Stock (each, a “Common Shareholder”) who determines to participate in the Rights Offering (the “Participating Common Shareholders”), which may include the Global Backstop Parties. |
Purchase Price | At least $245.0 million in the aggregate divided by the number of shares of Common Stock (“Common Shares”) being offered in the Rights Offering (the “Purchase Price”) with a purchase price of $2.00 per newly-issued share. |
Use of Proceeds | A portion of the proceeds of the Rights Offering will be used by the Company to repay in full all of the indebtedness outstanding under the Second Lien Credit Agreement, dated as of August 9, 2017, among the Company, the lenders party thereto from time to time and Lightship Capital, as the administrative agent, together with any prepayment premium or make-whole amounts and all fees and expenses related to the foregoing. Any remaining proceeds from the Rights Offering will be used by the Company for general corporate purposes, including to fund working capital. |
Commencement Date | March 19, 2018 (the “Commencement Date”). The Company will promptly amend the Rights Offering documents to reflect the terms herein and such other matters as the Company determines in good faith to be required by law. |
Termination Date | The date that is the earlier of (a) the date the Company publicly announces that it is terminating the Rights Offering and (b) October 31, 2018. |
Closing Date | The date (such date, the “Closing Date”) after the Commencement Date and after the expiration of the Offer Period (defined below) but prior to the Termination Date that the Company specifies as the date upon which each Participating Common Shareholder and/or Backstop Party shall be required to pay for the Rights Offering Shares (defined below) it has subscribed for or is committed to purchase. |
The Rights Offering | All Common Shareholders as of the Record Date will be entitled to purchase, on a pro rata basis based upon the number of shares owned by each such holder of Common Shares as of the Record Date, newly issued Common Shares of the Company (the “Rights Offering Shares”) at the Purchase Price such that the total amount of Rights Offering Shares sold pursuant to the Rights Offering and the Backstop Commitments described below will generate not less than $245.0 million in gross cash proceeds, it being understood that the Company will have the right to elect to issue more Rights Offering Shares if there are sufficient Participating Common Shareholders with any such additional shares being offered to Participating Common Shareholders on a pro rata basis. Each Common Shareholder will have not less than a period to be specified by the Company after the Commencement Date (the “Offer Period”) to determine whether to participate in the Rights Offering. Participating Common Shareholders must fund such purchase on the Closing Date. |
Global Backstop Commitments | As set forth in the Backstop Agreements, and subject solely to the conditions set forth therein, each Global Backstop Party will purchase, in accordance with their respective Global Backstop Commitments, Rights Offering Shares not subscribed and paid for in the Rights Offering by Common Shareholders pursuant to unexercised Rights. The allocation of Rights Offering Shares to the Global Backstop Parties shall be determined by the Company, in its discretion. |
Standstill and Voting Arrangements | The purchase of Common Shares by Vintage pursuant to the Rights Offering and/or the Backstop Agreement shall be permitted notwithstanding anything to the contrary contained in the Agreement, dated as of January 3, 2018, as amended (the “Vintage Agreement”), among Vintage, Kahn Capital Management, LLC and Brian R. Kahn, including Section 2 thereof. Except as provided in the preceding sentence, the Vintage Agreement shall continue in full force and effect. If, solely as a result of the purchase of Common Shares pursuant to the Rights Offering and/or the Backstop Agreement, Vintage (alone or together with its controlled affiliates and associates, collectively the “Vintage Shareholders”) acquires or otherwise possesses beneficial ownership (as that term is used in Section 13(d) of the Exchange Act) of 30% or more of the then-outstanding Common Shares, then at any annual or special meeting of the Common Shareholders, the Common Shares beneficially owned by the Vintage Shareholders in excess of 30% (whether acquired in the Rights Offering, pursuant to the Backstop Agreement or otherwise) will be voted in proportion to the way in which Common Shares owned by the shareholders who are not Vintage Shareholders are voted (other than on any proposal related to any merger, acquisition, recapitalization, restructuring, disposition or other business combination involving the Company). Should the preceding sentence be applicable, the Vintage Shareholders agree to use commercially reasonable efforts (including providing information to the Company and executing reasonably necessary documentation) to effectuate the voting commitment in the immediately preceding sentence. The covenants in the two immediately preceding sentences will expire on December 31, 2023. |