8-KOther EventsExhibits & Filings

RTX Corp 8-K Report, Corporate Update (Jun 18, 2012)

Filed June 18, 2012For Securities:RTX

Summary

On June 18, 2012, United Technologies Corporation (UTC), now known as RTX Corp, filed an 8-K report detailing the issuance of 22,000,000 Equity Units. Each unit, priced at $50, consists of a stock purchase contract for common stock to be delivered on August 1, 2015, and a beneficial interest in the company's 1.55% Junior Subordinated Notes due 2022. The issuance aims to partially fund the cash consideration for the previously announced acquisition of Goodrich Corporation. The company also announced plans to reduce its bridge loan facility commitment from $15.0 billion to $2.0 billion, reflecting the capital raised from this equity unit offering and a prior notes offering. This strategic move signals a step towards financing a significant acquisition, with the remainder of the net proceeds from the Equity Units designated for general corporate purposes.

Key Highlights

  • 1United Technologies Corporation issued 22,000,000 Equity Units on June 18, 2012.
  • 2Each Equity Unit has a stated amount of $50 and comprises a stock purchase contract and a 5.0% interest in Junior Subordinated Notes due 2022.
  • 3The stock purchase contract obligates holders to buy UTC common stock on August 1, 2015, with the number of shares determined by a pricing agreement.
  • 4The primary purpose of the Equity Unit issuance is to help fund the cash component of the Goodrich Corporation acquisition.
  • 5The company will use net proceeds for the Goodrich acquisition and general corporate purposes.
  • 6UTC plans to reduce its $15 billion bridge loan facility commitment to $2.0 billion following this issuance.
  • 7The Equity Units and Notes were registered under a Form S-3 registration statement and detailed in a Prospectus Supplement.

Frequently Asked Questions

Equity Units are a financial instrument that combines a contract to purchase company stock in the future with an interest in the company's subordinated debt. UTC issued them to raise capital, specifically to help finance the cash portion of its acquisition of Goodrich Corporation. The stock component allows the company to secure future equity issuance, while the note component provides a current yield to investors.

The stock purchase contracts within the Equity Units stipulate that the company will deliver shares of common stock to holders on August 1, 2015. The exact number of shares to be delivered will be determined based on the terms outlined in the Purchase Contract and Pledge Agreement.

This issuance is part of UTC's broader financing strategy for the Goodrich acquisition. By raising capital through Equity Units and prior note offerings, the company is reducing its reliance on its $15 billion bridge loan facility, planning to lower its commitments under that facility to $2.0 billion. This indicates a shift towards more permanent or equity-linked financing.

Each Equity Unit consists of two main parts: (a) a stock purchase contract under which the holder agrees to purchase UTC common stock on August 1, 2015, and (b) a 5.0% undivided beneficial ownership interest in $1,000 principal amount of UTC's 1.55% Junior Subordinated Notes due 2022.