SEC Filing | Investor Relations | WillScot Mobile Mini Holdings Corp.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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): July 30, 2018 (July 24, 2018)

WILLSCOT CORPORATION

(Exact name of registrant as specified in its charter)

901 S. Bond Street, #600

Baltimore, Maryland 21231

(Address, including zip code, of principal executive offices)

(410) 931-6000

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Item 1.01                                           Entry into a Material Definitive Agreement

As previously disclosed, in connection with WillScot Corporation’s (the “Company”) pending acquisition of Modular Space Holdings, Inc. (the “ModSpace Acquisition”), on July 9, 2018, Williams Scotsman International, Inc. (“WSII”) and certain other subsidiaries of the Company entered into a first amendment (the “First Amendment”) to their ABL credit agreement, dated as of November 29, 2017 (the “ABL Credit Agreement”), among WSII, the guarantors party thereto, the lenders party thereto and Bank of America, N.A., as agent and collateral agent.

On July 24, 2018, WSII and certain of its subsidiaries entered into a second amendment to the ABL Credit Agreement (the “Second Amendment” and the ABL Credit Agreement, as amended by the First Amendment and the Second Amendment, the “Amended ABL Facility”) to its ABL Credit Agreement, to make technical amendments to the ABL Credit Agreement to permit the offering of the Unsecured Notes (as defined in Item 8.01 below). The Amended ABL Facility will not become effective until the closing of the ModSpace Acquisition.

Item 7.01.                                        Regulation FD Disclosure.

In connection with the financing for the ModSpace Acquisition, Mason Finance Sub. Inc., a newly-formed finance subsidiary of the Company (the “Escrow Issuer”), plans to offer to potential investors up to $300 million in aggregate principal amount of senior secured notes due 2023 (the “Secured Notes”). If the offering is consummated, the gross proceeds thereof will be deposited by the initial purchasers into a segregated escrow account pursuant to an escrow and security agreement. Concurrently with the closing of the ModSpace Acquisition, the escrowed proceeds will be released to fund the ModSpace Acquisition and to pay related fees and expenses. Upon consummation of the ModSpace Acquisition, the Escrow Issuer will merge with and into WSII, with WSII continuing as the surviving corporation, and WSII will assume the obligations of the Escrow Issuer under the Notes and the indenture governing the Secured Notes.

In connection with the proposed offering, the Company disclosed certain information to prospective investors.  The Company is furnishing herewith such information as Exhibit 99.1 to this Current Report on Form 8-K and incorporated by reference in this Item 7.01.

This Current Report on Form 8-K does not constitute an offer to sell or a solicitation of an offer to buy the Secured Notes. The Secured Notes have not been registered under Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any other jurisdiction and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

The information furnished pursuant to this Item 7.01 of this Current Report on Form 8-K, including the exhibit hereto, shall not be considered “filed” under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), nor shall it be incorporated by reference into future filings by the Company under the Securities Act of 1933, as amended or under the Exchange Act, unless the Company expressly sets forth in such future filing that such information is to be considered “filed” or incorporated by reference therein.

Item 8.01              Other Events

In connection with the financing for the ModSpace Acquisition, on July 28, 2018, the Escrow Issuer entered into a note purchase agreement with certain affiliated or managed funds or accounts of AlbaCore Capital LLP and Canyon Value Realization Fund, L.P. (together, the “Unsecured Lenders”), pursuant to which the Unsecured Lenders agreed to subscribe for the Escrow Issuer’s unsecured notes in an aggregate principal amount of $200.0 million (the “Unsecured Notes”). The gross proceeds thereof will be deposited by the Unsecured Lenders into a segregated escrow account pursuant to an escrow and security agreement. Concurrently with the closing of the ModSpace Acquisition, the escrowed proceeds will be released to fund the ModSpace Acquisition and to pay related fees and expenses. Upon consummation of the ModSpace Acquisition, the Escrow Issuer will merge with and into WSII, with WSII continuing as the surviving corporation, and WSII will assume the obligations of the Escrow Issuer under the Unsecured Notes and the indenture governing the Unsecured Notes. We expect the offering of the Unsecured Notes by the Escrow Issuer will close on or about August 3, 2018.

