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Filed pursuant to Rule 424(b)(5)
SEC File No. 333-63096
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED JUNE 27, 2001)
200,000 SHARES
WILLBROS GROUP, INC.
COMMON STOCK
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We are offering up to 200,000 shares of common stock.
Our common stock is listed on the New York Stock Exchange under the
symbol "WG." On August 9, 2001, the last reported sale price of our common stock
on the New York Stock Exchange was $13.00 per share.
The purchasers identified in the table set forth below under the
section entitled "Plan of Distribution" have agreed to purchase the number of
shares of our common stock determined by dividing the purchase commitment set
forth opposite their names by the per share purchase price. The purchasers will
purchase the shares of common stock at a price per share equal to the Canadian
dollar equivalent of U.S. $13.75 per share. This sale will result in total
proceeds to us of approximately $2,024,000 (based on the rate of exchange of
Canadian $1.5397 to U.S. $1.00 at August 9, 2001), before deducting offering
expenses payable by us. Delivery of the shares of common stock is expected to be
made on or about September 25, 2001.
INVESTING IN OUR COMMON STOCK INVOLVES RISKS WHICH ARE DESCRIBED IN THE
SECTION ENTITLED "RISK FACTORS" BEGINNING ON PAGE S-3.
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus supplement or the accompanying prospectus is truthful or complete.
Any representation to the contrary is a criminal offense.
The date of this prospectus supplement is August 14, 2001.
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TABLE OF CONTENTS
PAGE
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PROSPECTUS SUPPLEMENT
Risk Factors ........................................................... S-3
Forward-Looking Statements ............................................. S-8
Use of Proceeds ........................................................ S-9
Price Range of Common Stock and Dividend Policy ........................ S-9
Certain Tax Considerations ............................................. S-10
Plan of Distribution ................................................... S-12
Legal Opinion .......................................................... S-12
PROSPECTUS
About This Prospectus .................................................. 2
Where You Can Find More Information .................................... 2
About Willbros Group, Inc. ............................................. 3
Ratios of Earnings to Fixed Charges and Earnings to
Fixed Charges and Preferred Stock Dividends .......................... 4
Use of Proceeds ........................................................ 4
Description of Senior Debt Securities .................................. 5
Description of Subordinated Debt Securities ............................ 10
Description of Capital Stock ........................................... 15
Description of Warrants ................................................ 19
Plan of Distribution ................................................... 21
Legal Opinions ......................................................... 22
Experts ................................................................ 22
Enforceability of Civil Liabilities Under the Federal Securities Laws .. 22
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YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS
SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS OR TO WHICH WE HAVE REFERRED YOU. WE
HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT.
THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS MAY ONLY BE USED
WHERE IT IS LEGAL TO SELL THESE SECURITIES. THE INFORMATION IN THIS PROSPECTUS
SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS MAY ONLY BE ACCURATE ON THE DATE OF
THAT DOCUMENT.
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Unless the context otherwise requires, references in this prospectus
supplement to "Willbros," "we," "us" and "our" refer to Willbros Group, Inc. and
all of its subsidiaries collectively.
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RISK FACTORS
An investment in our common stock involves a number of risks. You should
carefully consider the following risk factors, together with all other
information contained in this prospectus supplement, the accompanying prospectus
and the documents incorporated by reference, before you decide to acquire any
shares of our common stock. Each of these risk factors could adversely affect
our business, results of operations and financial condition, as well as
adversely affect the value of an investment in our common stock.
OUR BUSINESS IS HIGHLY DEPENDENT UPON THE OIL, GAS AND POWER INDUSTRIES
The demand for our services depends largely on the conditions prevailing in
the oil, gas and power industries, and specifically the level of capital
expenditures of oil, gas and power companies. As a result, our business and
results of operations may be adversely affected during periods of reduced
activity in the oil, gas and power industries. There are numerous factors beyond
our control that influence the level of capital expenditures of oil, gas and
power companies, including:
o current and projected oil, gas and power prices;
o exploration, production and transportation costs;
o the discovery rate of new oil and gas reserves;
o the sale and expiration dates of oil and gas leases and concessions;
o the demand for electricity;
o regulatory restraints on the rates that power companies may charge
their customers;
o local and international political and economic conditions;
o the ability or willingness of host country government entities to fund
their budgetary commitments;
o technological advances; and
o the abilities of oil, gas and power companies to generate and access
capital.
OUR BUSINESS MAY BE SUSCEPTIBLE TO FLUCTUATING REVENUE AND CASH FLOW
We are dependent upon major construction projects to enhance our revenue
and cash flow. The availability of these types of projects is dependent upon the
condition of the oil, gas and power industries. Our failure to obtain major
projects, the delay in awards of major projects, the cancellation of major
projects or delays in completion of contracts are factors that could result in
the under-utilization of our resources, which would have an adverse impact on
our revenue and cash flow.
WE MAY BE ADVERSELY AFFECTED BY A CONCENTRATION OF BUSINESS IN A PARTICULAR
COUNTRY
Due to a limited number of major projects worldwide, we currently have, and
expect that we will continue to have, a substantial portion of our resources
dedicated to any one country. Therefore, our results of operations are
susceptible to adverse events beyond our control which may occur in a particular
country in which our business may be concentrated. For the last three years, our
contract revenue was generated in the following countries or areas:
Percentage of Contract Revenue
For the Year Ended December 31,
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2000 1999 1998
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Nigeria.............................. 45% 43% 17%
United States........................ 30 24 33
Venezuela............................ 8 13 27
Australia............................ 7 11 -
Offshore West Africa................. 6 1 -
Oman................................. 4 5 6
Indonesia............................ - 2 9
Ivory Coast.......................... - 1 5
Pakistan............................. - - 2
Others............................... * * 1
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* less than 1%.
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At December 31, 2000, approximately 39% of our property, plant, equipment and
spare parts was located in Nigeria, 25% in the United States, 16% in Venezuela
and 12% in Offshore West Africa. Our operations and assets are subject to
various risks inherent in conducting business in these countries.
OUR SIGNIFICANT INTERNATIONAL OPERATIONS ARE SUBJECT TO POLITICAL AND ECONOMIC
RISKS OF DEVELOPING COUNTRIES
We have substantial operations and assets in developing countries in
Africa, the Middle East and South America. Accordingly, we are subject to risks
which ordinarily would not be expected to exist in the United States, Canada,
Japan or western Europe. Some of these risks include:
o foreign currency restrictions;
o extreme exchange rate fluctuations;
o expropriation of assets;
o civil uprisings and riots;
o availability of suitable personnel and equipment;
o termination of existing contracts;
o government instability; and
o legal systems of decrees, laws, regulations, interpretations and court
decisions which are not always fully developed and which may be
retroactively applied.
Our operations in developing countries may be adversely affected in the event
any governmental agencies in these countries interpret laws, regulations or
court decisions in a manner which might be considered inconsistent or
inequitable in the United States, Canada, Japan or western Europe. We may be
subject to unanticipated taxes, including income taxes, excise duties, import
taxes, export taxes, sales taxes or other governmental assessments which could
have a material adverse effect on our results of operations for any quarter or
year.
Given the unpredictable nature of the risks described in the preceding
paragraph, there is no assurance that these risks will not result in a loss of
business which could have a material adverse effect on our results of
operations. We have attempted to mitigate the risks of doing business in
developing countries by:
o separately incorporating our operations in many of these countries;
o working with local partners in some countries;
o contracting whenever possible with major international oil and gas
companies;
o obtaining sizeable down payments or securing payment guarantees;
o entering into contracts providing for payment in U.S. dollars instead
of the local currency whenever possible;
o maintaining reserves for credit losses;
o maintaining insurance on equipment against political risks and
terrorism;
o limiting our capital investment in each country; and
o retaining local advisors to assist us in interpreting the laws,
practices and customs of the countries in which we operate.
From time to time, international oil companies operating in Nigeria,
including one of our major clients, have expressed concern over the Nigerian
government's tardiness in meeting its payment obligations and have threatened to
reduce their planned investments, and/or cut production, in Nigeria. In
addition, indecision by the Nigerian government over agreeing to budget
expenditure plans for oil companies involved in joint ventures with the Nigerian
National Petroleum Corporation may also lead these companies to curtail their
planned investments in Nigeria. Any reduction in the level of investment or
production could reduce the amount of contract work awarded in Nigeria which
could materially adversely affect our business and results of operations. We
cannot predict whether any of these actions will be taken in the future and, if
taken, the extent to which any of these actions would impact our current or
future prospects in Nigeria.
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OUR BUSINESS IS DEPENDENT ON A LIMITED NUMBER OF KEY CLIENTS
We operate primarily in a single operating segment in the oil, gas and
power industries, providing construction, engineering and specialty services to
a limited number of clients. Much of our success depends on developing and
maintaining relationships with our major clients and obtaining a share of
contracts from these clients. The loss of any of our major clients could have a
material adverse effect on our operations. Our ten largest clients were
responsible for 84% of our revenue in 2000, 67% of our revenue in 1999 and 78%
of our revenue in 1998. Operating units of Royal Dutch Shell accounted for 44%
and Duke Energy accounted for 11% of our total revenue in 2000.
OUR DEPENDENCE UPON FIXED PRICE CONTRACTS COULD ADVERSELY AFFECT OUR OPERATING
RESULTS
A substantial portion of our projects are currently performed on a
fixed-price basis, although some projects are performed on a cost-plus or
day-rate basis or some combination of the foregoing. We attempt to cover
increased costs resulting from anticipated changes in labor, material and
service costs of long-term contracts either through an estimation of these
anticipated changes, which is reflected in the original price, or through price
adjustment clauses. Despite these attempts, however, the revenue, cost and gross
profit realized on a fixed-price contract will often vary from the estimated
amounts because of unforeseen conditions or changes in job conditions and
variations in labor and equipment productivity over the term of the contract.
These variations and the risks generally inherent in construction may result in
the actual gross profits realized being different from those originally
estimated and in reduced profitability or losses on projects. Depending on the
size of a project, these variations from estimated contract performance could
have a significant effect on our operating results for any quarter or year. In
general, turn-key contracts to be performed on a fixed-price basis involve an
increased risk of significant variations. This is a result of the long-term
nature of these contracts and the inherent difficulties in estimating costs and
of the interrelationship of the integrated services to be provided under these
contracts whereby unanticipated costs or delays in performing part of the
contract can have compounding effects by increasing costs of performing other
parts of the contract.
PERCENTAGE-OF-COMPLETION METHOD OF ACCOUNTING FOR CONTRACT REVENUE MAY RESULT IN
MATERIAL ADJUSTMENTS ADVERSELY AFFECTING OUR OPERATING RESULTS
We recognize contract revenue using the percentage-of-completion method.
