Exhibit 10.3

 

FEE AND INTEREST EQUITIZATION AGREEMENT

 

This Fee and Interest Equitization Agreement (this “Agreement”), dated as of May
14, 2020, is made by and among Babcock & Wilcox Enterprises, Inc., a Delaware
corporation (the “Company”), B. Riley Financial, Inc. (“B. Riley Financial”)
and, solely for purposes of Section 13 hereof, B. Riley FBR, Inc. (“B. Riley
FBR”). As used herein, “Parties” refers collectively to the Company and B. Riley
Financial.

 

RECITALS

 

1. B. Riley Financial and B. Riley FBR are the sole Term Loan Lenders, as such
term is defined in the Amended and Restated Credit Agreement, dated as of May
14, 2020 (the “Amended and Restated Credit Agreement”), among the Company, as
the borrower, Bank of America, N.A., as administrative agent, and the other
lenders party thereto.

 

2. In connection with their entry into the Amended and Restated Credit
Agreement, the Company has agreed pursuant to a fee letter dated the date hereof
between B. Riley Financial and the Company (the “B. Riley Fee Letter”) to pay to
B. Riley Financial an aggregate fee of $3,900,000.00 with respect to the
provision of the B. Riley Limited Guaranty on the terms and conditions set forth
in this Agreement (the “Fee Payment”).

 

3. On the terms and conditions set forth in this Agreement, B. Riley Financial
has agreed to accept payment of the Fee Payment and payment of interest with
respect to the Term Loans payable between the date hereof and December 31, 2020
that is waived under the Amended and Restated Credit Agreement (the “Interest
Payments” and, together with the Fee Payment, the “Payment Amounts”) in shares
of the Company’s common stock, par value $0.01 per share (“Common Stock”), in
lieu of payment in cash pursuant to the terms of the Amended and Restated Credit
Agreement or the B. Riley Fee Letter, as applicable.

 

Now, therefore, in consideration of the mutual promises, agreements,
representations, warranties, and covenants contained herein, the Parties hereby
agree as follows:

 

Section 1. Payment of Payment Amounts in Common Stock.

 

(a) Satisfaction of Payment Amounts in Common Stock. On the terms and subject to
the conditions set forth in this Agreement, including Section 5, in satisfaction
of any requirement contained in the B. Riley Fee Letter that the Fee Payment be
paid by the Company to B. Riley Financial, or any requirement contained in the
Amended and Restated Credit Agreement that the Interest Payments be paid by the
Company to the Term Loan Lenders, B. Riley Financial agrees to purchase and
accept from the Company on the applicable Settlement Date (as defined below),
and the Company agrees to sell, issue and deliver to B. Riley Financial on the
applicable Settlement Date, a number of shares of Common Stock (the “Shares”)
equal to (x) the aggregate dollar value of the applicable Payment Amount divided
by (y) subject to Section 1(c), the Conversion Price. For purposes of this
Agreement:

 

(i) “Average VWAP” means, with respect to any period of Trading Days, the
average of the VWAP for each Trading Day in such period.

 

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(ii) “Conversion Price” means the Average VWAP over the fifteen (15) consecutive
Trading Days beginning on and including the Trading Day immediately following
the date of this Agreement (such period, the “Measurement Period”); provided
that (A) the Conversion Price shall be subject to adjustment as described in
Section 1(d) and (B) prior to the receipt of any stockholder approvals under the
rules of the New York Stock Exchange (“NYSE”), the Conversion Price shall not be
less than $1.55 (subject to adjustment pursuant to Section 1(d)).

 

(iii) “Market Disruption Event” means any of the following events: (A) any
suspension of, or limitation imposed on, trading by the Principal Stock Exchange
in shares of Common Stock during any period or periods aggregating one half-hour
or longer and whether by reason of movements in price exceeding limits permitted
by the Principal Stock Exchange or otherwise relating to the Common Stock; or
(B) the failure to open of the exchange or quotation system on which the Common
Stock is traded or the closure of such exchange or quotation system prior to its
respective scheduled closing time for the regular trading session on such day
(without regard to after hours or other trading outside the regular trading
session hours).

 

(iv) “Principal Stock Exchange” means the NYSE or, if the Common Stock is not
listed on the NYSE, the principal national securities exchange or public
quotation system on which the Common Stock is then listed for trading or quoted.

