How will the leadership and governance of the combined company be structured?

The current CEO of Harris will become the Executive Chairman and CEO of the combined company, while the current CEO of L3 will serve as Vice Chairman, President, and COO. The L3 CEO is planned to succeed the Harris CEO as the top executive two years after the merger closes. The board of directors will consist of twelve members, with an equal number of designees from both companies' current independent directors, plus the two CEOs.

What are the key conditions that must be met for the merger to be completed?

The merger requires several conditions to be met, including the approval of the merger agreement by the stockholders of both L3 and Harris, the approval of the stock issuance by Harris shareholders, approval for listing on the NYSE, expiration of antitrust waiting periods and receipt of necessary regulatory approvals, and the absence of any governmental prohibitions. Both parties must also receive certain tax-related assurances and not experience material adverse effects.

What are the financial implications for L3 shareholders?

L3 shareholders will receive 1.30 shares of Harris common stock for each share of L3 common stock they own. This means L3 shareholders will become shareholders in the combined entity, owning approximately 46% of the new company. L3's equity awards will generally vest and be settled in Harris Common Stock, subject to adjustments and the exchange ratio.

LHX 8-K: Leadership Changes & Material Agreements

Q: What is the primary goal of this merger between L3 Technologies and Harris Corporation?

The primary goal is to combine the businesses of L3 Technologies and Harris Corporation into a larger, more diversified aerospace and defense company. This merger aims to create a stronger market position and realize potential synergies.

Summary

L3 Technologies, Inc. and Harris Corporation have entered into a definitive agreement to combine their businesses in an all-stock merger of equals. The combined entity will be named L3 Harris Technologies, Inc. and will be headquartered in Melbourne, Florida. This merger aims to create a larger, more diversified aerospace and defense company. Harris shareholders will own approximately 54% of the combined company, while L3 shareholders will own approximately 46%, based on an exchange ratio of 1.30 shares of Harris common stock for each share of L3 common stock. The transaction is structured as a merger where L3 will merge with a subsidiary of Harris, with L3 becoming a wholly-owned subsidiary of Harris post-merger. The governance structure of the combined company has been carefully considered, with the current CEO of Harris set to become Executive Chairman and CEO, and the current CEO of L3 becoming Vice Chairman, President, and COO. The L3 CEO is slated to succeed the Harris CEO as the combined company's CEO on the second anniversary of the closing. The combined company's board will comprise twelve directors, with an equal split between L3 and Harris designees, plus the two CEOs. The merger is subject to customary closing conditions, including stockholder approvals from both companies, regulatory approvals (including antitrust), and listing approval on the NYSE. The agreement includes termination clauses and specified termination fees for both parties, highlighting the commitment to the transaction while managing potential risks.

Key Highlights

1L3 Technologies and Harris Corporation are merging in an all-stock transaction to form L3 Harris Technologies, Inc.
2Harris shareholders will own approximately 54% and L3 shareholders 46% of the combined entity.
3The exchange ratio is set at 1.30 shares of Harris common stock for each L3 common stock share.
4Key leadership roles in the combined company are defined, with a succession plan for the CEO position.
5The combined company will be headquartered in Melbourne, Florida.
6The merger is subject to customary closing conditions, including stockholder and regulatory approvals.
7Termination fees are defined for both L3 and Harris in specific circumstances, indicating a strong commitment to the deal.

L3HARRIS TECHNOLOGIES, INC. /DE/ 8-K Report, Material Agreement (Oct 16, 2018)

Summary

Key Highlights

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