<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
[AMENDMENT NO.____________]
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
RMI TITANIUM COMPANY
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate Box):
[ ] No filing fee required
[ ] $125 per Exchange Act Rules O-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and O-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule O-11 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
5) Total fee paid:
------------------------------------------------------------------------
[ ] Fee paid previously by written preliminary materials.
[X] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid: $134,402
------------------------------------------
2) Form Schedule or Registration Statement No.: 333-61935
---------------------
3) Filing Party: RTI International Metals, Inc.
----------------------------------------------------
4) Date Filed: August 20, 1998
------------------------------------------------------
<PAGE> 2
[RMI LOGO]
11000 Warren Avenue
Niles, Ohio 44446
AUGUST 31, 1998
Dear Shareholders:
The following Proxy Statement is in connection with a Special Meeting of
Shareholders to be held on September 30, 1998 at Mr. Anthony's, 7440 South
Avenue, Boardman, Ohio at 11:00 a.m. Eastern Daylight Savings Time. The SOLE
PURPOSE of the meeting is to seek your approval of a proposal to restructure the
Company by forming a new Ohio holding company, RTI International Metals, Inc.,
which will exchange its shares of common stock on a one-for-one basis for all of
the current outstanding common stock of the Company, following which the Company
will become a wholly-owned subsidiary of RTI International.
Management believes that the use of the holding company structure will
provide greater flexibility in managing existing and future business operations
and will facilitate future acquisitions and strategic alliances. The rights of
the shareholders will be unchanged under the charter and bylaws of the new
holding company.
Whether or not you plan to attend the Meeting, it is important that you
vote your shares. Please promptly read the Proxy Statement and then complete,
sign, date and return your proxy card in the enclosed prepaid envelope.
Sincerely,
/s/ Robert M. Hernandez
Robert M. Hernandez
Chairman of the Board
<PAGE> 3
1000 Warren Avenue
Niles, Ohio 44446
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD SEPTEMBER 30, 1998
A Special Meeting of Shareholders of RMI Titanium Company will be held on
September 30, 1998, at 11:00 a.m., Eastern Daylight Savings Time, at Mr.
Anthony's, 7440 South Avenue, Boardman, Ohio, for the following purpose:
1. To consider and act upon the merger of RMI Acquisition Company with and
into RMI Titanium Company as described in the Proxy Statement/Prospectus
accompanying this Notice. The effect of the merger will be to create a
holding company structure, pursuant to which RMI Titanium Company will
be a wholly owned subsidiary of RTI International Metals, Inc., a newly
formed Ohio holding company, and the shares of RMI Titanium Company will
be exchanged for shares of the holding company.
Shareholders of record as of the close of business on August 28, 1998, are
entitled to notice of and to vote at the meeting.
By Order of the Board of Directors,
RICHARD M. HAYS
Secretary
Dated: August 31, 1998
YOU ARE REQUESTED TO COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY IN THE
ENCLOSED PREPAID ENVELOPE. THE GIVING OF THE ENCLOSED PROXY WILL NOT AFFECT YOUR
RIGHT TO REVOKE SUCH PROXY OR TO VOTE IN PERSON SHOULD YOU LATER DECIDE TO
ATTEND THE MEETING.
<PAGE> 4
PROSPECTUS
RTI INTERNATIONAL METALS, INC.
------------------------
RMI TITANIUM COMPANY
PROXY STATEMENT
SOLICITATION OF PROXIES FOR SPECIAL MEETING
OF SHAREHOLDERS TO BE HELD ON SEPTEMBER 30, 1998
This Proxy Statement/Prospectus is being furnished to the shareholders of
RMI Titanium Company, an Ohio corporation (the "Company" or "RMI"), in
connection with the solicitation of proxies by the Board of Directors of the
Company to be used in voting at the Special Meeting of Shareholders to be held
on September 30, 1998, and at any adjournment or postponement thereof (the
"Special Meeting"), at the time and place and for the purposes listed in the
preceding Notice of Special Meeting of Shareholders. This Proxy
Statement/Prospectus is first being mailed to holders of the Company's Common
Shares on or about August 31, 1998.
At the Special Meeting, the shareholders will be asked to approve the
principal terms of an Agreement of Merger (the "Merger Agreement") among the
Company, RTI International Metals, Inc., an Ohio corporation ("RTI"), and RMI
Acquisition Company, an Ohio corporation ("MergeCo"), pursuant to which a
holding company will be formed. At the time of the Merger, MergeCo will be a
wholly-owned subsidiary of RTI. Pursuant to the Merger Agreement, MergeCo will
merge with and into the Company (the "Merger"), and each outstanding common
share, $0.01 par value per share, or fraction thereof, of the Company ("RMI
Common Shares") will automatically be converted into one common share, $0.01 par
value per share, or fraction thereof, of RTI ("RTI Common Shares"). As a result,
the Company will become a subsidiary of RTI and the holders of RMI Common Shares
will become holders of the RTI Common Shares. RMI Common Shares issuable under
the Company's 1989 Stock Option Incentive Plan, the 1995 Stock Plan, the
Employee Savings and Investment Plan and the Bargaining Unit Employee Savings
and Investment Plan, will be issued as RTI Common Shares after the Merger. See
"Proposal to Form a Holding Company -- Plan of Implementation."
