Cubic Corporation (NYSE:CUB) Files An 8-K Completion of Acquisition or Disposition of Assets

On May 31, 2018, Cubic Corporation (“Cubic”), completed the previously announced sale of all of the issued and outstanding capital stock of Cubic Global Defense, Inc. (“CGD”) and Omega Training Group, Inc., each a subsidiary of Cubic Corporation (the “Services Subsidiaries”), to Nova Global Supply & Services, LLC (“Purchaser”), an entity affiliated with GC Valiant, LP (“Valiant”) to the Stock Purchase Agreement (the “Purchase Agreement”), dated April 18, 2018, by and among Cubic, CGD and Purchaser.

The consideration paid to Cubic consisted of $135.0 million in cash at the closing, subject to final adjustments in respect of, among other things, cash and cash equivalents, net working capital and indebtedness of the Services Subsidiaries as of the closing. In addition, Purchaser will pay Cubic an additional $3.0 million if certain earn-out conditions related to the award of certain government contracts occur.

The parties have made customary representations and warranties and covenants in the Purchase Agreement, including without limitation covenants that limit Cubic’s and its affiliates’ ability to engage in certain U.S. government-related services work not related to the products of Cubic and its affiliates for the five years following the closing of the Acquisition. The parties have also agreed to mutually indemnify each other for breaches of representations and warranties and covenants, subject to certain limitations set forth in the Purchase Agreement. The Purchaser has obtained “representation and warranty” insurance which will provide coverage for breaches of representations and warranties of Cubic and the Services Subsidiaries contained in the Purchase Agreement, subject to deductibles, exclusions, policy limits and certain other terms and conditions.

The Purchase Agreement was filed as Exhibit 2.1 to Cubic’s Form 8-K filed with the Securities and Exchange Commission on April 19, 2018.The description of the terms of the Purchase Agreement contained in this Form 8-K is qualified in its entirety by reference to the actual provisions of the Purchase Agreement.In addition, the representations and warranties of Cubic, including the Services Subsidiaries, contained in the Purchase Agreement have been made solely for the benefit of Purchaser. Such representations and warranties (i) have been made only for purposes of the Purchase Agreement, (ii) have been qualified by confidential disclosures made to Purchaser in connection with the Purchase Agreement, (iii) are subject to materiality qualifications contained in the Purchase Agreement which may differ from what may be viewed as material by investors, (iv) were made only as of the date of the Purchase Agreement or such other date as is specified in the Purchase Agreement and (v) have been included in the Purchase Agreement for the purpose of allocating risk between the contracting parties rather than establishing matters as facts. Accordingly, the Purchase Agreement will be filed only to provide investors with information regarding the terms of the Purchase Agreement, and not to provide investors with any other factual information regarding Cubic or the Services Subsidiaries or their businesses. Investors should not rely on the representations and warranties or any descriptions thereof as characterizations of the actual state of facts or condition of Cubic or the Services Subsidiaries. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Purchase Agreement, which subsequent information may or may not be fully reflected in our public disclosures. The Purchase Agreement should not be read alone, but should instead be read in conjunction with the other information regarding Cubic that is or will be contained in, or incorporated by reference into, the Forms 10-K, Forms 10-Q and other documents that Cubic has filed and may file with the Securities and Exchange Commission.

In connection with the closing, Cubic is filing herewith certain pro forma financial information, which is attached hereto as Exhibit 99.2.