-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VToXzSeHQ78fQ14iGO/8PRm7a/Uu6hQ+gLKMtanwSEqBbVnEhOcc2/94zhdfa8lB Wqx3+12lUMRqRiav4OyVyg== 0000950134-05-019863.txt : 20051027 0000950134-05-019863.hdr.sgml : 20051027 20051027145246 ACCESSION NUMBER: 0000950134-05-019863 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20051027 DATE AS OF CHANGE: 20051027 GROUP MEMBERS: HIGHLAND CAPITAL MANAGEMENT SERVICES INC GROUP MEMBERS: HIGHLAND CRUSADER OFFSHORE PARTNERS LP GROUP MEMBERS: HIGHLAND EQUITY FOCUS FUND LP GROUP MEMBERS: HIGHLAND LEGACY LTD GROUP MEMBERS: HIGHLAND SELECT EQUITY FUND LP GROUP MEMBERS: JAMES DONDERO GROUP MEMBERS: PAMCO CAYMAN LTD GROUP MEMBERS: PROSPECT STREET HIGH INCOME PORTFOLIO INC GROUP MEMBERS: PROSPECT STREET INCOME SHARES INC GROUP MEMBERS: STRAND ADVISORS INC SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: MOTIENT CORP CENTRAL INDEX KEY: 0000913665 STANDARD INDUSTRIAL CLASSIFICATION: COMMUNICATION SERVICES, NEC [4899] IRS NUMBER: 930976127 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-42503 FILM NUMBER: 051159824 BUSINESS ADDRESS: STREET 1: 300 KNIGHTSBRIDGE, PKY. CITY: LINCOLNSHIRE STATE: IL ZIP: 60069 BUSINESS PHONE: 8474784200 MAIL ADDRESS: STREET 1: 300 KNIGHTSBRIDGE, PKY. CITY: LINCOLNSHIRE STATE: IL ZIP: 60069 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN MOBILE SATELLITE CORP DATE OF NAME CHANGE: 19931019 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: HIGHLAND CAPITAL MANAGEMENT LP CENTRAL INDEX KEY: 0001167365 IRS NUMBER: 752716725 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 13455 NOEL ROAD STE 1300 CITY: DALLAS STATE: TX ZIP: 75240 BUSINESS PHONE: 9726284100 MAIL ADDRESS: STREET 1: 13455 NOEL ROAD STE 1300 CITY: DALLAS STATE: TX ZIP: 75240 SC 13D/A 1 d29668asc13dza.htm AMENDMENT TO SCHEDULE 13D sc13dza
 

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934
(Amendment No. 10)*

Motient Corporation

(Name of Issuer)

Common Stock, par value $0.01 per share

(Title of Class of Securities)

619908304

(CUSIP Number)

Patrick H. Daugherty, Esq.
Highland Capital Management, L.P.
Two Galleria Tower
13455 Noel Road, Suite 1300
Dallas, Texas 75240
(972) 628-4100

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

October 26, 2005

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.


 

             
CUSIP No. 619908304 Page 2 of 17

  1. Name of Reporting Person:
Prospect Street High Income Portfolio, Inc.
I.R.S. Identification Nos. of above persons (entities only):
04-3028343

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) þ  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
WC

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Maryland

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
1,155,224

8. Shared Voting Power:
0

9. Sole Dispositive Power:
1,155,224

10.Shared Dispositive Power:
0

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
1,155,224

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
1.7%

  14.Type of Reporting Person (See Instructions):
CO/IV


 

             
CUSIP No. 619908304 Page 3 of 17

  1. Name of Reporting Person:
Prospect Street Income Shares Inc.
I.R.S. Identification Nos. of above persons (entities only):
36-2765811

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) þ  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
WC

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Maryland

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
111,940

8. Shared Voting Power:
0

9. Sole Dispositive Power:
111,940

10.Shared Dispositive Power:
0

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
111,940

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
0.2%

  14.Type of Reporting Person (See Instructions):
CO/IV


 