Under this method, estimated contract revenue is accrued based generally on the
percentage that costs to date bear to total estimated costs, taking into
consideration physical completion. Estimated contract losses are recognized in
full when determined. Accordingly, contract revenue and total cost estimates are
reviewed and revised periodically as the work progresses and as change orders
are approved, and adjustments based upon the percentage of completion are
reflected in contract revenue in the period when these estimates are revised.
These estimates are based on management's reasonable assumptions and our
historical experience, and are only estimates. Variation of actual results from
these assumptions or our historical experience could be material. To the extent
that these adjustments result in an increase, a reduction or an elimination of
previously reported contract revenue, we would recognize a credit or a charge
against current earnings, which could be material.
OUR OPERATIONS ARE SUBJECT TO A NUMBER OF OPERATIONAL RISKS
Our business operations include pipeline construction, dredging, pipeline
rehabilitation services, marine support services and the operation of vessels
and heavy equipment. These operations involve a high degree of operational risk.
Natural disasters, adverse weather conditions, collisions and operator or
navigational error could cause personal injury or loss of life, severe damage to
and destruction of property, equipment and the environment and suspension of
operations. In locations where we perform work with equipment that is owned by
others, our continued use of the equipment can be subject to unexpected or
arbitrary interruption or termination. The occurrence of any of these events
could result in work stoppage, loss of revenue, casualty loss, increased costs
and significant liability to third parties.
We maintain risk management and safety programs to mitigate the effects of
loss or damage. These programs have historically resulted in favorable loss
ratios and cost savings. While we maintain the insurance protection we deem
prudent, there can be no assurance that our insurance will be sufficient or
effective under all circumstances or against all hazards to which we may be
subject. An enforceable claim
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for which we are not fully insured could have a material adverse effect on our
financial condition and results of operations. Moreover, we cannot assure you
that we will be able to maintain adequate insurance in the future at rates that
we consider reasonable.
GOVERNMENTAL REGULATIONS COULD ADVERSELY AFFECT OUR BUSINESS
Many aspects of our operations are subject to governmental regulations in
the countries in which we operate, including those relating to currency
conversion and repatriation, taxation of our earnings and earnings of our
personnel, and our use of local employees and suppliers. In addition, we depend
on the demand for our services from the oil, gas and power industries and,
therefore, our business is affected by changing taxes, price controls and laws
and regulations relating to the oil, gas and power industries generally. The
adoption of laws and regulations by the countries or the states in which we
operate for the purpose of curtailing exploration and development drilling for
oil and gas or the development of power generation facilities for economic and
other policy reasons, could adversely affect our operations by limiting demand
for our services.
Our operations are also subject to the risk of changes in foreign and
domestic laws and policies which may impose restrictions on our business,
including trade restrictions, which could have a material adverse effect on our
operations. Other types of government regulation which could, if enacted or
implemented, adversely affect our operations include:
o expropriation or nationalization decrees;
o confiscatory tax systems;
o primary or secondary boycotts directed at specific countries or
companies;
o embargoes;
o extensive import restrictions or other trade barriers;
o mandatory sourcing rules;
o oil, gas or power price regulation; and
o unrealistically high labor rate and fuel price regulation.
We cannot determine to what extent our future operations and earnings may be
affected by new legislation, new regulations or changes in, or new
interpretations of, existing regulations.
OUR OPERATIONS EXPOSE US TO POTENTIAL ENVIRONMENTAL LIABILITIES
Our operations are subject to numerous environmental protection laws and
regulations which are complex and stringent. We regularly perform work in and
around sensitive environmental areas such as rivers, lakes and wetlands.
Significant fines and penalties may be imposed for non-compliance with
environmental laws and regulations, and some environmental laws provide for
joint and several strict liability for remediation of releases of hazardous
substances, rendering a person liable for environmental damage, without regard
to negligence or fault on the part of such person. In addition to potential
liabilities that may be incurred in satisfying these requirements, we may be
subject to claims alleging personal injury or property damage as a result of
alleged exposure to hazardous substances. These laws and regulations may expose
us to liability arising out of the conduct of operations or conditions caused by
others, or for the acts of ours which were in compliance with all applicable
laws at the time these acts were performed. We are currently not aware of any
non-compliance with any environmental law that could have a material adverse
effect on our business or operations.
HIGHLY COMPETITIVE INDUSTRY COULD IMPEDE GROWTH
We operate in a highly competitive environment. We compete against
government-owned or supported companies and other companies that have
substantially greater financial and other resources than we do. In some markets,
there is competition from national and regional firms against which we may not
be price competitive.
OUR OPERATING RESULTS COULD BE ADVERSELY AFFECTED IF OUR NON-U.S. OPERATIONS
BECAME TAXABLE IN THE UNITED STATES
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Willbros Group, Inc. is incorporated in Panama and is not a "controlled
foreign corporation" for purposes of U.S. tax law. The articles of incorporation
of Willbros Group, Inc. contain restrictions, subject to the determination by
the board of directors of Willbros Group, Inc. in good faith and in its sole
discretion, on any transfer of shares of common stock which would make Willbros
Group, Inc. a "controlled foreign corporation" under U.S. tax law. Moreover,
Willbros Group, Inc. and its non-U.S. subsidiaries carry out their activities in
a manner which we believe, based upon the advice of our counsel, do not
constitute the conduct of a trade or business in the United States. Accordingly,
although we report taxable income and pay taxes in the countries where we
operate, we believe, based upon our counsel's advice, that income earned by
Willbros Group, Inc. and its non-U.S. subsidiaries from operations outside the
United States is not reportable in the United States for tax purposes and is not
subject to U.S. income tax. If income earned, currently or historically, by
Willbros Group, Inc. or its non-U.S. subsidiaries from operations outside the
United States constituted income effectively connected to a United States trade
or business, and as a result became taxable in the United States, we could be
subject to U.S. taxes on a basis significantly more adverse than generally would
apply to these business operations. In this event, our consolidated operating
results could be materially and adversely affected.
WE ARE DEPENDENT UPON THE SERVICES OF OUR SENIOR MANAGEMENT
Our success depends heavily on the continued services of our senior
management. We do not have an employment agreement with any of these
individuals. Accordingly, we cannot be certain that any of these individuals
will continue in their capacity for any particular period of time. The loss or
interruption of services provided by one or more of our senior officers could
adversely affect our results of operations. Furthermore, we cannot assure you
that we will continue to attract and retain sufficient qualified personnel.
OUR STOCKHOLDER RIGHTS PLAN, ARTICLES OF INCORPORATION AND BY-LAWS MAY INHIBIT A
TAKEOVER, WHICH MAY ADVERSELY AFFECT THE PERFORMANCE OF OUR STOCK
Our stockholder rights plan and provisions of our articles of incorporation
and by-laws may discourage unsolicited takeover proposals or make it more
difficult for a third party to acquire us, which may adversely affect the price
that investors might be willing to pay for our common stock. For example, our
articles of incorporation and by-laws:
o provide for a classified board of directors, which allows only
one-third of our directors to be elected each year;
o restrict the ability of stockholders to take action by written
consent;
o establish advance notice requirements for nominations for election to
the board of directors;
o authorize the board of directors to designate the terms of and issue
new series of preferred stock; and
o provide for restrictions on the transfer of any shares of common stock
to prevent us from becoming a "controlled foreign corporation" under
United States tax law.
We also have a stockholder rights plan which gives holders of our common stock
the right to purchase additional shares of our capital stock if a potential
acquirer purchases or announces a tender or exchange offer to purchase 15% or
more of our outstanding common stock. The rights issued under the stockholder
rights plan would cause substantial dilution to a person or group that attempts
to acquire us on terms not approved in advance by our board of directors.
OUR STOCK PRICE IS VOLATILE
Our common stock has experienced significant price volatility, and such
volatility may continue in the future. The price of our common stock could
fluctuate widely in response to a range of factors, including variations in our
quarterly results and changing conditions in the economy in general or in our
industry in particular. In addition, stock markets generally experience
significant price and volume volatility from time to time which may affect the
market price of our common stock unrelated to our performance.
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FORWARD-LOOKING STATEMENTS
This prospectus supplement, the accompanying prospectus and the documents
we incorporate by reference include "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. All statements, other than statements of
historical facts, included or incorporated by reference in this prospectus
supplement and the accompanying prospectus, which address activities, events or
developments which we expect or anticipate will or may occur in the future are
forward-looking statements. The words "believe," "intend," "expect,"
"anticipate," "project," "estimate," "predict" and similar expressions are also
intended to identify forward-looking statements.
These forward-looking statements include, among others:
o the amount and nature of future capital expenditures;
o oil, gas and power prices;
o demand for our services;
o the amount and nature of future investments by foreign and domestic
governments;
o expansion and other development trends of the oil, gas and power
industries;
o business strategy; and
o expansion and growth of our business and operations.
These statements are based on assumptions and analyses made by us in light
of our experience and our perception of historical trends, current conditions
and expected future developments as well as other factors we believe are
appropriate in the circumstances. However, whether actual results and
developments will conform with our expectations and predictions is subject to a
number of risks and uncertainties which could cause actual results to differ
materially from our expectations, including:
o the risk factors discussed in this prospectus supplement and in the
documents we incorporate by reference;
o the timely award of one or more projects;
o cancellation of projects;
o weather;
o exceeding project cost and scheduled targets;
o failing to realize cost recoveries from projects completed or in
progress within a reasonable period after completion of the relevant
project;
o identifying and acquiring suitable acquisition targets on reasonable
terms;
o obtaining adequate financing;
o the demand for energy diminishing;
o political circumstances impeding the progress of work;
o general economic, market or business conditions;
o changes in laws or regulations; and
o other factors, most of which are beyond our control.
Consequently, all of the forward-looking statements made in this prospectus
supplement and the accompanying prospectus and in the documents we incorporate
by reference are qualified by these cautionary statements. Because these
forward-looking statements are subject to risks and uncertainties, there is no
assurance that the actual results or developments anticipated by us will be
realized or, even if substantially realized, that they will have the expected
consequences to or effects on us or our business or operations. You are
cautioned not to place undue reliance on the forward-looking statements, which
speak only as of the date of this prospectus supplement or the accompanying
prospectus or, in the case of documents incorporated by reference, as of the
date of the document being incorporated. We assume no obligation to update
publicly any of these forward-looking statements, whether as a result of new
information, future events or otherwise.
