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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): November 20, 1996
INTERNATIONAL TECHNOLOGY CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Delaware 1-09037 33-0001212
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
23456 Hawthorne Boulevard
Torrance, California 90505
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (310) 378-9933
None
(Former Name or Former Address, if Changed Since Last Report)
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Item 1. Changes in Control of Registrant.
On November 20, 1996, International Technology Corporation (the
"Company") issued 45,000 shares of Cumulative Convertible Participating
Preferred Stock, par value $100 per share (the "Convertible Preferred
Stock"), and sold warrants (the "Warrants") to purchase 1,250,000 shares
of common stock, par value $.01 per share (the "Common Stock"), for an
aggregate purchase price of $45,000,000, to certain investors affiliated
with The Carlyle Group (collectively, "Carlyle"), a Washington, D.C. based
private merchant bank (the "Investment"). The Convertible Preferred Stock
is convertible into Common Stock at an initial conversion price of $8 per
share. The Warrants have an exercise price of $12 per share.
Assuming the conversion of all of the Convertible Preferred Stock into
Common Stock and exercise of all of the Warrants, Carlyle would own
approximately 43% of the voting power of the Company.
The terms of the Convertible Preferred Stock provide that, for five
years from the consummation of the Investment, the holders of the
Convertible Preferred Stock have the right to elect a majority of the Board
of Directors of the Company, provided that Carlyle continues to own at
least 20% of the voting power of the Company.
As a result of the Investment, the Company accepted the resignations
of Kirby L. Cramer, W. Scott Martin, Ralph S. Cunningham, Donald S. Burns,
Henry E. Riggs and Jack O. Vance from the Board of Directors. The holders
of the Convertible Preferred Stock elected Daniel A. D'Aniello, Philip B.
Dolan, Admiral James David Watkins and Robert F. Pugliese as Carlyle
designees to serve on the Board of Directors until the next annual meeting
of stockholders or until their successors are duly elected and qualified.
Mr. D'Aniello is the Managing Director of The Carlyle Group; Mr. Dolan is
the Vice President of The Carlyle Group; Admiral Watkins is the president
of the Joint Oceanographic Institutions, Inc. and the president of
Consortium Oceanographic Research and Education and formerly was the
United States Secretary of Energy; and Mr. Pugliese is special
counsel to Eckert Seamans Cherin & Mellott.
In connection with the Investment, the Company entered into a
registration rights agreement with Carlyle whereby Carlyle or its
transferee will be entitled to certain additional rights with respect to
the registration under the Securities Act of 1933, as amended, of shares
of Common Stock issuable upon conversion of the Convertible Preferred
Stock or the exercise of the Warrants.
Upon consummation of the Investment, the Company and the Carlyle
purchasers entered into Amendment No. 1, dated November 20, 1996,
to the Securities Purchase Agreement dated August 28, 1996. The amendment
is attached hereto as Exhibit 10.1(a). Immediately following the consummation
of the Investment, one of the Carlyle purchasers transferred (i) 4,692 of its
5,915 shares of Convertible Preferred Stock and (ii) 521,350 of its 657,246
Warrant shares to The State Board of Administration of the State of Florida.
The net proceeds to the Company from the Investment are estimated to
be approximately $41,000,000. Such proceeds will be used for acquisitions,
working capital and other corporate purposes.
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The Investment triggered the right of holders of the Company's
outstanding 7% Cumulative Convertible Exchangeable Preferred Stock, par
value $100 per share (the "7% Preferred Stock") to convert into a greater
number of shares of Common Stock than that to which they are otherwise
entitled. On November 25, 1996 the Company issued a notice to all holders
of Depositary Shares, each of which represents 1/100 of a share of 7%
Preferred Stock, notifying such holders of the special conversion right.
The notice is attached hereto as Exhibit 20.1 and incorporated herein by
reference.
Item 5. Other Events.
In connection with the Investment, the Company amended its Certificate
of Incorporation on November 20, 1996 to effect a reverse stock split (the
"Reverse Stock Split"), pursuant to which each four shares of Common Stock
will be exchanged for one share of Common Stock. The Reverse Stock Split
became effective with respect to trading on the New York Stock Exchange on
Thursday, November 21, 1996.
On November 20, 1996, the Company issued the press release attached
hereto as Exhibit 99.1 which is incorporated herein by reference.