The sole purpose of the Merger is to create a holding company structure.
The Board of Directors believes the holding company structure will provide
greater flexibility in the management of existing and future business
operations. See "Proposal to Form a Holding Company -- Reasons for the Formation
of a Holding Company."
This Proxy Statement/Prospectus also constitutes the Prospectus of RTI
under the Securities Act of 1933, as amended (the "1933 Act"), for the issuance
of up to 21,007,468 RTI Common Shares, $0.01 par value, to be issued in exchange
for the RMI Common Shares in the Merger. This Proxy Statement/Prospectus does
not cover any resales of RTI Common Shares to be received by the shareholders of
the Company in the Merger, and no person is authorized to make any use of this
Proxy Statement/Prospectus in connection with any such resale. For further
information concerning the stock offered hereby, see "Proposal to Form a Holding
Company -- Principal Terms of the Merger" and " -- Articles of Incorporation,
Code of Regulations and Rights of Shareholders."
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS/PROXY STATEMENT. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE> 5
THIS PROXY STATEMENT/PROSPECTUS AND THE ACCOMPANYING FORM OF PROXY ARE
FIRST BEING MAILED TO SHAREHOLDERS OF THE COMPANY ON OR ABOUT AUGUST 31, 1998. A
SHAREHOLDER WHO HAS GIVEN A PROXY MAY REVOKE IT AT ANY TIME BEFORE IT IS
EXERCISED.
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION WITH RESPECT TO THE MATTERS DESCRIBED IN THIS PROXY STATEMENT/
PROSPECTUS OTHER THAN THOSE CONTAINED HEREIN OR IN THE DOCUMENTS INCORPORATED BY
REFERENCE HEREIN. ANY INFORMATION OR REPRESENTATIONS WITH RESPECT TO SUCH
MATTERS NOT CONTAINED HEREIN OR THEREIN MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY RTI OR THE COMPANY. THIS PROXY STATEMENT/PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES
OR THE SOLICITATION OF A PROXY OR AN OFFER TO SELL OR A SOLICITATION OF AN OFFER
TO BUY SUCH SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION. NEITHER THE DELIVERY OF
THIS PROXY STATEMENT/PROSPECTUS NOR ANY DISTRIBUTION OF SECURITIES HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF RTI OR THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION IN THIS PROXY STATEMENT/PROSPECTUS OR IN THE DOCUMENTS INCORPORATED
BY REFERENCE HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATES HEREOF OR
THEREOF.
ii
<PAGE> 6
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "SEC"). Such reports, proxy statements
and other information filed by the Company may be inspected and copied at the
public reference facilities maintained at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549 and at the following Regional Offices of the SEC: Chicago
Regional Office, Suite 1400, 500 West Madison Street, Chicago, Illinois 60661;
and New York Regional Office, Seven World Trade Center, 13th Floor, New York,
New York 10048. Copies of such material may be obtained from the Public
Reference Section of the SEC at 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549 upon payment of prescribed fees. The Company is also required to file
electronic versions of these documents with the SEC through the SEC's Electronic
Data Gathering Analysis and Retrieval (EDGAR) system. The SEC maintains a world
wide web site at http://www.sec.gov that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the SEC. In addition, reports, proxy and information statements and other
information concerning the Company can be inspected at the offices of the New
York Stock Exchange, 20 Broad Street, New York, New York 10005, on which the
Company's Common Shares are listed.
RTI was formed to effectuate the transactions described under "Proposal to
Form a Holding Company." RTI previously has not been subject to the requirements
of the Exchange Act and there is currently no public market for its stock.
However, if the transactions described herein are approved and consummated, RTI
will become subject to the same information, reporting and proxy statement
requirements under the Exchange Act as currently apply to the Company, and such
information will be available for inspection and copying at the offices of the
SEC set forth above. Following the date on which RTI Common Shares will be
listed on the New York Stock Exchange, Exchange Act reports, proxy statements,
and other information concerning RTI will be available for inspection and
copying at such exchange. Following completion of the Merger, the Company will
take steps to no longer be a reporting company under the Exchange Act.
