-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JkS/vhjY3sP5ynL94Ve+ZjCGvtJm8Lwmbtkr3u6n5pQlN1meKQKjO4OUJA0dYV0X sZbaKvvC1QmIC0cduMSQ9A== 0000311946-96-000013.txt : 19960412 0000311946-96-000013.hdr.sgml : 19960412 ACCESSION NUMBER: 0000311946-96-000013 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960328 ITEM INFORMATION: Acquisition or disposition of assets FILED AS OF DATE: 19960411 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: LOGICON INC /DE/ CENTRAL INDEX KEY: 0000311946 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROGRAMMING SERVICES [7371] IRS NUMBER: 952126773 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-07777 FILM NUMBER: 96546351 BUSINESS ADDRESS: STREET 1: 3701 SKYPARK DR CITY: TORRANCE STATE: CA ZIP: 90505-4794 BUSINESS PHONE: 3103730220X3237 MAIL ADDRESS: STREET 1: 3701 SKYPARK DRIVE CITY: TORRANCE STATE: CA ZIP: 90505-4794 8-K 1 ACQUISITION OF GEODYNAMICS BY LOGICON SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 March 28, 1996 LOGICON, INC. DELAWARE (State or other jurisdiction of incorporation or organization) 1-7777 95-2126773 (Commission File Number) (IRS Employer identification number) 3701 Skypark Drive, Torrance, California 90505-4794 (Address of principal executive offices) (Zip Code) (310) 373-0220 Registrant's telephone number, including area code Item 2. Acquisition or Disposition of Assets (a) On March 28, 1996 Logicon, Inc., a Delaware corporation and the Registrant, acquired all of the outstanding stock of Geodynamics Corporation, a California corporation, located at 21171 Western Avenue, Suite 110 Torrance, CA 90501, for a purchase price including transaction costs, of $31.7 million in cash. (b) The acquisition will be accounted for as a purchase and has been paid for in cash. Geodynamics Corporation will operate as a wholly-owned subsidiary of Logicon, Inc. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. (a) Financial Statements of Business Acquired. The financial statements listed below previously have been filed with the Commission in Geodynamics Corporation's Proxy Statement for its Special Meeting of Shareholders, filed with the Commission on February 29, 1996, Commission File Number 0-15034 and are incorporated herein by reference. Fiscal Year Report of Independent Accountants Consolidated Balance Sheets as of June 2, 1995 and June 3, 1994 Consolidated Statements of Income for Years Ended June 2, 1995, June 3,1994 and May 28, 1993 Consolidated Statements of Shareholders' Equity for the Years Ended June 2, 1995, June 3, 1994 and May 28, 1993 Consolidated Statements of Cash Flows for the Years Ended June 2, 1995, June 3, 1994 and May 28, 1993 Notes to Consolidated Financial Statements Interim Condensed Consolidated Balance Sheets as of December 1, 1995 (unaudited) and June 2, 1995 Unaudited Condensed Consolidated Statements of Income for the Three and Six Months Ended December 1, 1995 and December 2, 1994 Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months Ended December 1, 1995 and December 2, 1994 Notes to Condensed Consolidated Financial Statements (b) Pro forma Financial Information. The unaudited pro forma condensed combined statement of income of Logicon, Inc. (Logicon) and Geodynamics Corporation (Geodynamics) for the nine month period ended December 31, 1995, and for the most recent fiscal year ended March 31, 1995, reflect adjustments as if the transaction had occurred on April 1, 1994. The unaudited pro forma condensed combined balance sheet is presented as if the transaction had been consummated on December 31, 1995, the end of Logicon's third fiscal quarter. The acquisition is being accounted for using the purchase method. The historical results of operations of Geodynamics for the three month period ended June 2, 1995, have been included in both the pro forma condensed statement of income for the nine months ended December 31, 1995, and for the fiscal year ended March 31, 1995. In management's opinion, the inclusion of this three month period in both pro forma presentations does not materially impact the pro forma results. On January 17, 1996, Geodynamics sold its LaFehr & Chan Technologies, Inc. (LCT) subsidiary to an investor group. The operations of LCT have been deducted from all pro forma statements presented. A loss of $6.1 million was recorded by Geodynamics on the disposition. For purposes of the pro forma income statement presentations for the year ended March 31, 1995, and for the nine month period ended December 31, 1995, the loss, realized on the sale, has been excluded because of the nonrecurring nature of that transaction and because the transaction occurred in a period subsequent to the periods being presented. The loss, however, is reflected in the pro forma balance sheet for December 31, 1995. The unaudited pro forma condensed combined financial statements reflect Logicon's allocation of the purchase price, including transaction costs, of approximately $31.7 million to the assets and liabilities of