Sys - Filing of certain prospectuses and communications in connection with business combination transactions (425)
23 June 2008 - 8:01PM
Edgar (US Regulatory)
Filed
by: Kratos Defense & Security
Solutions, Inc.
Pursuant
to Rule 425 under the Securities Act of 1933 and deemed
filed
pursuant to Rule 14a-12 under the Securities Exchange Act 1934
Subject
Company: SYS
Commission
File No.: 001-32397
The following is a letter
provided to shareholders of Kratos on June 20, 2008.
Dear Kratos Shareholder,
I am writing to thank you for
being a loyal shareholder of Kratos Defense & Security Solutions, and
to tell you about a very important shareholder vote that is underway now.
I encourage you to vote your
shares IN FAVOR of all items on your proxy card.
As you know, Kratos has entered
into a merger agreement with SYS Technologies. The joint proxy statement filed
on Form S-4 has been declared effective by the SEC, and the final step in
this process is a shareholder vote.
If you are familiar with Kratos
evolution, then you know this has been a unique year of transformation for the
Company. Last year we divested approximately $200 million in wireless-related
businesses and subsequently, over a six month period, the Company acquired
Haverstick Consulting and is now in the final stages of a second acquisition
with SYS Technologies. Included with these acquired companies are approximately
1,000 employees, comprising nearly 50 percent of our revised global headcount
of over 2,000 employees.
As a shareholder, you are being
asked to vote your shares to approve this merger, and also to vote your shares
to approve a revised equity incentive plan which is directly related to the
incentive compensation of the 1,000 new Kratos employees.
We believe that ISS
(Institutional Shareholder Services) will most likely recommend a vote against
proposal number 4 on the Kratos proxy card for reasons specifically and solely
related to the Companys transformation and divested businesses and based on
the Companys historical equity incentive plans which were primarily related to
the businesses we have now divested. However, I want to explain why we strongly
believe you should vote in favor of all proposals on the Kratos proxy card.
First, ISS makes their
recommendation based solely on analytics. The purely numerical analysis
conducted by ISS does not account for the unique transformation activities or
for the historical equity plans and the related grants to those employees of
the divested companies.
Furthermore, the proposed
equity incentive plan included on the proxy card goes hand-in-hand with Kratos
growth strategy, and is the direct result of the 1,000 new employees being
brought into Kratos service-based business as a result of the acquisitions.
Our employees are our greatest asset, and retention of our employees is
critical to our success and the success of our recently acquired businesses.
Despite the likely ISS
recommendation(s), I encourage you to vote your shares IN FAVOR of the merger
with SYS Technologies and IN FAVOR of the equity incentive plans. Both of these
steps are vital to the Companys long-term growth strategy and to our ability
to attract and retain the best and the brightest talent in the industry.
Again, my sincere thanks for
being a shareholder of Kratos.
Regards,
|
|
|
Eric DeMarco
|
President
and CEO
|
Bridge Pointe Corporate
Centre
·
4810 Eastgate Mall
·
San
Diego, CA 92121
·
Tel: 858.812.7300
·
Fax:
858.812.7301
·
www.kratosdefense.com
*************************
In connection with the proposed
acquisition of SYS by Kratos Defense & Security Solutions, Inc.
("Kratos"), Kratos has filed with the U.S. Securities and Exchange
Commission (the "SEC") a registration statement on Form S-4,
containing a joint proxy statement/prospectus (which accompanies this letter)
and other relevant materials. INVESTORS AND SECURITY HOLDERS OF KRATOS AND SYS
ARE URGED TO READ THE DEFINITIVE JOINT PROXY STATEMENT/PROSPECTUS BECAUSE IT
CONTAINS IMPORTANT INFORMATION ABOUT KRATOS, SYS AND THE ACQUISITION. The
definitive joint proxy statement/prospectus and other relevant materials, and
any other documents filed by Kratos or SYS with the SEC, may be obtained free
of charge at the SEC's web site at www.sec.gov. In addition, investors and
security holders may obtain free copies of the documents filed with the SEC by
Kratos by directing a request to: Kratos Defense & Security Solutions,
Inc., 4810 Eastgate Mall, San Diego, CA 92121, Attn: Investor Relations, or by
going to Kratos' corporate website at www.kratosdefense.com. Investors and
security holders may obtain free copies of the documents filed with the SEC by
SYS by contacting SYS Technologies, Inc., 5050 Murphy Canyon Road, Suite 200,
San Diego, CA 92123, Attn: Investor Relations, or by going to SYS' corporate
website at www.systechnologies.com. Kratos, SYS and their respective executive
officers and directors may be deemed to be participants in the solicitation of
proxies from the stockholders of Kratos and SYS in favor of the acquisition.
Information about the executive officers and directors of Kratos is set forth
in amendment No. 2 to the registration statement on Form S-4, which was filed
with the SEC on May 22, 2008. Information about the executive officers and
directors of SYS and their ownership of SYS common stock is set forth in the
proxy statement for SYS' 2007 Annual Meeting of Stockholders, which was filed
with the SEC on October 29, 2007. Investors and security holders may obtain
more detailed information regarding the direct and indirect interests of
Kratos, SYS and their respective executive officers and directors in the
acquisition by reading the joint proxy statement/prospectus regarding the
acquisition when it becomes available.
*************************
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