RTI has filed with the SEC a Registration Statement on Form S-4, together
with all amendments and exhibits thereto (the "Registration Statement") under
the Securities Act of 1933 (the "Securities Act"), with respect to the
securities offered hereby. This Prospectus/Proxy Statement does not contain all
of the information set forth in the Registration Statement, certain parts of
which are omitted in accordance with the Rules and Regulations of the SEC. The
Registration Statement, including exhibits and schedules filed therewith, may be
obtained from the SEC's principal office at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, upon payment of fees prescribed by the SEC. Statements
made in the Prospectus/Proxy Statement as to the contents of any contract,
agreement or other document referred to are not necessarily complete; with
respect to each such contract, agreement or other document filed as an exhibit
to the Registration Statement, reference is made to the exhibit for a more
complete description of the matter involved, and each such statement shall be
deemed qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
1. Annual Report on Form 10-K of RMI for the Year ended December 31, 1997.
2. Quarterly Report on Form 10-Q of RMI for the Quarter ended March 31,
1998.
3. Quarterly Report on Form 10-Q of RMI for the Quarter ended June 30,
1998.
4. The description of RMI Common Shares included in the Registration
Statement on Form 8-A filed September 1, 1989.
Each document filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Prospectus/Proxy
Statement and prior to the termination of the offering of the RMI's Common
Shares pursuant hereto shall be deemed to be incorporated by reference in this
Prospectus/Proxy Statement and to be a part of this Prospectus/Proxy Statement
from the date of filing of such document. Any statement contained in this
Prospectus/Proxy Statement or in a document incorporated or deemed to be
incorporated by reference in this Prospectus/Proxy Statement shall be deemed to
be modified or superseded for purposes of the Registration Statement and this
Prospectus/Proxy Statement to the extent that a statement
iii
<PAGE> 7
contained in this Prospectus/Proxy Statement, or in any subsequently filed
document that also is or is deemed to be incorporated by reference in this
Prospectus/Proxy Statement, modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of the Registration Statement or this
Prospectus/Proxy Statement.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED
HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS ARE AVAILABLE WITHOUT CHARGE UPON
WRITTEN OR ORAL REQUEST BY A PERSON TO WHOM THIS PROSPECTUS HAS BEEN DELIVERED
FROM CRYSTAL REVAK, DIRECTOR OF INVESTOR RELATIONS, RMI TITANIUM COMPANY, 1000
WARREN AVENUE, NILES, OHIO 44446; TELEPHONE NUMBER (330) 544-7622. IN ORDER TO
ENSURE TIMELY DELIVERY OF THE DOCUMENTS, ANY REQUEST SHOULD BE MADE BY SEPTEMBER
10, 1998.
iv
<PAGE> 8
SUMMARY
The following is a summary of certain information contained elsewhere in
this Prospectus/Proxy Statement. The information contained in this summary is
qualified in its entirety by, and should be read in conjunction with, the more
detailed information appearing elsewhere in this Prospectus/Proxy Statement and
the documents incorporated herein by reference.
PROPOSAL TO FORM A HOLDING COMPANY
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS
VOTE FOR APPROVAL OF THE MERGER AGREEMENT.
GENERAL
The Board of Directors believes that it is in the best interest of the
Company and its shareholders to reorganize the corporate structure of the
Company by creating a new holding company. The result of the restructuring will
be to have the Company become a separate wholly-owned subsidiary of the new
parent company, RTI, with present holders of the RMI Common Shares becoming
holders of RTI Common Shares.
Following the Merger, the Company will continue to conduct its operations
substantially as it currently conducts such operations; however the Company may
cause some of its existing subsidiaries or divisions to be reorganized as
subsidiaries of the holding company. Although the immediate control of the
Company will change from the Company's present shareholders to RTI, the ultimate
control will remain unchanged, as the Company's present shareholders will, upon
completion of the Merger, become shareholders of RTI, owning the same relative
interests and having the same relative voting rights in RTI as they now own and
have in the Company. RTI Common Shares will be listed on the New York Stock
Exchange, just as the Company's Common Shares are currently listed, and RTI
Common Shares will be registered with the Securities and Exchange Commission
("SEC") pursuant to the Exchange Act. The directors of RTI will be the same as
the current directors of the Company.
PLAN OF IMPLEMENTATION
To implement the restructuring, the Company has caused RTI, a new Ohio
corporation, to be formed. MergeCo, an Ohio corporation, is a wholly-owned
subsidiary of RTI. RTI and MergeCo currently have no businesses or properties of
their own. MergeCo is a transitory corporation, formed solely to effectuate the
Merger, and will cease to exist upon completion of the Merger. See "Proposal to
Form a Holding Company -- Plan of Implementation" for a diagram comparing the
current structure of the Company with the proposed holding company structure to
be effected pursuant to the Merger.