Geodynamics based upon Logicon's current estimates of the relative values of the assets acquired and liabilities assumed. The final allocation of the purchase price may vary as additional information is obtained, and accordingly, the ultimate allocation may differ from those used in the unaudited pro forma condensed combined financial statements. The unaudited pro forma condensed combined financial statements should be read in conjunction with the separate historical financial statements and related notes of Geodynamics, appearing in answer to Item 7 (a) of this current report on Form 8-K and the historical financial statements, related notes and "Management's Discussion and Analysis of Consolidated Financial Condition and Results of Operations" of Logicon for the year ended March 31, 1995, and the nine month period ended December 31, 1995, previously filed with the Securities and Exchange Commission. The pro forma information is not necessarily indicative of the results that would have been reported had the acquisition actually occurred on the dates specified, nor is it necessarily indicative of the future results of the combined companies. LOGICON, INC. AND GEODYNAMICS CORPORATION PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME (Unaudited) Nine-Month Period Ended December 31, 1995
12/31/95 12/1/95 Logicon Geodynamics Less Pro Forma Historical Historical LCT Adjust Combined Note 1 Note 1 Note 2 Pro Forma ---------- ------ ------ -------- --------- (Dollar and shares in thousands, except per share data) Contract revenues and $348,093 $48,754 $5,705 $-1,248 (a) $389,894 interest Costs of contract revenues 290,233 46,604 5,614 -350 (c) 330,873 Selling and administrative expenses 27,557 27,557 Interest expense 63 43 20 Amortization of goodwill due to Geodynamics 353 (b) 353 ------- ------- ------- ------- ------- Income before taxes on income 30,303 2,087 48 -1,251 31,091 Provision for taxes on income 12,299 820 18 -335 (d) 12,766 ------- ------- ------- ------- ------- Net income $ 18,004 $ 1,267 $ 30 $ -916 $ 18,325 ======= ======= ======= ======= ======= Earnings per share of common stock: $ 1.27 $ 1.29 ======= ======= Average number of common shares, including common stock equivalents 14,178 22 (e) 14,200 ======= ======= ======= Note 1 - Geodynamics and LCT nine month periods ended December 1, 1995. The Geodynamics financial statements are based on a 52-53 week year. The quarterly periods for Geodynamics in fiscal year 1995 ended on September 2 and December 2, 1994 and March 3 and June 2, 1995. The quarterly periods for Geodynamics for the first six months of fiscal year 1996 ended on September 1 and December 1, 1995.In order to present the Geodynamics information on a nine month period comparable to the Logicon information, the historical results of operations of Geodynamics and LCT for the three month period ended June 2, 1995, have been included in both the pro forma condensed statement of income for the nine months ended December 31, 1995, and for the fiscal year ended March 31, 1995. In management's opinion, the inclusion of this three month period in both pro forma presentations does not materially impact the pro forma results. The unaudited condensed results of operations of Geodynamics and LCT for the three months ended June 2, 1995, are summarized as follows:
Three Month Period Ended June 2, 1995 Geodynamics LCT includes LCT ----------- --- (Dollars in thousands) Revenues $16,451 $1,604 Costs and expenses 16,021 1,984 ------- ------- Income (loss) from operations 430 -380 ------- ------- Other income (expense) Interest income 91 Interest expense -13 -39 ------- ------- Net other 78 -39 ------- ------- Income (loss) before provision for income taxes 508 -419 Provision (benefit) for income taxes 212 -197 ------- ------- Net income (loss) $ 296 $ -222 ======= ======= On January 17, 1996, Geodynamics sold its LCT subsidiary to an investor group. A loss of $6.1 million was recorded by Geodynamics on the disposition. For purposes of this pro forma income statement presentation, the loss, realized on the sale, has been excluded because of the nonrecurring nature of that transaction and because the transaction occurred in a period subsequent to the periods being presented. Note 2 - Pro forma adjustments to nine month period ended December 31, 1995 (in thousands) (a) To reflect a reduction in interest income from the use of $31,700, in cash, for the purchase price plus transaction c months. (b) To reflect nine months amortization of goodwill of $9,400 over a twenty year period. This amount represents the current estimate of the excess of purchase price over the relative values of the assets acquired and liabilities assumed. (c) To eliminate acquisition costs incurred by Geodynamics to complete this transaction. (d) To reflect the income tax effect of pro forma adjustments calculated a at applicable federal and state statutory rates (e) To reflect the conversion of Geodynamics stock options to Logicon stock options.
