On December 4, 2018, Fortress Transportation and Infrastructure Investors LLC (the
“
Company
”
) entered into a share purchase agreement with an existing shareholder of the Company (the “Investor”) pursuant to which the Company agreed to sell to the Investor an aggregate of
1,263,423 common shares (the
“
Shares
”
), par value $0.01 per share, representing limited liability company
interests of the Company, in connection with a registered direct offering (the
“
Offering
”
), at a price to
the Investor of $15.83 per share (the
“
Offering Price
”
), which equals the last reported sale price of the
Company’s common shares on the New York Stock Exchange on December 4, 2018. The Offering closed on December 6, 2018. The Shares were sold pursuant to a prospectus supplement, dated December 4, 2018, and related prospectus, dated February 24, 2017,
each filed with the Securities and Exchange Commission (the
“
SEC
”
), relating to the Company
’
s automatic shelf registration statement on Form S-3 (File No. 333- 216247). In connection with the issuance of the Shares, Cravath, Swaine & Moore LLP provided the Company with
the legal opinions attached to this Current Report on Form 8-K as Exhibit 5.1 and Exhibit 8.1, which are incorporated by reference herein.
Net proceeds received by the Company from the Offering were approximately $19.7 million, after deducting estimated offering expenses payable by the Company.
The Company intends to use the net proceeds from the Offering for general corporate purposes, including the repayment of outstanding revolving borrowings under the Company’s credit agreement dated as of June 16, 2017, as amended, and the funding of
future investments.
Upon completion of the Offering, the Company granted to FIG LLC (the
“
Manager
”
) an option to purchase 126,342 of the Company
’
s common shares, representing 10% of the number of common shares
issued and sold in the Offering, at an exercise price per share equal to the Offering Price (the
“
Manager Option
”
).
The Manager Option has been approved by the compensation committee of the Company
’
s board of directors to be granted pursuant to and in accordance with the terms of the
Management and Advisory Agreement, dated as of May 20, 2015, among the Company, the Manager and the other parties thereto and the Fortress Transportation and Infrastructure Investors Nonqualified Stock Option and Incentive Award Plan (the
“
Incentive Plan
”
), each as described in our Annual Report on Form 10-K for the fiscal year ended December 31,
2017, and the Form of Award Agreement relating to Manager options under the Incentive Plan (the “Form of Award Agreement”), as previously filed with the SEC as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 17, 2018.
In accordance with the terms of the Incentive Plan and the Form of Award Agreement, the Manager Option is fully vested as of the date of grant and will become
exercisable as to 1/30 of the shares subject to the Manager Option on the first day of each of the 30 calendar months following the date of the grant, and will terminate on the tenth anniversary of the date of grant. In the event of a
“
change in control
”
, as defined in the Form of Award Agreement, or a termination of the services of the Manager
to the Company, the Manager Option will immediately become fully exercisable. The foregoing description of the Manager Option does not purport to be complete and is qualified in its entirety by reference to the complete Form of Award Agreement.