Summary
L3Harris Technologies, Inc. (LHX) filed an 8-K on February 1, 2007, detailing the completion of a significant business combination. The company, in conjunction with Stratex Networks, Inc., has finalized a transaction where Harris Corporation contributed its Microwave Communications Division (MCD) and $32.1 million in cash to a newly formed entity, Harris Stratex Networks, Inc. (Newco). This entity was subsequently merged with Stratex Networks, Inc., creating a new combined company. This event marks a strategic move to establish a new entity focused on microwave communications, with Harris Corporation retaining a significant stake and governance influence.
Key Highlights
- 1Completion of a business combination involving Harris Corporation's Microwave Communications Division and Stratex Networks, Inc. to form Harris Stratex Networks, Inc. (Newco).
- 2Harris Corporation contributed its Microwave Communications Division assets and $32.1 million in cash to Newco.
- 3Harris Corporation received approximately 56% of Newco's outstanding common stock (32,850,965 shares of Class B common stock).
- 4Former Stratex shareholders received approximately 24,733,114 shares of Newco's Class A common stock.
- 5An Investor Agreement grants Harris Corporation significant control over Newco's board composition, with the right to elect Class B Directors based on its proportionate ownership.
- 6A Non-Competition Agreement restricts Harris Corporation from competing with Newco in specific microwave radio systems for five years, with certain exceptions for government entities and non-branded resales.
- 7A Registration Rights Agreement allows Newco to register shares held by Harris Corporation under the Securities Act of 1933.
Frequently Asked Questions
This 8-K filing announces the completion of a significant business combination where L3Harris Technologies' (then Harris Corporation's) Microwave Communications Division was combined with Stratex Networks, Inc. to form a new entity named Harris Stratex Networks, Inc. (Newco).
Harris Corporation holds approximately 56% of the outstanding common stock of Newco, represented by Class B common stock. The Investor Agreement gives Harris significant control over Newco's board of directors, allowing it to elect a proportional number of Class B Directors and maintain a majority of the board as long as it holds a majority of the common stock.
Yes, a Non-Competition Agreement is in place for five years post-combination. Harris Corporation is restricted from developing, manufacturing, distributing, or selling microwave radio systems that compete with Newco's identified products, unless it pertains to government entities or the resale of non-Harris branded equipment.
Harris Corporation contributed the assets comprising its Microwave Communications Division and $32.1 million in cash to the new entity, Harris Stratex Networks, Inc.