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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) - July 3, 1997
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LOCKHEED MARTIN CORPORATION
(Exact name of registrant as specified in its charter)
Maryland 1-11437 52-1893632
(State or other jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
6801 Rockledge Drive, Bethesda, Maryland 20817
(Address of principal executive offices) (Zip Code)
(301) 897-6000
(Registrant's telephone number, including area code)
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Not Applicable
(Former name or address, if changed since last report)
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Item 5. Other Events
On July 3, 1997, Lockheed Martin Corporation, a Maryland corporation
("Lockheed Martin"), and Northrop Grumman Corporation, a Delaware Corporation
("Northrop Grumman"), issued a joint press release announcing that they had
entered into an Agreement and Plan of Merger dated as of July 2, 1997 (the
"Merger Agreement"). A copy of the press release is attached hereto as Exhibit
99 and is incorporated herein by reference.
The Merger Agreement, which is among Northrop Grumman, Lockheed Martin and
Hurricane Sub, Inc. ("Lockheed Martin Merger Sub"), a Delaware corporation and
wholly-owned subsidiary of Lockheed Martin, provides for the merger (the
"Merger") of Lockheed Martin Merger Sub with and into Northrop Grumman, with
Northrop Grumman surviving as a wholly-owned subsidiary of Lockheed Martin.
Pursuant to the Merger Agreement, each share of common stock, par value $1.00
per share of Northrop Grumman ("Northrop Grumman Common Stock") outstanding
immediately prior to the Effective Time (as defined in the Merger Agreement) of
the Merger (other than shares held in Northrop Grumman's treasury) will be
converted into the right to receive 1.1923 shares of Lockheed Martin common
stock, par value $1.00 per share ("Lockheed Martin Common Stock"). No
fractional shares will be issued and cash, without interest, will be paid in
lieu thereof. As of the Effective Time, all shares of Northrop Grumman Common
Stock issued and outstanding immediately prior to the Effective Time will no
longer be outstanding and will be automatically canceled and retired and will
cease to exist, and each holder of a certificate or certificates which
immediately prior to the Effective Time represented outstanding shares of
Northrop Grumman Common Stock will cease to have any rights with respect
thereto, except the right upon the surrender of such certificate to (i) receive
certificate(s) of Lockheed Martin Common Stock representing the number of whole
shares of Lockheed Martin Common Stock into which such shares of Northrop
Grumman Common Stock have been converted and (ii) any cash, without interest, to
be paid in lieu of any fractional share of Lockheed Martin Common Stock,
provided, however, that certificate holders that properly perfect their rights
as provided by the General Corporation Law of the State of Delaware ("DGCL")
shall have the appraisal rights provided by the DGCL.
Prior to its execution, the Merger Agreement was unanimously approved by
the respective Boards of Directors of Lockheed Martin and Northrop Grumman. The
consummation of the Merger is subject, among other things, to the approval by
the stockholders of Lockheed Martin of the issuance of Lockheed Martin Common
Stock, to the approval of the Merger by the stockholders of Northrop Grumman and
to certain regulatory approvals. It is anticipated that the Merger will be
accounted for using the pooling-of-interests method of accounting, however,
Lockheed Martin is considering other transactions which, if consummated, could
result in the Merger being accounted for as a purchase.
Item 7. Exhibits
Exhibit No. Description
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99 Press Release issued July 3, 1997.
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SIGNATURES
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.
LOCKHEED MARTIN CORPORATION
/s/ STEPHEN M. PIPER
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Stephen M. Piper
Associate General Counsel
and Assistant Secretary
9 July, 1997
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INDEX TO EXHIBITS
Exhibit No. Description
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99 Press Release issued July 3, 1997.