             
CUSIP No. 619908304 Page 4 of 17

  1. Name of Reporting Person:
Highland Legacy Limited
I.R.S. Identification Nos. of above persons (entities only):

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) þ  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
WC

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Cayman Islands

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
223,880

8. Shared Voting Power:
0

9. Sole Dispositive Power:
223,880

10.Shared Dispositive Power:
0

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
223,880

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
0.3%

  14.Type of Reporting Person (See Instructions):
OO


 

             
CUSIP No. 619908304 Page 5 of 17

  1. Name of Reporting Person:
Highland Crusader Offshore Partners, L.P.
I.R.S. Identification Nos. of above persons (entities only):

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) þ  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
WC

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Bermuda

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
5,352,497

8. Shared Voting Power:
0

9. Sole Dispositive Power:
5,352,497

10.Shared Dispositive Power:
0

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
5,352,497

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
8.1%

  14.Type of Reporting Person (See Instructions):
PN


 

             
CUSIP No. 619908304 Page 6 of 17

  1. Name of Reporting Person:
PAMCO Cayman, Limited
I.R.S. Identification Nos. of above persons (entities only):

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) þ  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
WC

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Cayman Islands

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
223,880

8. Shared Voting Power:
0

9. Sole Dispositive Power:
223,880

10.Shared Dispositive Power:
0

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
223,880

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
0.3%

  14.Type of Reporting Person (See Instructions):
OO


 

             
CUSIP No. 619908304 Page 7 of 17

  1. Name of Reporting Person:
Highland Equity Focus Fund, L.P.
I.R.S. Identification Nos. of above persons (entities only):
46-0491961

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) þ  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
WC

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Delaware

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
1,518,779

8. Shared Voting Power:
0

9. Sole Dispositive Power:
1,518,779

10.Shared Dispositive Power:
0

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
1,518,779

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
2.3%

  14.Type of Reporting Person (See Instructions):
PN


 

             
CUSIP No. 619908304 Page 8 of 17

  1. Name of Reporting Person:
Highland Select Equity Fund, L.P.
I.R.S. Identification Nos. of above persons (entities only):

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) þ  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
WC

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Delaware

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
119,283

8. Shared Voting Power:
0

9. Sole Dispositive Power:
119,283

10.Shared Dispositive Power:
0

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
119,283

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
0.2%

  14.Type of Reporting Person (See Instructions):
PN


 

             
CUSIP No. 619908304 Page 9 of 17

  1. Name of Reporting Person:
Highland Capital Management Services, Inc.
I.R.S. Identification Nos. of above persons (entities only):

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) þ  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
WC

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Delaware

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
182,748

8. Shared Voting Power:
0

9. Sole Dispositive Power:
182,748

10.Shared Dispositive Power:
0

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
182,748

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
0.3%

  14.Type of Reporting Person (See Instructions):
CO


 

             
CUSIP No. 619908304 Page 10 of 17

  1. Name of Reporting Person:
Highland Capital Management, L.P.
I.R.S. Identification Nos. of above persons (entities only):
75-2716725

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) þ  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
AF/WC

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Delaware

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
8,822,764

8. Shared Voting Power:
0

9. Sole Dispositive Power:
8,822,764

10.Shared Dispositive Power:
0

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
8,822,764

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
13.3%

  14.Type of Reporting Person (See Instructions):
IA/PN


 

             
CUSIP No. 619908304 Page 11 of 17

  1. Name of Reporting Person:
Strand Advisors, Inc.
I.R.S. Identification Nos. of above persons (entities only):
95-4440863

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) þ  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
AF

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
Delaware

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
8,822,764

8. Shared Voting Power:
0

9. Sole Dispositive Power:
8,822,764

10.Shared Dispositive Power:
0

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
8,822,764

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
13.3%

  14.Type of Reporting Person (See Instructions):
CO


 