At the Annual Meeting of Stockholders, held November 20, 1996, the
holders of the Company's common stock approved Proposal 3, as described
in the Company's Proxy Statement dated October 30, 1996, the proposed
1996 Stock Incentive Plan, but did not approve Proposal 4 in the said
proxy statement, which proposed an amendment to the Company's certificate
of incorporation to eliminate provisions for a classified board of
directors and cumulative voting.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
The following exhibits are filed with this report on Form 8-K:
Exhibit No. Description
---------- -----------
10.1(a) Amendment No. 1, dated November 20, 1996, to
Securities Purchase Agreement dated August 28,
1996, by and among the Company and certain
Purchasers identified therein.
20.1 Notice to All Holders of Depositary Shares each
representing 1/100 of a share of 7% Cumulative
Convertible Exchangeable Preferred Stock dated
November 25, 1996.
99.1 Press Release of International Technology
Corporation dated November 20, 1996.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
INTERNATIONAL TECHNOLOGY CORPORATION
Date: November 20, 1996 By:___/s/____________________________
Anthony J. DeLuca
President and Acting Chief Executive
Officer
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Exhibit 10.1(a)
==============
AMENDMENT NO. 1
TO
SECURITIES PURCHASE AGREEMENT
This Amendment No. 1 to the Securities Purchase Agreement dated as of
August 28, 1996 is by and among (i) International Technology Corporation,
a Delaware corporation (the "Company") and (ii) Carlyle Partners II, L.P.,
a Delaware limited partnership (CPII"), Carlyle Partners III, L.P.
("CPIII"), a Delaware limited partnership, Carlyle International Partners
II, L.P. ("CIPII"), a Cayman Islands limited partnership, Carlyle
International Partners III, L.P. ("CIPIII"), a Cayman Islands limited
partnership, and C/S International Partners ("C/SIP"), a Cayman Islands
partnership (collectively "the Purchasers") dated November 20, 1996.
RECITALS
WHEREAS, pursuant to Section 10.8 of the Securities Purchase
Agreement, each Purchaser may assign, in whole or in part, the right to
acquire the Securities under the Securities Purchase Agreement to an
Affiliate of such Purchaser.
WHEREAS, the parties to the Securities Purchase Agreement desire to
amend the Securities Purchase Agreement to add certain Carlyle Affiliates
(as defined in the Securities Purchase Agreement) as "Purchasers" of
Securities thereunder.
WHEREAS, the parties to the Securities Purchase Agreement desire to
amend the Securities Purchase Agreement to state that C/SIP is a Cayman
Islands general partnership not a limited partnership.
WHEREAS, the parties to the Securities Purchase Agreement desire to
amend the Securities Purchase Agreement to change the definition of Carlyle
Affiliates.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and premises
contained herein and for other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties hereto agree as
follows:
1. Additional Purchasers. The Securities Purchase Agreement shall
be amended to add as "Purchasers" thereunder Carlyle Investment Group,
L.P., a Delaware limited partnership, Carlyle-IT Partners, L.P., a Delaware
limited partnership, Carlyle-IT International Partners, L.P., a Cayman
Islands limited partnership and Carlyle-IT International Partners II, L.P.,
a Cayman Islands limited partnership.
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2. Purchase of Securities. The Company shall sell to each Purchaser
and each Purchaser shall purchase from the Company, Securities in the
amount set forth next to such Purchaser's name on Exhibit A attached
hereto.
3. Organization of C/SIP. The Preamble on page 1 of the Securities
Purchase Agreement shall be amended to add the words "except for C/SIP
which is a general partnership" after the phrase "each of which is a
limited partnership" and before the phrase "of which TC Group, L.L.C. is
the general partner..." Section 5.1 shall be replaced in its entirety with
the following:
Purchaser, other than C/SIP, is a limited partnership duly
formed and validly existing and in good standing as a limited
partnership under the laws of its jurisdiction of formation and
has full partnership power and authority to carry on its business
as currently being conducted. C/SIP is a general partnership duly
formed and validly existing and in good standing as a general
partnership under the laws of its jurisdiction of formation and
has full partnership power and authority to carry on its
business as currently being conducted.
4. Definition of Carlyle Affiliates. The definition of Carlyle
Affiliates in the Securities Purchase Agreement shall be amended to insert
after the phrase "and their respective affiliates" the following: "or any
entity for which any Carlyle Affiliate acts as investment advisor with
respect to the Securities."
