GENERAL DYNAMICS CORPORATION (NYSE:GD) Files An 8-K Completion of Acquisition or Disposition of AssetsItem 2.01
As previously disclosed in the Current Report on Form8-K filed with the Securities and Exchange Commission (the “SEC”) by General Dynamics Corporation, a Delaware corporation (the “Company”) on February12, 2018, the Company is party to an Agreement and Plan of Merger, dated as of February9, 2018 (as amended, the “Merger Agreement”), with CSRA Inc., a Nevada corporation (“CSRA”), and Red Hawk Enterprises Corp., a Nevada corporation and wholly owned subsidiary of the Company (“Merger Sub”). to the Merger Agreement, on March5, 2018, Merger Sub commenced a tender offer to acquire all of the outstanding shares of CSRA’s common stock, par value $0.001 per share (the “Shares”), for $40.75 per Share, upon the terms and subject to the conditions set forth in the offer to purchase, dated March5, 2018 (as amended or supplemented, the “Offer to Purchase”), and the related letter of transmittal (together with the Offer to Purchase, the “Offer”). to Amendment No.1 to the Merger Agreement, on March20, 2018, the price offered by Merger Sub in the Offer was increased to $41.25 per Share, in cash without interest and less any applicable withholding taxes (the “Offer Price”).
The Offer expired at 11:59 p.m., New York City time, on Monday, April2, 2018 (the “Expiration Date”) and was not extended. Computershare Trust Company, N.A., the depositary for the Offer (the “Depositary”), informed the Company that, as of the Expiration Date, a total of 116,282,921 Shares (including 8,315,782 Shares subject to guaranteed delivery procedures as described in the Offer to Purchase) were validly tendered and not validly withdrawn, representing approximately 68.692% of the Shares then outstanding on a fully diluted basis (as determined to the Merger Agreement). On April3, 2018, Merger Sub accepted for payment (such time of acceptance for payment, the “Acceptance Time”) and, on April3, 2018, paid for, all such Shares validly tendered and not withdrawn to the Offer on or prior to the Expiration Date.
On April3, 2018, Merger Sub exercised its option (the “Top-Up Option”) to purchase, at a price equal to $41.25 per Share, an aggregate number of additional Shares that, when added to the number of Shares owned by the Company and Merger Sub immediately prior to the exercise of the Top-Up Option (which for purposes of this calculation did not include Shares that had been tendered subject to guaranteed delivery procedures), resulted in Merger Sub owning one Share more than 90% of the outstanding Shares determined on a fully diluted basis. Later on April3, 2018, the Company and Merger Sub then effected a short-form merger under Nevada law to which Merger Sub merged with and into CSRA, with CSRA surviving as a wholly owned subsidiary of the Company (the “Merger”).
The aggregate amount of consideration paid in connection with the exercise of the Top-Up Option was approximately $18.3billion, consisting of approximately $0.4million in cash plus the delivery of a promissory note by Merger Sub to CSRA with a one-year maturity, bearing a principal amount equal to approximately $18.3billion and accruing simple interest at the rate of six percent (6%) per annum. The obligations under this promissory note automatically ceased to exist and were of no further force and effect upon completion of the Merger. The aggregate amount of consideration paid by Merger Sub in connection with the acceptance of Shares in the Offer and the completion of the Merger, including to cash out the outstanding stock options and restricted stock units of CSRA and to fund amounts becoming due and payable under CSRA’s outstanding indebtedness, was approximately $9.76billion. Such amount was financed by a combination of available cash on hand, an advance of $7.5 billion drawn under the 364-Day Credit Facility described in the Offer to Purchase and $2.0 billion from the proceeds of the sale of short-term promissory notes under the Company’s commercial paper program. In addition, approximately $450million was paid to satisfy obligations under CSRA’s Second Amended and Restated Master Accounts Receivable Purchase Agreement (as amended).
The foregoing description of the Merger Agreement and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified in its entirety by reference to, the full text of the Merger Agreement and Amendment No.1 thereto, which are referenced as Exhibits2.1 and 2.2, respectively, and are incorporated herein by reference.
2
Item 2.01 Creation of a Direct Financial Obligation or an Obligation under anOff-BalanceSheet Arrangement of a Registrant
The information contained in Item 2.01 above is incorporated by reference into this Item 2.01.
| Item 2.01 | Financial Statements and Exhibits |
| (a) | Financial Statements of Businesses Acquired |
The financial statements required by Item 2.01(a) of Form8-Kwill be filed by amendment within 71 calendar days after the date on which this Current Report on Form8-Kmust be filed.
| (b) | Pro Forma Financial Information |
The pro forma financial information required by Item 2.01(b) of Form8-Kwill be filed by amendment within 71 calendar days after the date on which this Current Report on Form8-Kmust be filed.
| 2.1 | Agreement and Plan of Merger, dated February 9, by and among the Company, CSRA and Merger Sub, incorporated herein by reference to Exhibit 2.1 to the Current Report on Form 8-K of the Company filed February12, 2018. |
| 2.2 | Amendment No.1 to Agreement and Plan of Merger, dated March 20, 2018, by and among the Company, CSRA and Merger Sub, incorporated herein by reference to Exhibit 2.1 to the Current Report on Form 8-K of the Company filed on March20, 2018. |
3
About GENERAL DYNAMICS CORPORATION (NYSE:GD)
General Dynamics Corporation is an aerospace and defense company that offers a portfolio of products and services in business aviation; combat vehicles, weapons systems and munitions; command, control, communications, computers, intelligence, surveillance and reconnaissance (C4ISR) solutions and information technology (IT) services, and shipbuilding. The Company operates through four business groups: Aerospace, which produces Gulfstream aircraft; provides aircraft services, and performs aircraft completions for other original equipment manufacturers (OEMs); Combat Systems, which design and manufacture combat vehicles, weapons systems and munitions; Information Systems and Technology, which provides C4ISR solutions and IT services, and Marine Systems, which design and build nuclear-powered submarines, surface combatants and auxiliary and combat-logistics ships for the United States Navy, and Jones Act ships for commercial customers.