 

(v) “Trading Day” means any day on which (A) there is no Market Disruption Event
and (B) the Principal Stock Exchange is open for trading, or, if the Common
Stock is not listed on a national securities exchange, any Business Day;
provided that a “Trading Day” only includes those days that have a scheduled
closing time of 4:00 p.m. (New York City time) or the then standard closing time
for regular trading on the relevant exchange or trading system.

 

(vi) “Settlement Date” means (A) with respect to the Fee Payment, the first
Business Day following the Measurement Period and (B) with respect to an
Interest Payment, the scheduled interest payment date as provided for in the
Amended and Restated Credit Agreement without giving effect to any waiver or
deferral contemplated thereby.

 

(vii) “VWAP” means, on any Trading Day, the per share volume-weighted average
price as displayed under the heading “Bloomberg VWAP” on Bloomberg page (or its
equivalent successor if such page is not available) BW <Equity> AQR in respect
of the period from 9:30 a.m. to 4:00 p.m., New York City time, on such Trading
Day, or, if such price is not available, the market value per share of the
Common Stock on such Trading Day as determined by a nationally recognized
investment banking firm retained by the Company for this purpose.

 

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(b) Compliance with Stock Exchange Listing Requirements. The Company shall use
its reasonable best efforts to take, or cause to be taken, all actions, and do
or cause to be done, all things, necessary, proper or advisable on its part to
obtain, prior to the applicable Settlement Date, any necessary stockholder
approval under the rules of the Principal Stock Exchange, or the application of
any available exemption therefrom, for the sale, issuance and delivery of the
Shares pursuant to this Agreement. B. Riley Financial agrees to, and to cause
each of its subsidiaries to, cause all issued and outstanding shares of Common
Stock beneficially owned by any of them to (i) be present at each meeting of the
stockholders of the Company for purposes of determining a quorum to transact
business contemplated by this Section 1(b) and (ii) vote in favor of any
proposal presented to the Company’s stockholders seeking approval of the sale,
issuance and delivery of any Shares pursuant to this Agreement or approval of
any increase in the Company’s authorized capital for purpose of the sale,
issuance and delivery of any Shares pursuant to this Agreement.

 

(c) Payment if Shares Unable to be Delivered in Whole or in Part. To the extent
that the Company is unable to sell, issue and deliver any Shares pursuant to
Section 1(a) of this Agreement due to the failure to have obtained stockholder
approval under the requirements of the Principal Stock Exchange for such sale,
issuance and delivery as a result of the Conversion Price not being at least
$1.55 (disregarding, for purposes of this Section 1(c), clause (B) in the
definition of Conversion Price), then with respect to any Payment Amount payable
between the date hereof and the Term Loan Facility Maturity Date, the Company
shall (i) sell, issue and deliver on the applicable Settlement Date such number
of Shares that it may permissibly issue under the rules of the Principal Stock
Exchange without stockholder approval; (ii) if an exemption from such
stockholder approval requirements (or the required stockholder approval) is
later obtained between the date of this Agreement and the Term Loan Facility
Maturity Date, sell, issue and deliver such additional number of Shares that
would have been issued but for the limitation in subclause (i) on the later of
(A) the applicable Settlement Date and (B) the Business Day after obtaining such
exemption or stockholder approval; and (iii) if an exemption from such
stockholder approval requirements (or the required stockholder approval) is not
obtained between the date of this Agreement and the Term Loan Facility Maturity
Date, pay in cash on the Term Loan Facility Maturity Date that portion of such
Payment Amount not paid in Shares pursuant to subclause (i) or (ii), as
applicable.

 

(d) Adjustment to Conversion Price. If, prior to the applicable Settlement Date,
the Company effects a reclassification, stock split (including a reverse stock
split), stock dividend or distribution, recapitalization, merger, issuer tender
or exchange offer, or other similar transaction with respect to any shares of
its capital stock, the Conversion Price (including the price set forth in clause
(B) of the definition thereof) shall be equitably adjusted to reflect such
change and, as adjusted, shall, from and after the date of such event, be
subject to further adjustment in accordance herewith.

 

(e) Restrictions During Measurement Period. B. Riley Financial shall not,
directly or indirectly, including through one or more of their respective
affiliates, engage in any transactions with respect to the Common Stock intended
to or reasonably likely to affect the market price of the Common Stock, or
otherwise buy or sell any shares of Common Stock, during the Measurement Period,
whether taken before or during the Measurement Period.