The Company, RTI and MergeCo have approved the Merger Agreement which
provides that, subject to the satisfaction of certain conditions (including,
without limitation, approval of the principal terms of the Merger Agreement by
the shareholders of the Company), the Company will become a wholly-owned
subsidiary of RTI as a result of the merger of MergeCo with and into the
Company. In the Merger, each of the RMI Common Shares, or fraction thereof, will
be automatically converted into one RTI Common Share, or fraction thereof. RMI
Common Shares issuable under the Company's 1989 Stock Option Incentive Plan, the
1995 Stock Plan, the Employee Savings and the Investment Plan and Bargaining
Unit Employee Savings and Investment Plan will be issued as RTI Common Shares
after the Merger. None of the Company's debt will be assumed by RTI in the
Merger. A copy of the proposed form of Merger Agreement is attached hereto as
Appendix A.
BUSINESS OF THE COMPANY AND RTI
RTI was formed to effectuate the transactions described herein and does not
currently conduct any businesses or have any properties or assets of its own,
other than the stock of MergeCo.
The principal executive offices of the Company and RTI are located at 1000
Warren Avenue, Niles, Ohio 44446. The main telephone number for each of the
Company and RTI is (330) 544-7700.
1
<PAGE> 9
REASONS FOR THE FORMATION OF A HOLDING COMPANY
The holding company reorganization is intended to provide greater
flexibility in the management of existing and future business operations and to
facilitate entry into new businesses and the formation of joint ventures and
other strategic alliances. The creation of the holding company is expected to
permit: (i) the core titanium production and fabrication business to be
maintained separately from businesses that the holding company may acquire or
initiate; (ii) business units with distinct corporate cultures to be managed
without dilution of their unique characteristics; (iii) the holding company to
be better positioned to take advantage of certain potential state and local tax
savings opportunities; (iv) the holding company to maintain separation between
business units; and (v) the creation of an additional layer of protection to
guard the operating assets and income of each business unit from liabilities of
the others.
REQUIRED VOTE
Under the Merger Agreement, and as required by the Amended Articles of
Incorporation of RMI, it is a condition to completion of the Merger that the
principal terms of the Merger Agreement be approved by the holders of shares
representing at least two-thirds of the outstanding RMI Common Shares. As of the
Record Date there were 20,525,302 RMI Common shares outstanding. As a result,
the affirmative vote of 13,683,535 RMI Common Shares will be required to approve
the Merger. Abstentions and "broker non-votes" will have the same effect as
votes "against" the merger. See "General Information -- Solicitation of Proxy
and Revocability; Voting Securities -- Record Date and Voting Rights."
Each of the Company's directors and executive officers owns less than one
percent (1%) of the voting power of the Company. There will be no change in the
voting power of the Company's directors and executive officers as a result of
the Merger.
DISSENTERS' RIGHTS
A record holder of shares not voted in favor of the Merger may seek the
rights of a dissenting shareholder by complying with Ohio law. Dissenters'
rights entitle such holders to receive the "fair cash value" of their shares in
the form of a cash payment under the circumstances provided by Ohio law. In
order to initiate the process, a written demand must be served upon the Company
by the record owner of such shares on or before the tenth day after the
shareholder vote. Beneficial owners of shares must contact the record owner of
the shares, such as a bank or broker, to exercise this right. See "Proposal to
Form a Holding Company -- Dissenters' Rights."
NO CHANGE IN DIVIDEND POLICY
RMI has not paid dividends since the second quarter of 1991. When the
Merger takes effect, it is expected that there will be no change in the dividend
policy. The declaration and payment of future dividends and the amount thereof
will be dependant upon RTI's results of operations, financial condition, cash
requirements, future prospects and other factors deemed relevant by the Board of
Directors.
ARTICLES OF INCORPORATION, CODE OF REGULATIONS AND RIGHTS OF STOCKHOLDERS
The Articles of Incorporation and Code of Regulations of RTI are
substantially identical to the Articles of Incorporation and Code of Regulations
of the Company. Shareholders of RTI will have substantially identical rights as
they had as shareholders of RMI. See "Proposal to Form a Holding
Company -- Articles of Incorporation, Code of Regulations and Rights of
Stockholders."
TERMINATION AND AMENDMENT OF MERGER AGREEMENT
The Merger Agreement may be terminated at any time prior to consummation of
the Merger (whether before or after approval of the principal terms of the
Merger Agreement by the shareholders of the Company) by action of the Board of
Directors of the Company. Subject to applicable law, the Merger Agreement may be
amended, modified or supplemented at any time prior to the effective time of the
Merger by mutual consent of the Boards of Directors of the Company, RTI and
MergeCo.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The Merger is intended to be a tax-free reorganization for federal income
tax purposes. The Company will receive an opinion from Doepken Keevican & Weiss
Professional Corporation to the effect that the Merger will constitute a
tax-free reorganization for federal income tax purposes. Consequently, Company
shareholders who will receive only RTI Common Stock pursuant to the Merger will
not recognize gain or loss for federal income tax purposes. The Company's
shareholders are urged to consult their own tax advisors regarding the federal
(and any applicable foreign, state and local) income tax consequences of the
Merger. See "Proposal to Form a Holding Company -- Certain Federal Income Tax
Consequences."
