PORTLAND — December 12, 2008 — The
board of directors of Precision Castparts Corp.
(NYSE:PCP) has renewed its shareholder rights
agreement. The rights agreement, which was
adopted in 1998, is set to expire on December
16, 2008. The agreement is intended to
protect the Company and its shareholders from
potentially coercive takeover practices or
takeover bids that are inconsistent with the
interests of the Company and its shareholders.
The agreement is not intended to deter offers
that are fair and otherwise in the best interest
of the Company’s shareholders.
Under the renewed rights agreement, each holder
of the common stock of the Company as of 5:00 p.m.
New York time on December 16, 2008, will receive
a dividend of one right for each share of common
stock held entitling the holder to purchase from
the Company one one-thousandth of a share of Series
A No Par Serial Preferred Stock. Initially,
the rights will be represented by the common stock
certificates of the Company and will not be exercisable
or traded separately from the common stock of the
Company. In the absence of further board
action, the rights will generally become exercisable
if a person or group (i) acquires 15 percent
or more of the outstanding common stock of the
Company, or (ii) announces or commences a
tender or exchange offer that would result in the
person or group acquiring 15 percent or more of
the outstanding common stock of the Company. Rights
held by those that exceed the 15 percent threshold
will be void.
In the event that any person or group acquires 15
percent or more of the outstanding common stock
of the Company, and the rights are exercisable,
each holder of a right (other than holders of rights
that have become void) will have the right to receive
upon exercise of the right, in lieu of shares of
preferred stock, a number of shares of common stock
of the Company having a market value of two times
the exercise price of the right.
If, after a person or group acquires 15 percent
or more of the outstanding common stock of the
Company, and while the rights are exercisable,
(i) the Company is acquired in a merger or
other business combination transaction in which
the Company is not the surviving corporation or
in which shares of the common stock are exchanged
for stock or other securities or property, or (ii) 50
percent or more of the Company’s assets or
earning power is sold or transferred, each holder
of a right (other than holders of rights that have
become void) shall thereafter have the right to
receive, upon exercise of the right, common stock
of the acquiring company having a value equal to
two times the purchase price of the right.
The rights agreement also includes an exchange option.
In general, after a person or group acquires 15
percent or more of the outstanding common stock
of the Company and while the rights are exercisable,
the board of directors may, at its option, effect
an exchange of part or all of the rights (other
than rights that have become void) for shares of
the common stock or preferred stock of the Company.
Under this option, the Company would issue one
share of common stock of the Company for each right
or one one-thousandth of a share of preferred stock
for each right, subject to adjustment in certain
circumstances.
The board of directors may, at its option, redeem
all outstanding rights for $0.001 per right at
any time prior to the later of the Stock Acquisition
Date and the Distribution Date (as these terms
are defined in the Rights Agreement). The
rights will expire on December 15, 2018, unless
earlier redeemed, exchanged, or amended by the
board of directors.
The issuance of the rights is not a taxable event,
will not affect the reported financial condition
or results of operations (including earnings per
share) of the Company, and will not change the
manner in which the common stock of the Company
is currently traded.
The stock ownership percentages referred to in the
rights agreement are based upon beneficial ownership
(as defined in the rights agreement), which includes,
among other things, certain derivative or synthetic
arrangements having characteristics of a long position
in the common stock of the Company. A copy
of the rights agreement will be filed by the Company
with the Securities and Exchange Commission. The
definitive terms of the rights agreement are set
forth therein.
About Precision Castparts Corp.
Precision Castparts Corp. is a worldwide, diversified
manufacturer of complex metal components and products. It
serves the aerospace, power generation, automotive,
and general industrial and other markets. PCC
is the market leader in manufacturing large, complex
structural investment castings, airfoil castings,
and forged components used in jet aircraft engines
and industrial gas turbines. The Company
is also a leading producer of highly engineered,
critical fasteners for aerospace, automotive, and
other markets and supplies metal alloys and other
materials to the casting and forging industry.
###
Information included within this press release describing
projected growth and future results and events
constitutes forward-looking statements, within
the meaning of the Private Securities Litigation
Reform Act of 1995. Actual results in future
periods may differ materially from the forward-looking
statements because of a number of risks and uncertainties,
including but not limited to fluctuations in the
aerospace, power generation, automotive, and other
general industrial cycles; the relative success
of the Company’s entry into new markets;
competitive pricing; the financial viability of
the Company’s significant customers; the
impact on the Company of customer labor disputes;
the availability and cost of materials, energy,
supplies, insurance, and pension benefits; equipment
failures; relations with the Company’s employees;
the Company’s ability to manage its operating
costs and to integrate acquired businesses in an
effective manner; governmental regulations and
environmental matters; risks associated with international
operations and world economies; the relative stability
of certain foreign currencies; and implementation
of new technologies and process improvement. Any
forward-looking statements should be considered
in light of these factors. The Company undertakes
no obligation to publicly release any forward-looking
information to reflect anticipated or unanticipated
events or circumstances after the date of this
document.
Contact:
Dwight E. Weber
503-417-4855