 

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(f) Subordination. All payments, whether in the form of Shares or cash, to B.
Riley Financial under this Agreement shall be subject to the provisions of
Article XI of the Amended and Restated Credit Agreement and any other
subordination terms set forth therein. For the purposes of Article XI of the
Credit Agreement and any other subordination terms set forth therein, the Fee
Payment shall be deemed to be payable in respect of the Tranche A-6 Term Loan
Commitments.

 

Section 2. Representations and Warranties of the Company. The Company represents
and warrants to B. Riley Financial as set forth below:

 

(a) Organization, Power and Authority. The Company is duly organized and is
validly existing and in good standing under the laws of the State of Delaware.
The Company has the requisite corporate power and authority to enter into,
execute, and deliver this Agreement and to perform its obligations hereunder and
has taken all necessary action required for the due authorization of this
Agreement.

 

(b) Authorized and Issued Capital Stock. As of the date hereof, the authorized
capital stock of the Company consists of (i) 500,000,000 shares of Common Stock
and (ii) 20,000,000 shares of preferred stock, par value $0.01 per share
(“Preferred Stock”). As of May 8, 2020, (i) 46,407,555 shares of Common Stock
were issued and outstanding, (ii) 619,181 shares of Common Stock were held in
the treasury of the Company, (iii) 2,601,359 shares of Common Stock were
reserved for future issuance pursuant to outstanding stock options and other
rights to purchase shares of Common Stock and vesting of restricted stock units
and restricted stock granted under the Company’s stock option or stock-based
compensation plans, (iv) 1,666,667 shares of Common Stock were reserved for
issuance pursuant to outstanding warrants to purchase shares of Common Stock and
(v) no shares of Preferred Stock were issued and outstanding. The issued and
outstanding shares of Common Stock have been duly authorized and validly issued
and are fully paid and nonassessable, are not subject to and were not issued in
violation of any preemptive or similar rights. Except as set forth in this
Section 2(b), and except as contemplated by the Investor Rights Agreement, dated
as of April 30, 2019 (the “Investor Rights Agreement”), by and among the
Company, B. Riley FBR and Vintage Capital Management, LLC, as of the date of
this Agreement, no shares of capital stock or other equity securities or voting
interest in the Company are issued, reserved for issuance, or outstanding.
Except as set forth in this Section 2(b), and except as contemplated by the
Investor Rights Agreement, as of the date hereof, the Company is not party to or
otherwise bound by or subject to any outstanding option, warrant, call,
subscription, or other right (including any preemptive right), agreement, or
commitment that (w) obligates the Company to issue, deliver, sell, or transfer,
or repurchase, redeem, or otherwise acquire, or cause to be issued, delivered,
sold, or transferred, or repurchased, redeemed, or otherwise acquired, any
shares of the capital stock of, or other equity or voting interests in, the
Company or any security convertible or exercisable for or exchangeable into any
capital stock of, or other equity or voting interest in, the Company, (x)
obligates the Company to issue, grant, extend, or enter into any such option,
warrant, call, right, security, commitment, contract, arrangement, or
undertaking, (y) restricts the transfer of any shares of capital stock of the
Company (other than pursuant to restricted stock award agreements under the
Company’s stock option or stock-based compensation plans), or (z) relates to the
voting of any shares of capital stock of the Company (other than the Investor
Rights Agreement).

 

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(c) Execution and Delivery; Enforceability. This Agreement is duly and validly
executed and delivered by the Company and constitutes a valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms, except as may be limited by the effect of bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance, or similar laws affecting the
enforcement of creditors’ rights generally, and subject to principles of equity
and public policy.

 

(d) Issuance. The Shares, when issued and delivered on the terms and conditions
set forth in this Agreement, will be duly authorized, validly issued and
delivered, and fully paid and nonassessable, and will not be issued in violation
of any preemptive or similar rights.

 

(e) No Conflict. Assuming the Company is not required to increase the amount of
Common Stock it is authorized to issue under its Restated Certificate of
Incorporation in order to sell, issue and deliver the Shares under this
Agreement (the “Capitalization Exception”), the sale, issuance, and delivery of
the Shares on the terms and conditions set forth in this Agreement, and the
performance of and compliance with all of the provisions herein by the Company
and the consummation of the transactions contemplated herein, (i) will not
conflict with, or result in a breach or violation of, any of the terms or
provisions of, or constitute a default under (with or without notice or lapse of
time, or both), or result, in the acceleration of, or the creation of any lien
under, any indenture, mortgage, deed of trust, loan agreement, or other
agreement or instrument to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries is
subject, (ii) will not result in any violation of the provisions of the
Company’s Restated Certificate of Incorporation, as amended, or Amended and
Restated Bylaws or any of the organizational or governance documents of the
Company’s subsidiaries, and (iii) will not result in any violation of, or any
termination or impairment of any rights under, any law, statute, rule or
regulation or any license, authorization, injunction, judgment, order, decree,
rule, or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties, except in any such case described in subclauses (i) and (iii) for
any conflict, breach, violation, default, acceleration, lien, termination, or
impairment which would not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the Company and its subsidiaries,
taken as a whole, or impair or materially delay the ability of the Company to
perform its obligations hereunder.