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USE OF PROCEEDS
We expect the net proceeds from this offering of common stock to be
approximately $2,014,000 (based on the rate of exchange of Canadian $1.5397 to
U.S. $1.00 at August 9, 2001, as published by The Wall Street Journal), after
deducting estimated offering expenses of approximately $10,000 payable by us. We
intend to use all of the net proceeds from this offering for working capital and
general corporate purposes.
PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY
Our common stock commenced trading on the New York Stock Exchange on August
15, 1996, under the symbol "WG." The following table sets forth the high and low
sale prices per share of our common stock, as reported in the New York Stock
Exchange composite transactions, for the periods indicated:
High Low
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1999:
First Quarter............................ $ 6.50 $ 4.56
Second Quarter........................... 9.00 5.31
Third Quarter............................ 8.75 6.00
Fourth Quarter........................... 7.12 4.62
2000:
First Quarter............................ 7.19 4.12
Second Quarter........................... 7.62 4.50
Third Quarter............................ 8.06 5.12
Fourth Quarter........................... 6.94 4.37
2001:
First Quarter............................ 14.60 6.25
Second Quarter........................... 16.95 11.55
Third Quarter (through August 9)......... 13.30 11.30
Substantially all of our stockholders maintain their shares in "street
name" accounts and are not, individually, stockholders of record. As of July 25,
2001, the common stock was held by 94 holders of record and an estimated 1,800
beneficial owners.
In order to fund the development and growth of our business, we intend to
retain our earnings rather than pay dividends in the foreseeable future. Since
1991, we have not paid any dividends, except dividends in 1996 on our
outstanding shares of preferred stock, which were converted into shares of
common stock on July 15, 1996. Subject to restrictions under credit
arrangements, the payment of any future dividends will be at the discretion of
our board of directors and will depend upon, among other things, our financial
condition, funds from operations, the level of our capital expenditures and our
future business prospects. Our present credit agreement prohibits us from paying
cash dividends on our common stock.
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CERTAIN TAX CONSIDERATIONS
UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS FOR NON-U.S. HOLDERS
The following discussion is a general discussion of the material U.S.
federal income tax consequences of the ownership and disposition of our common
stock by a beneficial owner that is a "non-U.S. holder."
For purposes of this discussion, a non-U.S. holder is any person or entity
other than:
o an individual who is a citizen or resident of the United States;
o a corporation or partnership created or organized in or under the laws
of the United States or any political subdivision thereof;
o a trust if a court within the United States is able to exercise
primary supervision over the administration of the trust and one or
more United States persons have the authority to control all
substantial decisions of the trust; or
o an estate, the income of which is includible in gross income for U.S.
income tax purposes regardless of its source.
This discussion is based on the Internal Revenue Code of 1986, as amended, and
administrative interpretations as of the date of this prospectus supplement, all
of which are subject to change, including changes with retroactive effect. This
discussion does not address all aspects of U.S. federal income taxation that may
be relevant to non-U.S. holders in light of their particular circumstances and
does not address any tax consequences arising under the laws of any state, local
or foreign jurisdiction. Prospective holders should consult their tax advisors
with respect to the particular tax consequences to them of owning and disposing
of common stock.
DIVIDENDS. Dividends paid to a non-U.S. holder of common stock generally
will not be subject to United States federal income or withholding tax unless
such income is effectively connected with the conduct by such person of a trade
or business within the United States, and, if required by an applicable income
tax treaty, the dividends are attributable to a permanent establishment that
such person maintains in the United States. In such cases, a non-U.S. holder
will be subject to United States federal income tax in the same manner as a U.S.
holder. A non-U.S. corporation receiving effectively connected dividends may
also be subject to an additional "branch profits tax" imposed at a rate of 30%
(or a lower treaty rate) on an earnings amount that is net of the regular tax.
GAIN ON DISPOSITION OF COMMON STOCK. A non-U.S. holder generally will not
be subject to U.S. federal income or withholding tax on gain realized on a sale
or other disposition of common stock unless:
o the gain is effectively connected with a trade or business of the
non-U.S. holder in the United States, and, if required by an
applicable income tax treaty, the gain is attributable to a United
States permanent establishment of the non-U.S. holder; or
o in the case of certain non-U.S. holders who are non-resident alien
individuals and hold the common stock as a capital asset, the
individuals are present in the United States for 183 or more days in
the taxable year of the disposition and meet other requirements.
INFORMATION REPORTING REQUIREMENTS AND BACKUP WITHHOLDING. Non-U.S. holders
generally may be subject to information reporting and backup withholding at a
maximum rate of 31% with respect to payment within the United States of
dividends on common stock or payment of proceeds from the disposition of common
stock to or through the U.S. office of a U.S. or foreign broker, unless the
holder provides a taxpayer identification number, certifies as to its foreign
status on Internal Revenue Service Form W-8BEN or other applicable form, or
otherwise establishes an exemption. With respect to the payment by a foreign
office of a broker of proceeds from the disposition of common stock, or to the
payment of dividends on common stock outside the United States, non-U.S. holders
in some instances also may be subject to information reporting and backup
withholding. Even where applicable, however, such backup withholding and
information reporting can be avoided where the holder provides a taxpayer
identification number, certifies as to its foreign status, or otherwise
establishes an exemption.
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Backup withholding is not an additional tax. Rather, the tax liability of
persons subject to backup withholding will be reduced by the amount of tax
withheld. When withholding results in an overpayment of taxes, a refund may be
obtained if the required information is furnished to the Internal Revenue
Service.
PANAMANIAN TAXES
The following summary of certain Panamanian tax matters is based upon the
tax laws of Panama and regulations thereunder in effect as of the date of this
prospectus supplement, and is subject to any subsequent change in Panamanian
laws and regulations which may come into effect after such date. The principal
Panamanian tax consequences of ownership of shares of our common stock are as
follows.
GENERAL. Panama's income tax is exclusively territorial. Only income
actually derived from sources within Panama is subject to taxation. Income
derived by Panama or foreign corporations or individuals from off-shore
operations is not taxable. The territorial principle of taxation has been in
force throughout the history of the country and is supported by legislation,
administrative regulations and court decisions. We have not been in the past and
do not in the future expect to be subject to income taxes in Panama because all
of our income has arisen from activities conducted entirely outside Panama. This
is the case even though we maintain our registered office in Panama. There is no
income tax treaty between Panama and the United States.
TAXATION OF DISTRIBUTIONS AND CAPITAL GAINS. There will be no Panamanian
taxes on distribution of dividends or capital gains realized by an individual or
corporation, regardless of its nationality or residency, on the sale or other
disposition of shares of common stock so long as our assets are held and
activities are conducted entirely outside of Panama.
S-11
12
PLAN OF DISTRIBUTION
Subject to the subscription agreement between us and the purchasers named
below, we have agreed to sell to each of the purchasers (or one or more nominees
controlled by that purchaser), and each of the purchasers have agreed to
purchase from us, the number of shares of our common stock determined by
dividing the purchase commitment set forth opposite their names in the following
table by the Canadian Dollar equivalent of U.S.$13.75 per share based on the
average official Canadian/U.S. dollar exchange rate during a specified period.
Purchaser Purchase Commitment
--------- -------------------
(Amounts shown in
Canadian Dollars)
McIvor Holdings Ltd.................. $1,257,363
Corey McIvor Holdings Ltd............ $ 742,283
Craig McIvor Holdings Ltd............ $ 384,465
Brad Maguire......................... $ 206,768
Don Undershute....................... $ 171,713
Lauraine Maguire..................... $ 170,858
John Paul............................ $ 54,075
Yorkton Securities Inc. ITF
John Paul RRSP.................... $ 30,000
Brett Undershute..................... $ 33,231
I. Jeannine Undershute............... $ 28,472
D. Gregg Undershute.................. $ 18,981
Sharla Undershute.................... $ 18,981
----------
$3,117,190
==========
Each purchaser has advised us that such purchaser, whether purchasing our
common stock personally or through one or more nominees controlled by that
purchaser, is not acting as an underwriter, placement agent, broker or dealer in
connection with such purchaser's acquisition of our common stock and warrants
that such purchaser is purchasing our common stock for such purchaser's own
account and not with a view to distribution.
LEGAL OPINION
Arias, Fabrega & Fabrega, Panama City, Republic of Panama, as our counsel,
will issue an opinion for us regarding the validity of the shares of common
stock offered by this prospectus supplement and the accompanying prospectus.
S-12
13
$200,000,000
WILLBROS GROUP, INC.
Senior Debt Securities
Subordinated Debt Securities
Common Stock
Class A Preferred Stock
Warrants
------------------------
By this prospectus, we may offer up to $200,000,000 in aggregate amount of
senior debt securities, subordinated debt securities, common stock, Class A
preferred stock and warrants on terms to be determined at the time of sale.
We will provide the specific terms of these securities in supplements to
this prospectus. Before you invest, you should carefully read this prospectus
and any supplements to this prospectus.
Our common stock is listed on The New York Stock Exchange under the symbol
"WG."
THERE ARE SIGNIFICANT RISKS ASSOCIATED WITH AN INVESTMENT IN OUR
SECURITIES. THESE RISK FACTORS WILL BE DISCUSSED IN DETAIL IN EACH SUPPLEMENT TO
THIS PROSPECTUS UNDER THE HEADING "RISK FACTORS." YOU SHOULD REVIEW THAT SECTION
OF THE PROSPECTUS SUPPLEMENT FOR A DISCUSSION OF MATTERS THAT INVESTORS IN OUR
SECURITIES SHOULD CONSIDER.
------------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
This prospectus may not be used to sell securities unless accompanied by a
prospectus supplement.
The date of this prospectus is June 27, 2001.
14
TABLE OF CONTENTS
PAGE
----
About This Prospectus................. 2
Where You Can Find More Information... 2
About Willbros Group, Inc............. 3
Ratios of Earnings to Fixed Charges
and Earnings to Fixed Charges and
Preferred Stock Dividends........... 4
Use of Proceeds....................... 4
Description of Senior Debt
Securities.......................... 5
PAGE
----
Description of Subordinated Debt
Securities.......................... 10
Description of Capital Stock.......... 15
Description of Warrants............... 19
Plan of Distribution.................. 21
Legal Opinions........................ 22
Experts............................... 22
Enforceability of Civil Liabilities
Under the Federal Securities Laws... 22
------------------------
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS OR ANY
PROSPECTUS SUPPLEMENT OR TO WHICH WE HAVE REFERRED YOU. WE HAVE NOT AUTHORIZED
ANYONE TO PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT. THIS PROSPECTUS MAY
ONLY BE USED WHERE IT IS LEGAL TO SELL THESE SECURITIES. THE INFORMATION IN THIS
PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT MAY ONLY BE ACCURATE ON THE DATE OF THAT
DOCUMENT.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
SEC utilizing a "shelf" registration process. Under this shelf process, we may,
from time to time, sell any combination of the securities described in this
prospectus in one or more offerings up to a total dollar amount of $200,000,000.
