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
Date of Report (Date of earliest event reported)..........May 8, 2000
STONE & WEBSTER, INCORPORATED
(Exact name of registrant as specified in its charter)
Delaware 1-1228 13-5416910
(State or other jurisdiction (Commission File Number) (IRS Employer Number)
of incorporation)
245 Summer Street, Boston, MA 02210
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 589-5111
<PAGE>
Item 5. Other Events.
The text of registrant's press release dated May 8, 2000, relating to the
signing of a Letter of Intent to sell company assets to Jacobs Engineering
Group, Inc. and other corporate developments is included in Exhibit 99 to this
Form 8-K and is incorporated herein by reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
Exhibits
(99) Text of registrant's press release dated May 8, 2000
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 thereunto duly authorized.
STONE & WEBSTER, INCORPORATED
By: /S/ THOMAS L. LANGFORD
-------------------------------------
Thomas L. Langford
Executive Vice President
and Chief Financial Officer
Date: May 10, 2000
<PAGE>
FORM 8-K EXHIBIT 99
Exhibit 99 Text of registrant's press release dated May 8, 2000-
Contacts:
Michael Freitag
Kekst and Company
(212) 521-4800
John W. Prosser, Jr.
Jacobs Engineering Group Inc.
(626) 578-6803
FOR IMMEDIATE RELEASE
STONE & WEBSTER SIGNS LETTER OF INTENT
TO SELL COMPANY TO JACOBS ENGINEERING GROUP
Jacobs to Provide $50 Million Secured Revolving Credit Facility,
Enabling Stone & Webster to Address Its Current Liquidity Difficulties
Stone & Webster Will Seek Court Approval of Proposed Sale;
Current Bank Group Agrees to Terms of Proposed Transaction
BOSTON, Massachusetts, May 8, 2000 -- Stone & Webster, Incorporated (NYSE: SW)
today announced that it has signed a letter of intent with Jacobs Engineering
Group Inc. (NYSE: JEC) regarding a proposed transaction in which Jacobs would
acquire substantially all of Stone & Webster's assets in exchange for an
immediate $50 million secured revolving credit facility, assumption of
substantially all of Stone & Webster's balance sheet liabilities (including the
new credit facility), and $150 million in cash and stock. The $50 million credit
facility, which has been approved by the Company's current bank syndicate, is
intended to enable Stone & Webster to address its current liquidity difficulties
and continue to operate its businesses until the asset sale is consummated.
In addition, Stone & Webster announced that, in conjunction with and as a
condition to these proposed transactions with Jacobs, it intends to seek
bankruptcy court approval of the asset sale and credit agreement. Accordingly,
Stone & Webster intends to file a voluntary petition for reorganization under
Chapter 11 of the U.S. Bankruptcy Code after the Company signs a definitive sale
agreement with Jacobs, which is expected to occur later this month. Chapter 11
provides a constructive procedure for parties to maintain operations, protect
employees and ordinary course vendors, and seek rapid resolution of value issues
and a smooth melding of ongoing operations.
Stone & Webster fully expects to continue operating its businesses in the normal
course both before and during the Chapter 11 process. The Company's operations
will remain open and employees will continue to be paid in the normal manner and
their health insurance, pension plan and other benefits will not be disrupted.
The Company is in the process of advising all clients, vendors and
subcontractors that it intends to honor agreements to complete ongoing projects.
H. Kerner Smith, Chairman, President and Chief Executive Officer of Stone &
Webster, said: "We are very pleased to reach this agreement with Jacobs
Engineering Group. The resulting combination will be one of the largest
organizations in the industry, providing engineering, operating plant and
construction services spanning a number of key end markets including chemical,
process and hydrocarbon, power, pharmaceutical/biotech,
industrial/manufacturing, buildings, environmental and federal programs, and
infrastructure. The combined companies have done business in nearly 100
countries. We are pleased that Jacobs Engineering Group recognizes the value of
Stone & Webster's reputation and its employees, who will have an excellent
opportunity to be part of a broader world-class engineering, consulting and
construction business."
"After a thorough evaluation of all available strategic alternatives," Mr. Smith
continued, "Stone & Webster's Board of Directors has concluded that this
proposed transaction is in the best interest of all of the Company's
constituencies, including its employees, shareholders, clients, suppliers and
lenders. We firmly believe a combination of our operations and people with
Jacobs will be an excellent fit both strategically and culturally."
Noel G. Watson, President and Chief Executive Officer of Jacobs, said: "For more
than a century, Stone & Webster has had a tradition of excellence. We are very
pleased at the prospect of welcoming its talented and dedicated associates to
the Jacobs organization. Together, we will have an outstanding opportunity to
serve a growing roster of clients around the world with the highest quality
services and state-of-the art technology. We will be a formidable global
competitor in the rapidly consolidating engineering and construction industry."
The proposed transaction is subject to completion of due diligence by Jacobs,
negotiation of a definitive agreement, approval under Hart-Scott-Rodino Act, and
other customary conditions. Jacobs will not assume liabilities associated with
certain rejected contracts, which will be identified after completion of due
diligence.
Stone & Webster cautioned that because the proposed sale of assets is expected
to occur in the context of a pending Chapter 11 case, it is not possible to
determine at the present time what value, if any, will ultimately be received by
Stone & Webster's stockholders. Such a determination can only be made after
negotiation of a definitive sale agreement, the completion of the competitive
bid process provided for under Chapter 11, consummation of the asset sale
transaction, and the substantial resolution of Stone & Webster's contemplated
Chapter 11 case.
"We fully intend to fulfill all of our commitments on current and future
projects and keep all of our global operations open, serving clients and
conducting business as usual for the duration of the reorganization and we
appreciate the continued support of our clients and employees during this
transition period," Mr. Smith said.
Stone & Webster's financial advisors are Lazard Freres & Co. LLC and Goldman
Sachs & Co. Its legal advisor is Skadden, Arps, Slate, Meagher & Flom LLP.
Jacobs Engineering Group's financial advisors are Bank of America Securities and
Merrill Lynch. Its legal advisor is Gibson, Dunn & Crutcher LLP.
Jacobs Engineering Group Inc. is one of the world's largest providers of
professional technical services. With annual revenues exceeding $3 billion, the
Company offers full-spectrum support to industrial, commercial, and government
clients in diverse markets. Services include scientific and specialty consulting
as well as all aspects of project execution and operations & maintenance.
Stone & Webster is a global leader in engineering, construction and consulting
services for power, process/industrial and environmental/infrastructure markets.
Forward-Looking Information
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for
forward-looking statements made by or on behalf of the Company. Any of the
statements or comments made in this release that refer to the Company's
estimated or future results are forward looking and reflect the Company's
current analysis of existing trends and information. The Company cautions that a
variety of factors, including but not limited to the following, could cause
business conditions and results to differ materially from what is contained in
forward-looking statements: changes in the rate of economic growth in the United
States and other major international economies, changes in investment by the
energy, power and environmental industries, the uncertain timing of awards and
contracts, changes in regulatory environments, changes in project schedules,
changes in trade, monetary and fiscal policies world-wide, currency
fluctuations, outcomes of pending and future litigation, protection and validity
of patents and other intellectual property rights, increasing competition by
foreign and domestic companies and other risks detailed from time to time in the
Company's filings with the Securities and Exchange Commission. The Company
undertakes no obligation to publicly release any revisions to the
forward-looking statements or reflect events or circumstances after the date of
this document.