 

(f) Consents and Approvals. Subject to the Capitalization Exception and assuming
the accuracy of the representations and warranties of B. Riley Financial
contained in Section 3 and the agreements set forth in Section 4(c), no consent,
approval, authorization, order, registration, or qualification of or with any
third party or any court or governmental agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their properties is required
for the sale, issuance, and delivery of the Shares on the terms and conditions
set forth in this Agreement, and the performance of and compliance with all of
the provisions herein by the Company and the consummation of the transactions
contemplated herein, except such consents, approvals, authorizations,
registrations, or qualifications (i) as may be required under state securities
or blue sky laws in connection with the purchase, acceptance, sale, issuance and
delivery of the Shares or (ii) pursuant to the rules of the Principal Stock
Exchange.

 

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(g) No Reliance. The Company acknowledges that it is not, with respect to its
entry into this Agreement (but not the Amended and Restated Credit Agreement) on
the date hereof, relying upon any representation or warranty made by B. Riley
Financial not expressly set forth in this Agreement.

 

Section 3. Representations and Warranties of B. Riley Financial. B. Riley
Financial represents and warrants to the Company as set forth below:

 

(a) Organization, Power and Authority. B. Riley Financial is duly organized and
is validly existing and in good standing under the laws of the State of
Delaware. B. Riley Financial has the requisite power and authority to enter
into, execute, and deliver this Agreement and to perform its obligations
hereunder and has taken all necessary action required for the due authorization
of this Agreement.

 

(b) Execution and Delivery; Enforceability. This Agreement is duly and validly
executed and delivered by B. Riley Financial and constitutes, or, when executed
and delivered, will constitute, a valid and binding obligation of B. Riley
Financial, enforceable against B. Riley Financial in accordance with its terms,
except as may be limited by the effect of bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance, or similar laws affecting the
enforcement of creditors’ rights generally, and subject to principles of equity
and public policy.

 

(c) No Registration. B. Riley Financial understands that the Shares issued to it
have not been registered under the Securities Act of 1933, as amended (the
“Securities Act”), by reason of a specific exemption from the registration
provisions of the Securities Act, the availability of which depends upon, among
other things, the bona fide nature of the investment intent and the accuracy of
B. Riley Financial’s representations and warranties as expressed herein or
otherwise made pursuant hereto.

 

(d) Investment Intent. B. Riley Financial is acquiring the Shares for investment
for its own account, not as a nominee or agent, and not with the view to, or for
resale in connection with, any distribution thereof not in compliance with all
applicable securities laws, including the Securities Act. B. Riley Financial has
no present intention of selling, granting any participation in, or otherwise
distributing the same, except in compliance with all applicable securities laws,
including the Securities Act.

 

(e) Securities Laws Compliance. The Shares will not be offered for sale, sold,
or otherwise transferred by B. Riley Financial except pursuant to a registration
statement or in a transaction exempt from, or not subject to, registration under
the Securities Act and any other applicable securities laws.

 

(f) Sophistication. B. Riley Financial has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and
risks of its investment in the Shares being acquired hereunder. B. Riley
Financial understands and is able to bear any economic risks associated with
such investment (including the delayed delivery of the Shares from the date
hereof until the applicable Settlement Date and the necessity of holding the
Shares for an indefinite period of time). B. Riley Financial acknowledges that
it has been afforded the opportunity to ask questions and receive answers
concerning the Company and to obtain additional information that it has
requested to verify the information contained herein and evaluate its investment
in the Shares.

 

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(g) Accredited Investor. B. Riley Financial is an “Accredited Investor” as
defined in Rule 501(a) of Regulation D under the Securities Act.