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to
be duly executed, as of the date first written above.
INTERNATIONAL TECHNOLOGY CORPORATION
By: ___/s/____________________________
Name: Anthony J. DeLuca
Title: President and Chief Executive
Officer
CARLYLE PARTNERS II, L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
CARLYLE PARTNERS III, L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
CARLYLE INTERNATIONAL PARTNERS II,
L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
CARLYLE INTERNATIONAL PARTNERS III,
L.P.
By: TC Group, L.L.C., its General
Partner
By: TCG Holdings, L.L.C., its
Managing Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
C/S INTERNATIONAL PARTNERS
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its
Managing Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
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CARLYLE INVESTMENT GROUP, L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
CARLYLE-IT PARTNERS, L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
CARLYLE-IT INTERNATIONAL PARTNERS,
L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
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CARLYLE-IT INTERNATIONAL PARTNERS II,
L.P.
By: TC Group, L.L.C., its General
Partner
By: TCG Holdings, L.L.C., its
Managing Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
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EXHIBIT A
Purchaser Preferred Shares Warrant
Shares
===========================================================================
Carlyle Partners II, L.P. 11,170 1,241,166
- ---------------------------------------------------------------------------
Carlyle Partners III, L.P. 510 56,651
- ---------------------------------------------------------------------------
Carlyle International Partners II, L.P. 9,429 1,047,673
- ---------------------------------------------------------------------------
Carlyle International Partners III, 508 56,449
L.P.
- ---------------------------------------------------------------------------
C/S International Partners 2,123 235,889
- ---------------------------------------------------------------------------
Carlyle Investment Group, L.P. 12 1,302
- ---------------------------------------------------------------------------
Carlyle-IT Partners, L.P. 5,915 657,245
- ---------------------------------------------------------------------------
Carlyle-IT International Partners, 14,833 1,648,069
L.P.
- ---------------------------------------------------------------------------
Carlyle-IT International Partners II, 500 55,556
L.P.
- ---------------------------------------------------------------------------
i
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Purchase of International Technologies
<TABLE>
<CAPTION>
Warran
Purc
Purchase Contribution Preferred Common
Price Percentage Shares Stock
=========== ========== ========== ========
<S> <C> <C> <C> <C>
Carlyle Partners II, L.P. $11,170,495 24.8% 11,170 1,241,166
Carlyle Partners III, L.P. 509,863 1.1% 510 56,651
Carlyle International Partners II, L.P. 9,429,060 21.0% 9,429 1,047,673
Carlyle International Partners III, L.P. 508,039 1.1% 508 56,449
C/S International Partners 2,122,989 4.7% 2,123 235,889
Carylyle Investment Group, L.P. 11,721 0.0% 12 1,302
Carlyle-IT Partners, L.P. 5,915,198 13.1% 5,915 657,245
Carlyle-IT International Partners, L.P. 14,832,625 33.0% 14,833 1,648,069
Carlyle-IT International Partners II. L.P. 500,000 1.1% 500 55,556
----------- ----- ------ ----------
Total $45,000,000 100.0% 45,000 5,000,000
----------- ----- ------ ----------
TC Group, L.L.C. $45,000,000 45,000 5,000,000
Transfer:
========
Carlyle-IT Partners, L.P. - before $ 5,915,198 13.1% 5,915 657,246
transfer
Transfer to The State Board of $ 4,692,147 10.4% 4,692 521,350
Administration of the State of
Florida
Carlyle-IT Partners, L.P. - after $ 1,223,051 2.7% 1,223 135,895
transfer
</TABLE>
<PAGE>
SIGNATURE
_________
After reasonable inquiry and to the best of the knowledge and belief
of the undersigned, the undersigned certify that the information set forth
in this statement is true, complete and correct.
Dated: ____________, 1996
CARLYLE PARTNERS II, L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
CARLYLE PARTNERS III, L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
CARLYLE INTERNATIONAL PARTNERS II,
L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
CARLYLE INTERNATIONAL PARTNERS III,
L.P.
By: TC Group, L.L.C., its General
Partner
By: TCG Holdings, L.L.C., its
Managing Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
C/S INTERNATIONAL PARTNERS
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its
Managing Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
CARLYLE INVESTMENT GROUP, L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
CARLYLE-IT PARTNERS, L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
CARLYLE-IT INTERNATIONAL PARTNERS,
L.P.