This prospectus provides you with a general description of the securities we may
offer. Each time we offer to sell securities, we will provide a prospectus
supplement that will contain specific information about the terms of that
offering. The prospectus supplement may also add, update or change information
contained in this prospectus. You should read both this prospectus and any
prospectus supplement together with the additional information described under
the heading "Where You Can Find More Information." Unless the context otherwise
requires, references in this prospectus to "Willbros," "we," "us" and "our"
refer to Willbros Group, Inc. and all of its subsidiaries collectively.
WHERE YOU CAN FIND MORE INFORMATION
This prospectus constitutes a part of a registration statement on Form S-3
(together with all amendments, supplements, schedules and exhibits to the
registration statement, referred to as the registration statement) that we have
filed with the SEC under the Securities Act of 1933 with respect to the
securities offered by this prospectus. This prospectus does not contain all the
information which is in the registration statement. Portions of the registration
statement are omitted as allowed by the rules and regulations of the SEC. We
refer you to the registration statement for further information about our
company and the securities offered by this prospectus. Statements contained in
this prospectus concerning the provisions of documents are not necessarily
complete, and each statement is qualified in its entirety by reference to the
copy of the applicable document filed with the SEC.
We also file annual, quarterly and special reports, proxy statements and
other information with the SEC. You can inspect and copy the registration
statement and the reports and other information we file with the SEC at the
public reference room maintained by the SEC at Room 1024, Judiciary Plaza, 450
Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. You can obtain
information on the operation of the public reference room by calling the SEC at
1-800-SEC-0330. The same information will be available for inspection and
copying at the regional offices of the SEC located at 7 World Trade Center, 13th
Floor, New York, New York 10048 and at Citicorp Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661. The SEC also maintains a Web site which
provides online access to reports, proxy and information statements and other
information regarding companies that file electronically with the SEC at the
address http://www.sec.gov.
2
15
The SEC allows us to "incorporate by reference" into this prospectus the
information we file with them, which means we can disclose important business
and financial information about us to you by referring you to those documents.
The information incorporated by reference is considered to be a part of this
prospectus, except for any information that is superseded by information
included directly in this prospectus and any prospectus supplement, and
information that we file later with the SEC will automatically update and
supersede the information in this prospectus. We incorporate by reference the
documents listed below that we have previously filed with the SEC and any future
filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act until the termination of the offering made under this
prospectus:
- Our Annual Report on Form 10-K for the fiscal year ended December 31,
2000;
- Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2001;
- The description of our common stock contained in our registration
statement on Form 8-A, dated July 19, 1996, including any amendment or
report filed before or after the date of this prospectus for the purpose
of updating the description; and
- The description of our preferred stock purchase rights contained in our
registration statement on Form 8-A, dated April 9, 1999, including any
amendment or report filed before or after the date of this prospectus for
the purpose of updating the description.
These filings have not been included in or delivered with this prospectus.
You may request a copy of these filings at no cost, by writing or telephoning us
at the following address:
Willbros USA, Inc.
4400 Post Oak Parkway
Suite 1000
Houston, Texas 77027
Attention: Investor Relations
(713) 403-8000
The reports, proxy statements and other information we file with the SEC
can also be inspected and copied at the New York Stock Exchange, 20 Broad
Street, New York, New York 10002. For more information on obtaining copies of
our public filings at the New York Stock Exchange, you should call (212)
656-5060.
ABOUT WILLBROS GROUP, INC.
We are one of the leading independent contractors serving the oil, gas and
power industries, providing construction, engineering and specialty services to
industry and government entities worldwide. We place particular emphasis on
projects in developing countries where we believe our experience gives us a
competitive advantage. Our construction services include the building and
replacement of major pipelines and gathering systems, flow stations, pump
stations, gas compressor stations, gas processing facilities, oil and gas
production facilities, piers, dock facilities and bridges. Our engineering
services include feasibility studies, conceptual and detailed design, field
services, material procurement and overall project management. Our specialty
services include dredging, pipe coating, pipe double jointing, removal and
installation of flowlines, fabrication of piles and platforms, maintenance and
repair of pipelines, stations and other facilities, pipeline rehabilitation,
general oilfield services, transport of oilfield equipment, rigs and vessels and
facility operations.
We are incorporated in the Republic of Panama and maintain our headquarters
at Plaza Bancomer Building, 50th Street, 8th Floor, Apartado 6307, Panama 5,
Republic of Panama, and our telephone number is (50-7) 213-0947. Administrative
services are provided to us by our subsidiary, Willbros USA, Inc., whose
administrative headquarters is located at 4400 Post Oak Parkway, Suite 1000,
Houston, Texas 77027, and whose telephone number is (713) 403-8000.
3
16
RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO
FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The following table sets forth our ratios of earnings to fixed charges and
earnings to fixed charges and preferred stock dividends. For this purpose,
earnings include income (loss) before income taxes and fixed charges. Fixed
charges include interest (whether expensed or capitalized), amortization of debt
expense, discount and premium (whether expensed or capitalized), and an estimate
of the interest within rental expense.
THREE MONTHS
YEARS ENDED DECEMBER 31, ENDED
------------------------------------ MARCH 31,
1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ------------
Ratio of earnings to fixed charges......... 3.5 11.0 1.1 (1) (1) 2.0
Ratio of earnings to fixed charges and
preferred stock dividends(2)............. 2.2 11.0 1.1 (1) (1) 2.0
---------------
(1) Earnings for the years ended December 31, 1999 and December 31, 2000, were
insufficient to cover fixed charges by $16.7 million and $10.3 million,
respectively.
(2) We paid $1.2 million in preferred stock dividends in 1996. We had no
preferred stock outstanding during any of the other periods presented.
Therefore, the ratio of earnings to fixed charges and preferred stock
dividends is the same as the ratio of earnings to fixed charges for all
periods presented subsequent to 1996.
USE OF PROCEEDS
Unless otherwise indicated in the applicable prospectus supplement, we
intend to use the net proceeds from the sale of the securities described in this
prospectus and any prospectus supplement for working capital and general
corporate purposes, which may include:
- repayment of outstanding debt;
- capital expenditures;
- acquisitions;
- investments; and
- other business opportunities.
4
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DESCRIPTION OF SENIOR DEBT SECURITIES
GENERAL
The following description applies to the senior debt securities offered by
this prospectus. The senior debt securities will be direct, unsecured
obligations of Willbros and will rank on a parity with all of our outstanding
unsecured senior indebtedness. The senior debt securities may be issued in one
or more series. The senior debt securities will be issued under an indenture
between us and the trustee specified in the applicable prospectus supplement.
The statements under this caption are brief summaries of the material
provisions contained in the indenture, do not claim to be complete and are
qualified in their entirety by reference to the indenture, a copy of which is
filed as an exhibit to the registration statement of which this prospectus forms
a part. Whenever defined terms are used but not defined in this prospectus,
those terms have the meanings given to them in the indenture.
The following material describes only the general terms and provisions of
the senior debt securities to which any prospectus supplement may relate. The
particular terms of any senior debt security and the extent, if any, to which
these general provisions may apply to such senior debt securities will be
described in the prospectus supplement relating to the senior debt securities.
The indenture does not limit the aggregate principal amount of senior debt
securities which may be issued under it. Rather, the indenture provides that
senior debt securities of any series may be issued under it up to the aggregate
principal amount which we may authorize from time to time. Senior debt
securities may be denominated in any currency or currency unit we designate.
Senior debt securities of a series may be issuable in registered form
without coupons ("Registered Securities") or in the form of one or more global
securities in registered form (each a "Global Security").
You must review the prospectus supplement for a description of the
following terms, where applicable, of each series of senior debt securities for
which this prospectus is being delivered:
- the title of the senior debt securities;
- the limit, if any, on the aggregate principal amount or aggregate initial
public offering price of the senior debt securities;
- the priority of payment of the senior debt securities;
- the price or prices, which may be expressed as a percentage of the
aggregate principal amount, at which the senior debt securities will be
issued;
- the date or dates on which the principal of the senior debt securities
will be payable;
- the interest rate or rates, which may be fixed or variable, for the
senior debt securities, if any, or the method of determining the same;
- the date or dates from which interest, if any, on the senior debt
securities will accrue, the date or dates on which interest, if any, will
be payable, the date or dates on which payment of interest, if any, will
commence and the regular record dates for interest payments;
- the extent to which any of the senior debt securities will be issuable in
temporary or permanent global form, or the manner in which any interest
payable on a temporary or permanent global senior debt security will be
paid;
- each office or agency where the senior debt securities may be presented
for registration of transfer or exchange;
- the place or places where the principal of and any premium and interest
on the senior debt securities will be payable;
5
18
- the date or dates, if any, after which the senior debt securities may be
redeemed or purchased in whole or in part (1) at our option, (2)
mandatorily pursuant to any sinking, purchase or similar fund or (3) at
the option of the holder, and the redemption or repayment price or
prices;
- the terms, if any, upon which the senior debt securities may be
convertible into or exchanged for any other kind of our securities or
indebtedness or of any other issuer or obligor and the terms and
conditions upon which the conversion or exchange would be made, including
the initial conversion or exchange price or rate, the conversion period
and any other additional provisions;
- the authorized denomination or denominations for the senior debt
securities;
- the currency, currencies or units based on or related to currencies for
which the senior debt securities may be purchased and the currency,
currencies or currency units in which the principal of and any premium
and interest on the senior debt securities may be payable;
- any index used to determine the amount of payments of principal of and
any premium and interest on the senior debt securities;
- the payment of any additional amounts with respect to the senior debt
securities;
- whether any of the senior debt securities will be issued as Original
Issue Discount Securities (as defined below);
- information with respect to book-entry procedures, if any;
- any additional covenants or events of default not currently included in
the indenture relating to the senior debt securities; and
- any other terms of the senior debt securities not inconsistent with the
provisions of the indenture.
If any of the senior debt securities are sold for one or more foreign
currencies or foreign currency units or if the principal of or any premium or
interest on any series of senior debt securities is payable in one or more
foreign currencies or foreign currency units, the restrictions, elections, tax
consequences, specific terms and other information with respect to that issue of
senior debt securities and those currencies or currency units will be described
in the applicable prospectus supplement.
A judgment for money damages by courts in the United States, including a
money judgment based on an obligation expressed in a foreign currency, will
ordinarily be rendered only in U.S. dollars. New York statutory law provides
that a court shall render a judgment or decree in the foreign currency of the
underlying obligation and that the judgment or decree shall be converted into
U.S. dollars at the exchange rate prevailing on the date of entry of the
judgment or decree.