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Exhibit 99
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For Immediate Release
LOCKHEED MARTIN AND NORTHROP GRUMMAN
TO FORM STRATEGIC COMBINATION
$11.6 billion transaction to create $37 billion global technology leader
BETHESDA, Maryland/LOS ANGELES, California, July 3, 1997 -- Lockheed Martin
(NYSE:LMT) and Northrop Grumman (NYSE:NOC) announced today that their
respective boards of directors unanimously approved a definitive agreement to
combine the companies to further enhance efficiencies and increase global
competitiveness. Following shareholder approvals and U.S. government
regulatory reviews, the transaction will create a leading, broad-based
technology company with estimated 1997 revenues of approximately $37 billion
and nearly 230,000 employees.
Under terms of the agreement, Northrop Grumman shareholders will receive
1.1923 shares of Lockheed Martin common stock for each share of Northrop
Grumman stock. The transaction is expected to close by the end of 1997.
"As our industry becomes increasingly global, we must constantly improve
efficiencies to compete in the 21st century worldwide marketplace," said
Norman R. Augustine, chairman and chief executive officer of Lockheed Martin.
"In bringing together these two healthy, well-matched companies, we will meet
our commitments to reduce costs for our customers, increase long-term
opportunities for employees and enhance shareholder value."
The combination is consistent with Lockheed Martin's long-term growth strategy
to expand core businesses and move into closely related emerging markets. Key
impacts on its lines of business will be to:
-- Expand critical mass, economies of scale and synergy opportunities in
electronics, military aircraft, commercial aerostructures and information
systems;
-- Increase breadth and depth in key technological discriminators, such
as composites, data processing, stealth, sensors, microelectronics and
manufacturing;
-- Enhance systems engineering and platform integration capabilities.
It is anticipated that the transaction will be accounted for as a
pooling-of-interests; however, the impact of other transactions under
consideration could, if consummated, result in accounting for the transaction
as a purchase. Financially, the transaction is expected to be neutral to 1998
earnings and increasingly accretive thereafter.
Augustine noted that "Lockheed Martin and Northrop Grumman have been leaders
in consolidating the aerospace industry, and we are now taking the logical
next step in combining together to shape the future. Both corporations have
successfully integrated multiple operations and cultures, while maintaining
focus on program performance and mission success. We fully intend to combine
these two companies with the same spirit of teamwork and emphasis on
performance."
"We enter this transaction in the strongest position in our history, which
augurs well for the future," said Kent Kresa, chairman of the board, president
and chief executive officer of Northrop Grumman. "Another plus is that our two
companies have worked together successfully, including on such major current
programs as the Joint Strike Fighter, the F-22, the Apache Longbow, and
airborne early warning systems. We think this is a great opportunity to
combine our unique skills and dedicated employees for the benefit of our
customers and shareholders, as well as our employees."
Kresa will join the Lockheed Martin board of directors along with two other
members of the Northrop Grumman board to be determined. Kresa also will serve
as vice chairman of Lockheed Martin and will have a strong role in the
transition.
Dr. Vance D. Coffman, who will become vice chairman and chief executive
officer of Lockheed Martin on August 1, reaffirmed Lockheed Martin's
continuing commitment to serving as a merchant supplier, including supporting
The Boeing Company and other teammates around the world on various existing
and future programs.
Bear, Stearns & Co., Inc. and Lehman Brothers, Inc. are acting as financial
advisors to Lockheed Martin. Northrop Grumman is being advised by Salomon
Brothers.
Lockheed Martin, headquartered in Bethesda, Maryland, is a global technology
company with 1996 sales of $27 billion. The Corporation provides space and
missile systems, electronics, military aircraft, information systems, systems
integration and a broad range of services to U. S. and international
governments and commercial customers. It has 180,000 employees worldwide.
Northrop Grumman, headquartered in Los Angeles, California, is a leading
designer, systems integrator and manufacturer of military surveillance on
combat aircraft, defense electronics and systems, airspace management systems,
information systems, marine systems, precision weapons, space systems and
commercial and military aerostructures. The company currently employs more
than 45,000 people and had 1996 sales of approximately $8 billion.
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CONTACT: Lockheed Martin News & Information, 301/897-6352
Northrop Grumman Corporate Communications,
310/553-6262