 

(h) Legended Securities. B. Riley Financial understands and acknowledges that,
upon the original issuance thereof and until such time as the same is no longer
required under any applicable requirements of the Securities Act or other
applicable securities laws, the Company and its transfer agent shall make such
notation in the stock book and transfer records of the Company as may be
necessary to record that the Shares have not been registered under the
Securities Act and that the Shares may not be resold without registration under
the Securities Act and all other applicable securities laws or pursuant to an
exemption from the registration requirements thereof.

 

(i) No Conflict. The purchase and acceptance of the Shares acquired by B. Riley
Financial on the terms and conditions set forth in this Agreement, and the
performance of and compliance with all of the provisions herein by B. Riley
Financial and the consummation of the transactions contemplated herein, (i) will
not conflict with, or result in a breach or violation of, any of the terms or
provisions of, or constitute a default under (with or without notice or lapse of
time, or both), or result, in the acceleration of, or the creation of any lien
under, any indenture, mortgage, deed of trust, loan agreement, or other
agreement or instrument to which B. Riley Financial is a party or by which B.
Riley Financial is bound or to which any of the property or assets of B. Riley
Financial or any of its subsidiaries is subject, (ii) will not result in any
violation of the provisions of its certificate of incorporation, bylaws, or
similar governance documents, and (iii) will not result in any material
violation of, or any termination or material impairment of any rights under, any
law, statute, rule or regulation or any license, authorization, injunction,
judgment, order, decree, rule, or regulation of any court or governmental agency
or body having jurisdiction over B. Riley Financial or any of its properties,
except in any such case described in subclauses (i) and (iii) for any conflict,
breach, violation, default, acceleration, or lien which would not, individually
or in the aggregate, reasonably be expected to prohibit, materially delay, or
materially and adversely affect B. Riley Financial’s performance of its
obligations under this Agreement.

 

(j) Consents and Approvals. No consent, approval, authorization, order,
registration, or qualification of or with any court or governmental agency or
body having jurisdiction over B. Riley Financial or any of its properties is
required to be obtained or made by B. Riley Financial for the purchase and
acceptance of the Shares on the terms and conditions set forth in this
Agreement, and the performance of and compliance with all of the provisions
herein by B. Riley Financial and the consummation of the transactions
contemplated herein, except for any consent, approval, authorization, order,
registration, or qualification which, if not made or obtained, would not,
individually or in the aggregate, reasonably be expected to prohibit, materially
delay, or materially and adversely affect B. Riley Financial’s performance of
its obligations under this Agreement.

 

(k) No Reliance. B. Riley Financial acknowledges that, with respect to its entry
into this Agreement (but not the Amended and Restated Credit Agreement) on the
date hereof, it is not relying upon any representation or warranty made by the
Company not expressly set forth in this Agreement.

 

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Section 4. Additional Covenants and Agreements of the Parties.

 

(a) Listing; Registrable Securities. The Company shall use its commercially
reasonable efforts to list the Shares on the Principal Stock Exchange where the
Common Stock is then listed or admitted for trading. For the avoidance of doubt,
any Shares issued pursuant to this Agreement shall be “Investor Registrable
Securities” under the Registration Rights Agreement, dated as of April 30, 2019,
by and among the Company, B. Riley FBR and Vintage Capital Management, LLC.

 

(b) Cooperation. Each of the Parties shall use its reasonable best efforts (and
shall cause its subsidiaries to use their respective reasonable best efforts) to
reasonably cooperate with all other Parties and to take or cause to be taken all
actions, and do or cause to be done all things, reasonably necessary, proper, or
advisable on its or their part under this Agreement and applicable laws to
consummate and make effective the transactions contemplated by this Agreement,
including making and seeking all material governmental and third-party
notifications, filings, consents, waivers and approvals required for the
transactions contemplated hereby.

 

(c) Access to Non-Public Information. B. Riley Financial (i) understands and
acknowledges that the Company is in possession of information about the Company
and its operations (which may include material non-public information) that may
or may not be material or superior to information available to B. Riley
Financial and the public generally, (ii) waives any claim, or potential claim,
it has or may have against the Company relating to the Company’s possession of
material non-public information in connection with B. Riley Financial’s
agreement to purchase and accept Shares pursuant to this Agreement, (iii) has
independently participated in the negotiation of this Agreement and has been
represented by separate counsel and (iv) understands and acknowledges that the
Company would not enter into this Agreement in the absence of the
representations, warranties, covenants and agreements set forth in this Section
4(c).

