-----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, Rcm93uRr7MBbn2tsLnpRQY9HEpneG6cnpcbAlwyXSzg4zudsnIGJT8udx5a2by2u xhJpHfI/oL4KZrtf1ZkPkQ== 0000914062-05-000632.txt : 20051005 0000914062-05-000632.hdr.sgml : 20051005 20051005160843 ACCESSION NUMBER: 0000914062-05-000632 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050930 ITEM INFORMATION: Cost Associated with Exit or Disposal Activities ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20051005 DATE AS OF CHANGE: 20051005 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: 051125003 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 prg8k93005.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): SEPTEMBER 30, 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 September 30, 2005, PRG-Schultz International, Inc. (the "Company") committed to implementation of the major expense restructuring plan (the "Restructuring Plan") previously announced on August 19, 2005 (as filed under Form 8-K on August 23, 2005). On October 3, 2005, the Company issued a press release (the "Press Release") announcing that it had completed the Restructuring Plan and begun implementation of the major expense restructuring elements in such plan. Annualized savings from the Restructuring Plan will be approximately $42.2 million, including approximately $4.5 million announced on August 19, 2005. Most of the savings will come in the area of Selling, General and Administrative ("SG&A") expense, and only a small percentage of the Company's auditor staff will be directly impacted by the reductions. The Company expects that implementation of the plan will result in severance-related and other charges of approximately $8.5 million, of which approximately $1.6 million will be accrued during the third quarter and the remainder during the fourth quarter. Most cash outlays for severance costs will be paid out over future months. The Company expects to reduce Atlanta corporate headquarters SG&A headcount by approximately 30%, or 71 people. Worldwide headcount reductions will be 378, or approximately 14% of the Company's total workforce. Substantial savings will also come from areas other than headcount, including travel and travel-related expenses and fees for professional services and other purchased services. Implementation of the restructuring is to begin immediately, and the Company expects that virtually all of the reductions will be implemented during the fourth quarter of this year. On August 17, 2005, the Company committed to an initial step as part of a broader expense Restructuring Plan that was being developed for approval by the Company's Board of Directors. The actions taken in the initial step (which were executed during the third fiscal quarter ended September 30, 2005) and the formulation of the broader Restructuring Plan resulted 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. On September 30, 2005, the Company's Board of Directors approved and authorized management to carry out the Restructuring Plan. On October 3, 2005, management commenced implementation of the Restructuring Plan. The amount of the financial charge and future cash expenditures related to termination benefits under the expense Restructuring Plan is estimated to be $8.5 million. The Press Release is attached hereto as Exhibit 99.1 and incorporated herein by reference. 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 October 3, 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: October 5, 2005 By: /s/ Clinton McKellar ----------------------------------- Clinton McKellar, Jr. General Counsel and Secretary 4 EXHIBIT INDEX Exhibit Number Description - -------------------- -------------- 99.1* Press Release dated October 3, 2005 - ----------------- * This exhibit is filed, not furnished. EX-99.1 2 prg8k93005ex99.txt PRESS RELEASE EXHIBIT 99.1 PRG-Schultz Board of Directors Approves Expense Restructuring Plan ATLANTA--(BUSINESS WIRE)--Oct. 3, 2005--PRG-Schultz International, Inc. (Nasdaq: PRGS - News), today announced it has completed and begun implementation of the major expense restructuring plan previously announced on August 19 of this year. Annualized savings from the restructuring will be approximately $42.2 million, including approximately $4.5 million announced on August 19. Almost all of the savings will come in the area of Sales, General and Administrative (SG&A) expense, and only a small percentage of the company's auditor staff will be directly impacted by the reductions. The company expects that implementation of the plan will result in severance-related and other charges of approximately $8.5 million, of which approximately $1.6 million will be accrued during the third quarter and the remainder during the fourth quarter. Most cash outlays for severance costs will be paid out over future months. "Implementation of the plan will bring our overhead structure into better alignment with both the nature and size of our business," said James B. McCurry, President and Chief Executive Officer of PRG-Schultz. "Our new organization will be more focused, with shorter lines of communication that permit us to be more responsive to the needs of our clients and the demands of the marketplace." The company expects to reduce Atlanta corporate headquarters SG&A headcount by approximately 30%, or 71 people. Worldwide headcount reductions will be 378, or approximately 14% of the company's total workforce. Substantial savings will also come from areas other than headcount, including travel and travel-related expenses and fees for professional services and other purchased services. Implementation of the restructuring is to begin immediately, and the Company expects that virtually all of the reductions will be implemented during the fourth quarter of this year. 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, providing clients throughout the world 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 implementation of the 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 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. 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. -----END PRIVACY-ENHANCED MESSAGE-----