UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
WASHINGTON GROUP INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
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Delaware
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1-12054
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33-0565601 |
(State or other jurisdiction of
incorporation)
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(Commission File Number)
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(I.R.S. Employer
Identification Number) |
208 / 386-5000
(Registrant’s telephone number, including area code)
Not Applicable
(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:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c)) |
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On
November 4, 2007, URS Corporation, a Delaware corporation (
“URS”), Washington Group
International, Inc., a Delaware corporation (
“WGI”), Elk Merger Corporation, a Delaware corporation
and wholly owned subsidiary of URS (
“Merger Sub”), and Bear Merger Sub, Inc., a Delaware
corporation and wholly owned subsidiary of URS (
“Second Merger Sub”) agreed to amend the terms of
the Agreement and
Plan of Merger dated
May 27, 2007 (the
“Merger Agreement”) and entered into
Amendment No. 1 to the Agreement and
Plan of Merger (the
“Amendment”).
The Amendment provides that each WGI stockholder would have the right to elect to receive, for
each share of common stock of WGI, par value $0.01 per share (“WGI Common Stock”), other than those
shares held by URS, any subsidiary of URS, Merger Sub or Second Merger Sub and other than treasury
shares and shares as to which a WGI stockholder has validly demanded and perfected appraisal rights
under Delaware law, (a) 0.90 of a share of common stock of URS, par value $0.01 per share (“URS
Common Stock”) and $43.80 in cash, without interest, (b) an amount in cash, without interest, equal
to the sum of (i) $43.80 and (ii) 0.90 multiplied by the volume
weighted trading average prices of URS
Common Stock during the five trading days ending on the trading day that is one day prior to the
date of the WGI special meeting at which the required WGI stockholder
approval is received, or (c) a number of shares equal to the sum of (i)
0.90 and (ii) $43.80 divided by the volume weighted trading average prices of URS Common Stock during the
five trading days ending on the trading day that is one day prior to
the date of the WGI special meeting at which the required WGI shareholder approval is
received, in connection with the proposed transactions (the “Merger”). The all-cash
and all-stock elections, however, are subject to proration in order to preserve an overall per
share mix of 0.90 of a share of URS Common Stock and $43.80 in cash (the “Merger Consideration”)
for all of the outstanding shares of WGI Common Stock taken together.
Immediately following the completion of the Merger, each outstanding option to acquire shares
of WGI Common Stock, whether or not vested, that remains outstanding as of the effective time of
the Merger will be cancelled and converted into the right to receive the “option consideration,”
which equals the product of (1) the number of shares of WGI Common Stock subject to such option and
(2) the excess, if any, of $97.89 over the exercise price per share of WGI Common Stock subject to
the option. Under the Amendment, each WGI optionholder, other than Dennis Washington, will have the
right to elect to receive the option consideration, for each cancelled WGI option owned, in (a) a
combination of (i) an amount in cash, without interest, equal to the option consideration
multiplied by 0.4474 and (ii) a number of shares of URS Common Stock equal to the option
consideration less the cash payable pursuant to the preceding clause (i), divided by $60.10 (a
“Mixed Option Election”); (b) an amount in cash, without interest, equal to the option
consideration; or (c) a number of shares of URS Common Stock equal to the option consideration
divided by $60.10; provided, however, that all-cash and all-stock elections are subject to
proration in order to preserve an overall option consideration value mix of 44.74% cash and 55.26%
URS Common Stock. Any cancelled option held by Mr. Washington will be exchanged only for the
combination of cash and stock, as if Mr. Washington had made a
Mixed Option Election, but Mr. Washington may exercise his options prior to
the closing of the transaction so that he can elect to receive cash, which is his intention.
Based on the closing price of URS Common Stock (as reported on the New York Stock Exchange) of
$60.10 per share on
November 2, 2007, the value of the Merger Consideration is $97.89 per share of
WGI Common Stock, for total consideration of approximately $3.2 billion. Under the Merger
Agreement, as amended, WGI stockholders are estimated to receive an aggregate of approximately 29.4
million shares of URS Common Stock and approximately $1.4 billion in cash. Upon completion of the
Merger, WGI stockholders would own approximately 35% of the combined company based on URS’ current
outstanding shares.
Option Exercise and Transaction Support Agreement
On
November 4, 2007,
Dennis Washington
entered into an Option Exercise and Transaction Support
Agreement (the
“Support Agreement”) with URS and WGI. The Support Agreement provides that Mr.
Washington will exercise his options and vote in favor of the Merger if necessary to obtain the
required WGI stockholder approval. The exercise will be made in cash such that
following the exercise Mr. Washington will have record and beneficial ownership of 3,224,100
shares of WGI Common Stock. In connection with the Support Agreement,
on
November 3, 2007, the independent directors of WGI agreed to pay Mr. Washington’s filing fee under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the
“HSR Act”), and the legal fees of his counsel in preparing
such filing without any gross-up for imputed income.
Mr. Washington has indicated that he intends to
make the necessary HSR Act filing on
November 5, 2007 in order to be able to exercise his options.