Senior debt securities may be issued as original issue discount senior debt
securities which bear no interest or interest at a rate which at the time of
issuance is below market rates ("Original Issue Discount Securities"), to be
sold at a substantial discount below their stated principal amount due at the
stated maturity of the senior debt securities. There may be no periodic payments
of interest on Original Issue Discount Securities. In the event of an
acceleration of the maturity of any Original Issue Discount Security, the amount
payable to the holder of the Original Issue Discount Security upon acceleration
will be determined in accordance with the prospectus supplement, the terms of
the security and the indenture, but will be an amount less than the amount
payable at the maturity of the principal of the Original Issue Discount
Security. Federal income tax considerations with respect to Original Issue
Discount Securities will be described in the applicable prospectus supplement.
REGISTRATION AND TRANSFER
Unless otherwise indicated in the applicable prospectus supplement, senior
debt securities will be issued only as Registered Securities. Senior debt
securities issued as Registered Securities will not have interest coupons.
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Registered Securities (other than a Global Security) may be presented for
transfer, with the form of transfer endorsed thereon duly executed, or exchanged
for other senior debt securities of the same series at the office of the
security registrar specified in the indenture. The indenture provides that, with
respect to Registered Securities having The City of New York as a place of
payment, we will appoint a security registrar or co-security registrar located
in The City of New York for such transfer or exchange. Transfer or exchange will
be made without service charge, but we may require payment of any taxes or other
governmental charges.
BOOK-ENTRY SENIOR DEBT SECURITIES
Senior debt securities of a series may be issued in whole or in part in the
form of one or more Global Securities. Each Global Security will be deposited
with, or on behalf of, a depositary identified in the applicable prospectus
supplement. Global Securities will be issued in registered form and in either
temporary or permanent form. Until exchanged in whole or in part for the
individual securities which it represents, a Global Security may not be
transferred except as a whole by the depositary for the Global Security to a
nominee of the depositary or by a nominee of the depositary to the depositary or
another nominee of the depositary or by the depositary or any nominee to a
successor depositary or any nominee of the successor. The specific terms of the
depositary arrangement for a series of senior debt securities will be described
in the applicable prospectus supplement.
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in an applicable prospectus supplement, payment
of principal of and any premium and interest on Registered Securities will be
made at the office of such paying agent or paying agents as we may designate
from time to time. In addition, at our option, payment of any interest may be
made by:
- check mailed to the person entitled to the payment at the address in the
applicable security register; or
- wire transfer to an account maintained by the person entitled to the
payment as specified in the applicable security register.
Unless otherwise indicated in an applicable prospectus supplement, payment
of any installment of interest on Registered Securities will be made to the
person in whose name such senior debt security is registered at the close of
business on the regular record date for such payment.
CONSOLIDATION, MERGER OR SALE OF ASSETS
The indenture relating to the senior debt securities provides that we may,
without the consent of the holders of any of the senior debt securities
outstanding under the indenture, consolidate with, merge into or transfer our
assets substantially as an entirety to any person, provided that:
- any successor assumes our obligations on the senior debt securities and
under the indenture; and
- after giving effect to the consolidation, merger or transfer, no Event of
Default (as defined in the indenture) will have happened and be
continuing.
Any consolidation, merger or transfer of assets substantially as an
entirety, which meets the conditions described above, would not create an Event
of Default which would entitle holders of the senior debt securities, or the
trustee acting on their behalf, to take any of the actions described below under
"-- Events of Default, Waivers, Etc."
LEVERAGED AND OTHER TRANSACTIONS
The indenture and the senior debt securities do not contain provisions
which would protect holders of the senior debt securities in the event we
engaged in a highly leveraged or other transaction which could adversely affect
the holders of senior debt securities.
7
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MODIFICATION OF THE INDENTURE
The indenture provides that, with the consent of the holders of not less
than a majority in aggregate principal amount of the outstanding senior debt
securities of each affected series, modifications and alterations of the
indenture may be made which affect the rights of the holders of the senior debt
securities. However, no modification or alteration may be made without the
consent of the holder of each senior debt security affected which would, among
other things:
- modify the terms of payment of principal of or any premium or interest on
the senior debt securities; or
- reduce the percentage in principal amount of outstanding senior debt
securities required to modify or alter the indenture.
EVENTS OF DEFAULT, WAIVERS, ETC.
An "Event of Default" with respect to senior debt securities of any series
is defined in the indenture to include:
(1) default in the payment of principal of or any premium on any of
the outstanding senior debt securities of that series when due;
(2) default in the payment of interest on any of the outstanding
senior debt securities of that series when due and continuance of such
default for 30 days;
(3) default in the performance of any of our other covenants in the
indenture with respect to the senior debt securities of such series and
continuance of such default for 90 days after written notice;
(4) certain events of bankruptcy, insolvency or reorganization
relating to us; and
(5) any other event that may be specified in a prospectus supplement
with respect to any series of senior debt securities.
If an Event of Default with respect to any series of outstanding senior
debt securities occurs and is continuing, either the trustee or the holders of
not less than 25% in aggregate principal amount of the outstanding senior debt
securities of such series may declare the principal amount (or if such senior
debt securities are Original Issue Discount Securities, the portion of the
principal amount as may be specified in the terms of that series) of all senior
debt securities of that series to be immediately due and payable. The holders of
a majority in aggregate principal amount of the outstanding senior debt
securities of any series may waive an Event of Default resulting in acceleration
of the senior debt securities, but only if all Events of Default with respect to
senior debt securities of such series have been remedied and all payments due,
other than those due as a result of acceleration, have been made.
If an Event of Default occurs and is continuing, the trustee may, in its
discretion, and at the written request of holders of not less than a majority in
aggregate principal amount of the outstanding senior debt securities of any
series and upon reasonable indemnity against the costs, expenses and liabilities
to be incurred in compliance with such request and subject to certain other
conditions set forth in the indenture will, proceed to protect the rights of the
holders of all the senior debt securities of such series. Prior to acceleration
of maturity of the outstanding senior debt securities of any series, the holders
of a majority in aggregate principal amount of the senior debt securities may
waive any past default under the indenture except a default in the payment of
principal of or any premium or interest on the senior debt securities of that
series.
The indenture provides that, upon the occurrence of an Event of Default
specified in clause (1) or (2) of the first paragraph in this subsection, we
will, upon demand of the trustee, pay to it, for the benefit of the holder of
any senior debt security, the whole amount then due and payable on the affected
senior debt securities for principal, premium, if any, and interest, if any. The
indenture further provides that, if we fail to pay such amount upon demand, the
trustee may, among other things, institute a judicial proceeding for the
collection of those amounts.
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The indenture also provides that, notwithstanding any of its other
provisions, the holder of any senior debt security of any series will have the
right to institute suit for the enforcement of any payment of principal of or
any premium or interest on the senior debt securities when due and that such
right will not be impaired without the consent of such holder.
We are required to file annually with the trustee a written statement of
our officers as to the existence or non-existence of defaults under the
indenture or the senior debt securities.
SATISFACTION AND DISCHARGE
The indenture provides, among other things, that, when all senior debt
securities not previously delivered to the trustee for cancellation (1) have
become due and payable or (2) will become due and payable at their stated
maturity within one year, we may deposit with the trustee funds, in trust, for
the purpose and in an amount sufficient to pay and discharge the entire
indebtedness on the senior debt securities not previously delivered to the
trustee for cancellation. Those funds will include all principal, premium, if
any, and interest, if any, to the date of the deposit or to the stated maturity,
as applicable. Upon such deposit, the indenture will cease to be of further
effect except as to our obligations to pay all other sums due under the
indenture and to provide the officers' certificates and opinions of counsel
required under the indenture. At such time we will be deemed to have satisfied
and discharged the indenture.
GOVERNING LAW
The indenture and the senior debt securities will be governed by, and
construed in accordance with, the laws of the State of New York.
REGARDING THE TRUSTEE
Information concerning the trustee for a series of senior debt securities
will be set forth in the prospectus supplement relating to such series of senior
debt securities.
We may have normal banking relationships with the trustee in the ordinary
course of business.
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DESCRIPTION OF SUBORDINATED DEBT SECURITIES
GENERAL
The following description applies to the subordinated debt securities
offered by this prospectus. The subordinated debt securities will be unsecured,
subordinated obligations of Willbros. The subordinated debt securities may be
issued in one or more series. The subordinated debt securities will be issued
under an indenture between us and the trustee specified in the applicable
prospectus supplement.
The statements under this caption are brief summaries of the material
provisions contained in the indenture, do not claim to be complete and are
qualified in their entirety by reference to the indenture, a copy of which is
filed as an exhibit to the registration statement of which this prospectus forms
a part. Whenever defined terms are used but not defined in this prospectus,
those terms have the meanings given to them in the indenture.
The following material describes only the general terms and provisions of
the subordinated debt securities to which any prospectus supplement may relate.
The particular terms of any subordinated debt security and the extent, if any,
to which these general provisions may apply to such subordinated debt securities
will be described in the prospectus supplement relating to the subordinated debt
securities.
The indenture does not limit the aggregate principal amount of subordinated
debt securities which may be issued under it. Rather, the indenture provides
that subordinated debt securities of any series may be issued under it up to the
aggregate principal amount which we may authorize from time to time.
Subordinated debt securities may be denominated in any currency or currency unit
we designate.
Subordinated debt securities of a series may be issuable in the form of
Registered Securities or Global Securities.
