UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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o Soliciting Material Pursuant to §240.14a-12 |
GenCorp Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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P.O. Box 537012 Sacramento, CA 95853-7012 |
Terry L. Hall
Chairman of the Board,
President and Chief Executive Officer
Chairman of the Board,
President and Chief Executive Officer
March 24, 2006
Dear Fellow Shareholder,
GenCorp’s March 31, 2006 Annual Meeting of Shareholders is approaching soon, and your vote is important,no matter how many, or how few, shares you own.
Your Board has nominated for election as directors three individuals that the Board believes are highly qualified– R. Franklin Balotti, J. Gary Cooper and Steven G. Rothmeier – all of whom are committed to maximizing shareholder value. We believe these nominees possess critical industry and business experience unmatched by the slate of nominees proposed by Pirate Capital LLC, none of whom has indicated experience in the management of public companies, service on public companies’ boards or expertise in corporate governance matters. We believe that election of the Board’s nominees is in the best interests of all GenCorp shareholders, and we urge you to protect your investment in GenCorp bysigning, dating and returning the enclosed WHITE proxy card today.
ISS RECOGNIZES THAT MANAGEMENT’S STRATEGY HAS WORKED
In its March 21, 2006 recommendation regarding the Company’s annual meeting, Institutional Shareholder Services (ISS), the nation’s leading independent proxy advisor, noted that, “As a result of the asset divestures, restructuring the Atlas V contract, and pursuing a process to unlock the value of the real estate assets, the company is now a more focused company positioned for growth. Management’s strategy has worked as shareholders have realized value over the past three years as evidenced by solid stock performance.”*
As the chart above shows, GenCorp’s stock price has more than tripled during the past three years since the current team assumed GenCorp’s leadership. We believe this reflects investors’ recognition of the value of our aerospace/defense assets and our real estate portfolio and their support of our plans for the future.
* Permission to use quotation was neither sought nor obtained. |
OUR BOARD AND MANAGEMENT HAVE IN PLACE A STRATEGIC PLAN
The Company has taken decisive actions over the past three years to resolve legacy liabilities and divest non-core businesses. As a result of these efforts, GenCorp is now a stronger company with less risk and uncertainty from legacy liabilities that now is focused on two very attractive business segments, aerospace/defense and real estate, both of which we believe are poised for continued success. We expect the solid existing business base of Aerojet, our aerospace and defense segment, will generate predictable future profits and positive cash flow that will support the ongoing environmental remediation of our substantial real estate assets in the metropolitan Sacramento market, and thereby enable us to unlock the value of our real estate portfolio. We have a strategy and that strategy is being executed for the benefit of all GenCorp shareholders.
Pirate, on the other hand, has not proposed any strategy or alternative plan to create value.
PROACTIVELY ENHANCING CORPORATE GOVERNANCE
Pirate has resorted to what we see as tired rhetoric concerning classification of director terms and other matters in an effort that we think is designed to convince shareholders that your Board is indifferent to good corporate governance. We hope you will see through this.
We have already committed that, if a majority of our outstanding shares vote in favor of the proposal to declassify the Board at this year’s annual meeting, we will propose a binding resolution at next year’s annual meeting to declassify the Board. While the Board believes that maintaining a classified Board provides necessary continuity and gives the Board the necessary time to implement the long term strategy designed to maximize shareholder value, it is enabling its shareholders to decide for themselves whether annual election of all directors would be desirable.
In addition, the Board has just announced that it has unanimously determined to allow the Company’s shareholder rights plan to expire without renewal on February 18, 2007. Furthermore, the Board has determined that should the conditions of the rights plan be triggered prior to the scheduled expiration of the rights plan, the Company will either redeem the rights or amend the rights plan to make it inapplicable to such event.
YOUR VOTE IS IMPORTANT—PROTECT YOUR INVESTMENT
SUPPORT YOUR BOARD’S NOMINEES
SUPPORT YOUR BOARD’S NOMINEES
We believe your Board’s nominees are crucial to the continued execution of GenCorp’s strategy. We are confident that your Board of Directors and management have the knowledge and expertise to help GenCorp realize its full potential.We urge you to sign, date and return the enclosed WHITE proxy card today.
On behalf of the Board of Directors, thank you for your continued support.
Terry Hall
Chairman
Time is short. Your vote is extremely important – no matter how many or
how few shares you own.
how few shares you own.
Remember, you may be able to vote by telephone or by the Internet—simply follow the easy instructions on the enclosed WHITE proxy card. To vote your shares, please sign, date and return the enclosedWHITEproxy card TODAY in the postage-paid envelope provided. Please also note that, even if you have previously returned a green proxy card in error, you have every legal right to change your vote – only your latest-dated proxy counts.
