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CSC settles claims with the US government |
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CSC has reached an agreement in principle with the United States Government in its dispute of contract claims asserted under the Contract Disputes Act of 1978. The agreement is contingent on the completion of a definitive settlement agreement satisfactory to both parties.  Under the terms, CSC would receive a lump sum upfront cash payment of $277M and a five-year contract extension (four base years plus one option year) with an estimated value of $1B to continue to support and expand the capabilities of the systems covered by the original contract scheduled to expire in December 2011. The case has been pending before the Armed Services Board of Contract Appeals. On November 19, 2010 the Government and CSC had formally agreed to stay the claims litigation and engage in a non-binding alternate dispute resolution process to resolve all outstanding claims and other issues associated with the contract. CSC anticipates the settlement to result in a non-cash pre-tax charge to earnings in its second fiscal quarter of approximately $250M reducing EPS by an estimated $1.15. |
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