             
CUSIP No. 619908304 Page 12 of 17

  1. Name of Reporting Person:
James Dondero
I.R.S. Identification Nos. of above persons (entities only):

  2. Check the Appropriate Box if a Member of a Group (See Instructions):
    (a) þ  
    (b) o  

  3. SEC Use Only:

  4. Source of Funds (See Instructions):
AF/PF

  5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): o

  6. Citizenship or Place of Organization:
United States

Number of
Shares
Beneficially
Owned by
Each Reporting
Person With
7. Sole Voting Power:
9,024,326

8. Shared Voting Power:
0

9. Sole Dispositive Power:
9,024,326

10.Shared Dispositive Power:
0

  11.Aggregate Amount Beneficially Owned by Each Reporting Person:
9,024,326

  12.Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
o

  13.Percent of Class Represented by Amount in Row (11):
13.6%

  14.Type of Reporting Person (See Instructions):
IN


 

Page 13 of 17
     This Amendment No. 10 to Schedule 13D amends and supplements the Schedule 13D filed with the Securities and Exchange Commission (the “Commission”) on June 10, 2002, as amended by Amendment No. 1 to Schedule 13D filed with the Commission on October 20, 2003, Amendment No. 2 to Schedule 13D filed with the Commission on July 12, 2004, Amendment No. 3 to Schedule 13D filed with the Commission on November 16, 2004, Amendment No. 4 to Schedule 13D filed with the Commission on April 19, 2005, Amendment No. 5 to Schedule 13D filed with the Commission on September 7, 2005, Amendment No. 6 to Schedule 13D filed with the Commission on September 29, 2005, Amendment No. 7 to Schedule 13D filed with the Commission on October 11, 2005, Amendment No. 8 to Schedule 13D filed with the Commission on October 14, 2005 and Amendment No. 9 to Schedule 13D filed with the Commission on October 21, 2005 (as amended, the “Schedule 13D”). Capitalized terms used herein which are not defined herein have the meanings given to such terms in the Schedule 13D. Except as otherwise provided herein, all Items of the Schedule 13D remain unchanged.
Item 4. Purpose of the Transaction.
     Item 4 is hereby supplemented as follows:
     On October 26, 2005, Mr. James D. Dondero, a member of the Board of Directors (the “Board”) of Motient Corporation (the “Company”), whose principal business is serving as the President of the General Partner of Highland Capital Management, L.P. (“Highland”), sent the attached letter to the other members of the Board, addressing the amended exchange offer by the Company (the “Exchange Offer”), attached as an exhibit to the tender offer of the Company filed with the Commission on October 12, 2005, pursuant to which the Company is seeking to exchange its Series B Cumulative Convertible Preferred Stock (the “Series B Preferred”) for outstanding shares of Series A Cumulative Convertible Preferred Stock of the Company (the “Series A Preferred”). Mr. Dondero’s letter requests certain materials and raises certain issues in connection with the October 26, 2005 meeting of the Board (the “Board Meeting”), and addresses his continued concerns with respect to the Exchange Offer, which offer expired at 5:00 p.m., New York City time, on October 26, 2005. A copy of the letter from Mr. Dondero is attached hereto as Exhibit 99.2.
     On October 26, 2005, Highland, on behalf of itself and Highland Crusader Offshore Partners, L.P., Highland Equity Focus Fund, L.P. and Highland Capital Management Services, Inc. (collectively, the “Highland Parties”), sent the attached letter to the Company in order to inform the Company that the Highland Parties would not be exchanging their shares of the Series A Preferred for shares of the Series B Preferred pursuant to the Exchange Offer. A copy of the letter from Highland is attached hereto as Exhibit 99.3.
     On October 27, 2005, Mr. Dondero sent the attached letter to the other members of the Board, acknowledging the Board’s refusal to provide Mr. Dondero with requested materials prior to the Board Meeting, and stating that his attempts at discussion with the Board at the Board Meeting were ignored. A copy of the letter from Mr. Dondero is attached hereto as Exhibit 99.4.
     In response to the foregoing actions, among others, the Reporting Persons are considering various plans or proposals which relate to or could result in the transactions or changes contemplated by Items 4(a) through 4(j) of Schedule 13D. Such plans or proposals could include acquisitions of additional shares in the open market or otherwise and potentially seeking possible changes in the present Board and management of the Company. In the interim and prior to formulating any definitive plan or proposal, the Reporting Persons may communicate with other stockholders regarding their concerns about the actions taken by the Company and its management.


