Aviation General, Incorporated Adopts Shareholder Rights Agreement.Business Editors BETHANY, Okla.--(BUSINESS WIRE)--Aug. 7, 2001 Aviation General, Incorporated (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :AVGE AVGE Advanced Video Guidance Sensor ) announced today that its Board of Directors has adopted a Shareholder Rights Agreement under which rights to purchase shares of its newly issued Series A Junior Participating Preferred Stock Participating Preferred Stock A type of preferred stock that, under certain conditions, gives holders the right to receive earnings payouts over and above the specified dividend rate. will be distributed to stockholders as a non-cash dividend at the rate of one right for each share of the Company's common stock, par value $0.50, held of record as of the close of business on August 3, 2001. There has been considerable acquisition activity and consolidation in the past several years and numerous U.S. companies have considered it prudent to adopt shareholder protection plans similar to this Rights Agreement. The Rights Agreement adopted by the Board is expected to deter hostile tender offers hostile tender offer An offer to purchase shares from a firm's stockholders when directors of the target firm have recommended that stockholders not sell their stock. and creeping takeovers and should operate to preserve and maximize shareholder value in the event of a sale of the Company. The issuance of the Rights pursuant to the Rights Agreement has no dilutive effect Dilutive effect Result of a transaction that decreases earnings per common share (EPS). , will not affect reporting earnings per share, is not taxable to the Company or its shareholders and will not change the way in which the Company's shares are traded. The Rights Agreement would not be triggered by acquisition of additional common stock by the Company's Chairman/CEO, who is the largest stockholder as of today's date, and/or his affiliates. The Rights Agreement provides that one preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. purchase right will be issued on August 3, 2001, to the holders of record of Aviation General's common stock on each outstanding share at the close of business on that date. The rights become exercisable only if an entity acquires, without approval of Aviation General's Board of Directors, 15% or more of Aviation General's common stock or announces a tender offer with the intention to do the same. Each right allows holders to acquire additional shares of common stock in either Aviation General or an acquiring entity at a 50% discount to market. The rights are intended to enable all Aviation General stockholders to realize the long-term value of their investment in the Company and to deter a hostile acquisition of the Company not in the best interest of its stockholders. The rights will trade with the Company's common stock, unless and until they are separated upon the occurrence of certain future events. The Company's Board of Directors may redeem the rights at any time prior to their becoming exercisable. Additional details regarding the Rights Agreement will be outlined in a summary to be mailed to all stockholders. Aviation General, Incorporated is a publicly traded holding company with two wholly owned subsidiaries Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , Commander Aircraft Company and Strategic Jet Services, Inc. Commander Aircraft Company (www.commanderair.com) manufactures, markets and provides support services support services Psychology Non-health care-related ancillary services–eg, transportation, financial aid, support groups, homemaker services, respite services, and other services for its line of single engine, high performance Commander aircraft, and consulting, brokerage and refurbishment re·fur·bish tr.v. re·fur·bished, re·fur·bish·ing, re·fur·bish·es To make clean, bright, or fresh again; renovate. re·fur services for all types of piston aircraft. Strategic Jet Services, Inc. (www.strategicjet.com) provides consulting, sales, brokerage, acquisition, and refurbishment services for jet aircraft. The statements in this press release that relate to future plans, events or performance are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve risks and uncertainties. Actual results, events and performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Readers are encouraged to refer to the risk disclosures described in the Company's reports on Forms 10-K, 10-Q and 8K, as applicable. |
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