By: TC Group, L.L.C., its General Partner
By: TCG Holdings, L.L.C., its Managing
Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
<PAGE>
CARLYLE-IT INTERNATIONAL PARTNERS II,
L.P.
By: TC Group, L.L.C., its General
Partner
By: TCG Holdings, L.L.C., its
Managing Member
By: ___/s/____________________________
Name: ________________________________
Title:________________________________
Exhibit 20.1
============
November 25, 1996
To: All Holders of Depositary Shares representing 1/100 of a share of 7%
Cumulative Convertible Exchangeable Preferred Stock:
1. Overview. International Technology Corporation (the "Corpora-
tion") hereby notifies all holders (the "Holders") of Depositary Shares
(the "Depositary Shares") each representing 1/100 of a share of 7%
Cumulative Convertible Exchangeable Preferred Stock (the "7% Preferred
Stock") of the Corporation pursuant to Section 8(c) of the Certificate of
Designations (the "Certificate of Designations") of the Preferred Stock
that the Corporation has consummated a transaction which constitutes an
Ownership Change (as defined in the Certificate of Designations). As a
result of the Ownership Change, from and after the date of this Notice
until the close of business, Boston, Massachusetts time, on January 9,
1997, the Holders may, at their option, pursuant to Section 8(b) of the
Certificate of Designations, convert their Depositary Shares into the
common stock of the Corporation ("Common Stock") at a special conversion
price described below.
2. Ownership Change. On November 20, 1996, the Corporation
consummated a transaction (the "Carlyle Investment") which is summarized
below in Appendix A attached hereto. Based upon the advice of counsel,
the Corporation believes that the Carlyle Investment constitutes an
Ownership Change (as defined in the Certificate of Designations).
3. Reverse Split. In addition to the Carlyle Investment, the
Corporation also effected a 1-for-4 reverse stock split with respect to
its Common Stock, pursuant to an amendment filed to the Corporation's
Certificate of Incorporation on November 20, 1996 (the "Reverse Split").
The Officers' Certificate relating to adjustments made to the exercise
price as a result of the Reverse Split is attached hereto as Appendix B.
All share data herein relating to the Common Stock is adjusted to give
effect to the Reverse Split.
4. Special Conversion Rights. Pursuant to the special conversion
rights triggered by the Carlyle Investment, each Preferred Holder may, at
its option, convert all, but not less than all, of such Holder's
Depositary Shares into Common Stock at a special conversion price (the
"Special Conversion Price"). The Special Conversion Price is $12.68,
which represents the higher of (i) the average closing price of the Common
Stock for the five trading days ending on the day prior to the completion
of the Carlyle Investment (which price is $9.72) and (ii) $12.68. After
January 9, 1997, Holders will continue to have the right to convert
Depositary Shares into Common Stock at the previous conversion price of
$23.36. See "General Conversion Rights" below.
5. Special Conversion Price. The Special Conversion Price is
$12.68. Accordingly, each Depositary Share is convertible into 1.9716
shares of Common Stock (7.8864 shares of Common Stock prior to the Reverse
Split). On November 21, 1996, the closing price of the Common Stock on
the NYSE Composite Tape was $9-1/2 per share. See "Price Range of the
Common Stock" below.
6. Expiration of Special Conversion Rights. The special conversion
rights described herein will expire at, and the latest time by which
Holders may submit Depositary Shares for conversion at the Special
Conversion Price is the close of business, Boston, Massachusetts time, on
January 9, 1997.
7. General Conversion Rights. Pursuant to Section 7 of the
Certificate of Designations, generally and after the expiration of the
special conversion rights on January 9, 1997, the Depositary Shares will
be convertible only pursuant to Section 7 of
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the Certificate of Designations at the conversion price of $23.36 per
share of Common Stock. At this conversion price, each Depositary Share
would convert into 1.0702 shares of Common Stock.
8. Date of Conversion. All Depositary Shares validly tendered for
conversion shall be converted into shares of Common Stock after the close
of business, Boston, Massachusetts time, on January 9, 1997.
9. Procedure for Conversion. Each Holder who desires to convert
Depositary Shares into Common Stock ,ust satisfy in full the requirements
set forth in Section 7 of the Certificate of Designations prior to the
close of business, Boston, Massachusetts time, on January 9, 1997.