This Current Report on Form 8-K does not constitute an offer to sell or a solicitation of an offer to buy Unsecured Notes. The Unsecured Notes have not been registered under Securities Act, or the securities laws of any other jurisdiction and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

Cautionary Notice Regarding Forward Looking Statements

This Current Report on Form 8-K contains statements reflecting assumptions, expectations, projections, intentions or beliefs about future events that are intended as “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on the current expectations of the Company’s management. Discussion of risks and uncertainties that could cause actual results to differ materially from current projections, forecasts, estimates and expectations of the Company is contained in the Company’s filings with the SEC. Specifically, the Company makes reference to, and incorporates herein by reference, the section entitled “Risk Factors” in its Annual Report on Form 10-K for the year ended December 31, 2017. In addition to the risks and uncertainties set forth in the Company’s SEC filings, the forward-looking statements described in this Current Report on Form 8-K could be affected by, among other things, (i) conditions to the closing of the transaction may not be satisfied; (ii) problems may arise in successfully integrating ModSpace’s business into the Company’s current portfolio, which may result in the Company not operating as effectively and efficiently as expected; (iii) the Company may be unable to achieve expected synergies or it may take longer than expected to achieve such synergies; (iv) the transaction may involve unexpected costs or unexpected liabilities; (v) the Company may be unable to obtain regulatory approvals required for the transaction or required regulatory approvals may delay the transaction or result in the imposition of conditions that could have a material adverse effect on the Company; (vi) the business of the Company may suffer as a result of uncertainty surrounding the transaction; and (vi) the Company may be adversely affected by other economic, business, and/or competitive factors.

Any or all of the Company’s forward-looking statements may turn out to be wrong or differ materially from actual results. They can be affected by inaccurate assumptions or by known or unknown risks, uncertainties and other factors, many of which are beyond the Company’s control. The Company undertakes no obligation to update or revise publicly, any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law.

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Item 9.01                                           Financial Statements and Exhibits.

(d)  Exhibits

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

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Exhibit 99.1

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

The following unaudited pro forma condensed combined financial information sets forth selected pro forma consolidated financial information for WillScot Corporation (the “Company,” “WillScot” or “we,” “us,” or “our”) and is derived from and should be read in conjunction with, the consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended December 31, 2017 (the “2017 10-K”), the consolidated financial statements and related notes in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2018 (the “Q1 2018 10-Q”), and ModSpace Holdings, Inc.’s (“ModSpace”) historical consolidated financial statements included as Exhibits 99.1 and 99.2 to the Current Report on Form 8-K filed on July 24, 2018 incorporated by reference in this offering memorandum.

On June 21, 2018, we entered into an agreement and plan of merger (the “Merger Agreement”) with ModSpace pursuant to which our newly-formed acquisition subsidiary, Mason Merger Sub, Inc. (“Merger Sub”) will merge with and into ModSpace, with ModSpace as the surviving entity and continuing as our indirect subsidiary (the “ModSpace Acquisition”). The unaudited pro forma condensed combined financial information set forth below has been prepared to reflect adjustments to our financial condition and results of operations to give effect to the following items:

i.                                          the consummation of the ModSpace Acquisition, including our issuance of shares of our common stock, par value $0.0001 per share (the “Common Stock”), and warrants to purchase shares of Common Stock (the “the Warrants”) to the sellers of ModSpace;

ii.                                       the Financing Transactions (as defined and discussed below),

iii.                                    the effects of the acquisition of Acton Mobile Holdings, LLC (“Acton”), which closed on December 20, 2017 (the “Acton Acquisition”);

iv.                                   the effects of the business combination of Double Eagle Acquisition Corp. and Williams Scotsman International, Inc., which we completed on November 29, 2017 (the “Business Combination”), on the historical capital structure; and

v.                                      Transaction costs expected to be incurred in connection with the ModSpace Acquisition and Financing Transactions.

As referred to above, the “Financing Transactions” includes:

·                  our issuance of 8,000,000 shares of our Common Stock in an underwritten public offering at $16.00 per share (the “Equity Offering”),

·                  the entry by our indirect subsidiary, Williams Scotsman International, Inc. (“WSII”) and certain of its subsidiaries into a first amendment (the “Amended ABL Facility”) to the ABL Credit Agreement, dated as of November 29, 2017 (the “ABL Facility”) among WSII, the guarantors party thereto, the lenders party thereto and Bank of America, N.A., as agent and collateral agent. The Amended ABL Facility will become effective upon the closing of the ModSpace Acquisition and increases borrowing capacity under the ABL Facility from $600 million to $1.35 billion, with an accordion feature allowing aggregate borrowing capacity of up to $1.8 billion. Upon the closing of the ModSpace Acquisition, we expect total borrowings of $852.3 million under the ABL Facility, which represents an incremental $505.0 million in proceeds;

·                  WSII’s issuance of $300 million in aggregate principal amount of senior secured notes (the “Secured Notes”) to qualified institutional buyers pursuant to Rule 144A and

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Regulation S under the Securities Act of 1933, as amended (the “Securities Act”) (the “Secured Notes Offering”); and

·                  WSII’s issuance of $200 million in aggregate principal amount of senior unsecured notes (the “Unsecured Notes”) in a private placement transaction (the “Unsecured Financing”).

