Item 1.01 Entry Into A Material Definitive Agreement.
On April 13, 2021, Aegion Corporation, a Delaware corporation (the "Company"),
Carter Intermediate Inc., a Delaware corporation ("Parent"), and Carter
Acquisition, Inc., a Delaware corporation and wholly-owned subsidiary of Parent
("Merger Sub"), entered into Amendment No. 2 (the "Amendment") to the previously
announced Agreement and Plan of Merger, dated as of February 16, 2021 (the
"Original Merger Agreement"), as amended by that certain Amendment No. 1, dated
March 13, 2021 (the "Amended Merger Agreement," and, as amended by the
Amendment, the "Merger Agreement"), by and among the Company, Parent and Merger
Sub.
The Merger Agreement provides that, upon the terms and subject to the conditions
set forth in the Merger Agreement, Merger Sub will merge with and into the
Company (the "Merger" and, together with the other transactions contemplated by
the Merger Agreement, the "Transactions"), with the Company continuing as the
surviving corporation in the Merger and as a wholly-owned subsidiary of Parent.
The Amendment increases the merger consideration payable to holders of Aegion
common stock by providing that, at the effective time of the Merger, each share
of common stock, par value $0.01 per share, of the Company (the "Common Stock"),
issued and outstanding as of immediately prior to the effective time of the
Merger (other than shares of Common Stock (i) held in the treasury of the
Company or owned by any direct or indirect wholly-owned subsidiary of the
Company, (ii) owned by Merger Sub, Parent or any direct or indirect wholly-owned
subsidiary of Parent or (iii) for which appraisal rights have been properly
demanded in writing in accordance with the General Corporation Law of the State
of Delaware) will be cancelled and automatically converted into the right to
receive $30.00 in cash, without interest and subject to applicable withholding
(the "Merger Consideration"). Under the Amended Merger Agreement, the Merger
Consideration was $27.00 in cash, without interest.
The Amendment also amends the date by which the closing of the transaction must
occur from August 16, 2021 to June 15, 2021 (the "Outside Date") and further
provides that the Company may extend the Outside Date to a date on or before
August 16, 2021 by written notice to Parent.
The Amendment also increases, from $40 million to $50 million, the termination
fee the Company will be required to pay to Parent if the Merger Agreement is
terminated (i) by Parent or the Company due to the Merger not occurring by the
Outside Date or by Parent due to the Company's material breach of the Merger
Agreement and, in each case, an acquisition proposal has been publicly made or
made known to the Board of Directors of the Company (the "Company Board") prior
to the Company stockholders' meeting (if held) or the termination of the Merger
Agreement (if the Company stockholders' meeting is not held), and within 12
months of termination the Company consummates a transaction with respect to such
acquisition proposal (or any acquisition proposal that would have otherwise
constituted an acquisition proposal if announced or made known to the Company
Board prior to termination of the Merger Agreement), (ii) by either party due to
a failure to receive the necessary approval from the Company's stockholders and
an acquisition proposal has been publicly made prior to the Company
stockholders' meeting and within 12 months of termination the Company
consummates a transaction with respect to such acquisition proposal (or any
acquisition proposal that would have otherwise constituted an acquisition
proposal if announced or made known to the Company Board prior to termination of
the Merger Agreement), (iii) by the Company to enter into an agreement with
respect to a superior proposal from a competing buyer, (iv) by Parent due to the
Company Board changing its recommendation in response to a superior proposal
from a competing buyer or by (v) Parent for the Company's breach, in any
material respect, of its covenant not to solicit acquisition proposals from
third parties.
2
The Amendment also increases, from $70 million to $90 million, the termination
fee Parent will be required to pay to the Company if the Merger Agreement is
terminated by the Company if (i) the mutual closing conditions and Parent's
closing conditions (other than those to be satisfied at closing) have been
satisfied, (ii) the Company certifies to Parent in writing that the Company's
closing conditions (other than those to be satisfied at closing) have been
satisfied or are waived and that the Company stands ready to close for three
business days immediately thereafter, (iii) the Company remains ready to close
for such three day business period and (iv) Parent and Merger Sub fail to
consummate the Merger within such three business day period.
Parent has also, contemporaneously with the execution of the Amendment,
delivered to the Company (i) an amended equity commitment letter entered into
with New Mountain Partners VI, L.P. ("New Mountain") to cover the additional
aggregate Merger Consideration required to be paid by Parent in connection with
the Merger as a result of the Amendment and which, together with the debt
financing commitment delivered by Parent in connection with signing of the
Original Merger Agreement, commit sufficient funds to Parent to consummate the
Transactions and (ii) an amended limited guarantee in favor of Parent, pursuant
to which New Mountain has guaranteed certain of Parent's obligations, including
payment of any termination fee Parent is required to pay pursuant to the terms
of the Merger Agreement up to the amount of the increased termination fee
provided for in the Amendment.
All other material terms of the Merger Agreement, which was previously filed by
the Company as Exhibit 2.1 to the Current Report on Form 8-K dated February 17,
2021, except as amended by that certain Amendment No. 1, which was previously
filed by the Company as Exhibit 2.1 to the Current Report on Form 8-K dated
March 15, 2021, remain the same.
The foregoing summary description of the Amendment is subject to and qualified
in its entirety by reference to the Amendment, a copy of which is filed as
Exhibit 2.1, and the terms of which are incorporated herein by reference.
Item 8.01 Other Events.
