SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: November 9, 1995
(Date of earliest event reported)
____Fairchild Industries, Inc.____
(Exact name of registrant as specified in its charter)
___Delaware___ ____1-3102____ ___52-0579835__
(State or other (Commission File Number) (IRS Employer Identification No.)
jurisdiction of
incorporation)
Washington Dulles International Airport
300 West Service Road,
____P.O. Box 10803, Chantilly, Virginia 22021-9998
(Address of principal executive offices) (Zip Code)
___(703) 478-5800___
(Registrant's telephone number, including area code)
___No change___
(Former name or former address, if changed since last report)
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ITEM 5. Other Events.
On November 9, 1995, The Fairchild Corporation
("Fairchild") and its subsidiaries, RHI Holdings, Inc. ("RHI")
and Fairchild Industries, Inc. ("FII"), entered into an Agree-
ment and Plan of Merger dated as of November 9, 1995 (the
"Merger Agreement") with Shared Technologies Inc. ("Shared
Technologies") pursuant to which Shared Technologies will
acquire the telecommunications systems and service business
operated by Fairchild Communications Services Company ("FCSC").
The acquisition is to be effected by a merger of FII
with and into Shared Technologies (the "Merger"). Prior to the
Merger, FII will transfer all of its assets to, and have all of
its liabilities assumed by, RHI except for (i) the assets and
liabilities of FCSC, (ii) the outstanding Series A and Series C
Preferred Stock of FII (having a current aggregate liquidation
value of $44,237,745), (iii) the outstanding 12<% Senior Notes
due 1999 (the "Senior Notes") of FII (having a current aggre-
gate principal amount of $125,000,000) and (iv) an amount of
bank and other indebtedness of approximately $54,263,000 (the
"Assumed Indebtedness"). Pursuant to the Merger, the Series A
and C Preferred Stock will be redeemed in cash at their liqui-
dation value ($45.00 per share plus accrued and unpaid divi-
dends). Prior to the Merger, FII (or Shared Technologies) will
make a cash tender offer (at a price to be determined) to pur-
chase all of the outstanding Senior Notes and, in connection
therewith, will seek to obtain such Noteholders' consent to
amend the indenture under which the Senior Notes were issued to
remove all covenants which can be amended or deleted by major-
ity vote. The amount of Assumed Indebtedness will be reduced
(x) to the extent the purchase price to be paid in such offer
for the Senior Notes exceeds par and (y) by the amount of
accrued and unpaid dividends on the Series A and Series C Pre-
ferred Stock on the date of the Merger.
Upon the Merger, Shared Technologies, as the surviv-
ing corporation, will (i) purchase all Senior Notes tendered
pursuant to the aforesaid tender offer (and assume FII's obli-
gations with respect to any Senior Notes not so tendered), (ii)
repay the Assumed Indebtedness in full and (iii) deposit in
escrow the funds necessary to redeem the Series A and C Pre-
ferred Stock. As a result of the Merger, RHI will receive (i)
6,000,000 shares of Common Stock of Shared Technologies (repre-
senting approximately 41% of the outstanding shares after giv-
ing effect to such issuance), (ii) shares of 6% Cumulative Con-
vertible Preferred Stock of Shared Technologies having an
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aggregate liquidation preference of $25,000,000 (subject to
upward adjustment) and which are convertible into Common Stock
of Shared Technologies at a conversion price of $6.3750 per
share (which, if converted, would represent, together with the
other Common Stock issued to RHI, approximately 42% of the Com-
mon Stock of Shared Technologies on a fully diluted basis) and
(iii) shares of a Special Preferred Stock having an initial
liquidation preference of $20,000,000 (which could accrete up
to a maximum of $30,000,000 over a ten-year period if not ear-
lier redeemed). In connection with its stock ownership,
Fairchild and RHI will have the right to elect four of the
eleven members of the Board of Directors of Shared Technologies
and have agreed, subject to certain exceptions, not to sell any
of such shares for a two-year period.
The closing of the Merger is subject to a number of
conditions, including (i) the approval of the Merger by the
shareholders of Shared Technologies, (ii) holders of at least
51% of the outstanding principal amount of Senior Notes tender-
ing their Notes and giving their consent to the covenant
changes described above, and (iii) Fairchild obtaining a favor-
able tax ruling from the Internal Revenue Service.
For a more complete description of the proposed terms
of the Merger and the transactions contemplated thereby, refer-
ence is hereby made to the Merger Agreement (a copy of which is
filed as an exhibit hereto).
On November 13, 1995, Fairchild and Cincinnati
Milacron Inc. ("CM") entered into a letter setting forth the
basic terms and conditions of a transaction (the "Transaction")
pursuant to which CM will acquire Fairchild's D-M-E business
for $260 million subject to adjustment based on the closing
date value of D-M-E's net tangible assets. The purchase price
will be paid in the form of a one year 8% note of CM secured by
all or a portion of the assets comprising the D-M-E business.
Execution of definitive documentation and the closing of the
Transaction is subject to a number of conditions, including
(i) the reasonably satisfactory completion by CM of its due
diligence, (ii) approval of CM's board of directors, (iii)
negotiation of satisfactory arrangements with Fairchild's
lenders and CM's lenders, (iv) CM's negotiation of satisfactory
permanent financing for the Transaction and (v) if required by
law, approval of Fairchild's shareholders.
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ITEM 7. Exhibits.
(c) Exhibits
1. Agreement and Plan of Merger dated as of Novem-
ber 9, 1995 by and among Fairchild, RHI, FII and Shared
Technologies.
2. Letter Agreement dated November 13, 1995 between
Fairchild and CM.
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SIGNATURE
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 hereunto
duly authorized.
FAIRCHILD INDUSTRIES, INC.
Dated: November 14, 1995 By: /s/ Donald E. Miller
Name: Donald E. Miller
Title: Vice President
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LIST OF EXHIBITS
Exhibit Page
Agreement and Plan of Merger dated as of
November 9, 1995 by and among Fairchild,
RHI, FII and Shared Technologies..................
Letter Agreement dated November 13, 1995
between Fairchild and CM..........................