December 21, 1995
Securities and Exchange Commission
Division of Corporation Finance
450 Fifth Street, NW
Stop 1-4
Washington, D.C. 20549-1004
Attention: Filing Desk
RE: Thiokol Corporation
Commission File No. 1-6179
Current Report on Form 8-K dated December 21, 1995
Ladies/Gentlemen:
This Form 8-K is being filed electronically on EDGAR pursuant to Item 2,
Acquisition or Disposition of Assets.
Sincerely,
/s/ Edwin M. North
- ---------------------
Edwin M. North
Enclosures
cc: New York Stock Exchange (w/manually signed copy of report)
Chicago Stock Exchange (w/manually signed copy of report)
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________
FORM 8-K
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): December 21, 1995
Thiokol Corporation
_______________________________________________________________________
(Exact name of registrant as specified in its charter)
Delaware
_______________________________________________________________________
(State or other jurisdiction of incorporation)
1-6179 36-2678716
________________________ ________________________________
Commission File Number (IRS Employer Identification No.)
2475 Washington Boulevard, Ogden, Utah 84401-2398
________________________________________________________________________
(Address of principal executive offices) (Zip Code)
(801) 629-2000
_____________________________
Registrant's Telephone Number
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
Effective December 13, 1995, Thiokol Corporation's wholly-owned subsidiary,
Thiokol Holding Company ("Holding"), entered into a Stock Purchase Agreement
with Carlyle-Blade Acquisition Partners, L.P. ("Carlyle") and Blade
Acquisition Corp. ("Blade") pursuant to the terms of which Holding purchased
49%, $98 million; and Carlyle purchased 51%, $102 million of all of the
issued and outstanding voting common stock of Blade, a Delaware acquisition
corporation formed by Holding and Carlyle for the purpose of completing the
Howmet Cercast acquisition. Holding also purchased, for $50 million, all of
the issued and outstanding 9% paid-in-kind non- voting Series A preferred
stock, the terms and conditions of which are described in the Preferred Stock
Certificate of Designation filed with the Secretary of State of Delaware.
Paid-in-kind dividends are paid quarterly by the issuance of additional
shares preferred stock. Mandatory redemption of the preferred stock occurs
the earlier of ten years after the initial issue date or immediately before
the sale, merger, or consolidation of Blade or a transfer of more than 25% of
the Carlyle held common stock to nonaffiliates.
Holding's $148 million capital investment in Blade was funded by a capital
contribution made by Thiokol Corporation ("Thiokol") from cash balances on
hand and financing provided from various bank lines of credit. As a result of
such capital contribution, Thiokol's liquidity resources remain sufficient to
meet its anticipated working capital and capital expenditure needs.
The Blade voting common stock owned by Holding and Carlyle is subject to a
Security Agreement granted by each party to the other and such common stock
is held by a custodial agent pursuant to the terms of the Collateral
Custodial Agreement.
On December 13, 1995, Blade completed the $775 million acquisition (including
expenses) of Howmet Corporation, the world's largest manufacturer of
investment casting components for gas turbine engines, and the Cercast Group
of companies, a major producer of high quality aluminum alloy investment
castings from Pechiney International, S.A., and its affiliates ("Pechiney"),
a multinational French firm. The acquisition of Howmet and its subsidiaries
and the Cercast Group of companies, include the acquisition of the
nonoperating companies Howmet Insurance Company, a captive insurance company
and Pechiney Corporation the obligor on $816 million in promissory notes due
in 1999 secured by a trust, primary and secondary letters of credit and
Pechiney indemnifications.
The acquisition is financed by the Howmet and Cercast subsidiaries of Blade.
Financing consists of $425 million secured senior indebtedness with
maturities of 5 to 7.5 years at rates ranging from 9.5 to 9.75% including a
$100 million revolving credit facility; $60 million secured accounts
receivable financing; $125 million 10% senior subordinated notes with call
premium due 2003; and a $25 million 11% paid-in-kind eleven year note payable
to Pechiney. All debt financing is non-recourse to Blade and its shareholders
Holding and Carlyle.
The Shareholder Agreement by and among Holding, Carlyle and Blade set forth
the terms and conditions for the management of Blade and its subsidiaries
Howmet and Cercast, the composition of its Board of Directors, voting control
and super majority action required for major corporate actions. Pursuant to
the terms and conditions of the Shareholders Agreement, Holding has a call
option exercisable during a three year period commencing the third year from
the Closing Date, December 13, 1998, to purchase all of the issued and
outstanding voting common stock of Blade owned by Carlyle. Upon Holding's
exercise of the call option, at a purchase price valuation process set forth
in the Shareholder Agreement, Holding will own all of the issued and
outstanding common stock of Blade and its subsidiaries, Howmet Corporation
and the Cercast Group of companies.
The Shareholder Agreement contains a Change in Control provision which
provides Holding a right to accelerate the exercise of the call option to
purchase Carlyle's Blade common stock in the event of a Change in Control of
Carlyle as defined by the terms and conditions in the Shareholders Agreement.
In the event of a change of control of Thiokol Corporation as defined by the
terms and conditions of the Shareholders Agreement, Carlyle will effectively
gain control of the Board of Directors of Blade and will control the Blade
investment in Howmet Corporation and the Cercast group of companies. The
Shareholder Agreement contains provisions regarding the respective
shareholders' rights of Holding and Carlyle to exit the transaction including
Registration Rights Agreement, co-sale rights and tag-along rights in the
event either party sells any or all of its Blade common stock interests to a
third party subsequent to the expiration of the Holding call option.
A Standstill Agreement by and among Thiokol, Holding, Carlyle and Carlyle
affiliates provides for the protection of the long-term investment interests
of Holding in Blade and the investment interests of its stockholder Thiokol.
Holding and Carlyle have also entered into management agreements with Howmet
providing for annual payments of $1 million to each party for certain
management and consulting services. Agreements by Thiokol and a Carlyle
affiliate and Howmet Acquisition Corp. provides for the payment as of the
closing of transaction a $2 million transaction fee to each party.
Financial statements and exhibits required by Item 7 of Form 8-K will be
provided not later than 60 days after this report is filed. It is impractical
to provide the financial statements and Exhibits at this time
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SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
THIOKOL CORPORATION
(Registrant)
/s/ Richard L. Corbin
Dated: December 21, 1995 By: ________________________________
Richard L. Corbin
Senior Vice President
and Chief Financial Officer
