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SC TO-I/A

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

SCHEDULE TO

(Rule 13e-4)

TENDER OFFER STATEMENT UNDER SECTION 14(d)(1) OR 13(e)(1)

OF THE SECURITIES EXCHANGE ACT OF 1934

(Amendment No. 1)

 

MERCURY COMPUTER SYSTEMS, INC.

(Name of Subject Company (Issuer) and Filing Person (Offeror))

Options to Purchase Common Stock, Par Value $.01 Per Share,

of Mercury Computer Systems, Inc.

(Title of Class of Securities)

589378 10 8

(CUSIP Number of Class of Securities (Underlying Common Stock))

 

Craig Barrows, Esq.

Vice President and General Counsel

Mercury Computer Systems, Inc.

199 Riverneck Road

Chelmsford, Massachusetts 01824

(978) 256-1300

(Name, Address and Telephone Number of Person Authorized to Receive Notices and

Communications on Behalf of Filing Person)

Copies of all communications should be sent to:

Anthony J. Medaglia, Jr., P.C.

Goodwin Procter LLP

Exchange Place

Boston, Massachusetts 02109

(617) 570-1000

 

CALCULATION OF FILING FEE

 

 
Transaction Value*    Amount of Filing Fee**

$15,311,708

    $1,638.36
 

 

*

Calculated solely for purposes of determining the filing fee. This amount assumes that options to purchase 2,188,434 shares of common stock of Mercury Computer Systems,

 

Inc., which options have an approximate aggregate value of $15,311,708, will be exchanged pursuant to this offer. The aggregate value of such options was calculated based on the Black-Scholes option pricing model, as of July 31, 2006.

 

** The amount of the filing fee, calculated in accordance with Rule 0-11 under the Securities Exchange Act of 1934, as amended, equals $107.00 per million dollars of the value of the transaction. The filing fee was previously paid on August 11, 2006 in connection with the initial filing of this Schedule TO.

 

¨ Check the box if any part of the fee is offset as provided in 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.

 

Amount Previously Paid: Not applicable       Filing Party: Not applicable
Form or Registration No.: Not applicable       Date Filed: Not applicable

 

¨ Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer.

Check the appropriate boxes below to designate any transactions to which the statement relates:

 

  ¨ third party tender offer subject to Rule 14d-1.

 

  x issuer tender offer subject to Rule 13e-4.

 

  ¨ Going-private transaction subject to Rule 13e-3.

 

  ¨ amendment to Schedule 13D under Rule 13d-2.

Check the following box if the filing is a final amendment reporting the results of the tender offer:  ¨

 

Introductory Statement

This Amendment No. 1 to Schedule TO amends and supplements the Tender Offer Statement on Schedule TO filed by Mercury Computer Systems, Inc., a Massachusetts corporation (“Mercury”), with the Securities and Exchange Commission on August 11, 2006 in connection with Mercury’s offer to exchange certain outstanding eligible options to purchase shares of Mercury’s common stock, par value $.01 per share, that were originally granted under Mercury’s 1997 Stock Option Plan for shares of restricted stock or phantom stock units that will be granted under Mercury’s 2005 Stock Incentive Plan, upon the terms and subject to the conditions set forth in the Offer to Exchange that was filed as Exhibit (a)(1)(A) to the Schedule TO.

This Amendment No. 1 is being filed solely to add an additional exhibit to the Schedule TO. Attached as Exhibit (a)(1)(O) hereto is a PowerPoint presentation regarding the exchange program.

 

ITEM 12. EXHIBITS.

The Exhibit Index included in this Amendment No. 1 to Schedule TO is incorporated herein by reference.

 

3

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.

 

    MERCURY COMPUTER SYSTEMS, INC.
   

