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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): FEBRUARY 2, 1998
FIRST WAVE MARINE, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
0-00000
- ------------------------ 76-0461352
(Commission File Number) (I.R.S. Employer Identification No.)
4000 S. SHERWOOD FOREST BOULEVARD
SUITE 603
BATON ROUGE, LOUISIANA 70816
(Address of principal executive offices) (Zip Code)
(504) 292-8800
(Registrant's telephone number, including area code)
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Item 2. ACQUISITION OR DISPOSITION OF ASSETS
On February 2, 1998, First Wave Marine, Inc., a Delaware corporation
(the "Company") completed the acquisition (the "Bludworth Acquisition") of all
of the outstanding shares (the "Bludworth Shares") of John Bludworth Marine,
Inc., a Texas corporation. The Bludworth Shares were acquired from John L.
Bludworth III, pursuant to a Stock Purchase Agreement dated October 15, 1997 as
amended by the First and Second Amendments thereto, dated October 17, 1997 and
January 30, 1998, respectively (as amended, the "Bludworth Agreement"). Under
the terms of the Bludworth Agreement, the Company paid consideration of $15
million in cash and issued a promissory note in the amount of $4 million ( the
"Bludworth Note"). The Company used a portion of the proceeds from its recent
offering of 11% senior notes to fund the cash portion of the Bludworth
Acquisition. The promissory note is adjustable upward or downward based upon
outstanding debt and the final calculation of EBITDA of John Bludworth Marine,
Inc. for its fiscal year ending March 31, 1998 ("Bludworth EBITDA"). The
Bludworth Note must be paid after final calculation of the Bludworth EBITDA (on
or before July 31, 1998).
Bludworth is an established regional shipbuilder focusing on offshore
support vessel repair, as well as inland barge repair and inland boat
construction and repair. The Bludworth Acquisition expands the Company's
Houston-Galveston base of operations in a cost efficient manner, adding
significant new drydock capacity within the Company's area of operation and
diversifying its current mix of services to include expanded capabilities in the
offshore and the inland boat segment of the marine industry. The Bludworth
Acquisition provides the Company with two additional shipyards: (i) the John
Bludworth Marine facility in Pasadena, Texas, which is near the Company's other
Houston shipyards and (ii) the West Pelican Island facility which is adjacent to
the Company's East Pelican Island facility in Galveston, Texas.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements of Business Acquired.
The Consolidated Balance Sheets of John Bludworth Marine, Inc.
and Subsidiary as of September 30, 1997 and March 31, 1997 and March
31, 1996 and the related Consolidated Statements of Earnings,
Stockholders Equity and Cash Flows for the six months ended September
30, 1997 and the years ended March 31, 1997 and 1996 are incorporated
herein by reference to pages F-17 through F-28 of the Company's Section
424(b)(1) final Prospectus filed with the Commission on January 28,
1998 (Registration No. 333-38157).
(b) Pro Forma Financial Information.
Unaudited Pro Forma Consolidated Combined Financial
Information of the Company giving effect to the Bludworth Acquisition
is incorporated herein by reference to pages 28 through 32 of the
Company's Section 424(b)(1) final Prospectus filed with the Commission
on January 28, 1998 (Registration No. 333-38157).
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(c) Exhibits.
2.1 -- Stock Purchase Agreement dated October 15, 1997 between the
Company and John L. Bludworth III et al (incorporated herein
by reference to Exhibit No. 10.1 to the Company's Registration
Statement on Form S-1, Registration No. 333-38157).
2.2 -- First Amendment to Stock Purchase Agreement dated October
17, 1997 between the Company and John L. Bludworth III et al
(incorporated herein by reference to Exhibit No. 10.5 to the
Company's Registration Statement on Form S-1, Registration No.
333-38157).
*2.3 -- Second Amendment to Stock Purchase Agreement dated January
30, 1998 between the Company and John L. Bludworth III et al.
*23 -- Consent of Grant Thornton LLP
*filed herewith
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED HEREUNTO DULY AUTHORIZED.
FIRST WAVE MARINE, INC.
