Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.
A. Purchase Agreement and Private Placement of Senior Notes
On May 18, 2017, Great Lakes Dredge Dock Corporation (the
Company) entered into a Purchase Agreement (the Purchase
Agreement) by and among the Company, certain subsidiary
guarantors named therein (collectively, the Guarantors) and
Deutsche Bank Securities Inc., as representative (the
Representative) of the initial purchasers named therein
(collectively, the Initial Purchasers), relating to the issuance
and sale (the Private Placement) of $325,000,000 aggregate
principal amount of its 8.000% Senior Notes due 2022 (the Notes).
The Notes were priced at par, plus accrued interest, if any, from
May 24, 2017. The Company expects to receive net proceeds from
the Private Placement of approximately $321 million, after
deducting fees and estimated offering expenses.
The Notes were offered to the Initial Purchasers to a private
placement and have not been registered under the Securities Act
of 1933, as amended (the Securities Act). The Initial Purchasers
agreed to sell the Notes only to persons reasonably believed to
be qualified institutional buyers under Rule 144A and to persons
outside the United States under Regulation S, in each case
promulgated under the Securities Act.
The Purchase Agreement contains customary representations,
warranties, agreements, indemnification obligations, including
for liabilities under the Securities Act, other obligations and
termination provisions applicable to the Company, the Guarantors
and the Initial Purchasers.
On May 24, 2017, the Company completed the Private Placement of
the Notes in accordance with the Purchase Agreement.
The foregoing description of the Purchase Agreement is a summary.
The complete text of the Purchase Agreement is attached hereto as
Exhibit 10.1 and incorporated herein by reference.
B. Indenture Relating to 8.000% Senior Notes due 2022
The Notes were issued and authenticated to an indenture (the
Indenture), dated as of May 24, 2017, by and among the Company,
the Guarantors and Wells Fargo Bank, National Association, as
trustee (the Trustee).
The Notes will mature on May 15, 2022, and bear interest at a
rate of 8.000% per annum, payable semi-annually in arrears on May
15 and November 15 of each year, beginning on November 15, 2017.
The Notes are senior unsecured obligations of the Company and
will be guaranteed on a senior unsecured basis by the Guarantors
and any other subsidiary guarantors that from time to time become
parties to the Indenture.
The terms of the Indenture will, among other things, limit the
ability of the Company and its restricted subsidiaries to (i) pay
dividends, or make certain other restricted payments or
investments (ii) incur additional indebtedness and issue
disqualified stock (iii) create liens on their assets (iv)
transfer and sell assets (v) enter into certain business
combinations with third parties or into certain other
transactions with affiliates (vi) create restrictions on
dividends or other payments by the Companys restricted
subsidiaries; and (vii) create guarantees of indebtedness by
restricted subsidiaries. These covenants are subject to a number
of important limitations and exceptions that are described in the
Indenture.
The Company may redeem the Notes, in whole or in part, at any
time on or after May 15, 2020, at the redemption prices specified
in the Indenture, together with accrued and unpaid interest, if
any, to the redemption date. Prior to May 15, 2020, the Company
may redeem the Notes, in whole or in part, at a redemption price
equal to 50% of the principal amount of the Notes so redeemed,
plus a make whole premium (as determined in accordance with the
Indenture), together with accrued and unpaid interest, if any, to
the redemption date. In addition, on one or more occasions before
May 15, 2020, the Company may redeem up to 35% of the original
principal amount of the Notes with the net cash proceeds from one
or more equity offerings at a redemption price equal to 108.000%
of the principal amount thereof, together with accrued and unpaid
interest and additional interest, if any, to the redemption date.
Upon the occurrence of a change of control triggering event
specified in the Indenture, the Company must offer to purchase
the Notes at a purchase price equal to 101% of the principal
amount thereof, plus accrued and unpaid interest, if any, to the
date of purchase.
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The Indenture provides for customary events of default (subject
in certain cases to customary grace and cure periods), which
include nonpayment, breach of covenants in the Indenture, certain
payment defaults or acceleration of other indebtedness, a failure
to pay certain judgments and certain events of bankruptcy and
insolvency. If an event of default occurs and is continuing, the
trustee or holders of at least 25% in principal amount of the
outstanding Notes may declare all of the Notes to be due and
payable. These events of default are subject to a number of
important qualifications, limitations and exceptions that are
described in the Indenture.
The foregoing description of the Indenture is a summary. The
complete text of the Indenture is attached hereto as Exhibit 4.1
and incorporated herein by reference.
C. Registration Rights Agreement
On May 24, 2017, in connection with the Private Placement of the
Notes, the Company entered into a Registration Rights Agreement
(the Registration Rights Agreement) by and among the Company, the
Guarantors and the Representative, to which the Company has
agreed to offer to exchange the Notes privately placed on May 24,
2017 for a new issue of substantially identical notes registered
under the Securities Act.