 

Page 14 of 17

Item 7. Material to be Filed as Exhibits.
     Item 7 is hereby amended and supplemented as follows:
         
 
  Exhibit 99.2   Letter of James D. Dondero to the Board of Directors of Motient Corporation, dated October 25, 2005.
 
       
 
  Exhibit 99.3   Letter of Highland Capital Management, L.P. to Motient Corporation, dated October 26, 2005.
 
       
 
  Exhibit 99.4   Letter of James D. Dondero to the Board of Directors of Motient Corporation, dated October 26, 2005


 

Page 15 of 17

SIGNATURE
     After reasonable 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.
Date: October 27, 2005
             
    HIGHLAND CAPITAL MANAGEMENT, L.P.
 
           
    By:   Strand Advisors, Inc., its general partner
 
           
 
      By:   /s/ James Dondero
 
           
 
      Name:   James Dondero
 
      Title:   President
    STRAND ADVISORS, INC.
 
           
    By:   /s/ James Dondero
         
    Name:   James Dondero
    Title:   President
 
           
    /s/ James Dondero
     
    James Dondero
 
           
    PROSPECT STREET HIGH INCOME PORTFOLIO, INC.
 
           
    By:   /s/ James Dondero
         
    Name:   James Dondero
    Title:   President
 
           
    PROSPECT STREET INCOME SHARES INC.
 
           
    By:   /s/ James Dondero
         
    Name:   James Dondero
    Title:   President
 
           
    HIGHLAND LEGACY LIMITED
 
           
    By:   Highland Capital Management, L.P., its collateral manager
    By:   Strand Advisors, Inc., its general partner
 
           
 
      By:   /s/ James Dondero
 
           
 
      Name:   James Dondero
 
      Title:   President
 
           
    HIGHLAND CRUSADER OFFSHORE PARTNERS, L.P.
 
           
    By:   Highland Capital Management, L.P., its general partner
    By:   Strand Advisors, Inc., its general partner
 
           
 
      By:   /s/ James Dondero
 
           
 
      Name:   James Dondero
 
      Title:   President


 

Page 16 of 17

             
    PAMCO CAYMAN, LIMITED
 
           
    By:   Highland Capital Management, L.P., its collateral manager
    By:   Strand Advisors, Inc., its general partner
 
           
 
      By:   /s/ James Dondero
 
           
 
      Name:   James Dondero
 
      Title:   President
 
           
    HIGHLAND EQUITY FOCUS FUND, L.P.
 
           
    By:   Highland Capital Management, L.P., its general partner
    By:   Strand Advisors, Inc., its general partner
 
           
 
      By:   /s/ James Dondero
 
           
 
      Name:   James Dondero
 
      Title:   President
 
           
    HIGHLAND SELECT EQUITY FUND, L.P.
 
           
    By:   Highland Capital Management, L.P., its general partner
    By:   Strand Advisors, Inc., its general partner
 
           
 
      By:   /s/ James Dondero
 
           
 
      Name:   James Dondero
 
      Title:   President
 
           
    HIGHLAND CAPITAL MANAGEMENT SERVICES, INC.
 
           
    By:   /s/ James Dondero
         
    Name:   James Dondero
    Title:   President


 

Page 17 of 17

APPENDIX I

     The name of each director and officer of HCM Services, Strand, Prospect Portfolio and Prospect Shares is set forth below. Unless otherwise indicated, the business address of each person listed below is Two Galleria Tower, 13455 Noel Road, Suite 1300, Dallas, Texas 75240. Each person identified below is a citizen of the United States of America. The present principal occupation or employment of each of the listed persons is set forth below. During the past five years, none of the individuals listed below has been convicted in a criminal proceeding or been a party to a civil proceeding, in either case of the type specified in Items 2(d) or (e) of Schedule 13D.
     