(Registrant)

Date: August 11, 2006    

By:

   /s/ Robert E. Hult
        Robert E. Hult
        Senior Vice President,
        Chief Financial Officer

 

4

EXHIBIT INDEX

 

          Incorporated by Reference     

Exhibit
Number

   

Exhibit Description

    Form    File No.    Exhibit  

Filing Date

    Filed
Herewith
(a)(1)(A)    Offer to Exchange, dated August 11, 2006, including Transmittal Letter, form of Election to Participate and form of Notice of Withdrawal.    TO-I    005-52823    (a)(1)(A)   August 11, 2006   
(a)(1)(B)    Form of Personnel Grant Status.    TO-I    005-52823    (a)(1)(B)   August 11, 2006   
(a)(1)(C)    Email dated August 11, 2006 announcing the commencement of the election period for the exchange program.    TO-I    005-52823    (a)(1)(C)   August 11, 2006   
(a)(1)(D)    Form of email reminder of option exchange program expiration date.    TO-I    005-52823    (a)(1)(D)   August 11, 2006   
(a)(1)(E)    Preliminary Proxy Statement.    14A    000-23599    N/A   June 27, 2006   
(a)(1)(F)    Definitive Proxy Statement.    14A    000-23599    N/A   July 10, 2006   
(a)(1)(G)    Mercury’s 2005 Stock Incentive Plan, amended and restated through August 7, 2006.    8-K    000-23599    10.1   August 8, 2006   
(a)(1)(H)    Form of Restricted Stock Award Agreement under Mercury’s 2005 Stock Incentive Plan.    8-K    000-23599    10.3   November 16, 2005   
(a)(1)(I)    Form of Deferred Stock Award Agreement under Mercury’s 2005 Stock Incentive Plan.    10-Q    000-23599    10.1   May 9, 2006   
(a)(1)(J)    French Guidelines for Stock Free Awards to employees and corporate officers of Mercury’s French subsidiaries.    TO-I    005-52823    (a)(1)(J)   August 11, 2006   
(a)(1)(K)    Mercury’s Annual Report on Form 10-K for the fiscal year ended June 30, 2005.    10-K    000-23599    N/A   September 13, 2005   
(a)(1)(L)    Mercury’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.    10-Q    000-23599    N/A   November 9, 2005   
(a)(1)(M)    Mercury’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2005.    10-Q    000-23599    N/A   February 9, 2006   
(a)(1)(N)    Mercury’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006.    10-Q    000-23599    N/A   May 9, 2006   
(a)(1)(O)    PowerPoint Presentation Regarding the Exchange Program.               X
(b)    Not applicable.              
(d)(1)    Mercury’s 1997 Stock Option Plan, as amended and restated.    8-K    000-23599    10.1   November 18, 2004   
(d)(2)    Form of Option Agreement under Mercury’s 1997 Stock Option Plan.    10-Q    000-23599    10.1   November 1, 2004   
(d)(3)    Form of Restricted Stock Award Agreement under Mercury’s 1997 Stock Option Plan.    8-K    000-23599    10.1   August 17, 2005   

 

5

          Incorporated by Reference     

Exhibit
Number

   

Exhibit Description

    Form    File No.    Exhibit    Filing Date    Filed
Herewith

(d)(4)

    Form of Restricted Stock Award Agreement with James R. Bertelli under Mercury’s 1997 Stock Option Plan.    10-K    000-23599    10.2.4    September 13, 2005   

(d)(5)

    Form of Stock Option Agreement under Mercury’s 2005 Stock Incentive Plan.    8-K    000-23599    10.2    November 16, 2005   

(d)(6)

    Form of Restricted Stock Award Agreement under Mercury’s 2005 Stock Incentive Plan.    8-K    000-23599    10.3    November 16, 2005   

(d)(7)

    Form of Restricted Stock Award Agreement with James R. Bertelli under Mercury’s 2005 Stock Incentive Plan.    8-K    000-23599    10.4    November 16, 2005   

(d)(8)

    Form of Stock Option Agreement under Mercury’s 2005 Stock Incentive Plan.    8-K    000-23599    10.1    June 2, 2006   

(d)(10)

    Form of Change in Control Severance Agreement.    8-K    000-23599    10.1    February 23, 2006   

(g)

    Not applicable.               

