SAN DIEGO, July 28, 2011 (GLOBE NEWSWIRE) -- Kratos Defense & Security Solutions, Inc. (Nasdaq:KTOS), a leading National Security Solutions provider, today announced the closing of its previously announced private offering to eligible purchasers of $115 million aggregate principal amount of its 10% Senior Secured Notes due 2017 (the "Notes"). The gross proceeds from the offering of approximately $122.5 million, which includes an approximate $5.7 million of issuance premium and $1.8 million of accrued interest, will be used to finance, in part, the cash portion of the purchase price for the acquisition of Integral Systems, Inc., to refinance existing indebtedness of Integral Systems, to pay certain severance payments in connection with the acquisition of Integral Systems and to pay related fees and expenses. As a result of the Notes being issued at a premium, the effective interest rate on the newly issued Notes is 8.88%.
The Notes were offered inside the United States to qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act") and outside the United States to non-U.S. persons in reliance on Regulation S under the Securities Act.
The Notes have not been registered under the Securities Act, any other United States federal securities laws or the securities laws of any state and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state laws.
Kratos also announced the closing of an amendment to its existing $35 million revolving line of credit to increase it to $65 million, with an extension of the maturity date to July 27, 2016. The interest rate on the line of credit is a range from LIBOR plus 3% to 3.75%. The facility has an accordion feature with the ability to expand the revolver to $100 million. There are currently no borrowings outstanding on the revolving credit facility.
The facility is comprised of a syndication of banks led by KeyBank National Association (NYSE:KEY), as Administrative Agent and Lead Arranger and Sole Book Runner, and East West Bank (Nasdaq:EWBC) and Bank of the West participating in the syndication.
About Kratos Defense & Security Solutions
Kratos Defense & Security Solutions, Inc. (Nasdaq:KTOS) is a specialized National Security technology business providing mission critical products, services and solutions for United States National Security priorities. Kratos' core capabilities are sophisticated engineering, manufacturing and system integration offerings for National Security platforms and programs. Kratos' areas of expertise include Command, Control, Communications, Computing, Combat Systems, Intelligence, Surveillance and Reconnaissance (C5ISR), unmanned systems, cyber warfare, cyber security, information assurance, critical infrastructure security and weapons systems sustainment. Kratos, including the recent acquisition of Integral Systems, has primarily an engineering and technical oriented work force of approximately 4,100, many of which hold an active National Security clearance, including Secret, Top Secret and higher. The vast majority of Kratos' work is performed on a military base, in a secure facility or at a critical infrastructure location. Kratos' primary end customers are United States Federal Government agencies, including the Department of Defense, classified agencies, intelligence agencies and Homeland Security related agencies. News and information are available at www.KratosDefense.com.
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