Section 7(b) of the Certificate of Designations generally provides that:
(a) each Holder who desires to convert Depositary Shares must
surrender the depositary receipt(s) representing all Depositary Shares
owned by such holder, duly endorsed or assigned to the Corporation or in
blank, at the office of the transfer agent, First National Bank of Boston,
by first class mail to P.O. Box 1889, Mail Stop 45-02-53, Boston,
Massachusetts 02105, or by overnight delivery to 150 Royall Street, Mail
Stop 45-02-53, Canton, Massachusetts 02021. Such holder must complete the
conversion notice on the reverse side of his or her depositary receipts
representing the Depositary Shares to be surrendered for conversion.
EACH HOLDER WHO DESIRES TO CONVERT DEPOSITARY SHARES INTO COMMON STOCK
PURSUANT TO THE SPECIAL CONVERSION RIGHTS DESCRIBED HEREIN MUST SURRENDER
DEPOSITARY RECEIPTS REPRESENTING ALL DEPOSITARY SHARES OWNED BY SUCH
HOLDER. PURSUANT TO THE TERMS OF THE CERTIFICATE OF DESIGNATIONS, HOLDERS
MAY NOT ELECT TO CONVERT ONLY A PORTION OF THEIR DEPOSITARY SHARES.
(b) If the shares of Common Stock issuable upon conversion are
not to be issued in the same name as the name in which such holder's
Depositary Shares are registered, such holder must duly execute the form
on the reverse side of his or her depositary receipts representing the
Depositary Shares to be surrendered for conversion, with the endorsement
or signature guaranteed by a financial institution that is a member of the
Stock Transfer Association's approved medallion program (such as STAMP,
SEMP OR MSP).
(c) In the case of lost or destroyed Depositary Share receipts
to be surrendered for conversion, the holder must immediately contact the
transfer agent, First National Bank of Boston, and additional
documentation necessary to be completed in order to effectively surrender
such lost or destroyed Depositary Share receipts will be forwarded to such
10. Irrevocability of Exercise of Special Conversion Rights. Any
exercise by a Holder of the special conversion rights triggered by the
Carlyle Investment shall be irrevocable, and no dividends on Depositary
Shares validly tendered for conversion shall accrue from and after January
9, 1997.
11. No Payment of Cash in Lieu of Common Stock. The Corporation
will not exercise its option under Section 8 of the Certificate of
Designations to pay cash in lieu of Common Stock for all shares of
Depositary Shares tendered for conversion.
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12. Delivery of Shares of Common Stock. All shares of Common Stock
issuable to those Holders who have validly tendered their Depositary
Shares will be delivered as promptly as practicable following such tender
but in any event no later than the close of business on January 24, 1997,
together with a check for any fractional shares issuable upon conversion.
13. Price Range for the Common Stock. The Common Stock is listed on
the New York Stock Exchange (the "NYSE") and the Pacific Stock Exchange
under the symbol ITX. The following table sets forth the high and low
sale prices of the Common Stock, as reported by the NYSE for the periods
indicated. All prices have been adjusted to give effect to the Reverse
Split.
Fiscal Quarter ended High Low
-------------------- ----- ----
June 30, 1994 . . . . . . . . . . . . . . . . $13 $8
September 30, 1994. . . . . . . . . . . . . . 15-1/2 9-1/2
December 31, 1994 . . . . . . . . . . . . . . 18 11
March 31, 1995. . . . . . . . . . . . . . . . 13 9
June 30, 1995 . . . . . . . . . . . . . . . . 13-1/2 9-1/2
September 29, 1995. . . . . . . . . . . . . . 15-1/2 11
December 29, 1995 . . . . . . . . . . . . . . 13-1/2 9
March 29, 1996. . . . . . . . . . . . . . . . 11 8
June 28, 1996 . . . . . . . . . . . . . . . . 14 8-1/2
September 27, 1996. . . . . . . . . . . . . . 12 7-1/2
December 27, 1996 (through November 21, 1996) 11-1/2 8-7/8
The Corporation has not paid a cash dividend on its Common Stock for
the three years ended March 29, 1996. The Corporation's credit agreements
prohibit cash dividends on its Common Stock.
14. Price Range for the Depositary Shares. The Depositary Shares
are listed on the NYSE under the symbol ITX pr. The following table sets
forth the high and low sale prices of the Depositary Shares, as reported
by the NYSE for the periods indicated.