(h)

    Not applicable.               

 

6

POWER POINT PRESENTATION
©
2006 Mercury Computer Systems, Inc.
Stock Option Exchange Program
Stock Option Exchange Program
Exhibit (a)(1)(O)

©
2006 Mercury Computer Systems, Inc.
2
Agenda
Agenda
•
Equity Compensation Philosophy
•
Program Overview
•
Key Dates
•
Eligibility
•
Things To Consider
•
What You Need to Do
•
Questions and Answers

©
2006 Mercury Computer Systems, Inc.
3
Equity Compensation Philosophy
Equity Compensation Philosophy
•
Equity Compensation is a reward based on the long term future
performance of the company.
•
Equity Compensation should align the actions and behaviors of
Mercury associates with the interests of Mercury shareholders.
•
Equity Compensation should foster a sense of ownership among
Mercury participants.
•
Equity Compensation should be cost efficient.
•
This is a voluntary program.

©
2006 Mercury Computer Systems, Inc.
4
Program Overview
Program Overview
•
Eligible
associates
can
elect
to
exchange
certain
underwater
stock
options
for
replacement
awards
to
be
granted
promptly
after
the
close
of
the
election
period.
•
Elections
to
participate
must
be
done
on
a
grant-by-grant
basis.
Grants
can
not
be
partially
exchanged.
•
Options
are
eligible
to
be
exchanged
if
their
per
share
exercise
price
is
greater
than
the
“threshold
price.”
•
The
“threshold
price”
is
the
greater
of
(1)
$23.00
or
(2)
the
closing
price
of
our
common
stock
reported
on
the
Nasdaq
Global
Select
Market
on
the
date
the
election
period
for
the
exchange
program
expires.

©
2006 Mercury Computer Systems, Inc.
5
Program Overview
Program Overview
•
All
eligible
options
will
be
exchanged
for
restricted
stock
rights
in
accordance
with
a
fixed
4-to-1
exchange
ratio.
As
an
example,
if
you
elect
to
exchange
an
eligible
option
representing
the
right
to
purchase
1,000
shares
of
common
stock,
you
will
receive
a
replacement
award
consisting
of
250
restricted
stock
rights.
We
will
not
issue
any
fractional
restricted
stock
rights.
•
Restricted
stock
rights
means
either
shares
of
restricted
stock
subject
to
a
restricted
stock
award,
or
phantom
stock
units
subject
to
a
deferred
stock
award.

©
2006 Mercury Computer Systems, Inc.
6
Program Overview
•
Restricted
stock
awards
consist
of
shares
of
our
common
stock
that
will
be
issued
on
the
date
the
awards
are
granted.
Restricted
stock
awards
will
be
subject
to
vesting
based
on
continued
employment
for
a
specified
period.
Until
shares
of
restricted
stock
have
vested,
they
remain
subject
to
(1)
forfeiture
upon
termination
of
employment
and
(2)
restrictions
on
transfer.
•
Deferred
stock
awards
consist
of
phantom
stock
units
that
are
not
actual
shares
of
our
common
stock.
Rather,
they
represent
the
right
to
receive
our
common
stock
at
a
future
date.
Phantom
stock
units
are
subject
to
(1)
forfeiture
upon
termination
of
employment
and
(2)
restrictions
on
transfer
prior
to
vesting
and
the
related
issuance
of
our
common
stock.
•
All
replacement
awards
will
be
granted
under
our
2005
Stock
Incentive
Plan,
and
will
be
subject
to
the
terms
of
that
plan
and
an
award
agreement
between
you
and
us.