On April 14, 2021, the Company issued a press release announcing that it had
entered into the Amendment. A copy of the press release is attached hereto as
Exhibit 99.1 and incorporated herein by reference.
Forward-Looking Statements
This communication contains "forward-looking statements" within the meaning of
the U.S. federal securities laws. Such statements include statements concerning
anticipated future events and expectations that are not historical facts. All
statements other than statements of historical fact are statements that could be
deemed forward-looking statements. Forward-looking statements are typically
identified by words such as "believe," "expect," "anticipate," "intend,"
"target," "estimate," "continue," "positions," "plan," "predict," "project,"
"forecast," "guidance," "goal," "objective," "prospects," "possible" or
"potential," by future conditional verbs such as "assume," "will," "would,"
"should," "could" or "may," or by variations of such words or by similar
expressions or the negative thereof.
3
Actual results may vary materially from those expressed or implied by
forward-looking statements based on a number of factors, including, without
limitation: (1) risks related to the consummation of the merger, including the
risks that (a) the merger may not be consummated within the anticipated time
period, or at all, (b) the parties may fail to obtain stockholder approval of
the merger agreement, (c) the parties may fail to secure the termination or
expiration of any waiting period applicable under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, (d) other conditions to the
consummation of the merger under the merger agreement may not be satisfied, and
(e) the significant limitations on remedies contained in the merger agreement
may limit or entirely prevent the Company from specifically enforcing the
obligations of Carter Intermediate, Inc. (Parent) and its wholly owned
subsidiary, Carter Acquisition, Inc. (Merger Sub), under the merger agreement or
recovering damages for any breach by Parent or Merger Sub; (2) the effects that
any termination of the merger agreement may have on the Company or its business,
including the risks that (a) the Company's stock price may decline significantly
if the merger is not completed, (b) the merger agreement may be terminated in
circumstances requiring the Company to pay Parent a termination fee, or (c) the
circumstances of the termination, including the possible imposition of a
12-month tail period during which the termination fee could be payable upon
certain subsequent transactions, may have a chilling effect on alternatives to
the merger; (3) the effects that the announcement or pendency of the merger may
have on the Company's and its business, including the risks that as a result (a)
the Company's business, operating results or stock price may suffer, (b) the
Company's current plans and operations may be disrupted, (c) the Company's
ability to retain or recruit key employees may be adversely affected, (d) the
Company's business relationships (including, customers, franchisees and
suppliers) may be adversely affected, or (e) the Company's management's or
employees' attention may be diverted from other important matters; (4) the
effect of limitations that the merger agreement places on the Company's ability
to operate its business, return capital to stockholders or engage in alternative
transactions; (5) the nature, cost and outcome of pending and future litigation
and other legal proceedings, including any such proceedings related to the
merger and instituted against the Company and others; (6) the risk that the
merger and related transactions may involve unexpected costs, liabilities or
delays; (7) other economic, business, competitive, legal, regulatory, and/or tax
factors; and (8) other factors described under the heading "Risk Factors" in
Part I, Item 1A of the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 2020, as updated or supplemented by subsequent reports that
the Company has filed or files with the SEC. Potential investors, stockholders
and other readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date on which they are
made. Neither Parent nor the Company assumes any obligation to publicly update
any forward-looking statement after it is made, whether as a result of new
information, future events or otherwise, except as required by law.
Additional Information and Where to Find It
This communication does not constitute an offer to sell or the solicitation of
an offer to buy any securities or a solicitation of any vote or approval. This
communication may be deemed to be solicitation material in respect of the
proposed merger between Merger Sub and the Company. In connection with the
proposed transaction, the Company plans to file a proxy statement with the SEC.
STOCKHOLDERS OF THE COMPANY ARE URGED TO READ THE PROXY STATEMENT (INCLUDING ANY
AMENDMENTS OR SUPPLEMENTS THERETO AND ANY DOCUMENTS INCORPORATED BY REFERENCE
THEREIN) AND OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE PROPOSED
TRANSACTION THAT THE COMPANY WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION
AND THE PARTIES TO THE PROPOSED TRANSACTION. Stockholders and investors will be
able to obtain free copies of the proxy statement and other relevant materials
(when they become available) and other documents filed by the Company at the
SEC's website at www.sec.gov. Copies of the proxy statement (when they become
available) and the filings that will be incorporated by reference therein may
also be obtained, without charge, by contacting the Company's Investor Relations
at kcason@aegion.com or 1.800.325.1159.
4
Participants in Solicitation
The Company and its directors, executive officers and certain employees, may be
deemed, under SEC rules, to be participants in the solicitation of proxies in
respect of the proposed transaction. Information regarding the Company's
directors and executive officers is available in its annual report on Form 10-K
filed with the SEC on March 10, 2021. Other information regarding the
participants in the proxy solicitation and a description of their direct and
indirect interests, by security holdings or otherwise, will be contained in the
proxy statement and other relevant materials to be filed with the SEC (when they
become available). These documents can be obtained free of charge from the
sources indicated above.
Item 9.01 Financial Statements and Exhibits.
(d)
Exhibit No. Description
2.1 Amendment No. 2 to the Agreement and Plan of Merger,
dated as of April 13, 2021, among Carter Intermediate,
Inc., Carter Acquisition, Inc. and Aegion Corporation,
filed herewith.
99.1 Press Release of Aegion Corporation dated April 14,
2021, filed herewith.
5
© Edgar Online, source Glimpses