Fiscal Quarter ended High Low
-------------------- ----- ----
June 30, 1994 . . . . . . . . . . . . . . . . $21-1/8 $15-1/2
September 30, 1994. . . . . . . . . . . . . . 20-5/8 15-3/4
December 31, 1994 . . . . . . . . . . . . . . 22-5/8 16-1/2
March 31, 1995. . . . . . . . . . . . . . . . 18-1/4 15-3/4
June 30, 1995 . . . . . . . . . . . . . . . . 19-3/4 15-3/4
September 29, 1995. . . . . . . . . . . . . . 22-1/8 17-1/2
December 29, 1995 . . . . . . . . . . . . . . 20-1/2 16-1/8
March 29, 1996. . . . . . . . . . . . . . . . 18-1/8 16
June 28, 1996 . . . . . . . . . . . . . . . . 20 16-3/4
September 27, 1996. . . . . . . . . . . . . . 18-7/8 16-1/8
December 27, 1996 (through November 21, 1996) 20-1/8 18-1/4
3
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15. Tax Consequences of Conversion. Holders should consult their
tax advisors for a determination of the tax consequences, if any, of
converting their Depositary Shares into Common Stock.
16. General. For further information about the matters discussed
herein, please see the Certificate of Designations and the Corporation's
Annual Report on Form 10-K for the fiscal year ended March 29, 1996, as
amended, Quarterly Report on Form 10-Q for the quarter ended September 27,
1996, Current Reports on Form 8-K filed with the Securities and Exchange
Commission on August 28, 1996, and November 20, 1996, respectively, and
the Proxy Statement for the 1996 Annual Meeting of Stockholders, copies of
which will be provided by the Corporation without charge upon request.
Requests for the above or for more information on how to convert
Depositary Shares should be directed to D.F. King, 77 Water Street, 20th
Floor, New York, NY 10005, telephone no. 1-800-290-6432.
Holders considering converting Depositary Shares into Common Stock are
urged to carefully review such information.
Sincerely yours,
/s/
Anthony J. DeLuca
President and Acting Chief Executive
Officer
4
<PAGE>
APPENDIX A
SUMMARY OF CARLYLE INVESTMENT
Pursuant to a Securities Purchase Agreement dated August 28, 1996 by
and between certain investors affiliated with the Carlyle Group
(collectively, "Carlyle") and the Corporation, Carlyle has made a cash
investment of $45,000,000 in the Corporation in exchange for 45,000 shares
of newly issued Cumulative Convertible Participating Preferred Stock, par
value $100 per share (the "Carlyle Preferred Stock"), and warrants (the
"Warrants") to purchase 1,250,000 additional shares of Common Stock, par
value $.01 per share, of the Corporation (the "Common Stock"). Initially,
the holders of the Carlyle Preferred Stock own approximately 38% of the
voting power of the Corporation (43% assuming exercise of the Warrants).
For so long as Carlyle continues to beneficially own shares of capital
stock having 20% or more of the votes that may be cast at annual or
special meetings of stockholders, then the holders of the Carlyle
Preferred Stock will have the exclusive right, voting separately as a
class, to elect (i) during the five-year period ending on November 20,
2001, the smallest number of directors that constitutes a majority of the
Corporation's Board of Directors and (ii) subsequent to November 20, 2001,
the greatest number of directors that constitutes a minority of the Board
of Directors at any special meeting of stockholders called for such
purpose, at any annual meeting and in any written consent pursuant to
Delaware law.
The initial conversion price of the Convertible Preferred Stock is
$8.00 per share and the initial exercise price of the Warrants is $12.00
per share. If all shares of the Corporation's existing 7% Preferred Stock
(represented by the Depositary Shares) were converted into Common Stock at
the special conversion price of $12.68, the conversion price and exercise
price of the Carlyle Preferred Stock could be reduced to as low as $5.80
and $8.72, respectively, ultimately creating additional dilution of the
Common Stock.
For a more detailed discussion about the Carlyle Investment, Holders
are urged to review the Company's Proxy Statement dated October 30, 1996
for the 1996 Annual Meeting of Stockholders. Copies of the Proxy
Statement will be provided by the Corporation without charge upon request.
Requests should be directed to International Technology Corporation,
Attention: Investor Relations, 23456 Hawthorne Boulevard, Torrance,
California 90505, 310-378-9933.
