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ROYAL PRECISION SIGNS LETTER OF INTENT
TO ACQUIRE PH GROUP INC.
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FOR IMMEDIATE RELEASE
Contact: Thomas A. Schneider, President and Chief Operating Officer
Anthony J. Montgomery, Executive Vice President - Sales & Marketing
Kevin L. Neill, Vice President - Finance and Chief Financial Officer
Royal Precision, Inc. (480) 627-0200
Internet: www.royalprecision.com
RCG Capital Markets Group, Inc. (480) 675-0400
Retail: Jim Estrada, Brett Maas
Analysts/Institutional: Joe Dorame
Media: Jeff Stanlis
Internet: www.rcgonline.com
(SEPTEMBER 28, 2000) - SCOTTSDALE, ARIZONA - Royal Precision, Inc. (Nasdaq:
RIFL) announced today that it has signed a letter of intent to acquire PH Group
Inc. (OTC Bulletin Board: PHHH), a manufacturer of hydraulic presses and
injection molding machines for applications in metalworking, compression molding
and plastic injection molding. PH Group is based in Columbus, Ohio and had sales
of $9.8 million in 1999.
PH Group Inc. designs and manufactures a wide range of hydraulic presses for
metal forming applications, primarily in the automotive, aircraft and appliance
industries. The Company's product lines for hydraulic presses range from 1 to
5,000 tons and are marketed under the names PH Hydraulics and St. Lawrence
Press. The U.S. market for hydraulic presses is estimated to be in excess of
$150 million per year. The Company's injection molding machine product line is
designed for the automotive, electrical, medical, and consumer products
industries. The injection molding machines range from 15 to 450 tons and are
marketed under the name Trueblood V2. The U.S. market for injection molding
machines is estimated to be in excess of $200 million per year.
Under the terms of the transaction, PH Group shareholders would receive $1.00
worth of Royal Precision common stock for each share of PH Group common stock
they own. The exchange ratio will be the average closing price of Royal
Precision's common stock for a period of twenty consecutive trading days, ending
two days prior to the date of execution of a definitive agreement. As of June
30, 2000, PH Group had approximately 1.7 million shares of common stock
outstanding. In connection with the execution of the letter of intent, PH Group
granted Royal Precision an option to acquire 500,000 shares of PH Group common
stock at an exercise price of $0.50 per share.
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Thomas A. Schneider, president and chief operating officer of Royal Precision,
commented, "We are excited about the opportunity that this transaction presents
for our company. Completion of this transaction is part of our strategic
business plan to provide Royal Precision with a second platform to grow our
business and increase shareholder value. Following the closing of this
transaction, we look forward to working with the PH Group management team to
successfully combine our companies."
C. T. Sherman, president of PH Group, commented, "We are excited about now
having the capabilities to accomplish our growth oriented business plan with the
help of Royal Precision. We believe our shareholders will benefit from the
execution of that plan and by being part of a larger public company. We believe
Royal Precision's growth plans and ours should produce an exciting future for
the combined companies."
The proposed acquisition is subject to a number of conditions including the
execution and delivery of definitive agreements acceptable to both parties,
approval of the boards of Royal Precision and PH Group, and the approval of
shareholders.
Royal Precision, Inc. is a leading designer and manufacturer of high-quality
innovative golf club shafts, including the Rifle(TM) shaft featuring the
Company's "Frequency Coefficient Matching" technology, or "FCM," designed to
provide consistent flex characteristics to all the clubs in a golfer's bag.
Royal Precision, Inc. is also a designer and distributor of Royal Grip(R) golf
club grips offering a wide variety of standard and custom models, all of which
feature durability and a distinctive feel and appearance.
THIS PRESS RELEASE INCLUDES STATEMENTS WHICH MAY CONSTITUTE FORWARD LOOKING
STATEMENTS MADE PURSUANT TO THE SAFE HARBOR PROVISION OF THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995. THESE STATEMENTS, WHICH USUALLY CONTAIN THE WORDS
"BELIEVE", "EXPECT", "ANTICIPATE", OR "WILL", ARE SUBJECT TO RISKS AND
UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE
FORWARD LOOKING STATEMENTS. FACTORS THAT WOULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THE FORWARD LOOKING STATEMENTS INCLUDE, BUT ARE NOT LIMITED TO,
RISKS RELATED TO THE COMPANY'S DEPENDENCE ON DISCRETIONARY CONSUMER SPENDING AND
DEMAND FROM ORIGINAL EQUIPMENT MANUFACTURERS, THE COMPANY'S LIMITED OPERATING
HISTORY, THE TIMELINESS AND MARKET ACCEPTANCE OF NEW PRODUCT INTRODUCTIONS
INCLUDING THE RIFLE GRAPHITE, COMPETITION, SEASONALITY OF SALES, FLUCTUATIONS IN
OPERATING RESULTS, PROTECTION OF INTELLECTUAL PROPERTY RIGHTS, SUPPLY DELAYS,
USE OF THIRD PARTY SUPPLIERS, CUSTOMER CONCENTRATION AND OTHER FACTORS DETAILED
IN THE COMPANY'S SECURITIES AND EXCHANGE COMMISSION FILINGS.
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