Under the Support Agreement, Mr. Washington generally agrees not to, directly or indirectly, sell,
transfer, exchange or otherwise dispose of any of his options or WGI common stock. Under certain
circumstances at the request of URS Mr. Washington must irrevocably constitute and appoint URS as
his attorney and proxy with the full power to vote his shares of WGI common stock in favor of the Merger.
The Support Agreement will terminate on the earlier to occur of (a) the termination of the Merger
Agreement in accordance with the terms thereof, (b) the date following the date of the WGI Stockholder
Meeting, including any adjournment or postponement thereof and (c) the effective time of the Merger.
Nothing in the Support Agreement may be construed to limit or affect any action or inaction by
Mr. Washington in his capacity as a director or fiduciary of WGI.
ITEM 5.02
COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.
In connection with the Support Agreement,
on
November 3, 2007, the independent directors of WGI agreed to pay Mr. Washington’s filing fee under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the
“HSR Act”), and the legal fees of his counsel in preparing
such filing without any gross-up for imputed income.
ITEM 7.01 REGULATION FD DISCLOSURE.
On
November 5, 2007,
URS and WGI issued a joint
press release announcing that URS and WGI
had each entered
into the Amendment and the Support Agreement. A copy of the
press release is furnished as
Exhibit 99.1 to this Form 8-K
pursuant to Item 7.01.
Exhibit 99.1 attached hereto shall not be deemed
“filed” for purposes of
Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated
by reference in any filing under the Securities Act of 1933, as amended.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
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2.1 |
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Amendment No. 1 to the Agreement and Plan of Merger by and
among URS Corporation, Elk Merger Corporation, a wholly owned
subsidiary of URS Corporation, Bear Merger Sub, Inc., a
wholly owned subsidiary of URS Corporation, and Washington
Group International, Inc., dated November 4, 2007. |
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10.1 |
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Option Exercise and Transaction Support Agreement by and
among URS Corporation, Washington Group International, Inc.
and Dennis Washington, dated November 4, 2007 |
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99.1 |
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Additional Information for Investors
In connection with the proposed transaction, URS and Washington Group filed a definitive joint
proxy statement/prospectus with the Securities and Exchange Commission (the
“SEC”) on
October 1,
2007, and will file supplemental materials with the SEC. Investors and security holders are urged
to read the definitive joint proxy/prospectus and the supplemental materials because they contain
important information about the proposed transaction. Investors and security holders may obtain
free copies of this document and other documents filed with the SEC at the SEC’s
web site at
www.sec.gov. In addition, investors and security holders may obtain free copies of the documents
filed with the SEC by URS by contacting URS Investor Relations at
877-877-8970. Investors and
security holders may obtain free copies of the documents filed with the SEC by Washington Group by
contacting Washington Group Investor Relations at
866-964-4636. In addition, you may also find
information about the merger transaction at
www.urs-wng.com.
URS, Washington Group and their directors and executive officers may be deemed participants in
the solicitation of proxies from the stockholders of URS and Washington Group in connection with
the proposed transaction. Information regarding the special interests of these directors and
executive officers in the proposed transaction is included in the definitive joint proxy
statement/prospectus of URS and Washington Group described above. Additional information regarding
the directors and executive officers of URS is also included in URS’ proxy statement for its 2007
Annual Meeting of Stockholders, which
was filed with the SEC on
April 18, 2007. Additional information regarding the directors and
executive officers of Washington Group is also included in Washington Group’s proxy statement for
its 2007 Annual Meeting of Stockholders, which was filed with the SEC on
April 17, 2007, as
amended. These documents are available free of charge at the SEC’s
web site at
www.sec.gov and from
Investor Relations at URS and Washington Group as described above.
Forward Looking Statements
This Form 8-K contains forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995, as amended, which are identified by the use of forward-looking
terminology such as may, will, could, should, expect, anticipate, intend, plan, estimate, or
continue or the negative thereof or other variations thereof. Each forward-looking statement,
including, without limitation, any financial guidance, speaks only as of the date on which it is
made, and Washington Group undertakes no obligation to update any forward-looking statement to
reflect events or circumstances after the date on which it is made or to reflect the occurrence of
anticipated or unanticipated events or circumstances. The forward-looking statements are
necessarily based on assumptions and estimates of management and are inherently subject to various
risks and uncertainties. Actual results may vary materially as a result of changes or developments
in social, economic, business, market, legal, and regulatory circumstances or conditions, both
domestically and globally, as well as due to actions by customers, clients, suppliers, business
partners, or government bodies. Performance is subject to numerous factors, including demand for
new power generation and for modification of existing power facilities, public sector funding,
demand for extractive resources, capital spending plans of customers, and spending levels and
priorities of the U.S., state and other governments. Results may also vary as a result of
difficulties or delays experienced in the execution of
contracts or implementation of strategic
initiatives. Results may also be impacted by costs relating to the proposed merger transaction with
URS Corporation and the timing of such merger transaction if it is approved by both companies’
stockholders. For additional risks and uncertainties impacting the forward-looking statements
contained in this Form 8-K, please see
“Note Regarding Forward-Looking Information” and
“Item 1A.
Risk Factors” in Washington Group’s annual report on Form 10-K for fiscal year 2006.