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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
SCHEDULE 14D-1/A
Tender Offer Statement Pursuant to Section
14(d)(1) of the Securities Exchange Act of 1934
(Amendment No. 10)
__________________
COMSAT CORPORATION
(Name of Subject Company)
REGULUS, LLC
LOCKHEED MARTIN CORPORATION
(Bidders)
Common Stock, Without Par Value
(Title of Class of Securities)
20564D107
(CUSIP Number of Class of Securities)
STEPHEN M. PIPER, ESQ.
LOCKHEED MARTIN CORPORATION
6801 ROCKLEDGE DRIVE
BETHESDA, MARYLAND 20817
(301) 897-6000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications on behalf of Bidders)
COPY TO:
DAVID G. LITT, ESQ.
O'MELVENY & MYERS LLP
555 13TH STREET, N.W.
SUITE 500 WEST
WASHINGTON, D.C. 20004-1109
(202) 383-5300
CALCULATION OF FILING FEE
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Transaction Valuation(1): $1,169,509,386 Amount of Filing Fee: $233,901
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(1) Estimated for purposes of calculating the amount of the filing fee only.
The amount assumes the purchase of 25,703,503 shares of common stock,
without par value (the "Shares"), of COMSAT Corporation (the "Company")
at a price per Share of $45.50 in cash (the "Offer Price"). Such number
of shares represents 49% of the shares of Common Stock of the Company
outstanding as of September 11, 1998, minus the number of shares of the
Series II Common Stock of the Company outstanding as of September 11, 1998.
[x] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the form
or schedule and the date of its filing.
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Amount previously paid: $ 233,901 Filing Parties: Regulus, LLC and
Lockheed Martin Corporation
Form or registration no.: Schedule 14D-1 Date Filed: September 25, 1998
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(Continued on following page(s))
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This Amendment No. 10 to the Tender Offer Statement on Schedule 14D-1
(the "Schedule 14D-1") amends and supplements the Schedule 14D-1 of Regulus,
LLC, a single member Delaware limited liability company (the "Purchaser") and a
wholly-owned subsidiary of Lockheed Martin Corporation, a Maryland corporation
("Parent"), in respect of the tender offer (the "Offer") by the Purchaser to
purchase up to 49% (less certain adjustments) of the issued and outstanding
shares (the "Shares") of common stock, without par value, of COMSAT Corporation,
a District of Columbia corporation (the "Company"), at a price of $45.50 per
Share, net to the seller in cash, without interest thereon, upon the terms and
subject to the conditions set forth in the Offer to Purchase dated September 25,
1998 (the "Offer to Purchase") and in the related Letter of Transmittal. The
Offer is being made pursuant to an Agreement and Plan of Merger dated as of
September 18, 1998, among the Company, Parent and Deneb Corporation, a wholly-
owned subsidiary of Parent. The Schedule 14D-1 was initially filed with the
Securities and Exchange Commission on September 25, 1998. Capitalized terms not
defined herein have the meanings assigned thereto in the Schedule 14D-1 and the
Offer to Purchase, which is attached as Exhibit (a)(1) to the Schedule 14D-1.
The Purchaser and Parent hereby amend and supplement the Schedule 14D-1
as follows:
The first full paragraph on page 3 of the Offer to Purchase is deleted
in its entirety and replaced with the following:
"The Company's financial advisor, Donaldson, Lufkin & Jenrette
Securities Corporation ("DLJ"), has delivered to the Company's Board of
Directors a written opinion as of September 18, 1998 (the "September 18,
1998 DLJ Fairness Opinion"), and a separate opinion as of July 7, 1999
(the "July 7, 1999 DLJ Fairness Opinion" and, collectively with the
September 18, 1998 DLJ Fairness Opinion, the "DLJ Fairness Opinion"), to
the effect that, as of the date of such opinion, the Consideration to be
received by the holders of Company Common Stock pursuant to the Merger
Agreement was fair to such holders from a financial point of view. The
full text of the September 18, 1998 DLJ Fairness Opinion, which sets
forth the factors considered and the assumptions made by DLJ in
rendering such opinion, is contained in the Company's
Solicitation/Recommendation Statement on Schedule 14D-9 (the "Schedule
14D-9"), which was mailed to shareholders of the Company on September
25, 1998. The full text of the July 7, 1999 DLJ Fairness Opinion, which
sets forth the factors considered and the assumptions made by DLJ in
rendering such opinion, is contained in Amendment No. 4 to the Schedule
14D-9, which was filed with the Securities and Exchange Commission on
July 15, 1999. SHAREHOLDERS ARE URGED TO, AND SHOULD, READ THE JULY 7,
1999 DLJ FAIRNESS OPINION CAREFULLY IN ITS ENTIRETY."
ITEM 2. IDENTITY AND BACKGROUND
Item 2(a)-(d) and (g) of the Schedule 14D-1 is hereby amended and
supplemented as follows:
The text of the fourth paragraph after the table entitled
"Lockheed Martin Corporation Summary Financial Data" in Section 9 of the
Offer to Purchase ("Certain Information Concerning Parent and the
Purchaser"), which was amended and restated in its entirety in Amendment
No. 8 to the Schedule 14D-1 filed with the Securities and Exchange
Commission on April 21, 1999, is deleted in its entirety and replaced
with the following:
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"Marcus C. Bennett and Caleb B. Hurtt, each a director of
Parent, also serve on the Company's Board of Directors. In August 1997,
Mr. Bennett joined the Company's Board of Directors and serves on its
Finance Committee and on its Committee on Audit, Corporate
Responsibility and Ethics. In May 1996, Mr. Hurtt joined the Company's
Board of Directors and serves on its Committee on Compensation and
Management Development as Chairman and on its Nominating and Corporate
Governance Committee. As of June 1, 1999, Mr. Bennett held options to
purchase 4,961 shares of Company Common Stock, of which 2,480 are
currently exercisable or will be exercisable within sixty days. As of
June 1, 1999, Mr. Hurtt held 1,000 shares of Company Common Stock and
options to purchase 9,922 shares of Company Common Stock, of which 7,441
are currently exercisable or will be exercisable within sixty days. Both
Mr. Bennett and Mr. Hurtt have elected to defer receipt of annual
retainer fees and instead have received phantom stock units, which are
not included in their beneficial ownership of Company Common Stock. As
of June 1, 1999, Mr. Bennett's account held a balance of 2,016 phantom
stock units and Mr. Hurtt's account held a balance of 2,788 phantom
stock units. As of June 1, 1999, Mr. Bennett had beneficial ownership of
57,092 shares of Parent Common Stock and had 141,800 options exercisable
for shares of Parent Common Stock, of which 140,000 are currently
exercisable or would be exercisable within sixty days. In addition, as
of June 1, 1999, Mr. Bennett had accounts in Parent deferred
compensation plans credited with 1,461 phantom stock units, of which 861
units were nonforfeitable. As of June 1, 1999, Mr. Hurtt had beneficial
ownership of 5,672 shares of Parent Common Stock. In addition, as of
June 1, 1999, Mr. Hurtt had accounts in Parent deferred compensation
plans credited with 2,213 phantom stock units, of which 1,013 units were
nonforfeitable. To avoid any actual or perceived conflict of interest,
each of Mr. Bennett and Mr. Hurtt recused himself from the deliberations
relating to the Merger conducted by both Boards of Directors. Messrs.
Bennett and Hurtt currently serve on the Company's Board of Directors in
their individual capacities and not as representatives of Parent. It is
anticipated that, following the Offer, Messrs. Bennett and Hurtt will
serve as two of the three directors on the Company's Board of Directors
which Parent will be entitled to designate under the Shareholders
Agreement."
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT
COMPANY
Item 3(a) is hereby amended by the incorporation of the changes to the
fourth paragraph after the table entitled "Lockheed Martin Corporation Summary
Financial Data" in Section 9 of the Offer to Purchase ("Certain Information
Concerning Parent and the Purchaser") set forth above under Item 2.
In addition, Item 3(a) is hereby amended and supplemented by the
deletion in their entirety of the paragraphs added to Item 3(a) pursuant to
Amendment No. 8 to the Schedule 14D-1 filed with the Securities and Exchange
Commission on April 21, 1999, and their replacement with the following
paragraphs:
"Parent has a continuing engagement with the law firm of Wunder,
Knight, Levine, Thelen & Forscey to provide general legislative support.