Date: February 13, 1998
By: /s/ David B. Ammons
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David B. Ammons
Executive Vice President,
CFO and Secretary
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EXHIBIT INDEX
2.1 -- Stock Purchase Agreement dated October 15, 1997 between the
Company and John L. Bludworth III et al (incorporated herein by
reference to Exhibit No. 10.1 to the Company's Registration Statement
on Form S-1, Registration No. 333-38157).
2.2 -- First Amendment to Stock Purchase Agreement dated October 17,
1997 between the Company and John L. Bludworth III et al (incorporated
herein by reference to Exhibit No. 10.5 to the Company's Registration
Statement on Form S-1, Registration No. 333- 38157).
*2.3 -- Second Amendment to Stock Purchase Agreement dated January 30,
1998 between the Company and John L. Bludworth III et al.
*23 -- Consent of Grant Thornton LLP
*filed herewith
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EXHIBIT 2.3
SECOND AMENDMENT TO THE
STOCK PURCHASE AGREEMENT
PREAMBLE
THIS SECOND AMENDMENT TO THE STOCK PURCHASE AGREEMENT (hereinafter
referred to as the "Second Agreement"), dated as of the 30th day of January,
1998, amending that certain Stock Purchase Agreement by and among the parties
hereto dated October 15, 1997 (the "Stock Purchase Agreement," as amended by the
Second Amendment is hereinafter referred to as the "Agreement") is made and
entered into by and among:
JOHN L. BLUDWORTH, III, an individual of lawful age domiciled in
Hockley, Texas, who is the sole shareholder of John Bludworth Marine,
Inc. (collectively, along with his undersigned spouse, the "Sellers");
and
JOHN BLUDWORTH MARINE, INC., a Texas corporation whose principal place
of business is located at Pasadena, Texas, and which is the owner of
all the outstanding shares of all of its subsidiaries, including but
not limited to its subsidiary, Bludworth Shipyard and Fabrication,
Inc., a Texas corporation; and
BLUDWORTH SHIPYARD AND FABRICATION, INC., a Texas corporation whose
principal place of business is located at Galveston, Texas, and which
is the wholly owned subsidiary of John Bludworth Marine, Inc.
The above two corporations hereinafter collectively referred to as the
"Company;" and
EAE SERVICES, INC., a Texas corporation whose principal place of
business is located at Baton Rouge, Louisiana (the "Purchaser"); and
FIRST WAVE MARINE, INC., a Delaware corporation whose principal place
of business is located at Baton Rouge, Louisiana, appearing herein for
the limited purposes of providing for certain stock options and
guarantying the Purchaser's promissory note provided for in Section
2.02.
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RECITALS
WHEREAS, the parties desire to amend the Stock Purchase Agreement to
modify Section 2.06 and for other purposes.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements and tenants hereafter set forth, the Sellers, the Company and the
Purchaser hereby agree as follows:
1. Paragraph 2.06 is hereby amended in its entirety as follows:
SECTION 2.06. Additional Consideration. In the event that the March 31,
1998 EBITDA of the Company exceeds $4,500,000.00, the Purchaser shall, within
ten (10) Business Days after the Agreed Date, pay to John L. Bludworth, III, as
an additional payment for the purchase price of his shares, one-half (1/2) of
the amount by which the Company's final March 31, 1998 EBITDA exceeds
$4,500,000.00. The parties anticipate that through March 31, 1998, John L.
Bludworth, III, shall remain employed as an active executive officer of the
Company for $30,000.00 per month, with normal and customary fringe benefits and
use of Company car. Any dispute or disagreement with respect to the computation
of the Company's EBITDA or the increase in purchase price to John L. Bludworth,
III, shall be resolved by arbitration as provided in Section 11.16 of the Stock
Purchase Agreement.
2. On or before March 31, 1998, John L. Bludworth, III will assume the
ownership and responsibility for the Valley Forge Life Insurance (Policy Number
ULHN000354) on the life of John L. Bludworth, III and will pay to the Company
the cash surrender value of the policy, if any.
3. On or before March 31, 1998, upon the termination of the split
dollar life insurance policies (Sun Life Assurance Company of Canada, Policy
Number 020011920 and Protective Life Insurance Company, Policy Number B00255740)
on the life of John L. Bludworth, III, either John L. Bludworth, III or the
Trust shall repay the Company the lesser of (a) the cash surrender value of the
policies or (b) the total amount of paid premiums on the policies.