    Present Principal Occupation or Employment
Name   and Business Address (if applicable)
Highland Capital Management Services, Inc.
   
James D. Dondero, Director
  President
Mark K. Okada, Director
  Executive Vice President
Patrick H. Daugherty
  Secretary
Todd A. Travers
  Assistant Secretary
J. Kevin Ciavarra
  Assistant Secretary
David Lancelot
  Treasurer
Chad Schramek
  Treasurer
 
   
Strand Advisors, Inc.
James D. Dondero, Director
  President
Mark K. Okada
  Executive Vice President
R. Joseph Daugherty
  Vice President
Todd A. Travers
  Secretary
J. Kevin Ciavarra
  Assistant Secretary
Chad Schramek
  Treasurer
 
   
Prospect Street High Income Portfolio, Inc. and Prospect Street Income Shares Inc.
James D. Dondero, Director
  President
Mark K. Okada
  Executive Vice President
R. Joseph Daugherty, Director
  Senior Vice President
M. Jason Blackburn
  Secretary and Treasurer
Michael S. Minces
  Chief Compliance Officer
Timothy K. Hui, Director
  Associate Provost for Graduate Education of the Pennsylvania Biblical University, 48 Willow Green Drive, Churchville, Pennsylvania 18966
Scott F. Kavanaugh, Director
  Private investments
James F. Leary, Director
  Managing Director of Benefit Capital Southwest, Inc., 2006 Peakwood Drive, Garland, Texas 75044
Bryan A. Ward, Director
  Senior Manager of Accenture, LLP, 3625 Rosedale, Dallas, Texas 75205

 

EX-99.2 2 d29668aexv99w2.htm LETTER - JAMES D. DONDERO exv99w2
 

EXHIBIT 99.2
HIGHLAND CAPITAL MANAGEMENT, L.P.
1300 Two Galleria Tower
13455 Noel Road, LB 45
Dallas, Texas 75240
October 25, 2005
Via Certified Mail
Board of Directors
Motient Corporation
300 Knightsbridge Pkwy.
Lincolnshire, Illinois 60069
Ladies and Gentlemen:
I received notice on Monday of this week of a meeting of the Board of Directors (the “Board”) of Motient Corporation (the “Company”) that is now apparently scheduled for 9:00 a.m. tomorrow. After my subsequent request for the material to be covered at such meeting, I was provided with a copy of proposed resolutions to be discussed. I also received a copy of a letter from the Company dated October 24, 2005, responding to my letter to you of last week concerning the disclosures and omissions in the documents related to the exchange offer commenced by the Company on September 27, 2005 and subsequently amended (the “Exchange Offer”).
First, to my knowledge, the Company has not duly called any meetings (other than the meeting held on September 26, 2005) to substantively discuss the Exchange Offer. If the Board held other meetings to discuss these matters, they were called without valid notice to all Board members and thus the decisions made are not valid. At the meeting held on September 26, 2005, the Board may have authorized the Exchange Offer (with me abstaining because of the lack of time provided to directors to review the proposed offer), but the Board did not “carefully consider” or become “apprised of all material facts” relating to the Exchange Offer, as suggested in the proposed resolutions for tomorrow’s meeting. Specifically the Board did not discuss, deliberate and “become apprised of all material facts” relating to: (i) the terms of the proposed offer; (ii) any recommendation or lack thereof to the Series A Preferred holders; (iii) the value of the Series B Preferred being issued or whether a fairness opinion had been obtained; (iv) a release of insiders and outside counsel; and (v) any amendments to the Registration Rights Agreement. The only conclusion that can be drawn is that this hastily-called meeting is designed to rectify the previous lack of deliberation and consideration of these issues by the Board. Thus, I request that the resolutions be revised to reflect the actual prior deliberations (or lack thereof) of the Board consistent with Delaware law.
Second, the proposed resolutions of the Company present a number of issues (in addition to the ones referred to above) that need to be explained, clarified and revised. It would appear that the meeting tomorrow has been called in haste without due consideration of the issues raised by the Exchange Offer or my recent letter regarding the Exchange Offer. For example, the resolutions refer to an “Interested Party Transaction” and appear to refer to Highland Capital’s beneficial ownership of Series A Preferred shares. What about the releases for the officers and directors included in the Exchange Offer? Are these not “Interested Party Transactions”? Although the resolutions refer to “fairness,” they do not detail the

