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STOCKHOLDERS' EQUITY
12 Months Ended
Dec. 31, 2019
Stockholders Equity Note [Abstract]  
STOCKHOLDERS’ EQUITY

NOTE 20— STOCKHOLDERS’ EQUITY

Shares Outstanding and Treasury SharesThe changes in the number of shares outstanding and treasury shares held by us are as follows (in millions):

 

 

 

Year ended December 31,

 

 

 

2019

 

 

2018

 

Shares outstanding

 

 

 

 

 

 

 

 

Beginning balance

 

 

181

 

 

 

95

 

Common stock issued (1)

 

 

13

 

 

 

2

 

Shares issued in the Combination (Note 3, Business Combination) (2)

 

 

-

 

 

 

85

 

Purchase of common stock

 

 

(1

)

 

 

(1

)

Ending balance

 

 

193

 

 

 

181

 

 

 

 

 

 

 

 

 

 

Shares held as Treasury shares

 

 

 

 

 

 

 

 

Beginning balance

 

 

3

 

 

 

3

 

Purchase of common stock

 

 

1

 

 

 

1

 

Retirement of common stock

 

 

(1

)

 

 

(1

)

Ending balance

 

 

3

 

 

 

3

 

 

 

 

 

 

 

 

 

 

Ordinary shares issued at the end of the period

 

 

196

 

 

 

183

 

 

(1) In December 2019, in connection with the Superpriority Credit Agreement, discussed in Note 13, Debt, we issued approximately 11 million shares of McDermott common stock, 0.09 million of Series B Warrants (that will entitle each holder to purchase one share of common stock of McDermott, par value $1.00 per share, at a purchase price of $0.01 per share) (the “Series B Warrants” and, together with the Series A Warrants, the “Warrants”) and 0.56 million shares of Series A Preferred Stock with par value of 0.001 per share, to certain Superpriority Credit Agreement lenders.

(2) As discussed in Note 3, Business Combination, in May 2018, we issued 84.5 million shares of McDermott common stock to the former CB&I shareholders. Additionally, effective as of the Combination Date, unvested and unexercised stock-settled equity-based awards (which included 2.1 million of CB&I restricted stock units and stock options to purchase 0.1 million shares of CB&I’s common stock) were canceled and converted into comparable McDermott stock-settled awards with generally the same terms and conditions as those prior to the Combination Date. The restricted stock units generally vest over a period ranging from three to four years from the original grant date. 

Effects of the Chapter 11 Cases on the Common Stock — The provisions of the RSA and the Plan of Reorganization contemplate that our existing equity interests will be cancelled and discharged in connection with the Chapter 11 Cases and the holders of those equity interests, including the holders of our outstanding shares of common stock, will be entitled to no recovery relating to those equity interests.

Accumulated Other Comprehensive (Loss) Income―The components of AOCI included in stockholders’ equity are as follows:

 

 

 

December 31,

 

 

 

2019

 

 

2018

 

 

 

(In millions)

 

Foreign currency translation adjustments ("CTA")

 

$

(97

)

 

$

(73

)

Net unrealized loss on derivative financial instruments

 

 

(12

)

 

 

(40

)

Defined benefit pension and other postretirement plans

 

 

6

 

 

 

6

 

Accumulated other comprehensive loss

 

$

(103

)

 

$

(107

)

 

The following table presents the components of AOCI and the amounts that were reclassified during the periods indicated:

 

 

 

Foreign

Currency

Translation

adjustments

 

 

Net unrealized

loss on

derivative

financial

instruments (1)

 

 

Defined

benefit

pension and

other

postretirement

plans

 

 

TOTAL

 

 

 

(In millions)

 

January 1, 2018

 

$

(49

)

 

$

(2

)

 

$

-

 

 

$

(51

)

Other comprehensive (loss) income before reclassification

 

 

(24

)

 

 

(46

)

 

 

6

 

 

 

(64

)

Amounts reclassified from AOCI (2)

 

 

-

 

 

 

8

 

 

 

-

 

 

 

8

 

Net current period other comprehensive income

 

 

(24

)

 

 

(38

)

 

 

6

 

 

 

(56

)

December 31, 2018

 

$

(73

)

 

$

(40

)

 

$

6

 

 

$

(107

)

Other comprehensive (loss) income before reclassification

 

 

(24

)

 

 

(57

)

 

 

-

 

 

 

(81

)

Amounts reclassified from AOCI (2)

 

 

-

 

 

 

85

 

 

 

-

 

 

 

85

 

Net current period other comprehensive (loss) income

 

 

(24

)

 

 

28

 

 

 

-

 

 

 

4

 

December 31, 2019

 

$

(97

)

 

$

(12

)

 

$

6

 

 

$

(103

)

 

(1)

Refer to Note 17, Derivative Financial Instruments, for additional details.

(2)

Amounts are net of tax, which was not material in 2019 and 2018.

Noncontrolling Interest―In 2002, P.T. Sarana Interfab Mandiri (“PTSIM”) acquired a 25% participating interest in our subsidiary, PT McDermott Indonesia (“PTMI”). After two years, PTSIM had the option to sell its interest to us for $5 million plus PTSIM’s share of PTMI’s undistributed earnings to the date of such sale. In January 2019, McDermott and PTSIM entered into framework agreement, restructuring the PTMI shareholders agreement, whereby PTSIM waived its put option right and exchanged its participating interest in PTMI for a non-participating interest, in exchange for a payment of approximately $29 million. In 2019, we paid the first two installments, totaling approximately $15 million, and had a remaining liability of approximately $14 million as of December 31, 2019, scheduled to be payable in early 2020.