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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): January 13, 1998
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GOVERNMENT TECHNOLOGY SERVICES, INC.
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(Exact name of registrant as specified in its charter)
Delaware 0-19394 54-1248422
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(State or other (Commission (IRS Employer
jurisdiction of File Identification
incorporation) Number) Number)
4100 Lafayette Center Drive, Chantilly, Virginia 20151-1200
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 703-502-2000
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Item 1. Changes in Control of Registrant
Not Applicable.
Item 2. Acquisition or Disposition of Assets
Not Applicable.
Item 3. Bankruptcy or Receivership
Not Applicable.
Item 4. Changes in Registrant's Certifying Accountant
Not Applicable.
Item 5. Other Events
On January 13, 1998, Government Technology Services, Inc. ("GTSI") and
BTG, Inc. ("BTG") issued a joint press release announcing that they had
amended their December 18, 1997 letter of intent for the purchase by GTSI
of BTG's product sales division. For additional information, please see
the attached press release.
Item 6. Resignation of Registrant's Directors
Not Applicable.
Item 7. Financial Statements and Exhibits
(c) Exhibits
99.1 Press release dated January 13, 1998
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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, thereunto duly authorized.
Date: January 15, 1998
GOVERNMENT TECHNOLOGY SERVICES, INC.
By: /s/ M. DENDY YOUNG
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M. Dendy Young
President and Chief Executive Officer
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INDEX TO EXHIBITS
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EXHIBIT |
NUMBER | DESCRIPTION
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99.1 | Press release dated January 13, 1998
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Exhibit 99.1
[GTSI Logo]
Government Technology Services, Inc.
4100 Lafayette Center Drive
Chantilly, VA 20151-1200
(703) 502-2000
www.gtsi.com
CONTACTS:
Fern Krauss Theda Parrish
ESTN Communications BTG
(301)- 424-9140 or (703) 502-2054 (703) 383-8145
[email protected] [email protected]
[email protected]
GTSI AND BTG AMEND LETTER OF INTENT
Amendment Will Allow Companies to Complete Transaction Faster
CHANTILLY, VA (January 13, 1998) -- Government Technology Services, Inc.
(GTSI) (Nasdaq:GTSI) and BTG, Inc. (Nasdaq:BTGI) today announced that they
have amended their December 18, 1997 letter for the sale to GTSI of
substantially all of the BTG division assets responsible for reselling
computer hardware, software and integrated systems to the Federal
Government. The amendment provides that at the closing GTSI will exchange
15,375 shares of a new series of preferred stock, designated Series C 8%
cumulative redeemable preferred stock, in lieu of the original three
million shares of GTSI common stock. The preferred stock will be nonvoting
except for the right to elect one member of the GTSI board. The $8 million
cash portion of the purchase price and BTG's right to nominate a second
director subject to GTSI's consent are unaffected by the amendment.
Under the structure, after the acquisition is closed, GTSI will seek
shareholder approval at its upcoming annual meeting for conversion of the
preferred stock to three million shares of common stock. If shareholder
approval is obtained, the preferred stock will automatically convert to
common stock. If shareholder approval is not obtained, dividends, payable
annually in cash or preferred stock at GTSI's option, will begin to accrue
on the preferred stock at an annual rate of 8% and the preferred stock will
become redeemable by GTSI at an initial redemption price equal to the
liquidation preference of $1,000 per share (or $15,375,000 in the
aggregate) plus accrued but unpaid dividends. If conversion is not
approved at the first shareholders meeting, GTSI has agreed to seek
shareholder approval a second time at the next shareholders meetings. If
conversion is not approved at the second meeting, the redemption price
will hereafter equal the liquidation preference plus an accrual thereon
since the second shareholders meeting at the rate of two percent per annum.
Consummation of the transaction remains subject to the satisfaction of
customary conditions and is expected to close during February, 1998.
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GTSI and BTG Amend Letter Of Intent Page -2-
Dendy Young, President and CEO of GTSI emphasized that elimination of
shareholder approval as a condition to closing the transaction would enable
the transaction to be completed more quickly and would eliminate certain
costs and a great deal of uncertainty for employees of both companies. Mr.
Young said, "It's important that the employees know quickly where they
will be working."
"This is a very positive move for both companies," said Dr. Edward
Bersoff, President and CEO of BTG. "The faster the transaction is
completed, the faster we can both go forward as stronger entities, and take
full advantage of the new opportunities that arise in 1998."
GTSI reported a net income of $1.9 million, or $0.27 per share, in the
third quarter of calendar 1997. For the same period, BTG reported a loss
of $2.3 million, or $0.27 per share.
Except for historical information, all of the statements, including
the benefits of the transaction for both companies, expectations and
assumptions contained in the foregoing are "forward-looking statements"
(within the meaning of the Private Securities Litigation Reform Act of
1995) that involve a number of risks and uncertainties. It is possible that
the assumptions made by management for purposes of such statements may not
materialize. Actual results may differ materially from those projected or
implied in any forward-looking statements. In addition to the above
factors, other important factors that could cause actual results to differ
materially are those listed in the Company's most recent report on Form
10-K and included from time to time in other documents filed by the Company
with the Securities and Exchange Commission.
About the Companies
BTG provides information technology services and products to
government and commercial clients. The company specializes in systems
engineering, integration and network systems, internet/intranet/extranet
access and services. The company is headquartered in Fairfax, Virginia.
Additional information on BTG is available on the Internet at www.btg.com
by e-mail or [email protected], or by calling 703-383-8000.
GTSI is the largest dedicated government reseller providing
broad-based information technology solutions. The Company offers access to
over 100,000 information technology products from more than 2,000
manufacturers. Headquartered in the Washington metropolitan area, GTSI
employs approximately 400 people and provides products and services to
Federal, state and local government customers worldwide. Founded in 1983,
GTSI has been ranked by Computer Reseller News as one of the top 10
resellers nationwide every year since 1993, when CRN began ranking
resellers. Further information may be obtained on the Internet at
www.gtsi.com.
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GTSI is a registered service mark of Government Technology Services, Inc.
All other trademarks and service marks are proprietary to their respective
owners.
