AAR’s board of directors has adopted a limited duration stockholder rights plan and declared a non-cash dividend distribution of one preferred share purchase right for each share of AAR’s common stock outstanding as of April 9, 2020, the record date, the company announced on Monday.
The plan has intended to protect the interests of the company and its stockholders by reducing the likelihood that any person or group gains control of AAR through open market accumulation or other tactics without paying an appropriate control premium.
The board has noted that in light of COVID-19, the closing price of AAR’s common stock is around 60 percent below the price in February. The board commented that the adoption of the rights plan has enabled the board to have sufficient time to make informed judgments and decisions that are in the best long-term interests of QTS and its stockholders.
The rights will become available when a person or group acquires 10 percent, or 20 percent in the case of passive investors who are eligible to, and do, report their holdings on Schedule 13G, or more of the outstanding common stock of AAR without board approval.
In the event the rights become exercisable, each right will entitle stockholders to buy one one-thousandth of a share of a new Series A junior participating preferred stock at an exercise price of $100.00.
Additional details regarding the Rights Plan will be contained in a Form 8-K to be filed by the Company with the U.S. Securities and Exchange Commission on March 30, 2020. The Rights Plan will expire, without any further action required by the Board of Directors, on February 28, 2021.
AAR is a global aerospace and defense aftermarket solutions Company that employs more than 6,000 people in over 20 countries. Headquartered in the Chicago area, AAR supports commercial and government customers through two operating segments: Aviation Services and Expeditionary Services. AAR’s Aviation Services include parts supply; OEM solutions; integrated solutions; maintenance, repair, overhaul; and engineering. AAR’s Expeditionary Services include mobility systems and composite manufacturing operations.