-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EfBCfl5Gwox51ZmQ9M1UlfVBRQpwwg5yt0Vl8VA2Uy+ROx5SrnGBC9DPqqncboyS 6xPw/LnQwEOj0NnROvnZSQ== 0000914062-05-000555.txt : 20050823 0000914062-05-000555.hdr.sgml : 20050823 20050823162548 ACCESSION NUMBER: 0000914062-05-000555 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050817 ITEM INFORMATION: Cost Associated with Exit or Disposal Activities ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050823 DATE AS OF CHANGE: 20050823 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRG SCHULTZ INTERNATIONAL INC CENTRAL INDEX KEY: 0001007330 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-ENGINEERING, ACCOUNTING, RESEARCH, MANAGEMENT [8700] IRS NUMBER: 582213805 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-28000 FILM NUMBER: 051043913 BUSINESS ADDRESS: STREET 1: 600 GALLERIA PARKWAY STREET 2: STE 100 CITY: ATLANTA STATE: GA ZIP: 30339-5949 BUSINESS PHONE: 7707793311 MAIL ADDRESS: STREET 1: 600 GALLERIA PARKWAY STREET 2: STE 100 CITY: ATLANTA STATE: GA ZIP: 30339-5949 FORMER COMPANY: FORMER CONFORMED NAME: PROFIT RECOVERY GROUP INTERNATIONAL INC DATE OF NAME CHANGE: 19960207 8-K 1 prg8k81905.txt FORM 8-K UNITED STATES 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): AUGUST 17, 2005 ----------------------- PRG-SCHULTZ INTERNATIONAL, INC. (Exact name of registrant as specified in its charter) -------------------------
GEORGIA 000-28000 58-2213805 (State or Other Jurisdiction (Commission File Number) (IRS Employer of Incorporation) Identification No.)
600 GALLERIA PARKWAY, SUITE 100, ATLANTA, GEORGIA 30339-5949 ------------------------------------------------------------------------------- (Address of principal executive office) (zip code) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (770) 779-3900 ------------------------------------------------------------- (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 (see General Instruction A.2. below): |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) - -------------------------------------------------------------------------------- ITEM 2.05 COSTS ASSOCIATED WITH EXIT OR DISPOSAL ACTIVITIES. On August 19, 2005, PRG-Schultz (the "Company") issued a press release (the "Press Release") announcing that it has taken an initial step in implementing an expense restructuring plan, currently being developed. The Press Release is attached hereto as Exhibit 99.1 and incorporated herein by reference. When completed, the plan will involve a major restructuring of the Company's sales, general and administrative expenses and is scheduled for completion no later than early fourth quarter, with implementation to begin immediately thereafter. The initial step includes headcount reductions in the Company's Atlanta headquarters, elimination of independent contractor positions in Atlanta, cancellation of an airplane charter service, termination of retainer contracts with outside consultants, and elimination of certain perquisites for corporate executives. Annualized savings from this first step will be approximately $4.5 million, before charges, representing only a small portion of the total savings expected to be realized from the overall plan, once it is developed and fully implemented. These initial actions are expected to result in severance-related and other charges of approximately $1 million, to be accrued during the third quarter ended September 30, 2005. Implementation of the overall plan is expected to result in significant additional severance-related and other charges. On August 17, 2005, the Company committed to this initial step as part of a broader expense restructuring plan that is being developed for approval by the Company's Board of Directors. The actions taken in the initial step (which will be completed by August 26, 2005) and the formulation of the broader plan result from the determination that the expense of the Company's overhead structure and processes is too high relative to the nature and size of the Company's business. The amount of the financial charge and future cash expenditures for the initial step in the expense restructuring plan is estimated to be $1 million. The statements made by PRG-Schultz are forward-looking statements that involve risks and uncertainties. All such statements are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995. PRG-Schultz's future financial performance could differ significantly from the expectations of management and from results expressed or implied in the Press Release. See the risk factors contained in the Press Release for a discussion of certain risks and uncertainties that may impact such forward looking statements. For further information on other risk factors, please refer to the "Risk Factors" contained in PRG-Schultz's Form 10-K for the year ended December 31, 2004 filed with the Securities and Exchange Commission, and in its subsequent filings with the SEC. PRG-Schultz disclaims any obligation or duty to update or modify these forward-looking statements. 