UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 8, 2006
ESSEX CORPORATION
(Exact name of Registrant as specified in its charter)
Commission File No. 0-10772
Virginia 54-0846569
(State or other jurisdiction of (IRS Employer ID No.)
incorporation or organization)
6708 Alexander Bell Drive
Columbia, Maryland 21046-2306
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: (301) 939-7000
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ X ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
INFORMATION TO BE INCLUDED IN THE REPORT
SECTION 1 - REGISTRANT'S BUSINESS AND OPERATIONS
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
AGREEMENT AND PLAN OF MERGER
On November 8, 2006, Essex Corporation, a Virginia corporation ("ESSEX"),
entered into a definitive Agreement and Plan of Merger (the "MERGER AGREEMENT")
with Northrop Grumman Space & Mission Systems Corp., an Ohio corporation
("NORTHROP GRUMMAN"), and Eagle Transaction Corporation, a Virginia corporation
and wholly owned subsidiary of Northrop Grumman ("MERGERCO"). The Merger
Agreement provides that, upon the terms and subject to the conditions set forth
in the Merger Agreement, MergerCo will be merged with and into Essex
Corporation, with Essex continuing as the surviving corporation and a wholly
owned subsidiary of Northrop Grumman (the "Merger").
Pursuant to the terms of the Merger Agreement, upon the effectiveness of the
Merger, each issued and outstanding share of Essex common stock will be
converted into the right to receive $24.00 in cash, without interest, and each
outstanding Essex stock option, whether or not vested or exercisable, will be
converted into the right to receive the excess, if any, of the $24.00 per share
merger consideration over the per share exercise price of the stock option.
In addition, Essex has agreed, among other things and subject to certain
exceptions as described in the Merger Agreement, (i) to conduct its business in
the ordinary course consistent with past practice during the interim period
between the execution of the Merger Agreement and the consummation of the
Merger, (ii) not to engage in certain transactions during such period, (iii) to
cause a shareholder meeting to be held promptly to consider approval of the
Merger Agreement, and (iv) subject to certain limited exceptions to permit the
board of directors to comply with their fiduciary duties, not to enter into
discussions or negotiations concerning, or to provide information in connection
with, alternative business combination transactions.
Consummation of the Merger is subject to a number of conditions, including
approval by Essex's shareholders, absence of any law or order prohibiting the
consummation of the Merger, expiration or termination of the applicable
Hart-Scott Rodino Antitrust Improvements Act of 1976 waiting period, and certain
other customary conditions. Under applicable Virginia law, approval by Essex's
shareholders will require the affirmative vote of holders of at least 2/3 of the
shares of Essex common stock entitled to vote.
Pursuant to the terms of the Merger Agreement, Northrop Grumman and Essex each
have certain termination rights. In the case of Northrop Grumman, it will have
the right to terminate the Merger Agreement if, among other reasons, the Essex
board of directors withdraws, modifies, qualifies or amends its recommendation
of the Merger in a manner adverse to Northrop Grumman, and in the case of Essex,
it will have the right to terminate the Merger Agreement if, among other
reasons, it determines to enter into an unsolicited alternative business
combination transaction that the board finds to be more favorable to Essex's
shareholders than the Merger, after following certain
procedures set forth in the Merger Agreement. Upon termination of the Merger
Agreement under specified circumstances, Essex will be required to pay Northrop
Grumman a termination fee of $22.5 million. Additionally, if the Merger cannot
be closed or is delayed for longer than six months because of regulatory
impediments (subject to the right of Northrop Grumman to extend the termination
date for an additional 90 days), Northrop Grumman has agreed to reimburse Essex
for out-of-pocket expenses (including reasonable legal fees and expenses)
incurred in connection with the Merger of up to $1 million.
In connection with entering into the Merger Agreement, three stockholders (Len
Moodispaw, John Hannon, and Terry Turpin), who collectively own 11 percent of
Essex's outstanding common stock and who are also members of the Essex's board
of directors, have signed voting agreements with Northrop Grumman, agreeing to
vote their shares in favor of the merger and in opposition to any competing
acquisition proposals. In addition, the voting agreements provide that the
stockholders may not transfer their shares (or any options or other similar
rights with respect to Essex stock) to any other party during the term of the
agreements. The term of the voting agreements extend until the earlier of the
closing of the Merger or 6 months after the termination of the Merger Agreement
for any reason.
The foregoing description of the Merger Agreement and the Merger does not
purport to be complete and is qualified in its entirety by reference to the
Merger Agreement, which is filed as EXHIBIT 2.1 hereto and incorporated herein
by reference.
CAUTIONARY STATEMENTS
The Merger Agreement has been included to provide investors with information
regarding its terms. Except for its status as a contractual document that
establishes and governs the legal relations among the parties thereto with
respect to the transactions described above, the Merger Agreement is not
intended to be a source of factual, business or operational information about
the parties.
The Merger Agreement contains representations and warranties made by the parties
to each other regarding certain matters. The statements embodied in the
representations and warranties are qualified by information in confidential
disclosure schedules that the parties have exchanged in connection with signing
the Merger Agreement. Please note that certain representations and warranties
were made as of a specific date, or may have been used for the purpose of
allocating risk between the parties rather than establishing matters as facts.