 


 

methodology or standard by which any Board member could conclude that the transaction is fair. How can a Board member reach this conclusion (which must meet a heightened standard under Delaware law) when the Company has failed to provide the requisite information and accurate disclosures? How can a Series A Preferred holder conclude (as suggested in the Company’s letter to holders dated October 19, 2005), that the value of the aggregate gross proceeds from the issuance of the Series B Preferred shares does not exceed $250 million, so as not to require a redemption of the Series A Preferred shares not exchanged? Where is this valuation issue addressed by the Board? This transaction should only be approved after extensive deliberation by the Board after it has been provided with the requisite background information.
Finally, I am concerned that certain important issues have not been adequately answered, including:
    The Company’s statement that it “should be able to register the shares of common stock underlying [the holder’s] shares of Series B Preferred.” (emphasis is mine). Can the Company register the Series B Preferred or not? What factors determine this possibility? What if the Series B Preferred cannot be registered?
 
    The Company’s continued lack of disclosure regarding the releases obtained from tendering Series A Preferred holders, stating in its October 24, 2005 letter to me that “with regards to the scope of the releases, we would simply note that a holder of Series A Preferred Stock who exchanges for Series B Preferred Stock will have claims with respect to the Series B Preferred stock rather than the Series A Preferred, thus substituting one set of claims for another.” Do the releases effectively release no claims? What claims will Series B Preferred holders have once the releases are executed?
 
    The Company’s statement that “Motient has no present intention of redeeming or rescinding Mr. Dondero’s Series A Preferred, or the Series A Preferred of any other holder.” Despite your intention not to redeem or rescind the shares of Series A Preferred, this does not change the fact that the Series A Preferred is still subject to litigation seeking rescission. I find it curious that you would inform the holders of Series A Preferred that you “may never be able to register [a Series A Preferred holder’s] resale,” and yet omit the potential value of a rescission offer to such holder, especially in light of Motient’s declining stock price and the possible dilution resulting from the proposed transaction with Mobile Satellite Ventures, LP. Also, the Company continues to ignore the fact that the proposed transaction (as publicly disclosed) may be impossible to consummate under the terms of the Series A Preferred if any Series A Preferred is not exchanged.
In addition to the materials I have requested above, in my role as a member of the Board I hereby request that you provide me with the following materials prior to any meeting where the Exchange Offer is considered:
    All minutes or resolutions (whether draft or executed) of the Company’s Executive Committee since its creation;
 
    Any documents conferring upon the Company’s Executive Committee its authority and/or powers;
 
    Any documents or correspondence from the Company’s Audit Committee received by the Board or Executive Committee in connection with the supposed “investigation” by the Audit Committee of any issues in connection with the Exchange Offer;

 


 

    Any valuations by third party experts received in connection with the Exchange Offer;
 
    Copies of all correspondence received from the Securities and Exchange Commission relating to the Exchange Offer;
 
    An indication of which holders have tendered their shares of Series A Preferred under the Exchange Offer; and
 
    Information regarding the status of the proposed transaction with Mobile Satellite Ventures, LP and the effect of the Exchange Offer on this proposed transaction.
Despite the Executive Committee’s arrogation of power and secretive decision process, I remain a director entitled to full and accurate information rather than to be excluded from deliberations, and I request that if you are not willing to provide the foregoing to me prior to our meeting, that you address each of these issues at the meeting and provide me with written answers and responses to each of the questions I raise, which should also be included in the minutes of the meeting.
Each director should independently consider his or her obligations under Delaware law and exercise the requisite due diligence to ensure that the disclosures in the Exchange Offer documents are true and correct before any exchanges are accepted. You should not rely on your ability to cure these errors in the future by merely offering a new “Series C Preferred.”
Sincerely,
/s/ James D. Dondero
James D. Dondero
cc: Securities and Exchange Commission