IF YOU HAVE ANY QUESTIONS ABOUT VOTING OR NEED ADDITIONAL ASSISTANCE, PLEASE CONTACT THE FIRM ASSISTING US IN THE SOLICITATION OF PROXIES:
INNISFREE M&A INCORPORATED
TOLL FREE AT 1-888-750-5834.
TOLL FREE AT 1-888-750-5834.
News Release
For Immediate Release
For Immediate Release
GenCorp Mails Letter to Shareholders Urging Them to Support Board’s Nominees
SACRAMENTO,Calif., March 24, 2006 — GenCorp Inc. (NYSE: GY) announced that today it mailed the following letter to its shareholders:
March 24, 2006
Dear Fellow Shareholder,
GenCorp’s March 31, 2006 Annual Meeting of Shareholders is approaching soon, and your vote is important,no matter how many, or how few, shares you own.
Your Board has nominated for election as directors three individuals that the Board believes are highly qualified– R. Franklin Balotti, J. Gary Cooper and Steven G. Rothmeier – all of whom are committed to maximizing shareholder value. We believe these nominees possess critical industry and business experience unmatched by the slate of nominees proposed by Pirate Capital LLC, none of whom has indicated experience in the management of public companies, service on public companies’ boards or expertise in corporate governance matters. We believe that election of the Board’s nominees is in the best interests of all GenCorp shareholders, and we urge you to protect your investment in GenCorp bysigning, dating and returning the enclosed WHITE proxy card today.
ISS RECOGNIZES THAT MANAGEMENT’S STRATEGY HAS WORKED
In its March 21, 2006 recommendation regarding the Company’s annual meeting, Institutional Shareholder Services (ISS), the nation’s leading independent proxy advisor, noted that, “As a result of the asset divestures, restructuring the Atlas V contract, and pursuing a process to unlock the value of the real estate assets, the company is now a more focused company positioned for growth. Management’s strategy has worked as shareholders have realized value over the past three years as evidenced by solid stock performance.”*
* Permission to use quotation was neither sought nor obtained. |
As the chart above shows, GenCorp’s stock price has more than tripled during the past three years since the current team assumed GenCorp’s leadership. We believe this reflects investors’ recognition of the value of our aerospace/defense assets and our real estate portfolio and their support of our plans for the future.
OUR BOARD AND MANAGEMENT HAVE IN PLACE A STRATEGIC PLAN
The Company has taken decisive actions over the past three years to resolve legacy liabilities and divest non-core businesses. As a result of these efforts, GenCorp is now a stronger company with less risk and uncertainty from legacy liabilities that now is focused on two very attractive business segments, aerospace/defense and real estate, both of which we believe are poised for continued success. We expect the solid existing business base of Aerojet, our aerospace and defense segment, will generate predictable future profits and positive cash flow that will support the ongoing environmental remediation of our substantial real estate assets in the metropolitan Sacramento market, and thereby enable us to unlock the value of our real estate portfolio. We have a strategy and that strategy is being executed for the benefit of all GenCorp shareholders.
Pirate, on the other hand, has not proposed any strategy or alternative plan to create value.
PROACTIVELY ENHANCING CORPORATE GOVERNANCE
Pirate has resorted to what we see as tired rhetoric concerning classification of director terms and other matters in an effort that we think is designed to convince shareholders that your Board is indifferent to good corporate governance. We hope you will see through this.
We have already committed that, if a majority of our outstanding shares vote in favor of the proposal to declassify the Board at this year’s annual meeting, we will propose a binding resolution at next year’s annual meeting to declassify the Board. While the Board believes that maintaining a classified Board provides necessary continuity and gives the Board the necessary time to implement the long term strategy designed to maximize shareholder value, it is enabling its shareholders to decide for themselves whether annual election of all directors would be desirable.
In addition, the Board has just announced that it has unanimously determined to allow the Company’s shareholder rights plan to expire without renewal on February 18, 2007. Furthermore, the Board has determined that should the conditions of the rights plan be triggered prior to the scheduled expiration of the rights plan, the Company will either redeem the rights or amend the rights plan to make it inapplicable to such event.
YOUR VOTE IS IMPORTANT—PROTECT YOUR INVESTMENT
SUPPORT YOUR BOARD’S NOMINEES
SUPPORT YOUR BOARD’S NOMINEES
We believe your Board’s nominees are crucial to the continued execution of GenCorp’s strategy.We are confident that your Board of Directors and management have the knowledge and expertise to help GenCorp realize its full potential.We urge you to sign, date and return the enclosed WHITE proxy card today.