We refer to the entry into the Amended ABL Facility and the amounts to be funded thereunder, the Secured Notes Offering and the Unsecured Financing collectively as the “Other Financing Transactions.” We refer to the Equity Offering and the Other Financing Transactions collectively as the “Financing Transactions.” We refer to the ModSpace Acquisition, the Acton Acquisition, the Business Combination and the Financing Transactions collectively as the “Transactions.”

In connection with our entry into the Merger Agreement and pursuant to an amended and restated commitment letter (the “ABL/Bridge Debt Commitment Letter”), dated July 5, 2018, by and among Bank of America, N.A., Deutsche Bank AG New York Branch, Barclays Bank PLC, Morgan Stanley Senior Funding, Inc., Credit Suisse AG and ING Capital LLC (collectively, with certain of their respective affiliates, the “Lenders”) and us, the Lenders committed to provide (i) an incremental ABL loan facility in an aggregate principal amount of up to $750.0 million; (ii) a senior secured bridge loan facility in an aggregate principal amount of up to $280 million (the “Secured Bridge Facility”); and (iii) a senior unsecured bridge loan facility in an aggregate principal amount of up to $320 million (the “Unsecured Bridge Facility”), on the terms and subject to the conditions set forth in the ABL/Bridge Debt Commitment Letter, to fund a portion of the Cash Consideration for the ModSpace Acquisition and to pay related fees and expenses. Although we do not currently expect to make any borrowings under the Unsecured Bridge Facility or the Secured Bridge Facility, there can be no assurance that such borrowings will not be made. In that regard, we may be required to borrow under the Unsecured Bridge Facility and/or the Secured Bridge Facility if we do not generate sufficient net proceeds from the Equity Offering to partially finance the ModSpace Acquisition and related fees and expenses. The ABL/Bridge Debt Commitment Letter provides that any net cash proceeds received by us from the Equity Offering will, to the extent they are to be used to fund the ModSpace Acquisition, reduce the commitments of the Lenders as follows: (i) first, the commitments of the Lenders in respect of the Unsecured Bridge Facility will be automatically and immediately reduced and terminated, on a dollar-for-dollar basis, by the first $70.0 million of such proceeds and (ii) second, to the extent those proceeds exceed $70.0 million, amounts to be funded under the ABL Facility will be automatically and immediately reduced, on a dollar-for-dollar basis, by the amount of such excess. We expect the Bridge Facilities to be undrawn at the closing of the ModSpace Acquisition as a result of the Financing Transactions.

In connection with our entry into the Merger Agreement and pursuant to a commitment letter (the “Unsecured Debt Commitment Letter”), dated July 24, 2018, by and among AlbaCore Capital LLP, Canyon Value Realization Fund, L.P. (collectively, with certain of their respective affiliated or managed funds or accounts, the “Unsecured Lenders”) and us, the Unsecured Lenders committed to purchase senior unsecured notes (the “Unsecured Notes”) in an aggregate principal amount of up to $200.0 million, on the terms and subject to the conditions set forth in the Unsecured Debt Commitment Letter, to fund a portion of the Cash Consideration for the ModSpace Acquisition and to pay related fees and expenses. To the extent that the aggregate gross proceeds from (i) the Equity Offering and (ii) the Unsecured Financing (to the extent the proceeds from the Unsecured Financing are funded into an escrow account for the purpose of funding the Cash Consideration for the Modspace Acquisition) are at least $300 million, then the Unsecured Bridge Facility commitment under

