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Item 1.01
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Entry into a Material Definitive Agreement.
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As previously disclosed in its Form 10-Q for the quarter ended March 31, 2017 filed with the Securities and Exchange Commission on May 10, 2017, Chicago Bridge & Iron Company N.V. (the “Company”), entered into certain amendments on May 8, 2017 (the “May 8th Amendments”) with respect to the following debt arrangements and instruments:
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the Company’s five-year, $1.35 billion committed revolving credit facility (the “Revolving Facility”) with Bank of America N.A. (“BofA”), as administrative agent, and BNP Paribas Securities Corp, BBVA Compass, Credit Agricole Corporate and Investment Bank (“Credit Agricole”) and TD Securities, each as syndication agents;
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the Company’s five-year, $800 million committed revolving credit facility (the “Second Revolving Facility”) with BofA, as administrative agent, and BNP Paribas Securities Corp., BBVA Compass, Credit Agricole and Bank of Tokyo Mitsubishi UFJ, each as syndication agents;
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the Company’s five-year, $500 million term loan (the “Second Term Loan”) with BofA as administrative agent;
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the Company’s senior notes (series A, B, C and D) totaling $800 million in the aggregate originally issued on December 27, 2012 (the “Senior Notes”); and
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the Company’s senior notes totaling $200 million in the aggregate originally issued on July 22, 2015 (the “Second Senior Notes” and, together with the Revolving Facility, the Second Revolving Facility, the Second Term Loan, the Senior Notes and the Second Senior Notes, the “Senior Facilities”).
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The May 8th Amendments require the Company, among other things, to secure the Senior Facilities through the pledge of accounts receivable, inventory, equipment, intellectual property, fixed assets, stock of certain of its subsidiaries and cash.
In order to effectuate the May 8, 2017 pledge of security, on May 29, 2017 the Company executed technical amendments to the Revolving Facility, the Second Revolving Facility and the Second Term Loan (such amendments, the “May 29th Amendments”). In connection with the May 29th Amendments, certain of the Company’s subsidiaries organized in the United States entered into a Pledge and Security Agreement dated May 29, 2017, pursuant to which they granted to BofA, as the collateral agent (the “Collateral Agent”), for the benefit of the Collateral Agent, the Administrative Agent and the Secured Creditors (all as defined in the May 29th Amendments), a duly perfected first priority security interest in substantially all of such subsidiaries’ respective assets (subject to certain exceptions).
The May 29th Amendments also:
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appoint BofA as Collateral Agent under the Revolving Facility, the Second Revolving Facility and the Second Term Loan;
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add a covenant to each of the relevant credit or term loan agreements that requires the Company and certain of its subsidiaries organized in Curacao, Liechtenstein, the Netherlands and the United Kingdom (and certain other foreign jurisdictions to the extent requested) to grant to the Collateral Agent, for the benefit of the Collateral Agent, the Administrative Agent and the Secured Creditors, a duly perfected first priority security interest in substantially all of their respective assets (subject to certain exceptions);
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add to each of the relevant credit or term loan agreements a number of other representations, warranties, covenants and agreements as a result of and relating to the collateral arrangements; and
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add to each of the relevant credit or term loan agreements a “most favored lender” provision that provides the lenders party to the Revolving Facility, the Second Revolving Facility and the Second Term Loan the benefit of certain more restrictive covenants or defaults under the agreements related to the Senior Notes and the Second Senior Notes.
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The foregoing description of the May 29th Amendments does not purport to be complete and is qualified in its entirety by reference to (i) Amendment No. 7, dated as of May 29, 2017, to the Credit Agreement, dated as of October 28, 2013, filed as Exhibit 10.1 hereto; (ii) Amendment No. 4, dated as of May 29, 2017, to the Amended and Restated Revolving Credit Agreement, dated as of July 8, 2015, filed as Exhibit 10.2 hereto; and (iii) Amendment No. 4, dated as of May 29, 2017, to the Term Loan Agreement, dated as of July 8, 2015, filed as Exhibit 10.3 hereto; each of which is incorporated by reference herein.
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Item 2.03
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Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
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The information set forth under Item 1.01 above is incorporated by reference into this Item 2.03.