2
<PAGE> 10
MARKET PRICE DATA
The RMI Common Shares are traded on the New York Stock Exchange under the
symbol "RTI". There currently is no public trading market for the shares of RTI.
However, RTI will be listed on the New York Stock Exchange effective upon
consummation of the Merger and public trading in the stock will thereupon
commence. The table below sets forth, for the fiscal quarters indicated, the
high and low closing prices of the RMI Common Shares as reported by the New York
Stock Exchange.
<TABLE>
<CAPTION>
HIGH LOW
---- ---
<S> <C> <C>
1996
First Quarter............................................... $16 1/2 $ 7 7/8
Second Quarter.............................................. $24 3/4 $14
Third Quarter............................................... $28 1/2 $18 3/4
Fourth Quarter.............................................. $28 1/8 $21
1997
First Quarter............................................... $28 $17 1/2
Second Quarter.............................................. $28 $20
Third Quarter............................................... $29 9/16 $20 9/16
Fourth Quarter.............................................. $26 3/16 $16 1/2
1998
First Quarter............................................... $24 11/16 $20
Second Quarter.............................................. $23 1/8 $20 1/16
Third Quarter (through August 19, 1998)..................... $23 7/8 $20
</TABLE>
On August 19, 1998, the last full trading day prior to the public
announcement of the proposed formation of a holding company, the last reported
sale price of RMI's Common Shares on the New York Stock Exchange was $21 5/8 per
share.
On August 25, 1998, the most recent practicable date prior to the mailing
of this Proxy Statement/ Prospectus, the last reported sale price of RMI's
Common Shares on the New York Stock Exchange was $20 3/8 per share.
3
<PAGE> 11
SELECTED FINANCIAL INFORMATION
The following table sets forth selected financial information with respect
to the Company. Such information is derived from, and qualified in its entirety
by reference to, the financial statements contained in certain documents
incorporated by reference herein. No information is included for RTI, since RTI
was formed to effectuate the transactions described herein and does not have any
operating history.
The summary selected financial information as of and for the six month
periods ended June 30, 1998 and 1997 has been derived from the unaudited
Consolidated Financial Statements of RMI, which, in the opinion of the Company,
reflect all adjustments (consisting of only normal recurring adjustments)
necessary for a fair presentation of results of operations and financial
position. The information set forth below should be read in connection with the
Consolidated Financial Statements and "Management's Discussion and Analysis of
Financial Condition and Results of Operations" each incorporated herein by
reference.
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30 YEARS ENDED DECEMBER 31
------- -----------------------
1998 1997 1997 1996 1995 1994 1993
-------- -------- -------- -------- -------- -------- --------
(UNAUDITED)
(DOLLARS IN THOUSANDS EXCEPT FOR PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Sales................. $185,581 $148,742 $318,530 $251,357 $171,166 $143,392 $127,397
Operating income
(loss).............. 40,059 25,564 56,315 33,730 (5,220)(1) (7,971) (10,764)
Income (loss) before
cumulative effect of
a change in
accounting
principle........... 45,463 23,008 60,085 31,759 (4,608)(3) (11,562) (11,955)
Net income (loss)..... 45,463(9) 23,008 60,085(2) 31,759 (4,608)(3) (12,764)(4) (28,893)(5)
BALANCE SHEET DATA:
(at end of period)
Working Capital....... $205,220 $158,079 $184,824 $132,136 $ 86,738 $ 74,694 $ 66,319
Total assets.......... 337,533 238,054 291,309 215,880 171,559 160,810 152,647
Long-term debt........ -- -- -- 3,600 64,020 54,740 66,660
Equity................ 266,907 182,662 221,173 158,736(6) 36,889 42,596(7) 27,861
NET INCOME (LOSS) PER
COMMON SHARE: (8)
Before change in
accounting
principle........... $ 2.22 $ 1.13 $ 2.94 $ 1.71 $ (0.30) $ (1.45) $ (8.14)
Net income (loss):
Basic............... $ 2.22 $ 1.13 $ 2.94 $ 1.71 $ (0.30) $ (1.60) $ (19.67)
Diluted............. 2.20 1.12 2.92 1.70 (0.30) (1.60) (19.67)
</TABLE>
- ---------
(1) Includes a $5.0 million charge reflecting the June 30, 1995 adoption of
Statement of Financial Accounting Standards ("SFAS") No. 121.
(2) Includes a $8.7 million income tax benefit. See Note 8 to the Consolidated
Financial Statements.
(3) Includes a $5.0 million charge reflecting the adoption of SFAS No. 121 and a
$7.2 million income tax benefit.