LOGICON, INC. AND GEODYNAMICS CORPORATION PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME (Unaudited) Year Ended March 31, 1995
March 31, 1995 Pro Forma 6/2/95 6/2/95 Pro For Logicon Geodynamics Less LCT Adjustments Combined Note 3 Historical Historical Note 4 Pro Forma ---------- ---------- -------- -------- --------- (Dollar and shares in thousands, except per share data) Contract revenues and interest $455,842 $61,153 $5,182 $-1,506 (a) $510,307 Costs of contract revenues 377,821 57,937 5,342 430,416 Selling and administrative expenses 45,827 45,827 Interest expense 71 71 Pro forma amortization of goodwill 957 470 (b) 1,427 ------- ------- ------- ------- ------- Income before taxes on income 31,237 3,145 -231 -1,976 32,637 Provision for taxes on income 13,086 1,227 -147 -664 (c) 13,796 ------- ------- ------- ------- ------- Net income $18,151 $1,918 $- 84 $-1,312 $18,841 ======= ======= ======= ======= ======== Earnings per share of common stock: $1.28 $1.33 ======= ======= Average number of common shares, including common stock equivalents 14,204 14,204 ======= ======= Note 3 - Pro forma statements for Logicon's year ended March 31, 1995, include pro forma adjustments to reflect the acquisition of Syscon Corporation effective February 16, 1995, as if the acquisition of Syscon Corporation had occurred on April 1, 1994, as follows:
Year Ended March 31, 1995 Jan.31, 1995 Pro Forma Logicon SYSCON Adjustments Combined Historical Historical Note A Pro Forma ---------- ---------- ---------- -------- (Dollars and shares in thousands, except per share data) Contract revenues and interest $345,191 $128,675 $-1,883 (1) $455,842 -1,708 (2) -14,433 (3) Costs of contract revenues 282,074 107,764 -12,017 (3) 377,821 Selling and administrative expenses 30,302 17,277 -1,752 (3) 45,827 HII management fee 2,539 -2,539 (4) Amortization of goodwill 2,535 -2,535 (5) 957 957 (6) ------- ------- ------- ------- Income before taxes on income 32,815 -1,440 -138 31,237 Provision for taxes on income 13,306 415 -635 (7) 13,086 ------- ------- ------- ------- Net income $ 19,509 $ -1,855 $ 497 $ 18,151 ======= ======= ======= ======= Earnings per share of common stock: $ 1.37 $ 1.28 ======= ======= Average number of common shares, including common stock equivalents 14,204 14,204 ======= ======= Note A - Pro forma adjustments to period ended March 31, 1995 (Dollars in thousands). (1) To reflect a reduction in interest income from the use of $45,300, in cash, for the purchase price incl en and one half months. (2) To eliminate interest income paid to Syscon by its former parent Harnischfeger Industries, Inc. (HII). (3) To eliminate Syscon's revenues and costs included in Logicon's historical year ended March 31, 1995. (4) To eliminate management fees charged to Syscon by its former parent HII. (5) To eliminate amortization of goodwill charged to Syscon by its former parent HII. (6) To reflect the amortiza tion of goodwill of $21,855 over a twenty year period less the amortization o s the excess of purchase price over the relative values of the assets acquired and liabilities assumed. (7) To reflect the income tax effect of pro forma adjustments calculated at applicable federal and state statut Note 4 - Pro forma adjustments to the period ended March 31, 1995 (Dollars in thousands). (a) To reflect a reduction in interest income from the use of $31,700, in cash, for the purchase price including he year. (b) To reflect one year's worth of the amortization of goodwill of $9,400 over a twenty year period. This amoun the assets acquired and liabilities assumed. (c) To reflect the income tax effect of pro forma adjustments calculated at applicable federal and state statut