©
2006 Mercury Computer Systems, Inc.
7
Program Overview: Multinational Conditions
Program Overview: Multinational Conditions
•
•
United States, Japan and United Kingdom
United States, Japan and United Kingdom
Options will be exchanged for restricted stock awards.  The new
grants will vest over three years. Generally, one third of the grant
will vest on the first, second and third grant anniversary date,
provided you are employed by us on the vesting date.
•
•
United Kingdom
United Kingdom
Associates will be responsible for paying the Company portion of
National Insurance costs.
•
•
France and Germany
France and Germany
Options will be exchanged for deferred stock awards.  The new
grants will vest over three years. Two thirds of the grant will vest
on the second grant anniversary date and the remaining one third
will vest on the third grant anniversary date, provided you are
employed by us on the vesting date.

©
2006 Mercury Computer Systems, Inc.
8
Key Dates
Key Dates
Estimated Replacement Award Grant Date
September 11, 2006
Election Period Ends/Expiration Date
September 8, 2006
Election Period begins
August 11, 2006
Milestone
Date

©
2006 Mercury Computer Systems, Inc.
9
Eligibility
Eligibility
•
Employees
are
“eligible
employees”
if
they
are
employed
by
Mercury
on
the
date
the
election
period
commences
and
on
the
date
on
which
the
tendered
options
are
cancelled
and
the
replacement
awards
are
granted.
•
Members
of
our
Board
of
Directors
and
our
five
most
highly
compensated
executive
officers
are
not
eligible
to
participate
in
the
exchange
program.
•
You
must
be
an
active
employee
on
the
replacement
award
grant
date
to
be
eligible
to
receive
a
replacement
award.
•
In
general,
employees
on
approved
leaves
of
absence
are
eligible.
•
If
you
receive
or
submit
a
notice
of
termination
on
or
before
the
replacement
award
grant
date,
you
will
not
be
eligible
to
participate.
In
these
cases
you
will
retain
your
outstanding
options
subject
to
their
existing
terms.

©
2006 Mercury Computer Systems, Inc.
10
Things To Consider
Things To Consider
•
Mercury
is
not
able
to
advise
you
on
what
course
of
action
is
right
for
you.
•
Participation
in
this
program
is
voluntary.
•
See
Section
14
and
15
and
Appendix
B
of
the
Offer
to
Exchange
for
a
description
of
certain
tax
consequences
of
the
exchange
program. 
These
descriptions
do
not
discuss
all
the
tax
consequences
that
may
be
relevant
to
you
in
light
of
your
particular
circumstances
and
are
not
intended
to
be
applicable
in
all
respects
to
all
categories
of
option
holders.
•
You
should
check
with
your
personal
financial/tax
advisor
prior
to
deciding
whether
to
participate.

©
2006 Mercury Computer Systems, Inc.
11
What You Need to Do
What You Need to Do
•
Read
all
materials
provided
to
you.
•
Review
your
option
holdings
via
your
personnel
grant
status
statement
or
on-line
via
your
eTrade
account.
•
If
you
choose
to
participate,
complete
and
submit
the
Election
Form
on
or
before
midnight
“Boston
Time”
on
the
expiration
date.
Follow
the
instructions
in
Appendix
C
of
the
Offer
to
Exchange.
•
You
may
change
or
revoke
your
election
at
any
time
prior
to
midnight
“Boston
Time”
on
the
expiration
date.
Follow
the
instructions
in
Appendix
C
or
D,
as
applicable,
of
the
Offer
to
Exchange.
•
Additional
copies
of
the
Offer
to
Exchange,
the
Election
Form
and
the
Notice
of
Withdrawal
are
available
at
http://hr.mc.com/optionexchange.

©
2006 Mercury Computer Systems, Inc.
12
If You Have Questions
If You Have Questions
•
You
can
find
the
materials
relating
to
the
Stock
Option
Exchange
Program
at
http://hr.mc.com/optionexchange.
•
If
you
have
questions
that
have
not
been
answered
during
this
presentation,
please
refer
to
the
Q&A
section
of
the
Offer
to
Exchange.
•
You
can
also
ask
additional
questions
by
sending
an
e-mail
to
MCS
Stock
Option
Exchange.