(4) Includes a $1.2 million charge reflecting the adoption of SFAS No. 112.
(5) Includes a $16.9 million charge reflecting the adoption of SFAS No. 106.
(6) Includes a $80.3 million increase resulting from the net proceeds of a
common stock offering.
(7) Includes a $26.4 million increase resulting from the net proceeds of a
rights offering.
(8) 1993 Common Share data has been adjusted to reflect a March 31, 1994
one-for-ten reverse stock split.
(9) Includes a $16.1 million income tax benefit. See Note 3 to the Consolidated
Financial Statements for the period ended June 30, 1998.
4
<PAGE> 12
FORWARD-LOOKING STATEMENTS
Certain statements incorporated by reference or made in this Proxy
Statement/Prospectus are "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements include, without limitation, statements regarding estimates of
industry shipments, the future availability and prices of raw materials, the
availability of capital on acceptable terms, the competitiveness of the titanium
industry, the impact of year 2000, potential environmental liabilities, the
Company's order backlog and the conversion of that backlog into revenue, the
Company's strategies and other statements contained herein that are not
historical facts. Because such forward-looking statements involve risks and
uncertainties, there are important factors that could cause actual results to
differ materially from those expressed or implied by such forward-looking
statements. Factors that could cause actual results to differ materially
include, but are not limited to, changes in global economic and business
conditions (including in the aerospace markets), the Company's ability to
recover its raw material costs in the pricing of its products, the availability
of capital on acceptable terms, actions of competitors, the extent to which the
Company is able to develop new markets for its products, the time required for
such development and the level of demand for such products, changes in the
Company's business strategies, and other factors discussed under "Risk Factors."
RISK FACTORS
The following factors should be considered in connection with an investment
in shares of RTI's Common Stock. Any one or more of such factors may cause RTI's
actual results for various financial reporting periods to differ materially from
those expressed in any forward-looking statements made by or on behalf of the
Company or RTI.
DEPENDENCE ON CYCLICAL AEROSPACE MARKETS
The U.S. titanium industry, including the Company, is largely dependent on
the aerospace industry, which has traditionally consumed the majority of
titanium mill products produced in the U.S. Sales to the aerospace industry
accounted for approximately 73% of Company's sales in the first six months of
1998, and 76% of the Company's annual sales in 1997, 73% in 1996 and 75% in
1995.
The cyclical nature of the aerospace industry has been the principal cause
of the fluctuations in performance of companies in the titanium industry. Prior
to the years 1989 and 1990, the last peak in the titanium industry cycle
occurred during the years 1979 through 1982. While U.S. industry mill products
shipment volumes, as reported by the U.S. Geological Survey, averaged
approximately 52.52 million pounds for the years 1988 through 1990, such
shipments dropped to an average of approximately 35.20 million pounds for the
years 1991 through 1994. The declining U.S. military budget and production
cutbacks at Boeing and Airbus Industries resulting from reduced commercial
airline demand for new aircraft negatively affected demand and prices for
titanium products until 1995, when demand for titanium products used in the
production of commercial aircraft increased. In 1995, most major U.S. commercial
airline carriers reported stronger operating profits and, beginning in the
second half of 1995 and continuing into 1998, aircraft manufacturers began to
increase aircraft build rates. Based upon data published by the U.S. Geological
Survey, the Company estimates that total mill product shipments from the
domestic titanium industry totaled approximately 62 million pounds in 1997, the
largest single shipping year in the history of the industry. No assurance can be
given as to the extent or duration of the recovery in the commercial aerospace
market or the extent to which such recovery will result in increases in demand
for titanium products.
Management believes that if the titanium industry experiences an extended
downturn, the Company may require additional capital to maintain its operations
and competitive position. No assurance can be given that the Company will have
access to such capital when required.
POTENTIAL LIMITATIONS ON ACCESS TO CAPITAL
The Company's Credit Agreement dated June 8, 1998 (the "Credit Facility")
contains covenants requiring, among other things, that the Company maintain a
minimum ratio of consolidated earnings before interest and taxes to consolidated
interest expense and a minimum consolidated net worth. If the Company is unable
to
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<PAGE> 13
comply with these covenants, any borrowings under the Credit Facility could
become due and the Company's ability to obtain capital could be impaired.
DEPENDENCE ON OTHERS FOR RAW MATERIALS AND CERTAIN CONVERSION SERVICES
The Company is dependent on third parties for titanium sponge, its basic
raw material. The Company is party to long-term contracts, one of which is with
a competing producer of mill products. The Company also purchases sponge on a
spot basis from a number of other third party suppliers. Should the Company's
ability to purchase sufficient quantities of sponge be disrupted for any reason,
it could have a material adverse effect upon the Company.