On behalf of the Board of Directors, thank you for your continued support.
Terry Hall
Chairman
Chairman
About GenCorp
GenCorp is a leading technology-based manufacturer of aerospace and defense products and systems with a real estate business segment that includes activities related to the development, sale and leasing of the Company’s real estate assets. Additional information about the Company can be obtained by visiting the Company’s web site at http://www.GenCorp.com.
Additional Information
This communication is not a solicitation of a proxy of any security holder of GenCorp Inc., nor does this communication constitute an offer to sell or the solicitation of an offer to buy any securities. On March 14, 2006, the Company filed with the SEC a definitive proxy statement on Schedule 14A and on March 16, 2006, Pirate Capital LLC and certain of its affiliates filed with the SEC a definitive proxy statement. Shareholders are strongly advised to read these materials because they contain important information. Shareholders and investors can obtain these proxy statements, any amendments and supplements to the proxy statements and other documents filed with the SEC by the Company and Pirate Capital LLC and such affiliates at http://www.sec.gov . Copies of the Company’s proxy statement and any amendments or supplements to the proxy statement are also available for free at the Company’s web site at http://www.GenCorp.com or by writing the Company at GenCorp Inc., P.O. Box 537012, Sacramento, California 95853-7012 Attention: Secretary. Detailed information regarding the names, affiliations and interests of individuals who may be deemed participants in the solicitation of proxies of the Company’s shareholders is available in the Company’s proxy statement.
Forward-Looking Statements
This release may contain certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. Such statements in this release and in subsequent discussions with the Company’s management are based on management’s current expectations and are subject to risks, uncertainty and changes in circumstances, which may cause actual results, performance or achievements to differ materially from anticipated results, performance or achievements. All statements contained herein and in subsequent discussions with the Company’s management that are not clearly historical in nature are forward-looking and the words “anticipate,” “believe,” “expect,” “estimate,” “plan,” and similar expressions are generally intended to identify forward-looking statements. A variety of factors could cause actual results or outcomes to differ materially from those expected and expressed in the Company’s forward-looking statements. Some important risk factors that could cause actual results or outcomes to differ from those expressed in the forward-looking statements include, but are not limited to, the following:
— cancellation or material modification of one or more significant contracts, such as the recent renegotiation of our Atlas V contract;
— future reductions or changes in U.S. government spending;
— failure to comply with regulations applicable to contracts with the U.S. government;
— product failures, schedule delays or other problems with existing or new products and systems or cost-overruns on the Company’s fixed-price contracts;
— significant competition and the Company’s inability to adapt to rapid technological changes;
— the release or explosion of dangerous materials used in the Company’s businesses;
— disruptions in the supply of key raw materials and difficulties in the supplier qualification process, as well as increases in the prices of raw materials;
— reduction in airbag propellant volume;
— a strike or other work stoppage or the Company’s inability to renew collective bargaining agreements on favorable terms;
— the loss of key employees and shortage of available skilled employees to achieve anticipated growth;
— environmental claims related to the Company’s current and former businesses and operations;
— the possibility that the environmental and other government regulations that impact the Company become more stringent or subject the Company to material liability in excess of its established reserves;
— changes in economic and other conditions in the Sacramento County, California, real estate market or changes in interest rates affecting real estate values in that market;
— the Company’s limited experience in real estate activities and the ability to execute its real estate business plan, including the Company’s ability to obtain all necessary zoning, land use and environmental approvals;
— the cost of servicing the Company’s debt and compliance with financial and other covenants;
— effects of changes in discount rates and returns on plan assets of defined benefit pension plans could require the Company to increase its shareholders’ deficit;
— fluctuations in sales levels causing the Company’s quarterly operating results to fluctuate;
— additional costs related to the Company’s recent divestitures;
— costs and time commitment related to acquisition activities;
— inability to effectively and efficiently implement the necessary initiatives to eliminate the material weakness we expect to report in our internal controls over financial reporting; and
— those risks detailed from time to time in the Company’s reports filed with the SEC.
This list of factors that may affect future performance and the accuracy of forward-looking statements are illustrative, but by no means exhaustive. These and other factors are described in more detail in the Company’s Annual Report on Form 10-K for the year ended November 30, 2005 and in the Company’s subsequent filings with the SEC. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. All such risk factors are difficult to predict, contain material uncertainties that may affect actual results and may be beyond the Company’s control. The Company is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.
Contact information:
Investors: Yasmin Seyal, senior vice president and chief financial officer 916.351.8585
Media: Linda Cutler, vice president, corporate communications 916.351.8650
Media: Linda Cutler, vice president, corporate communications 916.351.8650
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