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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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) June 18, 1996
ELECTRONIC DATA SYSTEMS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 01-11779 75-2548221
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
5400 Legacy Drive
Plano, Texas 75024-3105
(Address of principal executive offices,
including zip code)
Registrant's telephone number, including area code (214) 604-6000
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ITEM 5. OTHER EVENTS.
On June 18, 1996, Electronic Data Systems Corporation, a Delaware
corporation ("EDS"), announced that its Board of Directors has approved actions
likely to result in an increase for previously announced second quarter charges
and that EDS now estimates the aggregate total of the pre-tax non-recurring
charge will be approximately $850 million. EDS also announced that its Board of
Directors has adopted a dividend policy under which EDS would pay quarterly
dividends of $0.15 per share through the end of 1996. A copy of the press
release is attached as Exhibit 99(a) hereto.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) EXHIBITS
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
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99(a) Press Release of Electronic Data Systems Corporation dated
June 18, 1996
2
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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.
ELECTRONIC DATA SYSTEMS
CORPORATION
By: D. Gilbert Friedlander
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Name: D. Gilbert Friedlander
Title: Senior Vice President
June 18, 1996
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EDS NEWS RELEASE
CONTACT: Tony Good - EDS
(214) 605-6777
FOR IMMEDIATE RELEASE: TUESDAY, JUNE 18, 1996
EDS BOARD ADOPTS DIVIDEND POLICY AND AUTHORIZES
REVISION TO SECOND-QUARTER CHARGE ESTIMATE
PLANO, Texas--The newly constituted EDS Board of Directors, meeting officially
for the first time since the company's split-off from General Motors
Corporation, today adopted a dividend policy for the remainder of 1996 under
which EDS would continue to pay quarterly dividends of $0.15 per share. This
per-share dividend rate is the same as the dividend paid on GM Class E (GME)
shares in 1996. When EDS became an independent company on Friday, June 7, shares
of GME were exchanged for EDS common stock on a one-for-one basis. GME ceased
trading that day, and EDS stock began trading on the following Monday, June 10.
Also today, the board approved actions likely to result in an increase of the
previously announced second-quarter charge. EDS now estimates the aggregate
total of the one-time, pre-tax charge will be approximately $850 million ($1.12
per share, after tax) in the second quarter. This represents an increase from
the previous estimate for the second-quarter charge, which the company earlier
had indicated could reach $750 million.
In April's announcement of the second-quarter charge, EDS said that it would
take certain actions, and was considering others, to maintain and improve
operating efficiencies and accelerate EDS' move towards "user-centered"
computing. Included in these actions was the implementation of a voluntary
early-retirement offer and a workforce realignment designed to both reduce labor
costs and change the skill mix of EDS' workforce. EDS also said it was in the
process of evaluating certain aspects of its business to identify any redundant
facilities and related assets that no longer fit its strategic objectives.
The $850 million in charges includes the employee-related actions discussed
above, the write-down of assets in connection with the refreshment of
information technology assets and facility consolidation, the revision of
estimates associated with certain customer contracts, and the decision to exit
certain activities. EDS expects its earnings per share in the second quarter,
before the $850 million charge and previously announced split-off transaction
costs, to be generally in line with analysts' expectations of $0.49 to $0.52 per
share.
EDS currently expects that the one-time $850 million charge will fall into three
major categories: employee related, $277 million; technology refreshment and
other, $513 million; and cost of revenues, $60 million.
As previously stated, EDS expects that the restructuring actions will result in
savings commencing in the second half of 1996.
Statements about the effect of the restructuring and other actions discussed
above, the amount of charges that may be incurred by EDS and expected
earnings-per-share results are forward-looking statements which by their nature
are subject to uncertainties that could cause actual results to vary.
EDS (NYSE:EDS) is a leader in the global information services industry. The
company's more than 95,000 employees specialize in applying a range of ideas and
technologies to help business and government customers improve their economics,
products, services and customer relationships. EDS, which serves customers in 42
countries, reported revenues of $12.4 billion in 1995. EDS can be visited via
the internet at http://www.eds.com.