IMPORTANT ADDITIONAL INFORMATION ABOUT THE MERGER
ESSEX WILL FILE WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION") A
PROXY STATEMENT AND OTHER DOCUMENTS REGARDING THE PROPOSED BUSINESS COMBINATION
TRANSACTION REFERRED TO IN THE FOREGOING INFORMATION. INVESTORS AND SECURITY
HOLDERS ARE URGED TO READ THE PROXY STATEMENT WHEN IT BECOMES AVAILABLE, BECAUSE
IT WILL CONTAIN IMPORTANT INFORMATION. A DEFINITIVE PROXY STATEMENT WILL BE SENT
TO SECURITY HOLDERS OF ESSEX SEEKING THEIR APPROVAL OF THE TRANSACTION.
INVESTORS AND SECURITY HOLDERS MAY OBTAIN A FREE COPY OF THE DEFINITIVE PROXY
STATEMENT (WHEN IT IS AVAILABLE) AND OTHER DOCUMENTS FILED BY ESSEX WITH
THE SEC AT THE COMMISSION'S WEB SITE AT WWW.SEC.GOV. THE DEFINITIVE PROXY
STATEMENT AND OTHER DOCUMENTS ALSO MAY BE OBTAINED FOR FREE BY DIRECTING A
REQUEST TO:
CORPORATE SECRETARY, ESSEX CORPORATION, 6708 ALEXANDER BELL DRIVE, COLUMBIA,
MARYLAND 21046, OR BY PHONE AT 301-939-7000.
ESSEX AND ITS DIRECTORS AND EXECUTIVE OFFICERS MAY BE DEEMED TO BE PARTICIPANTS
IN THE SOLICITATION OF PROXIES FROM ESSEX STOCKHOLDERS. COLLECTIVELY, AS OF MAY
3, 2006, AS REPORTED IN THE PROXY STATEMENT FOR THE 2006 ANNUAL MEETING OF
STOCKHOLDERS, THE BENEFICIAL OWNERSHIP OF THE DIRECTORS AND EXECUTIVE OFFICERS
OF ESSEX WAS APPROXIMATELY 14.7%. STOCKHOLDERS MAY OBTAIN ADDITIONAL INFORMATION
REGARDING THE INTERESTS OF SUCH PARTICIPANTS BY READING THE PROXY STATEMENT WHEN
IT BECOMES AVAILABLE.
FORWARD-LOOKING STATEMENTS
THIS CURRENT REPORT ON FORM 8-K MAY CONTAIN "FORWARD-LOOKING STATEMENTS" WITHIN
THE MEANING OF THE UNITED STATES PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995. SUCH STATEMENTS ARE BASED ON CURRENT EXPECTATIONS, FORECASTS AND
ASSUMPTIONS AND ARE SUBJECT TO RISKS AND UNCERTAINTIES, WHICH MAY CAUSE ACTUAL
OUTCOMES, PERFORMANCE OR ACHIEVEMENTS TO DIFFER MATERIALLY FROM ANTICIPATED
OUTCOMES, PERFORMANCE OR ACHIEVEMENTS. RISKS AND UNCERTAINTIES INCLUDE: THE
SATISFACTION OF THE CONDITIONS TO CLOSING, INCLUDING RECEIPT OF STOCKHOLDER AND
REGULATORY APPROVAL; GENERAL INDUSTRY AND MARKET CONDITIONS; THE ABILITY OF
EITHER COMPANY TO ACHIEVE FUTURE BUSINESS OBJECTIVES; AND THE RISK THAT THE
PERCEIVED ADVANTAGES OF THE TRANSACTION, IF CONSUMMATED, MAY NOT BE ACHIEVED.
ALL FORWARD-LOOKING STATEMENTS ARE ALSO EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY
THE CAUTIONARY STATEMENTS DETAILED FROM TIME TO TIME IN ESSEX'S FILINGS WITH THE
COMMISSION, INCLUDING ITS QUARTERLY REPORTS ON FORM 10-Q AND ITS ANNUAL REPORT
ON FORM 10-K. THE INFORMATION SET FORTH HEREIN SPEAKS ONLY AS OF THE DATE
HEREOF, AND ESSEX CORPORATION DISCLAIMS ANY INTENTION OR OBLIGATION TO UPDATE OR
REVISE ANY FORWARD-LOOKING STATEMENTS AS A RESULT OF DEVELOPMENTS OCCURRING
AFTER THE DATE HEREOF.
SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(D) EXHIBITS
Exhibit
NUMBER DESCRIPTION
2.1 Agreement and Plan of Merger Agreement dated as of November 8, 2006,
by and between Northrop Grumman Space & Mission Systems Corp., Eagle
Transaction Corporation, and Essex Corporation.*
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* The registrant has omitted certain schedules and exhibits in
accordance with Item 601(b)(2) of Regulation S-K. The
registrant will furnish the omitted schedules and exhibits to
the Securities and Exchange Commission upon request.
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 hereunto duly authorized.
ESSEX CORPORATION
/s/ Lisa G. Jacobson
----------------------------------------------------
DATE: November 9, 2006 Lisa G. Jacobson
Executive Vice President and Chief Financial Officer
EXHIBIT INDEX
Exhibit
NUMBER DESCRIPTION
2.1 Agreement and Plan of Merger dated as of November 8, 2006, by
and between Northrop Grumman Space & Mission Systems Corp.,
Eagle Transaction Corporation, and Essex Corporation.*
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* The registrant has omitted certain schedules and exhibits in
accordance with Item 601(b)(2) of Regulation S-K. The registrant will
furnish the omitted schedules and exhibits to the Securities and
Exchange Commission upon request.