Subject to certain specified limitations, the terms of the
Registration Rights Agreement require the Company to (i) use its
commercially reasonable efforts to cause a registration statement
with respect to an exchange offer for the Notes to become
effective within 365 days after the issue date of the Notes (ii)
use its commercially reasonable efforts to consummate the
exchange offer within 30 business days after the effective date
of the registration statement with respect to the exchange offer
and (iii) use its commercially reasonable efforts to file a shelf
registration statement for the resale of the Notes in certain
circumstances. If the Company fails to satisfy certain of its
registration obligations under the Registration Rights Agreement,
then the Company may under certain specified circumstances be
required to pay liquidated damages to the holders of the Notes,
in the form of additional interest, which will accrue at an
annual rate of 0.25% of the aggregate principal amount of the
outstanding Notes during the initial period following the
occurrence of such default, which rate shall increase by an
additional 0.25% during each subsequent 90-day period, up to the
maximum rate specified in the Registration Rights Agreement.
The foregoing description of the Registration Rights Agreement is
a summary and is qualified in its entirety by the terms thereof.
A copy of the Registration Rights Agreement is attached hereto as
Exhibit 4.2 and incorporated herein by reference.
D. Amendment to Credit Agreement
On May 18, 2017, the Company, certain of its subsidiaries, PNC
Bank, National Association, as lender and agent, and certain
other lenders named therein, entered into a Second Amendment (the
Credit Amendment) to its Revolving Credit and Security Agreement
dated December 30, 2016, as amended February 27, 2017 (the Credit
Agreement). The Credit Amendment was entered into to, among other
things, permit the Company to incur up to $325 million of debt as
part of a refinancing of the Companys $275 million principal
amount senior notes due 2019 (the 2019 Notes). The Credit
Amendment also amends the Credit Agreement to remove a provision
providing for acceleration of the Credit Agreements maturity date
to November 3, 2018 if the Company fails prior to that date to
extend the maturity date of the 2019 Notes to a date on or after
March 31, 2020.
The foregoing description of the Credit Amendment is a summary.
The complete text of the Credit Amendment is attached hereto as
Exhibit 10.2 and incorporated herein by reference.
E. Other
In reviewing the agreements included as exhibits to this report,
please note that they are included to provide you with
information regarding their terms and are not intended to provide
any other factual or disclosure information about the Company or
the other parties to the agreements. Certain of the agreements
contain representations and warranties by one or more of the
parties to the applicable agreement. These representations and
warranties have been made solely for the benefit of the other
parties to the applicable agreement and:
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should not in any instance be treated as categorical |
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may have been qualified by disclosures that were made to |
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may apply standards of materiality in a way that is |
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were made only as of the date of the applicable agreement |
Accordingly, these representations and warranties may not
describe the actual state of affairs as of the date they were
made or at any other time. Additional information about the
Company may be found elsewhere in the Companys other public
filings with the U.S. Securities and Exchange Commission (the
SEC), which are available without charge through the SECs website
at http://www.sec.gov.
Item 2.03 Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a
Registrant.
The information in Sections A and B of Item 1.01 of this Current
Report on Form 8-K is incorporated into this Item 2.03 by
reference.
Item 8.01 Other Events.
A. Redemption Transaction
On May 24, 2017, the Company furnished a notice to redeem all of
its outstanding 2019 Notes, other than those purchased on such
date in accordance with the Companys cash tender offer (the
Tender Offer) to repurchase any and all 2019 Notes tendered in
accordance with the terms and conditions specified in the
Companys Offer to Purchase, dated May 12, 2017.The redemption
price for 2019 Notes not purchased in accordance with the Tender
Offer will be 50% of the principal amount thereof plus accrued
and unpaid interest through the redemption date. Upon completion
of this redemption transaction (the Redemption Transaction),
which is expected to occur on June 23, 2017, the Company intends
to discharge all of its obligations under the indenture governing
its 2019 Notes.
B. Press Releases
On May 22, 2017, the Company issued a press release announcing
the results of its Tender Offer, and on May 24, 2017, the Company
issued a press release announcing the completion of its Private
Placement, its settlement of the Tender Offer and its Redemption
Transaction.
A copy of these press releases are attached hereto as Exhibit
99.2 and 99.3, respectively, and are incorporated herein in their
entirety (including the section entitled Cautionary Note
Regarding Forward-Looking Statements) by reference.
Item 9.01 Financial Statements and Exhibits.
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(d) |
Exhibits. |
The exhibits to this current report on Form 8-K are listed in the
Exhibit Index, which appears at the end of this report and is
incorporated by reference herein.
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About Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD)
Great Lakes Dredge & Dock Corporation is a provider of dredging services. The Company provides dredging services in the East, West and Gulf Coasts of the United States and around the world. It operates in two segments: Dredging Operations, which involves enhancement or preservation of navigability of waterways or the protection of shorelines through the removal or replenishment of soil, sand or rock, and Environmental & Remediation Operations, which provides construction services on soil, water and sediment for clients in both the public and private sectors in the United States. It holds interests in Amboy Aggregates, which is involved in mining sand from the entrance channel to New York Harbor for providing sand and aggregate for use in road and building construction and for clean land fill; Lower Main Street Development, LLC, which is engaged in land development and sale business, and TerraSea Environmental Solutions, which is engaged in the environmental services business. Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) Recent Trading Information
Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) closed its last trading session down -0.25 at 4.10 with 468,009 shares trading hands.