Material Sciences Corporation Provides
Update on Litigation Related to the Proposed Merger
Material Sciences Corporation (NASDAQ: MASC), a leading provider
of material-based solutions for acoustical and coated applications
(“MSC” or the “Company”), announced today that one of the leading
independent institutional proxy advisory firms, Institutional
Shareholder Services (“ISS”), has recommended that MSC stockholders
vote “FOR” the proposal to approve the merger (the “Merger”) with
Zink Acquisition Holdings Inc. (“Parent”) and Zink Acquisition
Merger Sub Inc. (“Merger Sub”), which are affiliates of New Star
Metals Inc. (“New Star”) and Insight Equity Holdings LLC
(“Insight”).
ISS Recommendation
ISS is one of the leading independent proxy advisory firms and
their voting analyses and recommendations are relied upon by major
institutional investment funds, mutual funds and fiduciaries
throughout the world. In recommending MSC support the Merger, ISS
concluded: “Given the substantial premium and rationale, support
for the merger is warranted.”* ISS also recommended MSC
stockholders vote FOR approval of executive compensation that may
be payable in connection with the Merger (Proposal 2) and FOR the
adjournment of the special meeting, if necessary (Proposal 3).
Clifford Nastas, Chief Executive Officer of MSC said, “We are
pleased that ISS recognizes that the merger is in the best
interests of our stockholders.”
MSC urges stockholders to follow the ISS recommendations by
voting “FOR” each of the proposals today. Stockholders who have
questions about the proposals or who need assistance voting their
shares should contact MSC’s proxy solicitor, Morrow & Co., LLC
toll-free at (800) 662-5200 or (203) 658-9400.
*Permission to use ISS quotation was neither sought nor
obtained.
Update on Litigation Relating to the Merger
As previously disclosed, MSC and certain members of the board of
directors of MSC (the “Board”), as well as Parent, Merger Sub, New
Star and Insight, were named as defendants in a purported class
action brought by an alleged MSC stockholder on January 15, 2014.
The lawsuit was filed in the Court of Chancery of the State of
Delaware and is captioned Hilary Coyne v. Material Sciences
Corporation., et al., Case No. 9257. The action asserted
claims that the members of the Board purportedly breached their
fiduciary duties to MSC’s stockholders in connection with the
proposed Merger. The action further claimed that New Star and
Insight aided and abetted those alleged breaches of fiduciary
duties. The plaintiff in the action sought equitable relief,
including an injunction preventing the consummation of the Merger,
rescission in the event the Merger is consummated, and an award of
attorneys’ and other fees and costs. MSC and the Board believe that
the claims were without merit, and on February 12, 2014, the
plaintiff in the lawsuit filed a notice of dismissal without
prejudice which the Court granted on February 13, 2014.
On February 20, 2014, MSC, the Board, Parent, Merger Sub, New
Star and Insight were named as defendants in a second purported
class action brought by a different alleged MSC stockholder. The
lawsuit was also filed in the Court of Chancery in the State of
Delaware and is captioned Anthony Tiano v. Material Sciences
Corporation, et al., Case No. 9375. The action alleges that the
members of the Board breached their fiduciary duties by causing MSC
to be sold at an unfair price and pursuant to an inadequate process
and by failing, along with MSC, to make certain disclosures. The
complaint further alleges that Insight and Merger Sub aided and
abetted these purported breaches of fiduciary duties. The complaint
seeks equitable relief, including an injunction preventing the
consummation of the Merger, rescission in the event the Merger is
consummated, and an award of attorneys’ and other fees and costs.
MSC and the Board believe that the claims in this action are
without merit and intend to defend against them vigorously.
Cautionary Note for Forward-Looking
Statements
Statements contained herein regarding the proposed transaction
between Parent, Merger Sub and MSC, the expected timetable for
completing the transaction, the potential benefits of the
transaction, and other statements about management’s future
expectations, beliefs, goals, plans or prospects constitute forward
looking statements. MSC has tried to identify these forward looking
statements by using words such as “expect,” “anticipate,”
“estimate,” “plan,” “will,” “would,” “should,” “forecast,”
“believe,” “guidance,” “projection” or similar expressions, but
these words are not the exclusive means for identifying such
statements. MSC cautions that a number of risks, uncertainties and
other important factors could cause MSC’s actual results,
performance and achievements to differ materially from those
expressed in, or implied by, the forward-looking statements,
including, without limitation, uncertainties as to the timing of
the Merger; the occurrence of any event, change or other
circumstances that could give rise to the termination of the
agreement and plan of merger; the possibility that alternative
acquisition proposals will be made; the outcome of any legal
proceedings that may be or have been instituted against MSC related
to the agreement and plan of merger; the inability to complete the
Merger due to the failure to obtain stockholder approval or the
failure to satisfy other conditions to completion of the Merger;
the failure to obtain the necessary financing arrangements set
forth in the debt and equity commitment letters delivered pursuant
to the agreement and plan of merger; the disruption of management’s
attention from MSC’s ongoing business operations due to the Merger;
the effect of the announcement of the Merger on MSC’s relationships
with its customers, operating results and business generally; the
effects of local and national economic, credit and capital market
conditions; and other risk factors set forth from time to time in
MSC’s other filings with the SEC, including the disclosures under
“Risk Factors” in those filings. Except as expressly required by
the federal securities laws, MSC undertakes no obligation to update
or revise any forward-looking statements, whether as a result of
new information, changed circumstances or future events or for any
other reason.
Additional Information and Where to
Find It
In connection with the proposed Merger and required stockholder
approval, MSC filed a definitive proxy statement with the SEC on
February 20, 2014, and has commenced mailing the definitive proxy
statement to its stockholders. MSC’S STOCKHOLDERS ARE URGED TO READ
THE DEFINITIVE PROXY STATEMENT REGARDING THE PROPOSED MERGER
BECAUSE IT CONTAINS IMPORTANT INFORMATION ABOUT MSC AND THE MERGER.
MSC’s stockholders may obtain free copies of the definitive proxy
statement and other documents filed with the SEC at the SEC’s web
site at www.sec.gov. In addition, the
documents filed by MSC with the SEC may be obtained free of charge
from MSC’s website at www.matsci.com,
or by directing a request to MSC at 2200 East Pratt Boulevard, Elk
Grove Village, Illinois 60007, Attn: James Pawlak.
Participants in the
Solicitation
MSC and its directors and officers may be deemed to be
participants in the solicitation of proxies from MSC’s stockholders
with respect to the special meeting of stockholders that will be
held to consider the proposed merger. Information about MSC’s
directors and executive officers and their ownership of MSC’s
common stock is set forth in the definitive proxy statement
regarding the proposed merger, which was filed with the SEC on
February 20, 2014. Stockholders may obtain additional information
regarding the interests of MSC and its directors and executive
officers in the proposed merger, which may be different than those
of MSC’s stockholders generally, by reading the proxy statement and
other relevant documents regarding the proposed merger, filed with
the SEC.
Company ContactMaterial Sciences CorporationJames D. Pawlak,
847-439-2210Vice President, Chief Financial OfficerorMedia
ContactSM Berger & CompanyStanley Berger or Andrew Berger,
216-464-6400
Material Sciences Corp. (MM) (NASDAQ:MASC)
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