Simmons Complains of Lockheed Board’s Tactics

Texas billionaire Harold C. Simmons, who has mounted a proxy fight for control of Lockheed Corp.’s board, sharply criticized the defense contractor Monday for its attempts to stymie the bid.

In a filing with federal regulators, Simmons disclosed that in addition to seeking a new board, he wants to eliminate Lockheed’s shareholders’ rights plan, which would make it prohibitively expensive for anyone to buy more than 20% of the company’s common stock. Simmons has an 18.9% stake.

A letter to Lockheed included in the Securities and Exchange Commission filing blasted the Calabasas-based aerospace firm for reportedly announcing the date of its annual meeting at a time designed to hamper NL Industries Inc.’s bid to unseat the board.

Under company bylaws, shareholders have 10 days from the public announcement of the meeting’s date to submit proxy statements for consideration at the meeting.

NL Industries, a Houston chemicals concern controlled by Simmons, said Lockheed announced the March 29 meeting shortly after 6 p.m. on Feb. 16.

“By announcing the shareholders meeting after the close of business on a Friday preceding a three-day holiday weekend, Lockheed’s management effectively gave NL just five business days to prepare its nomination materials,” NL Industries President J. Landis Martin said in the letter to Lockheed.

“We hope that management’s conduct in connection with the announcement of the annual meeting does not mean that we are in for five weeks of manipulation of Lockheed’s corporate machinery,” Martin added.

Lockheed spokesman Ron Meder said the company had no comment to make on Martin’s allegations.

Simmons, of Dallas, last Friday disclosed the names of his 15 nominees for the Lockheed board.

A second filing with the SEC late Monday also disclosed that NL Industries has hired Salomon Bros. as a proxy solicitor and Jefferies & Co., a Los Angeles-based investment firm, as a consultant in the proxy battle.

NL agreed to pay Salomon $150,000 a month and Jefferies $100,000 a month. In addition, the second filing disclosed that it would retain Salomon as a financial adviser and investment banker for a year if the proxy fight succeeds. Toward that end, NL paid Salomon $750,000 up front and agreed to pay mutually agreed upon fees “from time to time.”

Meanwhile, it was reported that members of the International Assn. of Machinists & Aerospace Workers employed by Lockheed will vote March 4 on a contract tentatively approved over the weekend by company and union officials.

Union negotiator Bob Gregory said the offer establishes an employee stock ownership plan for union members.