Sys - Filing of certain prospectuses and communications in connection with business combination transactions (425)
February 22 2008 - 6:01AM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington,
DC 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):
February 19, 2008
KRATOS DEFENSE & SECURITY SOLUTIONS, INC.
(Exact name of
registrant as specified in its charter)
Delaware
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0-27231
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13-3818604
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(State or Other
Jurisdiction of
Incorporation)
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(Commission
File Number)
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(I.R.S. Employer
Identification Number)
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4810 Eastgate Mall
San Diego, CA 92121
(Address of
Principal Executive Offices) (Zip Code)
(858)
812-7300
(Registrants
telephone number, including area code)
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 (
see
General Instruction A.2. below):
x
Written communications pursuant to Rule 425
under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12
under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant
to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant
to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement.
On February 20, 2008,
Kratos Defense & Security Solutions, Inc., a Delaware corporation
(
Kratos
), White
Shadow, Inc., California corporation and wholly-owned subsidiary of Kratos
(
Merger Sub
) and SYS, a California
corporation (
SYS
)
entered into an Agreement and Plan of Merger and Reorganization (the
Merger Agreement
) under which Merger Sub will be merged with and into SYS (the
Merger
), with SYS
continuing after the Merger as the surviving corporation and a wholly-owned
subsidiary of Kratos. The Merger
Agreement has been unanimously approved by the Boards of Directors of both
Kratos and SYS.
Merger
Agreement
Subject to the terms and
conditions of the Merger Agreement, at the effective time of the Merger, each
issued and outstanding share of common stock of SYS would be converted into the
right to receive 1.2582 shares of Kratos common stock. The Merger is intended
to qualify as a tax-free reorganization under Section 368(a) of the
Internal Revenue Code of 1986, as amended.
Additionally, at the
effective time each outstanding option to purchase common stock of SYS will be
cancelled. Warrants to purchase common
stock of SYS will continue to be in effect pursuant to their terms following
the Merger.
Consummation of the
Merger is subject to several closing conditions, including:
·
approval of the Merger by the shareholders
of SYS;
·
approval of the issuance of shares of
Kratos common stock in the Merger by the stockholders of Kratos; and
·
the effectiveness of a Form S-4
registration statement to be filed by Kratos.
The Merger Agreement
contains certain termination rights, including a termination fee of $2,394,000
to be paid by SYS to Kratos upon termination of the Merger Agreement in certain
circumstances
The foregoing description
of the Merger Agreement is qualified in its entirety by reference to the full
text of the Merger Agreement, a copy of which is attached hereto as
Exhibit 2.1
and is incorporated herein by reference.
Voting
Agreements
In connection with the
Merger Agreement, on February 20, 2008 certain executive officers and
directors of SYS entered into voting agreements with Kratos (the
SYS Voting Agreements
) pursuant to
which such officers and directors have undertaken to vote their shares of
common stock of SYS in favor of the Merger and against any other proposal or
offer to acquire SYS, unless the Merger Agreement has been terminated. The SYS Voting Agreements apply to all shares
of SYS common stock held by the signatories at the record date for the relevant
SYS stockholder meeting. The SYS Voting Agreements restrict the transfer of
shares by the signatories, except under certain limited conditions.
Additionally, on February 20,
2008 certain executive officers and directors of Kratos entered into voting
agreements with SYS (the
Kratos Voting Agreements
),
pursuant to which such officers and directors have undertaken to vote their
shares of common stock of Kratos in favor of the issuance of additional shares
of common stock of Kratos in connection with the Merger, unless the Merger
Agreement has been terminated. The Kratos
Voting Agreements apply to all shares of Kratos common stock held by the
signatories at the record date for the relevant Kratos stockholder meeting. The
Kratos Voting Agreements restrict the transfer of shares by the signatories,
except under certain limited conditions.
A copy of the SYS Voting
Agreement and Kratos Voting Agreement is attached hereto as
Exhibit 2.2
and
2.3
,
respectively, and is incorporated herein by reference. The foregoing description of the SYS Voting
Agreement and Kratos Voting Agreement is qualified in its entirety by reference
to the full text of such agreements.
2
The Merger Agreement,
form of SYS Voting Agreement and form of Kratos Voting Agreement have been
included to provide security holders with information regarding their
terms. It is not intended to provide any
other factual information about Kratos, Merger Sub or SYS. The Merger Agreement contains representations
and warranties that Kratos and SYS have made for the benefit of each
other. The assertions embodied in those
representations and warranties are qualified by information in confidential
disclosure schedules that the parties have exchanged with each other in
connection with the signing of the Merger Agreement. Accordingly, investors and security holders
should not rely on the representations and warranties as characterizations of
the actual state of facts, since they were only made as of the date of the
Merger Agreement and are modified in important part by the underlying
disclosure schedule.
You are encouraged to
read the Merger Agreement, the form of SYS Voting Agreement and the form of
Kratos Voting Agreement for a more complete understanding of the transaction.
The foregoing descriptions of the Merger Agreement, the form of SYS Voting
Agreement and the form of Kratos Voting Agreement are qualified in their
entirety by reference to the full text of the Merger Agreement, the form of SYS
Voting Agreement and the form of Kratos Voting Agreement.
Item
8.01 Other Events.
On February 21, 2008, Kratos issued a press
release announcing the execution of the Merger Agreement. A copy of the press release is furnished as Exhibit 99.1.