 

EX-99.3 3 d29668aexv99w3.htm LETTER - HIGHLAND CAPITAL MANAGEMENT, L.P. exv99w3
 

EXHIBIT 99.3
HIGHLAND CAPITAL MANAGEMENT, L.P.
1300 Two Galleria Tower
13455 Noel Road, LB 45
Dallas, Texas 75240
October 26, 2005
Via Certified Mail
Motient Corporation
300 Knightsbridge Pkwy.
Lincolnshire, Illinois 60069
Attn: Mr. Robert L. Macklin, Esq.
Re: Notice of Non-Exchange of Shares in Connection with Motient Corporation Exchange Offer
Dear Mr. Macklin:
The undersigned is providing you this letter on behalf of Highland Capital Management, L.P., Highland Crusader Offshore Partners, L.P., Highland Equity Focus Fund, L.P. and Highland Capital Management Services, Inc. (collectively, the “Highland Parties”) to inform you that the Highland Parties will not be exchanging their shares of Series A Convertible Preferred Stock for shares of Series B Convertible Preferred Stock pursuant to the Exchange Offer commenced by Motient Corporation on September 27, 2005 and as thereafter amended.
             
    Very truly yours,    
    Highland Capital Management, L.P.    
 
 
           
 
  By:   Strand Advisors, Inc.,    
 
      its general partner    
 
 
           
 
  By:   /s/ J. Kevin Ciavarra    
 
           
 
  Name:   J. Kevin Ciavarra    
 
  Title:   Officer    

EX-99.4 4 d29668aexv99w4.htm LETTER - JAMES D. DONDERO exv99w4
 

EXHIBIT 99.4
JAMES D. DONDERO
1300 Two Galleria Tower
13455 Noel Road, LB 45
Dallas, Texas 75240
October 26, 2005
Via Certified Mail
Board of Directors
Motient Corporation
300 Knightsbridge Pkwy.
Lincolnshire, Illinois 60069
Ladies and Gentlemen:
At today’s meeting of the Board of Directors (the “Board”) of Motient Corporation (the “Company”) to “discuss” and then to finally approve the terms of the already-commenced exchange offer and the related issuance of the Series B Preferred stock (the “Exchange Offer”), the Board avoided significant issues with respect to the Exchange Offer and rushed to another quick decision without discussion.
My letters to you dated October 19 and October 25, 2005, set forth detailed questions relating to the Exchange Offer that should have been reviewed and discussed before approving the Exchange Offer. These issues were not discussed and, in fact, given the way in which the meeting was conducted, it was clear that there was no desire to deal with these issues and address these legitimate concerns. Today’s meeting merely recited the terms of the Series B Preferred. Resolutions inaccurately state that the members of the Board had carefully considered the Exchange Offer and had become “apprised of all material facts.” As previously noted, the corporate governance of the Company is in desperate need of repair, and the Company’s stockholders deserve more than the maintenance to the continued corporate fiction.
Highland Capital Management, L.P. and certain of its affiliates today notified the Company that they elected not to participate in the Exchange Offer because they believe that the Company has not adequately disclosed all material information relating to the Exchange Offer and its implications to stockholders. Highland and I have also been given indications that various side deals and side letters may have been proffered to some Series A Preferred holders to encourage their exchange. If the Company entered into agreements with Series A Preferred holders prior to tendering, Highland and I suspect that these deals may violate the securities laws and should be disclosed. These sorts of indications, as well as prior concerns that I have expressed in my correspondence with the Board, continue to raise serious concerns for both me and Highland regarding the Board’s conduct in connection with the Exchange Offer, particularly the inadequacy of the Company’s disclosures.
Sincerely,
/s/ James D. Dondero
James D. Dondero
cc: Securities and Exchange Commission

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