You must review the prospectus supplement for a description of the
following terms, where applicable, of each series of subordinated debt
securities for which this prospectus is being delivered:
- the title of the subordinated debt securities;
- the limit, if any, on the aggregate principal amount or aggregate initial
public offering price of the subordinated debt securities;
- the priority of payment of the subordinated debt securities;
- the price or prices, which may be expressed as a percentage of the
aggregate principal amount, at which the subordinated debt securities
will be issued;
- the date or dates on which the principal of the subordinated debt
securities will be payable;
- the interest rate or rates, which may be fixed or variable, for the
subordinated debt securities, if any, or the method of determining the
same;
- the date or dates from which interest, if any, on the subordinated debt
securities will accrue, the date or dates on which interest, if any, will
be payable, the date or dates on which payment of interest, if any, will
commence and the regular record dates for interest payments;
- the extent to which any of the subordinated debt securities will be
issuable in temporary or permanent global form, or the manner in which
any interest payable on a temporary or permanent global subordinated debt
security will be paid;
- each office or agency where the subordinated debt securities may be
presented for registration of transfer or exchange;
- the place or places where the principal of and any premium and interest
on the subordinated debt securities will be payable;
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- the date or dates, if any, after which the subordinated debt securities
may be redeemed or purchased in whole or in part (1) at our option, (2)
mandatorily pursuant to any sinking, purchase or similar fund or (3) at
the option of the holder, and the redemption or repayment price or
prices;
- the terms, if any, upon which the subordinated debt securities may be
convertible into or exchanged for any other kind of our securities or
indebtedness or of any other issuer or obligor and the terms and
conditions upon which the conversion or exchange would be made, including
the initial conversion or exchange price or rate, the conversion period
and any other additional provisions;
- the authorized denomination or denominations for the subordinated debt
securities;
- the currency, currencies or units based on or related to currencies for
which the subordinated debt securities may be purchased and the currency,
currencies or currency units in which the principal of and any premium
and interest on the subordinated debt securities may be payable;
- any index used to determine the amount of payments of principal of and
any premium and interest on the subordinated debt securities;
- the payment of any additional amounts with respect to the subordinated
debt securities;
- whether any of the subordinated debt securities will be issued as
Original Issue Discount Securities;
- information with respect to book-entry procedures, if any;
- the terms of subordination;
- any additional covenants or events of default not currently included in
the indenture relating to the subordinated debt securities; and
- any other terms of the subordinated debt securities not inconsistent with
the provisions of the indenture.
If any of the subordinated debt securities are sold for one or more foreign
currencies or foreign currency units or if the principal of or any premium or
interest on any series of subordinated debt securities is payable in one or more
foreign currencies or foreign currency units, the restrictions, elections, tax
consequences, specific terms and other information with respect to that issue of
subordinated debt securities and those currencies or currency units will be
described in the applicable prospectus supplement.
A judgment for money damages by courts in the United States, including a
money judgment based on an obligation expressed in a foreign currency, will
ordinarily be rendered only in U.S. dollars. New York statutory law provides
that a court shall render a judgment or decree in the foreign currency of the
underlying obligation and that the judgment or decree shall be converted into
U.S. dollars at the exchange rate prevailing on the date of entry of the
judgment or decree.
Subordinated debt securities may be issued as Original Issue Discount
Securities, to be sold at a substantial discount below their stated principal
amount due at the stated maturity of the subordinated debt securities. There may
be no periodic payments of interest on Original Issue Discount Securities. In
the event of an acceleration of the maturity of any Original Issue Discount
Security, the amount payable to the holder of the Original Issue Discount
Security upon acceleration will be determined in accordance with the prospectus
supplement, the terms of the security and the indenture, but will be an amount
less than the amount payable at the maturity of the principal of the Original
Issue Discount Security. Federal income tax considerations with respect to
Original Issue Discount Securities will be described in the applicable
prospectus supplement.
REGISTRATION AND TRANSFER
Unless otherwise indicated in the applicable prospectus supplement,
subordinated debt securities will be issued only as Registered Securities.
Subordinated debt securities issued as Registered Securities will not have
interest coupons.
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Registered Securities (other than a Global Security) may be presented for
transfer, with the form of transfer endorsed thereon duly executed, or exchanged
for other subordinated debt securities of the same series at the office of the
security registrar specified in the indenture. The indenture provides that, with
respect to Registered Securities having The City of New York as a place of
payment, we will appoint a security registrar or co-security registrar located
in The City of New York for such transfer or exchange. Transfer or exchange will
be made without service charge, but we may require payment of any taxes or other
governmental charges.
BOOK-ENTRY SUBORDINATED DEBT SECURITIES
Subordinated debt securities of a series may be issued in whole or in part
in the form of one or more Global Securities. Each Global Security will be
deposited with, or on behalf of, a depositary identified in the applicable
prospectus supplement. Global Securities will be issued in registered form and
in either temporary or permanent form. Until exchanged in whole or in part for
the individual securities which it represents, a Global Security may not be
transferred except as a whole by the depositary for the Global Security to a
nominee of the depositary or by a nominee of the depositary to the depositary or
another nominee of the depositary or by the depositary or any nominee to a
successor depositary or any nominee of the successor. The specific terms of the
depositary arrangement for a series of subordinated debt securities will be
described in the applicable prospectus supplement.
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in an applicable prospectus supplement, payment
of principal of and any premium and interest on Registered Securities will be
made at the office of such paying agent or paying agents as we may designate
from time to time. In addition, at our option, payment of any interest may be
made by:
- check mailed to the person entitled to the payment at the address in the
applicable security register; or
- wire transfer to an account maintained by the person entitled to the
payment as specified in the applicable security register.
Unless otherwise indicated in an applicable prospectus supplement, payment
of any installment of interest on Registered Securities will be made to the
person in whose name such subordinated debt security is registered at the close
of business on the regular record date for such payment.
SUBORDINATION
The subordinated debt securities will be subordinated and junior in right
of payment to some of our other indebtedness (which may include senior
indebtedness for money borrowed) to the extent described in the applicable
prospectus supplement.
CONSOLIDATION, MERGER OR SALE OF ASSETS
The indenture relating to the subordinated debt securities provides that we
may, without the consent of the holders of any of the subordinated debt
securities outstanding under the indenture, consolidate with, merge into or
transfer our assets substantially as an entirety to any person, provided that:
- any successor assumes our obligations on the subordinated debt securities
and under the indenture; and
- after giving effect to the consolidation, merger or transfer, no Event of
Default (as defined in the indenture) will have happened and be
continuing.
Any consolidation, merger or transfer of assets substantially as an
entirety, which meets the conditions described above, would not create an Event
of Default which would entitle holders of the subordinated debt securities, or
the trustee acting on their behalf, to take any of the actions described below
under "-- Events of Default, Waivers, Etc."
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LEVERAGED AND OTHER TRANSACTIONS
The indenture and the subordinated debt securities do not contain
provisions which would protect holders of the subordinated debt securities in
the event we engaged in a highly leveraged or other transaction which could
adversely affect the holders of subordinated debt securities.
MODIFICATION OF THE INDENTURE
The indenture provides that, with the consent of the holders of not less
than a majority in aggregate principal amount of the outstanding subordinated
debt securities of each affected series, modifications and alterations of the
indenture may be made which affect the rights of the holders of the subordinated
debt securities. However, no modification or alteration may be made without the
consent of the holder of each subordinated debt security affected which would,
among other things:
- modify the terms of payment of principal of or any premium or interest on
the subordinated debt securities;
- adversely modify the subordination terms of the subordinated debt
securities; or
- reduce the percentage in principal amount of outstanding subordinated
debt securities required to modify or alter the indenture.
EVENTS OF DEFAULT, WAIVERS, ETC.
An "Event of Default" with respect to subordinated debt securities of any
series is defined in the indenture to include:
(1) default in the payment of principal of or any premium on any of
the outstanding subordinated debt securities of that series when due;
(2) default in the payment of interest on any of the outstanding
subordinated debt securities of that series when due and continuance of
such default for 30 days;
(3) default in the performance of any of our other covenants in the
indenture with respect to the subordinated debt securities of such series
and continuance of such default for 90 days after written notice;
(4) certain events of bankruptcy, insolvency or reorganization
relating to us; and
(5) any other event that may be specified in a prospectus supplement
with respect to any series of subordinated debt securities.
If an Event of Default with respect to any series of outstanding
subordinated debt securities occurs and is continuing, either the trustee or the
holders of not less than 25% in aggregate principal amount of the outstanding
subordinated debt securities of such series may declare the principal amount (or
if such subordinated debt securities are Original Issue Discount Securities, the
portion of the principal amount as may be specified in the terms of that series)
of all subordinated debt securities of that series to be immediately due and
payable. The holders of a majority in aggregate principal amount of the
outstanding subordinated debt securities of any series may waive an Event of
Default resulting in acceleration of the subordinated debt securities, but only
if all Events of Default with respect to subordinated debt securities of such
series have been remedied and all payments due, other than those due as a result
of acceleration, have been made.
If an Event of Default occurs and is continuing, the trustee may, in its
discretion, and at the written request of holders of not less than a majority in
aggregate principal amount of the outstanding subordinated debt securities of
any series and upon reasonable indemnity against the costs, expenses and
liabilities to be incurred in compliance with such request and subject to
certain other conditions set forth in the indenture will, proceed to protect the
rights of the holders of all the subordinated debt securities of such series.
Prior to acceleration of maturity of the outstanding subordinated debt
securities of any series, the holders of a majority in aggregate principal
amount of the subordinated debt securities may waive any past default under the
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indenture except a default in the payment of principal of or any premium or
interest on the subordinated debt securities of that series.
The indenture provides that, upon the occurrence of an Event of Default
specified in clause (1) or (2) of the first paragraph in this subsection, we
will, upon demand of the trustee, pay to it, for the benefit of the holder of
any subordinated debt security, the whole amount then due and payable on the
affected subordinated debt securities for principal, premium, if any, and
interest, if any. The indenture further provides that, if we fail to pay such
amount upon demand, the trustee may, among other things, institute a judicial
proceeding for the collection of those amounts.
The indenture also provides that, notwithstanding any of its other
provisions, the holder of any subordinated debt security of any series will have
the right to institute suit for the enforcement of any payment of principal of
or any premium or interest on the subordinated debt securities when due and that
such right will not be impaired without the consent of such holder.
We are required to file annually with the trustee a written statement of
our officers as to the existence or non-existence of defaults under the
indenture or the subordinated debt securities.
SATISFACTION AND DISCHARGE
The indenture provides, among other things, that, when all subordinated
debt securities not previously delivered to the trustee for cancellation (1)
have become due and payable or (2) will become due and payable at their stated
maturity within one year, we may deposit with the trustee funds, in trust, for
the purpose and in an amount sufficient to pay and discharge the entire
indebtedness on the subordinated debt securities not previously delivered to the
trustee for cancellation. Those funds will include all principal, premium, if
any, and interest, if any, to the date of the deposit or to the stated maturity,
as applicable. Upon such deposit, the indenture will cease to be of further
effect except as to our obligations to pay all other sums due under the
indenture and to provide the officers' certificates and opinions of counsel
required under the indenture. At such time we will be deemed to have satisfied
and discharged the indenture.
GOVERNING LAW
The indenture and the subordinated debt securities will be governed by, and
construed in accordance with, the laws of the State of New York.
REGARDING THE TRUSTEE
Information concerning the trustee for a series of subordinated debt
securities will be set forth in the prospectus supplement relating to such
series of subordinated debt securities.
We may have normal banking relationships with the trustee in the ordinary
course of business.
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DESCRIPTION OF CAPITAL STOCK
GENERAL
We have 36,000,000 authorized shares of capital stock, consisting of (a)
35,000,000 shares of common stock, par value $.05 per share; and (b) 1,000,000
shares of Class A preferred stock, par value $.01 per share.