4. Upon the stock sale of the Company, the pooled Workers Compensation
insurance policy of the Company and Jay Bludworth, Inc. will be canceled. Any
premium refund from the audit of the payrolls of the respective corporations
will be used to repay the A.I. Credit Corp. note. If any refund in excess of the
note amount is due as a result
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of the Audit, the excess will be divided among John Bludworth Marine, Inc.,
Bludworth Shipyard and Fabrication, Inc. and Jay Bludworth, Inc. pro rata
according to the respective premium payments as adjusted after audit of the
respective three companies.
5. Upon the stock sale of the Company, the pooled general liability
insurance policy will be cancelled. John Bludworth Marine, Inc., Bludworth
Shipyard and Fabrication, Inc. and Jay Bludworth, Inc. will be entitled to
receive any refunded premiums for the period ending March 31, 1998, pro rata
according to the payment of the premiums for such insurance.
6. If the independent firm of certified public accountants auditing the
Purchaser determines that any tax penalties are due to the Internal Revenue
Service ("IRS") for the non-payment of any estimated taxes for fiscal year end
March 31, 1998, such penalties, plus any interest, if any, thereon, may be
reserved by Purchaser from the payment of the Promissory Note of EAE Services,
Inc. to John L. Bludworth, III, until it is mutually agreed by the parties
whether or not any such penalties may be assessed by the IRS. Any amount
reserved against the Promissory Note shall remain subject to the terms of the
Promissory Note, including but not limited to, the accrual of interest.
7. To the extent any of the Assets conveyed to Purchaser by the Stock
Purchase Agreement are owned of record by Cottonpatch Equipment Company, John L.
Bludworth, III agrees to cause Cottonpatch Equipment Company to convey such
assets to the Company.
8. The Purchaser agrees to use its best efforts to review, confirm and
determine the financial data of the Company by February 28, 1998 in order to
fulfill its obligations contained in the Promissory Note of EAE Services, Inc.
to John L. Bludworth, III.
9. Except as amended by section 1 of the First Amendment and this
Second Amendment all other terms of the Stock Purchase Agreement shall remain in
full force and effect. All references to "Agreement" in the Stock Purchase
Agreement shall mean as amended by the First and Second Amendments.
[THE NEXT PAGE IS THE SIGNATURE PAGE TO THIS AGREEMENT.]
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IN WITNESS WHEREOF, the Sellers, the Company, the Purchaser and First
Wave Marine, Inc. have caused this Agreement to be executed as of the date first
written above, the corporate parties represented herein by their respective
officers thereunto duly authorized.
SELLERS:
/s/ John L. Bludworth, III
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John L. Bludworth, III
/s/ Karla M. Bludworth
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Karla M. Bludworth
THE COMPANY:
JOHN BLUDWORTH MARINE, INC.
By: /s/ John L. Bludworth, III
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John L. Bludworth, III
President
BLUDWORTH SHIPYARD AND
FABRICATION, INC.
By: /s/ John L. Bludworth, III
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John L. Bludworth, III
President
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THE PURCHASER:
EAE SERVICES, INC.
By: /s/ Samuel F. Eakin
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Samuel F. Eakin
Chief Executive Officer and
Chairman of the Board
Intervening for the purpose of agreeing
to guarantee Purchaser's Note as provided
in Section 2.02(f), and to grant stock
options as provided in Section 6.01:
FIRST WAVE MARINE, INC.
By: /s/ Samuel F. Eakin
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Samuel F. Eakin
Chief Executive Officer and
Chairman of the Board
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EXHIBIT 23
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in this current report on
Form 8-K dated February 2, 1998, of our report dated November 8, 1997,
accompanying the consolidated financial statements of John Bludworth Marine,
Inc. and Subsidiary, appearing in the Section 424 (b)(1) Prospectus of First
Wave Marine, Inc. filed with the Securities and Exchange Commission pursuant to
the Securities Act of 1933 on January 28, 1998.
/s/ GRANT THORNTON LLP
GRANT THORNTON LLP
Houston, Texas
February 13, 1998
