Willbros: Entry Into A Material Definitive Agreement
The following excerpt is from the company's SEC filing
Willbros Group, Inc., a Delaware corporation (the Company), previously announced its intent to exit the electric and gas
distribution business in the Northeast and sell its investment in the related Hawkeye business, which formed part of the Companys Utility Transmission and Distribution operating segment. On August 21, 2013, Hawkeye, LLC, a New York
limited liability company and wholly-owned subsidiary of the Company (Hawkeye), and Halpin Line Construction LLC, a New York limited liability company and wholly-owned subsidiary of the Company (Halpin and, together with
Hawkeye, the Sellers), entered into an Asset Purchase Agreement dated as of such date (the Purchase Agreement), with Elecnor Hawkeye, LLC, a Delaware limited liability company, as purchaser (Elecnor). Elecnor is a
wholly-owned subsidiary of Elecnor, Inc., a Delaware corporation and wholly-owned subsidiary of Elecnor, S.A., a company organized in Spain. Pursuant to the terms of the Purchase Agreement, Elecnor will acquire certain assets of the Sellers
comprising the Hawkeye business (the Disposition). Certain assets, primarily equipment and working capital associated with the Maine Power and Reliability Project (MPRP) contract, which Hawkeye is currently performing work
under for Central Maine Power Company, will remain with the Sellers. Hawkeye will retain responsibility for the execution of the MPRP contract.
At the closing of the Disposition (the Closing), expected to be by September 30, 2013, Elecnor will pay closing consideration ranging from $22 million to $26 million in cash, subject to
working capital and other typical post-closing adjustments. A portion of that amount will be deposited into an escrow account during the period of the working capital adjustment process (up to 75 days, or longer if the working capital adjustment is
in dispute between the parties). The amount of the escrow will be determined at Closing and is based on a percentage of the pre-closing estimated net working capital of the Sellers. Besides the escrowed amount, as an additional source of funds for
any indemnification liabilities of the Sellers, the Purchase Agreement requires the Sellers to obtain, and provide Elecnor with, a letter of credit in the amount of $2,000,000, which may be reduced to $1,000,000 at the first anniversary of the
Closing, and terminated on the second anniversary of the Closing.
The Purchase Agreement includes a guaranty by the Company
of each of the obligations of the Sellers thereunder including certain indemnification obligations. The parties anticipate making a voluntary filing with the Committee on Foreign Investment in the United States (CFIUS).
The Purchase Agreement contains customary representations, warranties, covenants and indemnities of the parties to the agreement. The
completion of the Disposition is subject to the satisfaction or waiver of various customary closing conditions. Additionally, the closing is conditioned upon the receipt of written notice from CFIUS or the President that the transaction does not
present any unresolved national security concerns as a result of Elecnors investment in the Hawkeye business. The Purchase Agreement provides for customary termination rights of the parties to the agreement.
This Current Report on Form 8-K contains forward-looking statements. All statements, other than statements of historical facts, which
address activities, events or developments the Company expects or anticipates will or may occur in the future, including such things as the expected date of Closing, are forward-looking statements. A number of risks and uncertainties could cause
actual results to differ materially from these statements, including the occurrence of any event, change or other circumstances that could give rise to the termination of the Purchase Agreement and the inability to complete the proposed Disposition
due to, among other things, the failure to satisfy the conditions set forth in the Purchase Agreement, as well as other risk factors described from time to time in the Companys documents and reports filed with the Securities and Exchange
Commission. The Company assumes no obligation to update publicly such forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law.
The above information was disclosed in a filing to the SEC. To see this filing in its entirety, click here.
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