COMMON STOCK
As of May 31, 2001, 14,392,392 shares of our common stock were outstanding.
All of the outstanding shares of our common stock are fully paid and
nonassessable. The holders of our common stock are entitled to one vote for each
share of common stock held on all matters voted upon by stockholders, including
the election of directors. Holders of our common stock have no right to cumulate
their votes in the election of directors. Subject to the rights of any
then-outstanding shares of our preferred stock, the holders of our common stock
are entitled to receive dividends as may be declared in the discretion of the
Board of Directors out of funds legally available for the payment of dividends.
We are subject to restrictions on the payment of dividends under the provisions
of our bank credit agreement.
The holders of our common stock are entitled to share equally and ratably
in our net assets upon a liquidation or dissolution after we pay or provide for
all liabilities, subject to any preferential liquidation rights of any preferred
stock that at the time may be outstanding. The holders of our common stock have
no preemptive, subscription, conversion or redemption rights. There are no
governmental laws or regulations in the Republic of Panama affecting the
remittance of dividends, interest and other payments to our nonresident
stockholders so long as we continue not to engage in business in the Republic of
Panama.
Our articles of incorporation contain restrictions, subject to the
determination by the Board of Directors in good faith and in its sole
discretion, on the transfer of any shares of our common stock in order to
prevent us from becoming a "controlled foreign corporation" under United States
tax law. See "-- Anti-Takeover Effects of Provisions of Our Articles of
Incorporation and Bylaws."
CLASS A PREFERRED STOCK
As of the date of this prospectus, there were no outstanding shares of
Class A preferred stock; however, the Board of Directors has reserved for
issuance pursuant to our Stockholder Rights Plan described below 35,000 shares
of Series A junior participating preferred stock. Class A preferred stock may be
issued from time to time in one or more series, and the Board of Directors,
without further approval of the stockholders, is authorized to fix the dividend
rates and terms, conversion rights, voting rights, redemption rights and terms,
liquidation preferences, sinking fund and any other rights, preferences,
privileges and restrictions applicable to each series of Class A preferred
stock.
The specific matters that the Board of Directors may determine include the
following:
- the designation of each series;
- the number of shares of each series;
- the rate of any dividends;
- whether any dividends will be cumulative or non-cumulative;
- the terms of any redemption;
- the amount payable in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the affairs of our company;
- rights and terms of any conversion or exchange;
- restrictions on the issuance of shares of the same series or any other
series; and
- any voting rights.
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The prospectus supplement relating to any new series of Class A preferred
stock for which this prospectus is being delivered will specify the applicable
terms, which may include those listed above. The purpose of authorizing the
Board of Directors to determine these rights, preferences, privileges and
restrictions is to eliminate delays associated with a stockholder vote on
specific issuances. The issuance of Class A preferred stock, while providing
flexibility in connection with possible acquisitions and other corporate
purposes, could:
- decrease the amount of earnings and assets available for distribution to
holders of common stock;
- adversely affect the rights and powers, including voting rights, of
holders of common stock; and
- have the effect of delaying, deferring or preventing a change in control.
For example, the Board of Directors, with its broad power to establish the
rights and preferences of authorized but unissued Class A preferred stock, could
issue one or more series of Class A preferred stock entitling holders to vote
separately as a class on any proposed merger or consolidation, to convert Class
A preferred stock into a larger number of shares of common stock or other
securities, to demand redemption at a specified price under prescribed
circumstances related to a change in control, or to exercise other rights
designed to impede a takeover.
STOCKHOLDER RIGHTS PLAN
On April 1, 1999, our Board of Directors approved a rights agreement with
Mellon Investor Services, LLC, as rights agent, and declared a distribution of
one preferred share purchase right ("Right") for each outstanding share of
common stock. Each Right, when it becomes exercisable, entitles its registered
holder to purchase one one-thousandth of a share of Series A junior
participating Class A preferred stock ("Series A preferred stock") at a price of
$30 per one one-thousandth of a share.
The Rights are attached to and trade with shares of our common stock.
Currently, the Rights are not exercisable and there are no separate certificates
representing the Rights. If the Rights become exercisable, we will distribute
separate Rights certificates. Until that time and as long as the Rights are
outstanding, any transfer of shares of our common stock will also constitute the
transfer of the Rights associated with those common shares. The Rights will
expire on April 15, 2009, unless we redeem or exchange the Rights before that
date.
The Rights will become exercisable upon the earlier to occur of:
- the public announcement that a person or group of persons has acquired
15% or more of our common stock, except in connection with an offer
approved by our Board of Directors; or
- 10 days, or a later date determined by our Board of Directors, after the
commencement of, or announcement of an intention to commence, a tender or
exchange offer that would result in a person or group of persons
acquiring 15% or more of our common stock.
If any person or group of persons acquire 15% or more of our common stock,
except in connection with an offer approved by our Board of Directors, each
holder of a Right, except the acquiring person or group, will have the right,
upon exercise of the Right, to receive that number of shares of our common stock
or Series A preferred stock having a value equal to two times the exercise price
of the Right.
In the event that any person or group acquires 15% or more of our common
stock and either (a) we are acquired in a merger or other business combination
in which the holders of all of our common stock immediately prior to the
transaction are not the holders of all of the surviving corporation's voting
power or (b) more than 50% of our assets or earning power is sold or
transferred, then each holder of a Right, except the acquiring person or group,
will have the right, upon exercise of the Right, to receive common shares of the
acquiring company having a value equal to two times the exercise price of the
Right.
The Rights are redeemable in whole, but not in part, by action of the Board
of Directors at a price of $.005 per Right prior to the earlier to occur of a
person or group acquiring 15% of our common stock or the expiration of the
Rights. Following the public announcement that a person or group has acquired
15% of our common stock, the Rights are redeemable in whole, but not in part, by
action of the Board of Directors at a
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price of $.005 per Right, provided the redemption is in connection with a merger
or other business combination involving our company in which all the holders of
our common stock are treated alike and which does not involve the acquiring
person or its affiliates.
In the event shares of Series A preferred stock are issued upon the
exercise of the Rights, holders of the Series A preferred stock will be entitled
to receive, in preference to holders of common stock, a quarterly dividend
payment in an amount per share equal to the greater of (a) $10 or (b) 1,000
times the dividend declared per share of common stock. The Series A preferred
stock dividends are cumulative but do not bear interest. Shares of Series A
preferred stock are not redeemable. In the event of liquidation, the holders of
the Series A preferred stock will be entitled to a minimum preferential
liquidation payment of $1,000 per share; thereafter, and after the holders of
the common stock receive a liquidation payment of $1.00 per share, the holders
of the Series A preferred stock and the holders of the common stock will share
the remaining assets in the ratio of 1,000 to 1 (as adjusted) for each share of
Series A preferred stock and common stock so held, respectively. In the event of
any merger, consolidation or other transaction in which the shares of common
stock are exchanged, each share of Series A preferred stock will be entitled to
receive 1,000 times the amount received per share of common stock. These rights
are protected by antidilution provisions.
Each share of Series A preferred stock will have 1,000 votes, voting
together with the common stock. In the event that the amount of accrued and
unpaid dividends on the Series A preferred stock is equivalent to six full
quarterly dividends or more, the holders of the Series A preferred stock shall
have the right, voting as a class, to elect two directors in addition to the
directors elected by the holders of the common stock until all cumulative
dividends on the Series A preferred stock have been paid through the last
quarterly dividend payment date or until non-cumulative dividends have been paid
regularly for at least one year.
The stockholder rights plan is designed to deter coercive takeover tactics
that attempt to gain control of our company without paying all stockholders a
fair price. The plan discourages hostile takeovers by effectively allowing our
stockholders to acquire shares of our capital stock at a discount following a
hostile acquisition of a large block of our outstanding common stock and by
increasing the value of consideration to be received by stockholders in
specified transactions following an acquisition.
ANTI-TAKEOVER EFFECTS OF PROVISIONS OF OUR ARTICLES OF INCORPORATION AND BY-LAWS
Our articles of incorporation, as amended and restated, and our restated
by-laws contain provisions that might be characterized as anti-takeover
provisions. These provisions may deter or render more difficult proposals to
acquire control of our company, including proposals a stockholder might consider
to be in his or her best interest, impede or lengthen a change in membership of
the Board of Directors and make removal of our management more difficult.
CLASSIFIED BOARD OF DIRECTORS; REMOVAL OF DIRECTORS; ADVANCE NOTICE
PROVISIONS FOR STOCKHOLDER NOMINATIONS. Our articles of incorporation provide
for the Board of Directors to be divided into three classes of directors serving
staggered three-year terms, with the numbers of directors in the three classes
to be as nearly equal as possible. Any director may be removed from office but
only for cause and only by the affirmative vote of a majority of the then
outstanding shares of stock entitled to vote on the matter. Any stockholder
wishing to submit a nomination to the Board of Directors must follow the
procedures outlined in our articles of incorporation. Any proposal to amend or
repeal the provisions of our articles of incorporation relating to the matters
contained above in this paragraph requires the affirmative vote of the holders
of 75% or more of the outstanding shares of stock entitled to vote on the
matter.
UNANIMOUS CONSENT OF STOCKHOLDERS REQUIRED FOR ACTION BY WRITTEN
CONSENT. Under our restated by-laws, stockholder action may be taken without a
meeting only by unanimous written consent of all of our stockholders.
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ISSUANCE OF PREFERRED STOCK. As described above, our articles of
incorporation authorize a class of undesignated Class A preferred stock
consisting of 1,000,000 shares. Class A preferred stock may be issued from time
to time in one or more series, and the Board of Directors, without further
approval of the stockholders, is authorized to fix the rights, preferences,
privileges and restrictions applicable to each series of Class A preferred
stock. The purpose of authorizing the Board of Directors to determine these
rights, preferences, privileges and restrictions is to eliminate delays
associated with a stockholder vote on specific issuances. The issuance of Class
A preferred stock, while providing flexibility in connection with possible
acquisitions and other corporate purposes, could, among other things, adversely
affect the voting power of the holders of our common stock and, under certain
circumstances, make it more difficult for a third party to gain control of us.
