| Item 1.01 | Entry into a Material Definitive Agreement. |
Common Stock Offering
On June 14, 2019, Chart Industries, Inc. (“Chart”) issued and sold an aggregate of 4,025,000 shares of common stock, $0.01 par value per share (the “Common Stock”), which included the full exercise of the underwriters’ option to purchase additional shares, pursuant to an underwriting agreement (the “Underwriting Agreement”) with J.P. Morgan Securities LLC, Credit Suisse Securities (USA) LLC and Morgan Stanley & Co. LLC, and the several underwriters named in Schedule 1 thereto (collectively, the “Underwriters”). The offering of Common Stock was made pursuant to Chart’s effective registration statement on FormS-3 (FileNo. 333-232049) initially filed with the Securities and Exchange Commission (the “SEC”) on June 10, 2019 and a related prospectus supplement.
The Underwriting Agreement contains customary representations, warranties and agreements by Chart. Additionally, Chart has agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act, or to contribute to payments the Underwriters may be required to make due to any such liabilities.
Chart estimates that the net proceeds from the sale of Common Stock, after deducting underwriting discounts and commissions and estimated offering expenses payable by Chart, will be approximately $286.3 million. Chart expects to use the net proceeds from the sale of Common Stock (together with borrowings under its new credit facilities) to finance Chart’s previously announced acquisition of the IndustrialAir-X-Changers business of Harsco Corporation (the “Acquisition”) and to pay related fees and expenses. If the Acquisition is not consummated for any reason, Chart expects to use the net proceeds from the offering for general corporate purposes, which may include repayment of indebtedness or to fund future acquisitions.
The foregoing description of the Underwriting Agreement is qualified in its entirety by reference to the Underwriting Agreement filed as Exhibit 1.1 to this Current Report onForm 8-K and incorporated herein by reference.
Debt Financing
On June 14, 2019, Chart entered into the Fourth Amended and Restated Credit Agreement (the “New Credit Agreement”) by and among Chart, Chart Industries Luxembourg S.à.r.l. (“Chart Lux”), Chart Asia Investment Company Limited (“Chart Asia”, together with Chart Lux and Chart, the “Borrowers”), the other foreign borrowers from time to time party thereto, the lenders from time to time party thereto and JPMorgan Chase Bank, N.A.
The New Credit Agreement provides for (i) a $450 million term loan facility (the “New Term Loan Facility”) and (ii) a revolving credit facility (the “New Revolving Credit Facility” and, together with the New Term Loan Facility, the “New Credit Facilities”) in a principal amount of up to $550 million, which includes a $100 million sublimit for letters of credit, a $250 million sublimit for discretionary letters of credit and a $50 million sublimit for swingline loans. Under the terms of the New Credit Agreement, Chart may, subject to the satisfaction of certain conditions, request increases in the revolving credit facility commitments and term loans in an aggregate principal amount of up to $450 million or a lesser amount in integral multiples of $25 million to the extent existing or new lenders agree to provide such increased or additional commitments, as applicable. The proceeds of the New Credit Facilities are to be used (i) to fund the Acquisition and related transaction costs, (ii) to refinance existing indebtedness, (iii) for working capital and (iv) for general corporate purposes. The New Credit Facilities have a five year maturity.
