ITEM 1.01. — Entry Into a Material Definitive Agreement.
On December 5, 2016, L-3 Communications Corporation (the “Company”), a wholly owned subsidiary of L-3 Communications Holdings, Inc. (“L-3
Holdings”), completed its underwritten public offering of $550,000,000 aggregate principal amount of 3.85% Senior Notes due 2026 (the “Notes”) pursuant to an underwriting agreement (the “Underwriting Agreement”) among the
Company, the subsidiary guarantors named therein (the “Subsidiary Guarantors”) and Merrill Lynch, Pierce, Fenner & Smith Incorporated, Barclays Capital Inc., Deutsche Bank Securities Inc. and the other several underwriters named
in Schedule A of the Underwriting Agreement. A copy of the Underwriting Agreement is filed herewith as Exhibit 1.1. In connection with the issuance of the Notes, on December 5, 2016, the Company and the Subsidiary Guarantors entered into an
Eighth Supplemental Indenture (the “Eighth Supplemental Indenture”) with The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”), to an indenture (the “Base Indenture”) entered into on May 21,
2010 (the “Base Indenture”, and together with the Eighth Supplemental Indenture, the “Indenture”) with the Trustee.
The Notes:
(i) were issued at a price to the public of 99.489% of their principal amount, (ii) will bear interest at a fixed rate of 3.85% per year, payable semi-annually on June 15 and December 15 of each year to holders of record on
the immediately preceding June 1 and December 1, respectively, beginning on June 15, 2017 and (iii) will mature on December 15, 2026.
The Notes are unsecured senior obligations of the Company and rank equal in right of payment with all of the Company’s other existing and future senior
indebtedness. In addition, the Notes are guaranteed on an unsecured senior basis by each of the Company’s material domestic subsidiaries that guarantees any of the Company’s other indebtedness.
The Company may redeem some or all of the Notes at any time or from time to time, as a whole or in part, at its option at the prices and on the terms set
forth in the Indenture. In addition, upon the occurrence of a “Change of Control Triggering Event,” as defined in the Indenture, the Company will be required to make an offer to repurchase the Notes at a price equal to 101% of their
principal amount, plus accrued and unpaid interest to, but not including, the date of repurchase.
The Indenture also contains covenants that, among other
things, limit the Company’s ability and the ability of certain of its subsidiaries to create or assume certain liens or enter into sale and leaseback transactions, and the Company’s ability to engage in mergers or consolidations or
transfer or lease all or substantially all of its assets. Finally, the Indenture contains customary events of default.
The sale of the Notes was made
pursuant to the Company’s and the subsidiary guarantors’ Registration Statement on Form S-3, as amended (File No. 333-212152) (the “Registration Statement”) and the prospectus supplement, dated November 29, 2016, to the
prospectus contained therein dated June 21, 2016.
The Company intends to use the net proceeds from the offering plus cash on hand to:
(i) replenish the amount of cash used, and the amount of revolving credit borrowings drawn, to repay $200 million aggregate principal amount of its 3.95% senior notes due 2016 that matured on November 15, 2016 and (ii) redeem all of
its outstanding 1.50% senior notes due 2017, which have an aggregate principal amount of $350 million.
The foregoing description is qualified by
reference to the Base Indenture and Eighth Supplemental Indenture. The Base Indenture is filed as Exhibit 4.1 to the Registration Statement and the Eighth Supplemental Indenture is filed herewith as Exhibit 4.2 and such documents are incorporated by
reference herein.