On February 21, 2008, a conference call was
held by Kratos to discuss the Merger. A
replay of the recorded conference call will be available for 30 days
following the conference call and can be obtained through the Investors link of
Kratos website at www.kratosdefense.com.
Forward-Looking
Statements
This Report on Form 8-K contains certain forward-looking statements
including, without limitation, expressed or implied statements concerning Kratos
expectations regarding the timing of the closing of the Merger, anticipated
benefits to be realized from the Merger, future financial performance and cash
flows and market developments that involve risks and uncertainties. Such
statements are only predictions, and Kratos actual results may differ
materially. Factors that may cause Kratos results to differ include, but are
not limited to: risks that the closing will be delayed or that the conditions
to closing will not be satisfied; risks that the integration will prove more
costly, take more time, or be more distracting than currently anticipated; risks that the transaction will cause
disruption of Kratos operations and distraction of its management; risks of
adverse regulatory action or litigation; risks associated with debt leverage;
risks that changes or cutbacks in spending by the U.S. Department of Defense
may occur, which could cause delays or cancellations of key government
contracts; failure to successfully consummate acquisitions or integrate
acquired operations; and competition in the marketplace which could reduce
revenues and profit margins. Kratos
undertakes no obligation to update any forward-looking statements.
These and other risk factors are more fully discussed in Kratos Annual
Report on Form 10-K for the period ended December 31, 2006, Kratos Quarterly
Reports on Form 10-Q for the periods ended March 31, 2007, June 30,
2007 and September 30, 2007, and in other filings made with the Securities
and Exchange Commission (the
SEC
).
Important
Additional Information
This filing is being made
in respect of the proposed transaction involving Kratos and SYS. In connection
with the proposed transaction, Kratos plans to file with the SEC a Registration
Statement on Form S-4 containing a Joint Proxy Statement/Prospectus and
each of Kratos and SYS plan to file with the SEC other documents regarding the
proposed transaction. The definitive Joint Proxy Statement/ Prospectus will be
mailed to stockholders of Kratos and
SYS.
INVESTORS AND SECURITY HOLDERS ARE URGED
TO READ THE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE
SEC CAREFULLY IN
3
THEIR
ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION.
Investors and security
holders will be able to obtain free copies of the Registration Statement and
the Joint Proxy Statement/Prospectus (when available) and other documents filed
with the SEC by Kratos and SYS through the web site maintained by the SEC at
www.sec.gov. In addition, investors and security holders will be able to obtain
free copies of the Registration Statement and the Joint Proxy
Statement/Prospectus (when available) and other documents filed with the SEC
from Kratos by directing a request to Kratos Defense & Security Solutions,
Inc, ATTN: Investor Relations, 4810 Eastgate Mall, San Diego, CA 92121, or
going to Kratos corporate website at www.kratosdefense.com, or from SYS by
directing a request to ATTN: Investor Relations, 5050 Murphy Canyon Road, Ste.
200, San Diego, CA, 92123, or going to SYS corporate website at
www.systechnologies.com.
Kratos and SYS, and their
respective directors and executive officers, may be deemed to be participants
in the solicitation of proxies in respect of the proposed transaction. Information
regarding Kratos directors and executive officers is contained in its annual
proxy statement filed with the SEC on October 10, 2007. Information
regarding SYS directors and executive officers is contained in SYS annual
proxy statement filed with the SEC on October 29, 2007. Additional
information regarding the interests of such potential participants will be
included in the Joint Proxy Statement/Prospectus and the other relevant
documents filed with the SEC (when available).
Item
9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
Number
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Description
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2.1
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Agreement and
Plan of Merger and Reorganization, dated February 20, 2008, by and among
Kratos Defense & Security Solutions, Inc., White
Shadow, Inc. and SYS.*
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2.2
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Form of Voting
Agreement, dated February 20, 2008, by and among Kratos
Defense & Security Solutions, Inc.
and
certain shareholders of SYS.
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2.3
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Form of Voting
Agreement, dated February 20, 2008, by and among SYS and certain
stockholders of Kratos Defense & Security Solutions, Inc.
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99.1
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Press Release of Kratos
Defense & Security Solutions, Inc. issued on February 21,
2008.
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*
Certain schedules and exhibits referenced
in the Merger Agreement have been omitted in accordance with Item 601(b)(2) of
Regulation S-K. A copy of any omitted
schedule and/or exhibit will be furnished supplementally to the Securities and
Exchange Commission upon request.
4
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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KRATOS
DEFENSE & SECURITY SOLUTIONS, INC.
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Date: February 21,
2008
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/s/ Deanna Lund
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Deanna Lund
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Senior Vice President
and Chief Financial Officer
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5
Exhibit List
Exhibit
Number
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Description
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2.1
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Agreement and
Plan of Merger and Reorganization, dated February 20, 2008, by and among
Kratos Defense & Security Solutions, Inc., White
Shadow, Inc. and SYS.*
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2.2
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Form of Voting
Agreement, dated February 20, 2008, by and among Kratos
Defense & Security Solutions, Inc.
and
the shareholders of SYS.
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2.3
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Form of Voting
Agreement, dated February 20, 2008, by and among SYS and the
stockholders of Kratos Defense & Security Solutions, Inc.
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99.1
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Press Release of Kratos
Defense & Security Solutions, Inc. issued on February 21,
2008.
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*
Certain schedules and exhibits referenced
in the Merger Agreement have been omitted in accordance with Item 601(b)(2) of
Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished
supplementally to the Securities and Exchange Commission upon request.
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