What is being sold by Harris Corporation in this filing?

Harris Corporation is selling its Broadcast Communications Division, including its assets and certain subsidiaries, to Gores Broadcast Solutions, Inc.

What is the total value of the deal and how will it be paid?

The total purchase consideration is up to $225 million. This includes $160 million in cash at closing (subject to adjustments), a $15 million subordinated promissory note payable 15 months after closing, and an earnout of up to $50 million tied to the division's future revenue performance.

When is the sale expected to close?

The closing of the transaction is expected to occur in early calendar year 2013, subject to the satisfaction of customary closing conditions, including regulatory approvals.

Are there any conditions that could prevent the sale from closing?

Yes, the sale is subject to customary closing conditions, such as the accuracy of representations and warranties (not resulting in a Material Adverse Effect), performance of obligations by both parties, absence of a Material Adverse Effect on the Buyer's ability to close, and receipt of certain governmental approvals, including antitrust clearance under the Hart-Scott-Rodino Act.

LHX 8-K: Material Agreements

Summary

L3Harris Technologies, Inc. (then Harris Corporation) filed an 8-K on December 11, 2012, to announce a definitive Asset Sale Agreement for its Broadcast Communications Division. The agreement was with Gores Broadcast Solutions, Inc., an affiliate of The Gores Group, LLC. This transaction represents a significant divestiture for Harris, aimed at streamlining its business portfolio. The sale includes the Broadcast Communications business assets and related subsidiaries for a total consideration of up to $225 million. The payment structure involves $160 million in cash at closing, a $15 million subordinated promissory note, and an earnout of up to $50 million contingent on the division's future performance through 2016. The closing is anticipated for early calendar year 2013, subject to customary closing conditions.

Key Highlights

1Harris Corporation entered into an Asset Sale Agreement to sell its Broadcast Communications Division to Gores Broadcast Solutions, Inc.
2The total purchase consideration is up to $225 million, comprising $160 million cash at closing, a $15 million subordinated note, and an earnout of up to $50 million.
3The earnout is based on the Broadcast Communications Division's revenue performance between 2013 and 2016, with an annual cap of $25 million and an aggregate cap of $50 million.
4The agreement includes customary representations, warranties, covenants, and indemnities between Harris and the Buyer.
5Closing conditions include accuracy of representations and warranties (subject to Material Adverse Effect), performance of obligations, absence of Material Adverse Effect, and obtaining necessary governmental approvals (e.g., HSR Act).
6The transaction is not subject to a financing condition for the Buyer, though Harris will cooperate with the Buyer's financing efforts.
7Ancillary agreements include a transition services agreement, non-solicitation and non-competition agreements, and an intellectual property agreement.
8The expected closing date is early calendar year 2013, but there is no certainty the closing conditions will be met.

L3HARRIS TECHNOLOGIES, INC. /DE/ 8-K Report, Material Agreement (Dec 11, 2012)

Summary

Key Highlights

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