2 ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS. (a) Financial Statements. N/A (b) Pro Forma Financial Information. N/A (c) Exhibits. Exhibit Number Description -------------------- ----------- 99.1* Press Release dated August 19, 2005 ----------------- * This exhibit is filed, not furnished. 3 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, PRG-Schultz International, Inc. has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. PRG-SCHULTZ INTERNATIONAL, INC. Date: August 23, 2005 By: /s/ Clinton McKellar ----------------------------------- Clinton McKellar, Jr. General Counsel and Secretary 4 EXHIBIT INDEX Exhibit Number Description - -------------------- -------------- 99.1* Press Release dated August 19, 2005 - ----------------- * This exhibit is filed, not furnished. EX-99.1 2 prg8k81905ex99.txt PRESS RELEASE EXHIBIT 99.1 PRG-SCHULTZ ANNOUNCES THE INITIAL STEP IN AN SG&A EXPENSE RESTRUCTURING PLAN ATLANTA--(BUSINESS WIRE)--Aug. 19, 2005--PRG-Schultz International, Inc. (Nasdaq:PRGX) today announced that it has taken an initial step in implementing an expense restructuring plan, currently being developed. When completed, the plan will involve a major restructuring of the Company's sales, general and administrative expenses and is scheduled for completion no later than early fourth quarter, with implementation to begin immediately thereafter. The initial step includes headcount reductions in the Company's Atlanta headquarters, elimination of independent contractor positions in Atlanta, cancellation of an airplane charter service, termination of retainer contracts with outside consultants, and elimination of certain perquisites for corporate executives. Annualized savings from this first step will be approximately $4.5 million, before charges, representing only a small portion of the total savings expected to be realized from the overall plan, once it is developed and fully implemented. These initial actions are expected to result in severance-related and other charges of approximately $1 million, to be accrued during the third quarter. Implementation of the overall plan is expected to result in significant additional severance-related and other charges. About PRG-Schultz International, Inc. Headquartered in Atlanta, PRG-Schultz International, Inc. (PRG) is the world leader in recovery auditing and a leading profit improvement firm. PRG employs approximately 2,750 employees, providing clients in over 40 countries with insightful value to optimize and expertly manage their business transactions. Using proprietary software and expert audit methodologies, PRG industry specialists review client purchases and payment information to identify and recover overpayments. Forward-Looking Statements Statements made in this news release that look forward in time, including express and implied statements regarding the development of a restructuring plan, the accrual of severance-related and other charges, potential cost savings, completion of the plan, and the Company's future performance, involve risks and uncertainties and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such risks and uncertainties include the possibility that charges and savings may be more or less than anticipated, due, for example, to unforeseen delays in developing or implementing the plan, the possibility that the plan cannot be successfully implemented, the possibility of unanticipated costs arising from the termination of employment arrangements and other contracts, and the possibility that the Company may be forced to reevaluate its decision to terminate certain service and supply contracts and arrangements due to the fluctuating operational needs of the Company. Should the Company violate the financial covenants of its senior credit facility and be unable to continue to borrow under it, it will have to seek alternate sources of financing, and there is no guarantee that such financing will be available on acceptable terms, if at all. In addition, a default and acceleration under the senior credit facility would result in a cross-default under and could result in an acceleration of the Company's approximately $125 million outstanding convertible notes. In such an instance, the Company would seek to refinance the notes, but there is no guarantee that it would be able to do so on acceptable terms, if at all. For a discussion of other risk factors that may impact the Company's business, please see our Securities and Exchange Commission filings, including the Company's Forms 10-K and 10-Qs filed with the Securities and Exchange Commission on March 16, 2005, May 10, 2005 and August 9, 2005. The Company disclaims any obligation or duty to update or modify these forward-looking statements. CONTACT: PRG-Schultz International, Inc., Atlanta James E. Moylan, Jr. 770-779-6605 -----END PRIVACY-ENHANCED MESSAGE-----