| Item 1.01 | Entry into a Material Definitive Agreement. |
On July 19, 2023, VSE Corporation (the “Company”) entered into an Underwriting Agreement (the “Underwriting Agreement”) with RBC Capital Markets, LLC and William Blair & Company, L.L.C., acting as representatives of the several underwriters named therein (the “Underwriters”), pursuant to which the Company agreed to issue and sell (the “Offering”) 2,475,000 shares (the “Firm Shares”) of the Company’s common stock, par value $0.05 per share (the “Common Stock”), at a price to the public of $48.50 per share. The Company has also granted the Underwriters a 30-day option to purchase up to an additional 371,250 shares of Common Stock (the “Optional Shares” and, together with the Firm Shares, the “Shares”).
The Company estimates that the net proceeds from the Offering will be approximately $112.7 million (or $129.6 million if the Underwriters’ option to purchase additional shares is exercised in full), after deducting estimated underwriting discounts and commissions and before estimated offering expenses. The Company intends to use substantially all of the net proceeds from the Offering to repay outstanding borrowings under its revolving credit facility and any remaining amounts for general corporate purposes.
The Offering was made pursuant to the Company’s effective registration statement on Form S-3 (Registration No. 333-248139), which was previously filed with the Securities and Exchange Commission (the “SEC”) on August 20, 2020 and declared effective by the SEC on August 31, 2020, a base prospectus dated August 31, 2020 and a prospectus supplement dated July 19, 2023.
The Underwriting Agreement contains customary representations, warranties and agreements by the Company, customary conditions to closing, indemnification obligations of the Company and the Underwriters, including for liabilities under the Securities Act of 1933, as amended, other obligations of the parties and termination provisions. The representations, warranties and covenants contained in the Underwriting Agreement were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to such agreement, and may be subject to limitations agreed upon by the contracting parties. Pursuant to the Underwriting Agreement, the Company’s executive officers, directors and certain affiliated funds entered into lock-up agreements in substantially the form included as an exhibit to the Underwriting Agreement, providing for a 90-day “lock-up” period with respect to sales of Common Stock, subject to certain exceptions.
The foregoing description of the Underwriting Agreement is subject to, and is qualified in its entirety by, the full text of the Underwriting Agreement, a copy of which is filed as Exhibit 1.1 to this report and is incorporated by reference herein.
A copy of the opinion of Jones Day relating to the validity of the Shares issued in the Offering is filed herewith as Exhibit 5.1.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
