UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, B.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported:
May 10, 2007
Eagle Materials Inc.
(Exact name of registrant as specified in its charter)
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| Delaware
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1-12984
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75-2520779 |
| (State or other jurisdiction
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(Commission File Number)
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(IRS Employer |
| of incorporation)
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Identification No.) |
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| 3811 Turtle Creek Blvd., Suite 1100, Dallas, Texas
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75219 |
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(Zip code) |
Registrant’s telephone number including area code: (214) 432-2000
Not Applicable
(Former name or former address if changed from last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
TABLE OF CONTENTS
Item 8.01. Other Events.
As
previously disclosed, the Internal Revenue Service (the
“IRS”) has been examining the
federal income tax returns of Eagle Materials Inc. (the “Company”) for the fiscal years ended March
31, 2001, 2002, and 2003. On May 10, 2007, the IRS issued to the Company a Notice of Proposed
Adjustment that proposes to reduce the tax basis of, and disallow a portion of the depreciation
deductions claimed by the Company with respect to, assets acquired by the Company from Republic
Group LLC in a transaction completed in November 2000 (the “Republic Assets”). The Company believes
it has a substantial basis for its tax positions and intends to vigorously contest the proposed
adjustment.
If sustained, the adjustment proposed by the IRS would result in additional federal income
taxes owed by the Company of approximately $30.5 million, plus
applicable interest. In addition, the IRS has
informally indicated that it intends to impose statutory civil penalties. Moreover, for taxable
years subsequent to fiscal 2003, the Company also claimed depreciation deductions with respect to the tax
basis of the Republic Assets, as originally recorded. If challenged on the same basis as set forth
in the Notice of Proposed Adjustment, additional federal income taxes
of approximately $37 million, plus applicable interest and
possible civil penalties, could be asserted
by the IRS for those periods. Also, additional state income taxes,
interest, and civil penalties of approximately $4 million would
be owed by the Company for the fiscal years under exam and subsequent
taxable years if the IRS’ position is sustained.
The Notice of Proposed Adjustment is preliminary, as the IRS has not issued its
final examination report. The Company is continuing its discussions
with the IRS examining officers in an effort to
reach a favorable resolution. If the Company is unable to reach a
favorable resolution, the Company intends to pursue an administrative appeal
and, if necessary, resort to the courts for a final determination. Given the
preliminary nature of the proposed adjustment, the Company is unable to predict with certainty the
ultimate outcome or whether it will be required to make material payments of tax,
interest, and penalties to the IRS and state taxing authorities.