If demand for titanium products continues to increase, it is possible that
supplies of titanium sponge could become limited or that prices could increase
substantially, or both, and, as a result, that the Company's costs could rise
accordingly. To the extent that the Company is unable to recover its increased
costs, operating results may be adversely affected.
The Company is dependent upon the services of outside converters to perform
important conversion services with respect to certain of its products. An
interruption in these functions could have an adverse effect on the Company's
business in the short term.
ENVIRONMENTAL CONTINGENCIES
The Company is subject to pervasive environmental laws and regulations as
well as various health and safety laws and regulations that are subject to
frequent modifications and revisions. While the costs of compliance for these
matters have not had a material adverse impact on the Company in the past, it is
impossible to predict accurately the ultimate effect these changing laws and
regulations, and the enforcement thereof, may have on it in the future. The
Company is involved in investigative or cleanup projects under federal or state
environmental laws at a number of waste disposal sites, including a Superfund
site. The Company can give no assurance that additional environmental
investigation or remediation obligations at other locations will not be asserted
against it or entities for which it may be responsible, whether by contract
(including indemnity agreements relating to environmental matters) or by
operation of law.
The Company is one of 31 companies identified by the U.S. Environmental
Protection Agency (the "EPA") as a potentially responsible party ("PRP") under
the Comprehensive Environmental Response, Compensation and Liability Act
("CERCLA") with respect to a Superfund site in Ashtabula, Ohio. In 1986, the EPA
estimated the cost of remediation to be $48 million. Recent studies, based upon
improved remediation technology and redefined cleanup standards, have estimated
the cost of remediation of this site to be approximately $25 million. The actual
cost of remediation may vary from the estimates based upon a number of factors.
Under CERCLA, a PRP's liability can be joint and several and, therefore, the
Company could be liable for the entire amount. Under allocation agreements with
other PRP's, RMI's share has been established at approximately 10%. Actual
percentages may be more or less.
At June 30, 1998, the Company had accrued $3.5 million for future
environmental-related costs. Based on available information, the Company
believes that its share of potential environmental-related costs will be in the
range of $4.2 to $7.0 million in the aggregate, before expected contributions
from third parties (which does not include any amounts from insurers) of $2.1
million which the Company believes are probable. As these proceedings continue
toward final resolution, amounts in excess of those already provided may be
necessary to discharge the Company from its obligations for these projects. The
ultimate resolution of environmental matters could, individually or in the
aggregate, be material to RMI's consolidated financial statements.
NO ASSURANCES AS TO NEW PRODUCT AND MARKET DEVELOPMENT
In an effort to lessen its dependence on the aerospace market and to
increase its participation in other markets, the Company has been devoting
significant resources to developing new markets and applications for its
products, principally in the oil and gas and geothermal energy production
industries. The Company cannot give any assurances as to the extent to which it
will be able to develop new markets for its products, the time required for such
development or the level of demand for such products. The consequence of failure
to develop these new markets would be that the Company's dependence on the
cyclical aerospace industry would not be reduced.
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<PAGE> 14
TITANIUM INDUSTRY HIGHLY COMPETITIVE
The titanium metals industry is highly competitive on a worldwide basis.
Competition is primarily on the basis of price, quality and timely delivery.
Titanium also competes with other metals such as stainless steel and nickel
based corrosion resistant alloys. A metal manufacturing company with rolling and
finishing facilities could participate in the mill product segment of the
titanium industry. However, entry into the titanium industry at a greenfield
site would require a significant investment of capital and extensive technical
expertise.
Producers of titanium mill products are located primarily in the U.S.,
Japan, Russia, Europe and China. Currently, all domestic producers manufacture
mill products, at least in part, from purchased sponge, scrap or ingot. Two of
the Company's competitors produce a portion of their own sponge.
Imports of titanium mill products from countries that receive the
most-favored-nation ("MFN") tariff rate are subject to 15% tariff. The tariff
rate applicable to imports from countries that do not receive MFN treatment is
45%. Japanese producers, which benefit from MFN treatment, participate
significantly in the European market, but historically have not been a major
factor in the U.S. mill products market. The United States currently grants MFN
treatment to imports, including titanium mill product imports, from the former
Soviet Union countries, including Russia. Effective October 18, 1993, the U.S.
Government extended the benefits of the Generalized System of Preferences
("GSP") to Russia. Under GSP, the U.S. grants duty-free access to semifinished
and agricultural products from developing countries and territories. Certain
wrought titanium products are covered by GSP up to certain competitive needs
based limits, which effectively restrict the volume of imports for these
products. However, unwrought products such as titanium sponge, ingot and billet
have not yet been afforded GSP treatment. In 1995, a Russian producer began to
participate in the U.S. market for titanium mill products. This titanium
producer has the largest rated capacity in the world (although management
believes practical capacity is substantially less).
