TABLE OF CONTENTS
Item 1.01 Entry into a Material Definitive Agreement.
On June
17, 2008, Vulcan Materials Company (the “Company”) agreed to sell $250,000,000 aggregate
principal amount of its 6.30% Notes due 2013 (the “2013 Notes”) and $400,000,000 aggregate
principal amount of its 7.00% Notes due 2018 (the “2018 Notes,” and together with the 2013
Notes, the “Notes”) pursuant to the provisions of an Underwriting Agreement dated June 17, 2007
(the “Underwriting Agreement”), among the Company and Banc
of America Securities LLC, Goldman, Sachs & Co., J.P. Morgan
Securities Inc. and Wachovia Capital Markets, LLC, as representatives of the
several underwriters named therein (collectively, the “Underwriters”). The sale of the Notes
closed on June 20, 2008.
The
Company intends to use the net proceeds of approximately $644,977,500 from the offering of the Notes to
repay borrowings outstanding under the Company’s (i) 364-Day Bridge Credit Agreement dated as of November 16, 2007 with Wachovia Bank, National
Association, as administrative agent, and the lenders and other parties thereto, (ii) 364-Day
Credit Agreement dated as of November 16, 2007 with Bank of
America, N.A., as administrative agent, and the lenders and other parties thereto, (iii)
Five-Year Credit Agreement dated as of November 16, 2007
with Bank of America, N.A., as administrative agent, and the lenders
and other parties thereto, or (iv) commercial paper issuances.
The
Notes were offered and sold under a Registration Statement on Form S-3,
Registration No. 333-147796, filed by the
Company with the Securities and Exchange Commission on December 3, 2007, as
supplemented by the final prospectus supplement filed by the Company with the
Securities and Exchange Commission on June 19, 2008.
The
Notes were issued under the Senior Debt Indenture, dated as of December 11, 2007
(the “Indenture”), between the Company and Wilmington Trust Company, as trustee
(the “Trustee”), as supplemented by the Second Supplemental
Indenture, dated as of June 20, 2008, between the Company and the
Trustee (the “Second Supplemental indenture”).
The
2013 Notes were priced to investors at 99.799% of the principal amount, will bear
interest at 6.30% per annum and will mature on June 15, 2013, and the 2018 Notes were
priced to investors at 99.895% of the principal amount, will bear interest at 7.00% per
annum and will mature on June 15, 2018. Interest on each series of Notes will be payable on
June 15 and December 15 of each year, beginning on December 15, 2008.
Each series of Notes will be redeemable as a whole or in part, at the Company’s option, at any time, at a redemption price equal to the greater of (1) 100% of the principal amount of such notes and (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of interest accrued to the date of redemption)
on the notes of that series discounted to the redemption date semiannually
(assuming a 360-day year consisting of twelve 30-day months) at the treasury rate for that
series, plus 45 basis points (in the case of the 2013 notes) or 45 basis points
(in the case of the 2018 notes), and plus in each case, any accrued and unpaid interest
on the notes being redeemed to the date of redemption but interest installments whose
stated maturity is on or prior to the date of redemption will be payable to the
holders of such notes of record at the close of business on the
relevant record dates
for the notes.
Unless
the Company has exercised its right to redeem the Notes or has defeased the
Notes, upon a change of control repurchase event (as defined in the Second Supplemental Indenture),
the Company will be required to make an offer to repurchase the Notes
at a price in cash
equal to 101% of the principal amount of the Notes, plus any accrued and unpaid interest
to, but not including, the purchase date.
The
Indenture is filed as Exhibit 4.1 to the Company’s Form 8-K filed with the Securities and
Exchange Commission on December 11, 2007 and is incorporated herein by reference and the
Second Supplemental Indenture is filed as Exhibit 4.1 to this Form 8-K and is incorporated
herein by reference. The descriptions of the material terms of each of the Indenture and
the Second Supplemental Indenture are qualified in their entirety by
reference to such exhibits.
The
Underwriting Agreement contains usual and customary terms, conditions,
representations and warranties and indemnification provisions. The
Underwriting Agreement is filed as Exhibit 1.1 to this Form 8-K and is
incorporated herein by reference. The description of the material terms of the
Underwriting Agreement is qualified in their entirety by reference to such exhibit.
Certain
of the Underwriters and their respective affiliates have, from time to time, performed, and
may in the future perform, various financial advisory and investment banking
services for the company, for which they received or will receive customary
fees and expenses. Goldman, Sachs & Co. provided financial advisory services to
Vulcan in connection with the acquisition of Florida Rock Industries, Inc. for
which it received customary fees. In addition, each of Bank of America, N.A., an
affiliate of Banc of America Securities LLC, goldman Sachs Credit Partners L.P., an
affiliate of Goldman, Sachs & Co., JPMorgan Chase Bank, N.A., an affiliate of J.P.
Morgan Securities Inc., and Wachovia Bank, National Association, an affiliate of
Wachovia Capital Markets, LLC, is a lender under the Bridge Credit Facility,
364-Day Credit Facility and Five-Year Credit Facility. Banc of America
Securities LLC and Goldman, Sachs & Co. are dealers with respect to the Company’s
commercial paper program, and JPMorgan Chase Bank, N.A., an affiliate of J.P. Morgan
Securities Inc., is the issuing and paying agent. Citigroup Global Markets Inc. is an
affiliate of Citicorp USA Inc., a lender under the Company’s credit facilities, and
Citibank, N.A., the authenticating agent, paying agent, registrar and transfer agent
with respect to the Notes. In addition, certain of the other co-managers or their
affiliates are lenders under the Company’s credit facilities.
Certain of the Underwriters and their respective affiliates may also
participate in the Company’s new term loan anticipated to close on June 23, 2008.