1
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APPENDIX B
OFFICERS' CERTIFICATE
OF
INTERNATIONAL TECHNOLOGY CORPORATION
Philip H. Ockelmann does hereby certify that:
1. He is the Vice President, Finance and Treasurer of INTERNATIONAL
TECHNOLOGY CORPORATION, a Delaware corporation (the "Corporation").
2. The Corporation effected a 1-for-4 reverse stock split (the
"Reverse Split") with respect to the common stock of the Corporation
("Common Stock") pursuant to an amendment to its Certificate of
Incorporation filed on November 20, 1996, pursuant to which one share of
Common Stock was issued for every four shares outstanding immediately
prior to the Reverse Split.
3. Pursuant to Section 7(d)(i) of the Certificate of Designations
of 7% Cumulative Convertible Exchangeable Preferred Stock of International
Technology Corporation (the "Certificate of Designations"), the Conversion
Price (as defined in the Certificate of Designations) shall be adjusted to
be $23.36 per share of Common Stock. At this adjusted Conversion Price,
the number of shares of Common Stock to be delivered upon the surrender of
one Depositary Share, representing 1/100 of a share of 7% Cumulative
Convertible Exchangeable Preferred Stock would be approximately 1.0702
shares of Common Stock, as each share of 7% Cumulative Convertible
Exchangeable Preferred Stock would be convertible into 107.02 shares of
Common Stock.
4. The adjustment to the Conversion Price was calculated by
multiplying the former Conversion Price of $5.84 by four.
5. The adjustment to the Conversion Price was required by the
Reverse Split, pursuant to which one share of Common Stock was issued for
every four shares previously outstanding.
IN WITNESS WHEREOF, this Certificate has been signed by Philip H.
Ockelmann, and attested to by James M. Redwine, of the Corporation, all as
of November 25, 1996.
INTERNATIONAL TECHNOLOGY CORPORATION
By: ___/s/_________________________________
Name: Philip H. Ockelmann
Title: Vice President, Finance and
Treasurer
Attest:
By: ___/s/____________________________
Name: James M. Redwine
Title: Assistant Secretary
2
<PAGE>
Exhibit 99.1
============
International NEWS RELEASE
Technology
Corporation
Release Date: FOR IMMEDIATE RELEASE
Contact: International Technology Corp.
Philip H. Ockelmann
(310) 378-9933
Sitrick And Company
Jody Martin/Jeff Lloyd
(310) 788-2850
INTERNATIONAL TECHNOLOGY CORPORATION
CLOSES $45 MILLION CARLYLE INVESTMENT
Investment Supports Company's Growth and Diversification Plan
Torrance, CA November 20, 1996 International Technology Corporation
(NYSE: ITX) (IT) today announced that the Company's stockholders have
approved a $45 million investment by The Carlyle Group in newly issued
preferred stock of the Company and that the transaction has closed. In
addition, stockholders approved a one-for-four reverse split of IT's
common stock. Such approvals were announced today in Los Angeles at the
Company's annual meeting of stockholders.
Anthony J. DeLuca, IT's president and acting chief executive officer,
stated, "By approving this investment, IT's stockholders demonstrated
their confidence in our growth and diversification plan. This $45 million
equity infusion will substantially increase our financial strength and
stability, and will be the primary source of capital to finance our
acquisition program. Our objective is to make IT a platform to build a
multi-billion dollar global consulting, engineering and construction
firm."
The one-for-four reverse stock split will become effective for trading
tomorrow, November 21, 1996, and will reduce the total number of IT's
common shares outstanding from approximately 36 million to approximately
9 million. The Board of Directors believes that the reverse split will be
advantageous to the both the Company and its stockholders as a means of
enhancing the liquidity and marketability of IT's common stock.
Statements made in this news release that state the Company's or manage-
ment's intentions, hopes, beliefs, expectations or predictions for the
future are forward-looking statements that involve risk and uncertainties.
It is important to note that the Company's actual results could differ
materially from those projected in such forward-looking statements. In
addition to the factors set forth above, other important factors that
could cause actual results to differ materially include, but are not
limited to, projected financial results, funding of backlog, the effects
of the Company's restructuring, industry-wide market factors, and the
Carlyle investment.
International Technology Corporation, based in Torrance, California, is a
leading environmental management company providing services to government
and industry. The Company's common stock and depositary shares are traded
on the New York Stock Exchange under the symbols ITX and ITXpr,
respectively.
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