 

(d) Reserves. The Company shall keep reserved out of its authorized but unissued
shares of Common Stock a sufficient number of shares of Common Stock to satisfy
the issuance of the full amount of Shares pursuant to Section 1(a).

 

(e) No Transfer of Term Loans. Until the earlier to occur of the final
Settlement Date or the termination of this Agreement pursuant to Section 6, B.
Riley Financial will not, without the Company’s prior written consent, transfer
any interest in (i) any Term Loans or (ii) any interest, fees or other payments
owing to it under this Agreement, the Amended and Restated Credit Agreement or
the B. Riley Fee Letter, including the right to receive any part or portion of
the Fee Payment and Interest Payments. Notwithstanding the foregoing, B. Riley
Financial may at any time and without the consent of the Company transfer its
interest in any Term Loans or any interest, fees or other payments owing to it
under this Agreement, the Amended and Restated Credit Agreement or the B. Riley
Fee Letter, to any wholly owned subsidiary of B. Riley Financial; provided that
(i) B. Riley Financial shall remain liable for any of its obligations hereunder
and under the Amended and Restated Credit Agreement and the B. Riley Fee Letter
following any such transfer and (ii) B. Riley Financial and its controlled
affiliates shall be prohibited from transferring any of its ownership interest
in such transferee to a third party without the Company’s prior written consent.
Any purported transfer in violation of this Section 4(e) shall be null and void
ab initio.

 

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Section 5.Conditions to the Obligations of the Parties.

 

(a) Conditions to the Company Obligation to Deliver Shares. The obligations of
the Company to sell, issue and deliver the Shares on each Settlement Date shall
be subject to the satisfaction of each of the following conditions (which may be
waived in whole or in part by the Company in its sole discretion):

 

(i) No statute, rule, regulation, or order shall have been enacted, adopted, or
issued by any federal, state, or foreign governmental or regulatory authority of
competent jurisdiction, and no judgment, injunction, decree, or order of any
federal, state, or foreign court of competent jurisdiction shall have been
issued that, in each case, prohibits the sale, issue, delivery, purchase and
acceptance of the Shares as contemplated by this Agreement.

 

(ii) The Shares shall have been approved for listing on the Principal Stock
Exchange, subject to official notice of issuance; provided, however, that this
condition shall not apply in the event the Common Stock is no longer listed and
traded on any national securities exchange as of the applicable Settlement Date.

 

(b) Conditions to the Obligations of B. Riley Financial to Accept Shares. The
obligations of B. Riley Financial to purchase and accept Shares on each
Settlement Date shall be subject to the satisfaction of each of the following
conditions (which may be waived in whole or in part by B. Riley Financial in its
sole discretion):

 

(i) No statute, rule, regulation, or order shall have been enacted, adopted, or
issued by any federal, state, or foreign governmental or regulatory authority of
competent jurisdiction, and no judgment, injunction, decree, or order of any
federal, state, or foreign court of competent jurisdiction shall have been
issued that, in each case, prohibits the sale, issue, delivery, purchase and
acceptance of the Shares as contemplated by this Agreement.

 

(ii) The Shares shall have been approved for listing on the Principal Stock
Exchange, subject to official notice of issuance; provided, however, that this
condition shall not apply in the event the Common Stock is no longer listed and
traded on any national securities exchange as of the applicable Settlement Date.

 

Section 6. Termination. This Agreement may be terminated, and the transactions
contemplated hereby may be abandoned, at any time prior to the applicable
Settlement Date by (a) mutual written agreement of the Company and B. Riley
Financial, (b) by the Company following a material breach of the Amended and
Restated Credit Agreement or this Agreement by B. Riley Financial (after notice
thereof and a reasonable opportunity to cure), or (c) by B. Riley Financial
following a material breach of this Agreement by the Company (after notice
thereof and a reasonable opportunity to cure). Upon termination under this
Section 6, all rights and obligations of the Parties shall terminate without any
liability of any Party to any other Party except that (i) nothing contained
herein shall release any Party hereto from liability for any willful breach of
this Agreement and (ii) the covenants and agreements made by the Parties herein
in Section 4(c) and Sections 6 through 14 will survive indefinitely in
accordance with their terms.

 

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Section 7. Notices. All notices and other communications in connection with this
Agreement will be in writing and will be deemed given (and will be deemed to
have been duly given upon receipt) if delivered personally, sent via electronic
transmission, mailed by registered or certified mail (return receipt requested),
or delivered by an express courier (with confirmation) to the parties at the
following addresses (or at such other address for a party as will be specified
by like notice):

 

If to the Company:

Babcock & Wilcox Enterprises, Inc.