RESTRICTIONS ON TRANSFER OF COMMON STOCK. Our articles of incorporation
provide for restrictions on the transfer of any shares of our common stock to
prevent us from becoming a "controlled foreign corporation" under United States
tax law. Any purported transfer, including a sale, gift, assignment, devise or
other disposition of common stock, which would result in a person or persons
becoming the beneficial owner of 10% or more of the issued and outstanding
shares of our common stock, is subject to a determination by our Board of
Directors in good faith, in its sole discretion, that the transfer would not in
any way, directly or indirectly, affect our status as a non-controlled foreign
corporation. The transferee or transferor to be involved in a proposed transfer
must give written notice to our Secretary not less than 30 days prior to the
proposed transfer. In the event of an attempted transfer in violation of the
provisions of our articles of incorporation relating to the matters contained in
this paragraph, the purported transferee will acquire no rights whatsoever in
the transferred shares of common stock. Nothing in this provision, however,
precludes the settlement of any transactions entered into through the facilities
of the New York Stock Exchange. If the Board of Directors determines that a
transfer has taken place in violation of these restrictions, the Board of
Directors may take any action it deems advisable to refuse to give effect to or
to prevent the transfer, including instituting judicial proceedings to enjoin
the transfer.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for our common stock, as well as the
rights agent under our rights agreement, is Mellon Investor Services, LLC.
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DESCRIPTION OF WARRANTS
OFFERED WARRANTS
We may issue warrants that are debt warrants or equity warrants. We may
offer warrants separately or together with one or more additional warrants or
debt or equity securities or any combination of those securities in the form of
units, as described in the applicable prospectus supplement. If we issue
warrants as part of a unit, the accompanying prospectus supplement will specify
whether those warrants may be separated from the other securities in the unit
prior to the warrants' expiration date.
GENERAL TERMS OF WARRANTS
The applicable prospectus supplement will contain, where applicable, the
following terms of and other information relating to the warrants:
- the specific designation and aggregate number of, and the price at which
we will issue, the warrants;
- the currency with which the warrants may be purchased;
- the date on which the right to exercise the warrants will begin and the
date on which that right will expire or, if you may not continuously
exercise the warrants throughout that period, the specific date or dates
on which you may exercise the warrants;
- whether the warrants will be issued in fully registered form or bearer
form, in definitive or global form or in any combination of these forms,
although, in any case, the form of a warrant included in a unit will
correspond to the form of the unit and of any debt security included in
that unit;
- any applicable material United States federal income tax consequences;
- the identity of the warrant agent for the warrants and of any other
depositaries, execution or paying agents, transfer agents, registrars or
other agents;
- the proposed listing, if any, of the warrants or any securities
purchasable upon exercise of the warrants on any securities exchange;
- if applicable, the minimum or maximum amount of the warrants that may be
exercised at any one time;
- information with respect to book-entry procedures, if any;
- the terms of the securities issuable upon exercise of the warrants;
- the antidilution provisions of the warrants, if any;
- any redemption or call provisions;
- the exercise price and procedures for exercise of the warrants;
- whether the warrants are to be sold separately or with other securities
as part of units; and
- any other terms of the warrants.
SIGNIFICANT PROVISIONS OF THE WARRANT AGREEMENTS
We will issue the warrants under one or more warrant agreements to be
entered into between us and a bank or trust company, as warrant agent, in one or
more series, which will be described in the applicable prospectus supplement.
The following is a summary of the material provisions of the warrant agreements
and the warrants. This summary is not intended to be comprehensive, and holders
of warrants should review the detailed description of the relevant warrant
agreement included in any prospectus supplement.
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MODIFICATIONS WITHOUT CONSENT OF WARRANTHOLDERS. We and the warrant agent
may amend the terms of the warrants and the warrant certificates without the
consent of the holders to:
- cure any ambiguity;
- cure, correct or supplement any defective or inconsistent provision; or
- amend the terms in any other manner which we may deem necessary or
desirable and which will not adversely affect the interests of the
affected holders in any material respect.
ENFORCEABILITY OF RIGHTS OF WARRANTHOLDERS. The warrant agent will act
solely as our agent in connection with the warrant certificates and will not
assume any obligation or relationship of agency or trust for or with any holders
of warrant certificates or beneficial owners of warrants. Any holder of warrant
certificates and any beneficial owner of warrants may, without the consent of
any other person, enforce by appropriate legal action, on its own behalf, its
right to exercise the warrants evidenced by the warrant certificates in the
manner provided for in that series of warrants or pursuant to the applicable
warrant agreement. No holder of any warrant certificate or beneficial owner of
any warrants will be entitled to any of the rights of a holder of the debt or
equity securities or any other warrant property, if any, purchasable upon
exercise of the warrants, including the right to receive the payments on those
debt securities or other warrant property or to enforce any of the covenants or
rights in the relevant indenture or any other similar agreement.
REGISTRATION AND TRANSFER OF WARRANTS. Subject to the terms of the
applicable warrant agreement, warrants in registered, definitive form may be
presented for exchange and for registration of transfer at the corporate trust
office of the warrant agent for that series of warrants, or at any other office
indicated in the prospectus supplement relating to that series of warrants,
without service charge. However, the holder will be required to pay any taxes
and other governmental charges as described in the warrant agreement. The
transfer or exchange will be effected only if the warrant agent for the series
of warrants is satisfied with the documents of title and identity of the person
making the request.
NEW YORK LAW TO GOVERN. The warrants and each warrant agreement will be
governed by, and construed in accordance with, the laws of the State of New
York.
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PLAN OF DISTRIBUTION
We may sell the securities offered by this prospectus:
- through underwriters or dealers;
- through agents;
- directly to purchasers; or
- through a combination of any of these methods of sale.
Any underwriter, dealer or agent may be deemed to be an "underwriter" within the
meaning of the Securities Act of 1933.
The applicable prospectus supplement relating to the securities will set
forth:
- their offering terms, including the name or names of any underwriters,
dealers or agents;
- the purchase price of the securities and the net proceeds we may receive
from the sale;
- any underwriting discounts, commissions and other items constituting
compensation to underwriters, dealers or agents;
- any public offering price;
- any discounts or concessions allowed or reallowed or paid by underwriters
or dealers to other dealers; and
- any securities exchanges on which the securities may be listed.
If underwriters or dealers are used in the sale, the securities will be
acquired by the underwriters or dealers for their own account and may be resold
from time to time in one or more transactions,
- at a fixed price or prices which may be changed, or
- at market prices prevailing at the time of sale, or
- at prices related to such prevailing market prices, or
- at negotiated prices.
The securities may be offered to the public either through underwriting
syndicates represented by one or more managing underwriters or directly by one
or more of such firms. Unless otherwise set forth in the applicable prospectus
supplement, the obligations of underwriters or dealers to purchase the offered
securities will be subject to certain conditions precedent, and the underwriters
or dealers will be obligated to purchase all the offered securities if any are
purchased. Any public offering price and any discounts or concessions allowed or
reallowed or paid by underwriters or dealers to other dealers may be changed
from time to time.
Securities may be sold directly by us or through agents designated by us
from time to time. Any agent involved in the offer or sale of the securities in
respect of which this prospectus is delivered will be named, and any commissions
payable by us to the agent will be set forth, in the applicable prospectus
supplement. Unless otherwise indicated in the applicable prospectus supplement,
any such agent will be acting on a best efforts basis for the period of its
appointment.
If so indicated in the applicable prospectus supplement, we will authorize
underwriters, dealers or agents to solicit offers from certain specified
institutions to purchase securities from us at the public offering price set
forth in the prospectus supplement pursuant to delayed delivery contracts
providing for payment and delivery on a specified date in the future. Such
contracts will be subject to any conditions set forth in the applicable
prospectus supplement and the prospectus supplement will set forth the
commission payable for solicitation of such contracts. The underwriters and
other persons soliciting such contracts will have no responsibility for the
validity or performance of any such contracts.
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Underwriters, dealers and agents may be entitled under agreements entered
into with us to indemnification by us against certain civil liabilities,
including liabilities under the Securities Act of 1933, or to contribution by us
to payments which they may be required to make. The terms and conditions of such
indemnification will be described in an applicable prospectus supplement.
Underwriters, dealers and agents may be customers of, engage in transactions
with, or perform services for, us in the ordinary course of business.
Each class or series of securities will be a new issue of securities with
no established trading market, other than our common stock, which is listed on
the New York Stock Exchange. We may elect to list any other class or series of
securities on any exchange, but are not obligated to do so. Any underwriters to
whom securities are sold by us for public offering and sale may make a market in
such securities, but such underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. No assurance can be
given as to the liquidity of the trading market for any securities.
LEGAL OPINIONS
Arias, Fabrega & Fabrega, Panama City, Republic of Panama, will issue an
opinion for us regarding the validity of the debt securities, the shares of
common stock, the shares of Class A preferred stock and the warrants offered by
this prospectus. Certain legal matters will be passed upon for us by Conner &
Winters, A Professional Corporation, Tulsa, Oklahoma, and will be passed upon
for any agents, dealers or underwriters by counsel named in the applicable
prospectus supplement. As of the date of this prospectus, attorneys of Conner &
Winters, A Professional Corporation, owned, directly or indirectly,
approximately 64,460 shares of our common stock, in the aggregate.
EXPERTS
Our consolidated financial statements and financial statement schedule as
of December 31, 2000 and 1999, and for each of the years in the three-year
period ended December 31, 2000, have been incorporated by reference in this
prospectus and in the registration statement in reliance on the reports of KPMG
LLP, independent certified public accountants, incorporated by reference in this
prospectus and upon the authority of said firm as experts in accounting and
auditing.
To the extent that KPMG LLP audits and reports on our consolidated
financial statements issued at future dates, and consents to the use of their
report thereon, such financial statements also will be incorporated by reference
in the registration statement in reliance upon their report and said authority.
ENFORCEABILITY OF CIVIL LIABILITIES
UNDER THE FEDERAL SECURITIES LAWS
We are a corporation organized under the laws of the Republic of Panama. In
addition, some of our directors are residents of countries other than the United
States. Accordingly, it may not be possible to effect service of process on such
persons in the United States and to enforce judgments against such persons
predicated on the civil liability provisions of the federal securities laws of
the United States. Because a substantial amount of our assets are located
outside the United States, any judgment obtained in the United States against us
may not be fully collectible in the United States. We have been advised by our
counsel in the Republic of Panama, Arias, Fabrega & Fabrega, that courts in the
Republic of Panama will enforce foreign judgments for liquidated amounts in
civil matters, subject to some conditions and exceptions. However, courts in the
Republic of Panama will not enforce in original actions liabilities predicated
solely on the United States federal securities laws. Our agent for service of
process in the United States with respect to matters arising under the United
States federal securities laws is CT Corporation System, 111 Eighth Avenue, New
York, New York 10011.
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200,000 SHARES
WILLBROS GROUP, INC.
Common Stock
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PROSPECTUS SUPPLEMENT
AUGUST 14, 2001
(Including Prospectus dated June 27, 2001)
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