LMT Sets Final Exchange Ratio of 8.2136 for Exchange Offer
OREANDA-NEWS. Lockheed Martin (NYSE: LMT) announced today that the final exchange ratio for its exchange offer for shares of common stock of Lockheed Martin will be 8.2136 shares of common stock of Abacus Innovations Corporation (“Abacus”) for each share of Lockheed Martin common stock validly tendered and not properly withdrawn. As a result, Lockheed Martin stockholders who tender their shares of Lockheed Martin common stock in the exchange offer will receive approximately 8.2136 shares of Leidos common stock (subject to the receipt of cash in lieu of fractional shares) for each share of Lockheed Martin common stock accepted for exchange. The exchange is expected to be tax-free to participating Lockheed Martin stockholders for U.S. federal income tax purposes, except for any gain or loss attributable to the receipt of cash in lieu of fractional shares.
Lockheed Martin is offering to exchange all 76,958,918 shares of common stock of Abacus for shares of Lockheed Martin that are validly tendered and not properly withdrawn. Based on the final exchange ratio, Lockheed Martin will accept for exchange a maximum of 9,369,694 shares of Lockheed Martin common stock in the exchange offer, which shares will be retired and will reduce Lockheed Martin’s share count.
The final calculated per-share value of shares of Lockheed Martin common stock and the final calculated per-share value of Abacus common stock, in each case determined in the manner described in the Prospectus—Offer to Exchange dated July 11, 2016 (the “Prospectus”) filed with the Securities and Exchange Commission, and in the case of Abacus reduced by $13.64 per share (which equals the per-share amount of the approximately $1.0 billion special dividend to be paid to Leidos stockholders in connection with the transaction), would have resulted in an exchange ratio higher than the upper limit of 8.2136. Accordingly, the final exchange ratio has been set at 8.2136 shares of Abacus common stock for each share of Lockheed Martin common stock accepted in the exchange offer. Based on the final calculated per-share value of Lockheed Martin common stock and the final calculated per-share value of Abacus common stock, in each case determined in the manner described in the Prospectus and in the case of Abacus reduced by $13.64 per share, tendering stockholders will receive approximately $107.42 of Leidos common stock for each $100 in value of Lockheed Martin common stock accepted for exchange.
The exchange offer is scheduled to expire at 8:00 a.m. EDT on August 16, 2016, unless Lockheed Martin extends or terminates the exchange offer. Accordingly, Lockheed Martin stockholders may tender or withdraw their shares of Lockheed Martin common stock until that time by following the procedures described in the Prospectus, the Letter of Transmittal and the Exchange and Transmittal Information Booklet. The merger is expected to occur immediately after completion of the exchange offer on August 16. The transactions are subject to customary closing conditions. On August 8, 2016, Leidos stockholders approved the issuance of the Leidos shares required to consummate the transaction.
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