1200 East Market Street, Suite 650

Akron, OH 44305

Attention: General Counsel

 

with a copy (which shall not constitute notice) to:

Wachtell, Lipton, Rosen & Katz

51 West 52nd Street

New York, NY 10019

Attention: David A. Katz

Email: dakatz@wlrk.com

 

King & Spalding LLP

1180 Peachtree Street, NE

Atlanta, GA 30309

Attention: William Calvin Smith, III

Zachary L. Cochran

Email:    calsmith@kslaw.com

zcochran@kslaw.com

 

If to B. Riley Financial:

B. Riley Financial, Inc.

299 Park Avenue, 21st Floor

New York, NY 10171

Attention: Alan N. Forman, General Counsel

Email: aforman@brileyfin.com

 

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Section 8. Assignment; Third Party Beneficiaries. Neither this Agreement nor any
of the rights, interests, or obligations under this Agreement (including the
right to receive any Shares on any Settlement Date) may be assigned by any Party
(whether by operation of law or otherwise) without the prior written consent of
(a) the Company, in the case of an assignment by B. Riley Financial and (b) B.
Riley Financial, in the case of an assignment by the Company. Notwithstanding
the foregoing, B. Riley Financial may at any time and without the consent of the
Company assign this Agreement or its rights, interests or obligations hereunder
to any wholly owned subsidiary of B. Riley Financial; provided that (i) B. Riley
Financial shall remain liable for any of its obligations hereunder following any
such assignment, (ii) any such assignee shall, as of the effective date of such
assignment, be required to make and be capable of making the representations set
forth in Section 3 with respect to such assignee, (iii) such assignee shall be
bound by and subject to the obligations of B. Riley Financial under this
Agreement (including for the avoidance of doubt the transfer restrictions set
forth in Section 4(e)) as if such assignee were a party hereto, and (iv) B.
Riley Financial and its controlled affiliates shall be prohibited from
transferring any of its ownership interest in such assignee to a third party
without the Company’s prior written consent. Any purported assignment in
violation of this Section 8 shall be null and void ab initio.

 

Section 9. Prior Negotiations; Entire Agreement; Expenses. This Agreement, the
Amended and Restated Credit Agreement and the B. Riley Fee Letter together
constitute the entire agreement of the Parties with respect to the subject
matter hereof and supersede all prior agreements, arrangements, or
understandings, whether written or oral, between the Parties with respect to the
transactions contemplated hereby. Each Party shall bear all costs incurred by
such Party in connection with the negotiation and execution of this Agreement
and the consummation of the transactions contemplated hereby.

 

Section 10. Governing Law; Venue. This Agreement is governed in all respects,
including as to validity, interpretation and effect, by the laws of the State of
New York, without giving effect to its principles or rules of conflict of laws,
to the extent such principles are not mandatorily applicable by statute and
would permit or require the application of the laws of another jurisdiction. The
Parties hereby irrevocably submit to the exclusive jurisdiction of the Courts of
the State of New York sitting in New York County and the United States District
Court of the Southern District of New York, and any appellate court from any
thereof solely in respect of the interpretation and enforcement of the
provisions of this Agreement, and irrevocably agree that all claims in respect
of the interpretation and enforcement of the provisions of this Agreement, or
with respect to any action or proceeding hereunder, shall be heard and
determined in any of the courts of the State of New York sitting in New York
County and the United States District Court of the Southern District of New
York, and that such jurisdiction of such courts with respect thereto shall be
exclusive, except solely to the extent that all such courts shall lawfully
decline to exercise such jurisdiction. Each Party hereby waives and agrees not
to assert, as a defense in any action, suit or proceeding for the interpretation
or enforcement hereof, that it is not subject to such jurisdiction. Each Party
hereby waives and agrees not to assert, to the maximum extent permitted by law,
as a defense in any action, suit or proceeding for the interpretation or
enforcement hereof, that such action, suit or proceeding may not be brought or
is not maintainable in such courts, that the venue thereof may not be
appropriate or that this Agreement may not be enforced in or by such courts. The
Parties hereby consent to and grant any such court jurisdiction over the person
of such parties and over the subject matter of any such dispute. THE PARTIES
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY ACTION, SUIT,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE)
BROUGHT BY EITHER OF THEM AGAINST THE OTHER IN ANY MATTERS ARISING OUT OF OR IN
ANY WAY CONNECTED WITH OR CONTEMPLATED BY THIS AGREEMENT.