Under this engagement, Peter S. Knight, a Presidentially-appointed director
of the Company since September 1994 and partner of Wunder Knight, has
rendered services to Parent. Parent paid Wunder Knight $54,716, $161,669,
$112,129, $135,325 and $151,370 for services rendered and
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expenses incurred during 1999 (through June 1), 1998, 1997, 1996 and 1995,
respectively. Mr. Knight recused himself from the deliberations relating to
the determination by the Company's Board of Directors on July 7, 1999 to
reconfirm its recommendation that shareholders approve the Merger
Agreement.
Parent also has a continuing engagement with the law firm of Manatt,
Phelps & Phillips, LLP to provide general legal and legislative advocacy
services in connection with government contracts and contracting
opportunities in the state of California. Under this engagement, Charles
T. Manatt, a Presidentially-appointed director of the Company since May
1995 and chairman of Manatt Phelps, has not rendered any services to
Parent. Parent paid Manatt Phelps $24,078, $65,414, $116,113, $153,126 and
$66,686 for services rendered and expenses incurred during 1999 (through
June 1), 1998, 1997, 1996 and 1995, respectively.
Standard Technology, Inc., a technology, engineering and systems
integration firm, has provided services to Parent under various contracts,
which resulted from arm's-length negotiations, in connection with a
Department of Defense mentor-protege program to encourage large defense
contractors to subcontract with minority-owned businesses. Kathryn C.
Turner, a director of the Company since August 1997, is the Chairperson,
Chief Executive Officer and sole shareholder of Standard Technology.
Parent paid Standard Technology $949,803, $1,807,711, $2,008,766,
$1,846,662 and $2,242,126 in 1999 (through June 1), 1998, 1997, 1996 and
1995, respectively, under those contracts. Pursuant to the mentor-protege
program, Parent agreed to award Standard Technology with a targeted amount
of $1 million of contracts per year through 2001. Pursuant to the mentor-
protege program, Parent also participates on an ad hoc advisory board which
provides guidance on business matters and has provided financial assistance
to Standard Technology. Parent has made an unsecured loan to Standard
Technology, which is repayable over a fifteen year period commencing upon
the earlier of 2007 or the year after Standard Technology achieves annual
revenues in excess of $25 million. As of June 1, 1999, the outstanding
balance of the loan was $2,632,166, which includes previously capitalized
interest. Interest does not currently accrue on the loan but will accrue
at 8% per annum on the unpaid principal amount once repayment is required.
In addition, Parent has guaranteed up to $2 million of Standard
Technology's borrowings under a line of credit with a commercial bank,
which also is secured by Standard Technology's accounts receivable and a
personal guarantee by Ms. Turner. Ms. Turner recused herself from the
deliberations relating to the determination by the Company's Board of
Directors on July 7, 1999 to reconfirm its recommendation that shareholders
approve the Merger Agreement."
In addition, Item 3(b) of the Schedule 14D-1 is hereby amended and supplemented
as follows:
The following paragraph is added to page 25 of the Offer to Purchase at the
end of Section 11 ("Background of the Offer; Contacts with the Company"):
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"The Merger and the Merger Agreement were originally scheduled to be
considered by the Company's shareholders at the Company's annual meeting of
shareholders on June 18, 1999. Following the announcement by Parent on June 9,
1999 relating to Parent's expected financial performance that was described in
Amendment No. 9 to the Schedule 14D-1 filed with the Securities and Exchange
Commission on June 15, 1999, and in light of the proximity of the release of the
information to the original meeting date, the Company, with the concurrence of
Parent, rescheduled the date of the annual meeting. Following that action, the
Company's Board of Directors asked DLJ to render a new opinion as to the
fairness to the Company's shareholders, from a financial point of view, of the
consideration to be received by such shareholders under the Merger Agreement.
DLJ delivered its opinion to the Company's Board of Directors on July 7, 1999.
Following receipt of the opinion and a review and determination that the reasons
for the Merger continue to apply, the Company's Board of Directors reconfirmed
its recommendation that the Company's shareholders vote in favor of the Merger
Agreement. On July 15, 1999, the Company filed Amendment No. 4 to the Schedule
14D-9 with the Securities and Exchange Commission reconfirming its
recommendation that the Company's shareholders vote in favor of the Merger
Agreement."
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
July 15, 1999
REGULUS, LLC
By: /s/ Marian S. Block
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Name: Marian S. Block
Title: Vice President
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
July 15, 1999
LOCKHEED MARTIN CORPORATION
By: /s/ Marian S. Block
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Name: Marian S. Block
Title: Assistant Secretary