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the ABL/Bridge Debt Commitment Letter will be cancelled and terminated in full. The Unsecured Notes will mature 5 years and 3 months after the date of issuance. The Unsecured Notes will bear interest at a rate of 10.0% per annum if paid in cash (or if paid in kind, 11.5% per annum) for the first 2 years and 6 months after the date of issuance and thereafter increasing to 12.5% per annum with no paid in kind option, in each case payable semi-annually. The Unsecured Notes will be WSII’s general unsecured obligations and will rank pari passu in right of payment with all of WSII’s existing and future senior indebtedness, effectively junior to all of WSII’s existing and future secured indebtedness, including the Amended ABL Facility, WSII’s existing 7.875% senior secured notes due 2022 (the “2022 Notes”) and the Secured Notes, to the extent of the value of the collateral securing such indebtedness, and senior in right of payment to any of WSII’s future unsecured subordinated indebtedness. In connection with the Equity Offering, we granted the underwriters a 30 day option to purchase up to an additional 1,200,000 shares of our Common Stock at $16.00 per share less underwriting discounts. In the event the underwriters exercise this option in whole or in part we expect to reduce on a dollar for dollar basis the size of our incremental borrowings under the Amended ABL Facility. A reduction in incremental borrowings under the Amended ABL Facility of $1 million would cause our interest expense presented in the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2017, the three months ended March 31, 2017 and the three months ended March 31, 2018 to decrease by approximately $46 thousand, $12 thousand and $12 thousand, respectively.

The following unaudited pro forma condensed combined financial information is based on the historical financial statements of WillScot, Acton and ModSpace described below. Our fiscal year is different than ModSpace’s historical fiscal year. Our fiscal year ends on December 31, while ModSpace’s historical fiscal year ends on September 30. In preparing the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2017, certain historical financial information for ModSpace was reclassed to align with WillScot’s annual reporting period. To adjust the historical operating results of ModSpace’s September fiscal year, we added the operating results for the three months ended December 31, 2017 (Successor), and subtracted the operating results for the three months ended December 31, 2016 (Predecessor) from the year ended September 30, 2017 for ModSpace Statement of Operations, to arrive at the reclassed statement of operations for the twelve months ended December 31, 2017 for ModSpace. The ModSpace operating results for the three months ended December 31, 2017 and 2016 are derived from the historical unaudited interim financial statements of ModSpace included in our Current Report on Form 8-K filed on July 24, 2018 incorporated by reference in this offering memorandum. The periods were derived by taking the ModSpace historical unaudited statement of operations for the six month ended March 31, 2017 and 2016, respectively, and subtracting the three months ended March 31, 2017 and 2016, respectively. In addition, certain reclassifications were made to the reported financial information of ModSpace to conform to the reporting classifications of WillScot.

The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2017 combines:

·                  the audited historical consolidated statement of operations of Willscot for the year ended December 31, 2017;

·                  the reclassed unaudited historical consolidated statement of operations of ModSpace for the twelve months ended December 31, 2017; and

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·                  the unaudited historical consolidated statement of operations of Acton for the period from January 1, 2017 to December 20, 2017.

The unaudited pro forma condensed combined statement of operations for the three months ended March 31, 2018 combines:

·                  the unaudited historical consolidated statement of operations of WillScot for the three months ended March 31, 2018 (historical statements include Acton operating results as it was a wholly owned subsidiary of WillScot during this period); and

·                  the unaudited historical consolidated statement of operations of ModSpace for the three months ended March 31, 2018.

The unaudited pro forma condensed combined statement of operations for the three months ended March 31, 2017 combines:

·                  the unaudited historical consolidated statement of operations of WillScot for the three months ended March 31, 2017; and

·                  the unaudited historical consolidated statement of operations of ModSpace for the three months ended March 31, 2017; and

·                  the unaudited historical consolidated statement of operations of Acton for the period from January 1, 2017 to March 31, 2017.

The unaudited pro forma condensed combined balance sheet as of March 31, 2018 combines:

·                  the unaudited historical consolidated balance sheet of WillScot as of March 31, 2018 (historical statements include Acton as it was a wholly owned subsidiary of WillScot during this period); and

·                  the unaudited historical consolidated balance sheet of ModSpace as of March 31, 2018.

The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2017 is based on, derived from, and should be read in conjunction with, our historical audited financial statements as set forth in our 2017 10-K. The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2017 is also based on, derived from, and reclassed from ModSpace’s historical audited financial statements for the fiscal year ended September 30, 2017 and should be read in conjunction with ModSpace’s historical audited financial statements included in this Current Report on Form 8-K filed on July 24, 2018 incorporated by reference in this offering memorandum, as adjusted to conform to our calendar year end, and the historical unaudited consolidated statement of operations of Acton for the period from January 1, 2017 to December 20, 2017. The unaudited pro forma condensed statement of operations for the year ended December 31, 2017 does not include the operating results of Tyson Onsite (“Tyson”), which we acquired on January 3, 2018.