 

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Section 11. Counterparts. This Agreement may be executed in any number of
counterparts, all of which will be considered one and the same agreement and
will become effective when counterparts have been signed by each of the parties
and delivered to the other Parties (including via facsimile or other electronic
transmission), it being understood that each Party need not sign the same
counterpart.

 

Section 12. Waivers and Amendments.

 

(a) Waivers and Amendments Generally. This Agreement may be amended, modified,
superseded, cancelled, renewed, or extended, and the terms and conditions of
this Agreement may be waived, only by a written instrument signed by all the
Parties (and, in the case of a modification to or waiver of Section 13, by B.
Riley FBR) or, in the case of a waiver, by the Party waiving compliance. No
delay on the part of any Party in exercising any right, power, or privilege
pursuant to this Agreement will operate as a waiver thereof, nor will any waiver
on the part of any Party of any right, power, or privilege pursuant to this
Agreement, nor will any single or partial exercise of any right, power, or
privilege pursuant to this Agreement, preclude any other or further exercise
thereof or the exercise of any other right, power, or privilege pursuant to this
Agreement. The rights and remedies provided pursuant to this Agreement are
cumulative and are not exclusive of any rights or remedies which any Party
otherwise may have at law or in equity.

 

(b) Waivers, Amendments and Consents by the Company. Until the later of (i) the
date when the services of the Company’s Chief Executive Officer are no longer
provided by an affiliate of B. Riley Financial and (ii) B. Riley FBR no longer
holds the right to nominate any directors to serve on the Company’s board of
directors pursuant to the Investor Rights Agreement or any other agreement with
the Company, any amendment, wavier or consent given on behalf of the Company in
connection with this Agreement shall not be effective unless approved by a
majority of the members of the Company’s board of directors on the date of such
action that are independent of B. Riley Financial under applicable law.

 

Section 13. Waiver of Certain Preemptive Rights. B. Riley FBR hereby (i)
consents to the offer, sale, issue and delivery of the Shares pursuant to this
Agreement and waives any and all notice requirements with respect to hereto
pursuant to Section 3 of the Investor Rights Agreement and (ii) waives its right
to purchase or otherwise acquire shares of Common Stock in accordance with
Section 3 of the Investor Rights Agreement in connection with the transactions
contemplated hereby.

 

Section 14. Definitions; Interpretation. All capitalized terms used in this
Agreement without definition have the respective meanings ascribed to them in
the Amended and Restated Credit Agreement. When a reference is made in this
Agreement to “Sections” such reference shall be to a Section of this Agreement
unless otherwise indicated. The terms defined in the singular have a comparable
meaning when used in the plural, and vice versa. The headings contained in this
Agreement are for reference purposes only and are not part of this Agreement.
Whenever the words “include,” “includes” or “including” are used in this
Agreement, they shall be deemed followed by the words “without limitation.” No
rule of construction against the draftsperson shall be applied in connection
with the interpretation or enforcement of this Agreement, as this Agreement is
the product of negotiation between sophisticated parties advised by counsel. All
references to “$” or “dollars” mean the lawful currency of the United States of
America. Except as expressly stated in this Agreement, all references to any
statute, rule or regulation are to the statute, rule or regulation as amended,
modified, supplemented or replaced from time to time (and, in the case of
statutes, include any rules and regulations promulgated under the statute) and
to any section of any statute, rule or regulation include any successor to the
section. Whenever the words “hereof”, “hereby”, “herein” and “hereunder” and
words of like import are used in this Agreement, they shall refer to this
Agreement as a whole and not to any particular provision of this Agreement.
“Business Day” means any day except a Saturday, a Sunday or any other day on
which commercial banks are required or authorized by law to close in New York,
New York.

 

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed
and delivered all as of the date first written above.

 

Babcock & Wilcox Enterprises, Inc.           By: /s/ Dwayne M. Petish   Name:
Dwayne M. Petish   Title: Treasurer

 

B. Riley Financial, Inc.           By: /s/ Bryant R. Riley   Name: Bryant R.
Riley     Title: Co-CEO  

 

B. Riley FBR, Inc.,   solely for purposes of Section 13 hereof           By: /s/
Michael McCoy   Name: Michael McCoy     Title: CFO  

 

[Signature Page – Fee and Interest Equitization Agreement]

 

 

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