LOGICON, INC. AND GEODYNAMICS CORPORATION PRO FORMA CONDENSED COMBINED BALANCE SHEET (Unaudited) December 31, 1995
Pro Dec. 31, 1995 Dec 1, 1995 Less Forma Logicon Geodynamics LCT Adjust Combined Historical Historical Note 5(b)Note 5 Pro Forma ---------- --------- ----- ------- --------- (Dollars in thousands) Current assets: Cash, cash equivalents and marketable securities $ 36,915 $ 6,836 $ 98 $-31,700 (a) $ 12,162 1,809 (b-1) -1,600 (b-2) Accounts receivable 84,569 15,119 1,592 98,096 Prepaid expenses 1,419 1,421 310 2,530 Deferred income tax benefits 8,654 513 -139 9,306 ------- ------- ------- ------- ------- Total current assets 131,557 23,889 1,861 -31,491 122,094 Property, plant and equipment 9,092 11,121 7,598 -57 (a) 12,558 Excess of purchase price over net assets of businesses acquired, net of accumulated amortization 27,939 1,387 1,387 9,400 (a) 37,339 Other assets 3,440 775 2,665 ------- ------- ------- ------- ------- $168,588 $39,837 $11,621 $-22,148 $174,656 ======= ======= ======= ======== ======== Current liabilities: Accounts payable and other accrued liabilities $ 13,635 $ 5,022 $ 741 $ 89 (c) $18,005 Accrued salaries, wages and employee benefits 26,941 1,297 926 647 (b-6) 27,959 Intercompany LCT 8,121 4,950 (b-3) -1,600 (b-2) 4,771 (b-4) Estimated taxes on income 246 680 (b-5) 926 ------- ------- ------- ------- ------- Total current liabilities 40,822 6,319 9,788 9,537 46,890 Long-term liabilities 1,834 1,745 -89 (c) Stockholders' equity: Common stock 1,389 12,552 -9,411 (a) 1,389 -3,141 (b-7) Other paid-in capital 17,493 17,493 Retained earnings 111,964 19,132 88 -12,946 (a) 111,964 -6,098 (b-8) Unrealized loss on available for sale securities -25 -25 Unrealized compensation and notes receivable -3,055 -3,055 ------- ------- ------- ------- ------- 127,766 31,684 88 -31,596 127,766 ------- ------- ------- ------- ------- $168,588 $39,837 $11,621 $-22,148 $174,656 ======== ======= ======= ======= ======= Note 5 - Pro forma adjustments (Dollars in thousands). (a) To reflect the payment of $31,700, in cash, for the purchase price plus transaction costs to acquire Geodynamics an estimate of the relative values of the assets acquired and liabilities assumed. (b) To reflect the sale of LCT on January 17, 1996. (1) Cash proceeds from the sale. (2) Cash payment for settlement of earnout agreement. (3) Agreed sales price of LCT as adjusted. (4) Loss on sale of LCT before estimated tax liability and assumption of bank debt. (5) Estimated tax liability in connection with LCT sale. (6) Assumption of bank debt by Geodynamics. (7) Repurchase of 261,756 Geodynamics shares in connection with the sale. (8) Loss on the sale of LCT. (c) To reclassify long-term liability to current liability.
(c) Exhibits Exhibit 2: Agreement and plan of merger dated October 18, 1995, and as amended by Amendment No. 1 dated February 15, 1996, effective March 28, 1996, by and among Logicon, Inc. (the registrant), LIN, Inc. and Geodynamics Corporation is incorporated by reference to Annex I of Geodynamics Corporation's Proxy Statement for its Special Meeting of Shareholders, filed with the Commission on February 29, 1996, Commission file number 0-15034 and is incorporated herein by reference. 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 thereunto duly authorized. Logicon, Inc. (Registrant) April 11, 1996 By: RALPH L. WEBSTER Ralph L. Webster Vice President - Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----