Our balance sheet as of March 31, 2018 and our statement of operations for the three months ended March 31, 2018 and 2017 are based on, derived from, and should be read in conjunction with, our historical unaudited financial statements, included in our Q1 2018 for the quarter ended March 31, 2018. ModSpace’s balance sheet as of March 31, 2018 and statement of operations for the three months ended March 31, 2018 and 2017 are based on, and derived from, ModSpace’s historical unaudited financial statements, and should be read in conjunction with, ModSpace’s historical unaudited financial statements, included in the Current Report on Form 8-K filed on July 24, 2018 incorporated by reference in this offering memorandum.

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The unaudited pro forma condensed combined statements of operations for the year ended December 31, 2017, the three months ended March 31, 2018, and the three months ended March 31, 2017 assume that the Transactions occurred on January 1, 2017. The unaudited pro forma condensed combined balance sheet as of March 31, 2018 assumes that the Transactions occurred on March 31, 2018. The unaudited pro forma condensed combined financial information has been prepared by management for illustrative purposes only and is not necessarily indicative of the consolidated financial position or results of operations that would have been realized had the Transactions occurred as of the dates indicated, nor is it meant to be indicative of any anticipated consolidated financial position or future results of operations of the combined company. In addition, the accompanying unaudited pro forma condensed combined statements of operations do not include any expected cost savings or restructuring actions which may be achievable or which may occur subsequent to the ModSpace Acquisition, or the costs to achieve these cost savings or restructuring actions. The pro forma financial information also does not include the impact of any non-recurring activity and one-time transaction-related costs. The historical consolidated financial information has been adjusted in the accompanying unaudited pro forma condensed combined financial statements to give effect to pro forma events that are (i) directly attributable to the Transactions related thereto, (ii) factually supportable and (iii) with respect to the unaudited pro forma condensed combined statements of operations, are expected to have a continuing impact on the combined results.

The ModSpace Acquisition will be accounted for as a business combination using the acquisition method of accounting under the provisions of Accounting Standard Codification No. 805, “Business Combinations,” (“ASC 805”) and applying the pro forma assumptions and adjustments described in the accompanying notes to the unaudited pro forma condensed combined financial statements. Under ASC 805, the Company values assets acquired and liabilities assumed in a business combination at their fair values as of the acquisition date. Fair value measurements can be highly subjective and the reasonable application of measurement principles may result in a range of alternative estimates using the same facts and circumstances. The process for estimating the fair values of identifiable intangible assets and certain tangible assets requires the use of significant estimates and assumptions by management, including estimating future cash flows, and developing appropriate discount rates. Under ASC 805, transaction costs are not included as a component of consideration transferred, and are expensed as incurred. The final valuation is expected to be completed as soon as practicable but no later than one year after the consummation of the ModSpace Acquisition. The purchase price allocation is subject to completion of the Company’s final analysis of the fair value of the assets and liabilities of ModSpace as of the effective date of the ModSpace Acquisition. Accordingly, the purchase price allocation in the unaudited pro forma condensed combined financial statements is preliminary. Adjustments to the preliminary purchase price allocation could be material. The Company believes the fair values assigned to the assets to be acquired and liabilities to be assumed are based on reasonable estimates and assumptions using currently available data.

This unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X. The unaudited pro forma condensed combined financial information is presented for informational purposes only and does not purport to represent what our results of operations would actually have been if the Transactions had occurred on the dates indicated nor do they purport to project our results of operations for any future period.

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WILLSCOT CORPORATION

UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET

AS OF MARCH 31, 2018

(In thousands)

See notes to unaudited pro forma condensed combined balance sheet.

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WILLSCOT CORPORATION

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

FOR THREE MONTHS ENDED MARCH 31, 2018

(In thousands, except loss per share data)

See notes to unaudited pro forma condensed combined statement of operations.

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WILLSCOT CORPORATION

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

FOR THREE MONTHS ENDED MARCH 31, 2017

(In thousands, except loss per share data)

See notes to unaudited pro forma condensed combined statement of operations.

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WILLSCOT CORPORATION

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 31, 2017

(In thousands, except loss per share data)