Exhibit 6
DYNCORP AND SUBSIDIARIES
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
As of September 30, 1999
(in thousands, except share amounts)
DynCorp Information Pro Forma
DynCorp Systems, LLC Adjustments Combined
---------------------------------------------------
Assets
Current Assets:
Cash and cash equivalents $ 11,537 $ 4 $ 254,812 D $ 18,921
(167,540) E
(79,892) C
Accounts receivable, net 254,581 69,280 99 A 323,960
Inventories 647 5,198 - 5,845
Other current assets 22,095 6,970 (5,199) A 23,941
75 D
----------- ------------ ------------ ----------
Total current assets 288,860 81,452 2,355 372,667
Property and Equipment, 24,258 10,940 - 35,198
net of accumulated
depreciation
Intangible Assets, net of 60,734 237 80,214 B 141,185
accumulated amortization
Other Assets 36,537 9,948 8,884 D 59,434
(9,948) A
(1,187) C
15,200 B
----------- ------------ ------------ ----------
Total Assets $ 410,389 $ 102,577 $ 95,518 $ 608,484
=========== ============ ============ ==========
Liabilities and Stockholders' Equity
Current Liabilities:
Notes payable and
current portion of
long-term debt $ 28,262 $ 5,486 $ (5,486) A $ 24,782
24,520 D
(28,000) C
Accounts payable 54,355 6,943 (519) A 60,779
Deferred revenue and
customer advances 2,646 7,504 - 10,150
Accrued liabilities 125,444 3,095 2,202 A 130,042
(699) C
---------- ------------ ----------- ---------
Total current liabilities 210,707 23,028 (7,982) 225,753
Long-Term Debt 152,025 - (50,000) C 335,227
233,202 D
Other Liabilities and
Deferred Credits 35,350 27,231 (11,000) B 51,581
Contingencies and
Deferred Credits - - - -
Temporary Equity:
Redeemable Common Stock -
ESOP shares, 7,256,919
shares issued and
outstanding, subject
to restrictions 190,067 - - 190,067
Other shares, subject to
restrictions - - 6,048 D 6,048
Permanent Stockholders' Equity:
Common Stock, par value
ten cents per share,
authorized 20,000,000
shares; issued
5,002,465 (1) shares 500 - - 500
Paid-in Surplus 127,195 - 6,006 D 133,201
Accumulated Other
Comprehensive Income (5) - - (5)
Reclassification to
Temporary Equity for
Redemption Value Greater
than Par Value (189,341) - (6,005) D (195,346)
Deficit (67,943) - (2,380) C (90,376)
(20,053) B
Treasury Stock, at cost;
2,259,522 shares (41,923) - - (41,923)
Unearned ESOP Shares (6,243) - - (6,243)
Net Parent Company Investment - 52,318 (41,073) B -
(11,245) A
----------- ---------- ---------- -------
Total Liabilities and
Shareholders' Equity $ 410,389 $ 102,577 $ 95,518 $ 608,484
=========== ========== ========== ==========
(1) Shares issued are at the historical amount, before pro forma adjustments.
DYNCORP AND SUBSIDIARIES
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
Nine Months Ended September 30, 1999
(in thousands, except per share amounts)
DynCorp Information Pro Forma
DynCorp Systems, LLC Adjustments Combined
--------------------------------------------------
Revenues $ 967,782 $ 159,225 $ (2,032) A $ 1,122,513
(2,592) F
130 G
Costs and Expenses:
Costs of services 917,709 147,787 (3,966) A 1,054,996
1,875 H
(5,147) F
(3,262) G
Corporate general and
administrative 15,381 2,134 (2,134) G 15,381
Interest income (1,375) - - (1,375)
Interest expense 13,010 919 22,129 I 31,561
(4,497) J
Other 3,447 824 2,005 L 5,264
(1,012) K
--------- ------------- ----------
Total costs and
expenses 948,172 151,664 1,105,827
Earnings before income
taxes and minority
interest 19,610 7,561 16,686
Provision for income taxes 6,872 3,064 (3,462) N 6,474
--------- ------------- ---------
Earnings before minority
interest 12,738 4,497 10,212
Minority interest 1,899 - 1,899
--------- -------------- ----------
Net Earnings $ 10,839 $ 4,497 $ 8,313
========= ============== ==========
Accretion of redeemable
shares - - 1,332 M 1,332
Common stockholders'
share of earnings $ 10,839 $ 6,981
=========== ==========
Basic earnings per share $ 1.08 $ 0.67
Diluted earnings per
share $ 1.06 $ 0.65
Weighted average number
of shares outstanding
for basic earnings per
share 10,047 426 10,473
Weighted average number
of shares outstanding
for diluted earnings
per share 10,268 426 10,694
DYNCORP AND SUBSIDIARIES
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
At December 31, 1998
(in thousands, except per share amounts)
DynCorp Information Pro Forma
DynCorp Systems, LLC Adjustments Combined
-------------------------------------------------------
Revenues $ 1,233,707 $ 233,552 $ (3,280) A $ 1,457,870
(6,280) F
171 G
Costs and Expenses:
Costs of services 1,173,151 215,836 2,500 H 1,376,259
(6,868) F
(2,464) A
(5,896) G
Corporate general
and administrative 18,630 3,204 (3,204) G 18,630
Interest income (1,600) - - (1,600)
Interest expense 14,144 1,220 29,596 I 40,340
(4,620) J
Other 2,687 1,909 2,673 L 7,269
----------- ----------- ----------
Total costs and
expenses 1,207,012 222,169 1,440,898
Earnings before
income taxes and
minority interest 26,695 11,383 16,972
Provision for income
taxes 9,559 4,661 (7,601) N 6,619
----------- ----------- ----------
Earnings before
minority interest 17,136 6,722 10,353
Minority interest 2,081 - 2,081
----------- ----------- ----------
Net Earnngs $ 15,055 $ 6,722 $ 8,272
=========== =========== ==========
Accretion of
redeemable shares - - 1,815 M 1,815
Common stockholders'
share of earnings $ 15,055 $ 6,722 $ 6,457
=========== ============= ==========
Basic earnings per
share $ 1.47 $ 0.61
Diluted earnings
per share $ 1.43 $ 0.59
Weighted average
number of shares
outstanding for
basic earnings per
share 10,242 426 10,668
Weighted average
number of shares
outstanding for
diluted earnings
per share 10,514 426 10,940
DYNCORP AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
(in thousands, except share amounts)
The following adjustments give pro forma effect to the transaction:
A)Eliminate assets, liabilities and results of operations for items not
acquired per the Purchase Agreement.
B)Record purchase accounting adjustments, including goodwill of $80,214
and in-process research and development costs of $20,053.
C)Eliminate fixed and floating rate note payable, including issuance
costs.
D)Record new financing, including issuance costs, and the issuance of
426,217 shares of redeemable common stock.
E)Record purchase price paid.
F)Eliminate results of operations of businesses sold and held for sale.
G)Eliminate GTE allocations of indirect expenses and related revenue
impact and replace with DynCorp allocations of indirect expenses and
related revenue impact.
H)Record estimated increase in pension and other post-retirement benefit
expenses.
I)Record interest on new financing and related costs.
J)Eliminate interest on old debt and related costs.
K)Eliminate adjustment to goodwill of business held for sale.
L)Record amortization of goodwill based on 30-year life.
M)Record accretion related to redeemable shares.
N)Adjust income tax provision to 38.8% and 39% to reflect DynCorp's
estimated effective tax rate for 1999 and 1998, respectively.