In the second half of 1997, this Russian producer filed two separate
petitions under the trade laws. The first sought GSP treatment for unwrought
products from Russia (sponge, powders, ingot and billet). The second petition
sought removal of the competitive needs limits for wrought products (plate,
sheet, pipe, etc.). The competitive needs limit was actually exceeded by this
producer in 1997. In August 1998, the GSP treatment was granted for wrought
products; however the treatment for unwrought products is still pending.
The Company believes that any significant increase in the imports of
wrought products from Russia without a similar favorable GSP treatment granted
for unwrought products could materially affect competition in the domestic
titanium industry.
PRINCIPAL SHAREHOLDER
As of the Record Date, USX Corporation ("USX") was the owner of 5,483,600
shares of RMI Common Stock, constituting approximately 27% of the outstanding
shares of RMI Common Stock. USX may be able to exercise effective control over
RTI through its representation on the Board of Directors of RTI and by reason of
its substantial voting power with respect to the election of directors and
actions requiring shareholder approval. In December 1996, USX issued in a public
offering 6 3/4% Exchangeable Notes due February 2000 ("Debt Exchangeable for
Common Stock" or "DECS") the principal amount of which is mandatorily
exchangeable at maturity for up to 5,483,600 shares of RMI Common Stock owned by
USX, or at USX's option, an equivalent amount of cash. The Company is unable to
predict the effect on the relationship between RMI and USX of any transfer by
USX (upon maturity of the DECS or otherwise) of shares of Common Stock held by
USX.
POTENTIAL CONFLICTS OF INTEREST
Two executives of USX (one of whom is a director of USX) and one
non-employee director of USX are current directors of the Company and will serve
on RTI's ten-member Board of Directors. One of these USX executives will also
serve as RTI's Chairman. These individuals will owe fiduciary duties to RTI and
USX and it is possible that the interests of one entity may differ from the
interests of the other. Members of the RTI's prospective Board of Directors have
been advised generally to abstain from voting on matters where they may have a
conflict of interest. If a director were to vote in spite of a potential
conflict of interest, there is a possibility that such director may not vote
consistent with RTI's best interest.
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<PAGE> 15
ANTI-TAKEOVER EFFECT OF CERTAIN PROVISIONS
Certain provisions of the RTI's Articles of Incorporation and its Credit
Facility and Ohio law could discourage potential acquisition proposals and could
delay or prevent a change in control of the Company. The Company is, and RTI
will be, authorized to issue up to five million shares of Preferred Stock, the
relative rights and preferences of which may be fixed by RTI's Board of
Directors (subject to the provisions of the Articles of Incorporation), without
shareholder approval. Although the Company has no present plans to issue any
shares of Preferred Stock, the future issuance thereof may have the effect of
delaying, deferring or preventing a change in control of RTI or the payment of
dividends on Common Stock. The issuance of Preferred Stock could also adversely
affect the voting power of the holders of Common Stock, including the loss of
voting control to others. Both the Company's and RTI's Articles of Incorporation
provide that certain extraordinary transactions, such as certain mergers and
consolidations, a sale or disposition of all or substantially all of the assets,
a dissolution and any amendment to the Articles of Incorporation, require a
two-thirds vote of the shareholders. Other provisions of the Code of Regulations
provide that directors may be removed only for cause and special meetings may be
called only by a shareholder or shareholders holding 50% of the shares of stock
entitled to vote. The acquisition by any person or group (other than USX) of
beneficial ownership of 25% or more of the voting capital stock of RTI and,
within any twelve month period, individuals who were directors of RTI ceasing to
constitute a majority of the Board of Directors of RTI will constitute events of
default under the Credit Facility entitling the banks to accelerate the maturity
of the Company's borrowings thereunder.
IMPACT OF YEAR 2000
Some older computer programs were written using two digits rather than four
to define the applicable year. As a result, those computer programs have
time-sensitive software that recognizes a date using "00" as the year 1900
rather than 2000. This failure to use four digits to define the applicable year
has created what is commonly referred to as the "Year 2000 Issue" and could
cause a system failure or miscalculations causing disruption of operations,
including a temporary inability to process transactions or engage in similar
normal business activities. The Company has and will continue to make certain
investments in its application software in an effort to ensure the Company is
Year 2000 compliant. In addition, the Company is monitoring the compliance
efforts of entities with which it interacts. While it is not possible, at
present, to accurately estimate the incremental cost of this effort, the Company
does not anticipate it will have a material impact on the long-term results of
operations, liquidity or consolidated financial position of the Company or RTI.
The Company's ability to achieve Year 2000 compliance and the level of
incremental costs associated therewith could be adversely impacted by, among
other things, the availability and cost of programming and testing resources,
vendors' ability to modify proprietary software and unanticipated problems
identified in the ongoing compliance review. In addition, the Company has
limited or no control over the actions of proprietary software vendors,
customers, suppliers and other entities with which it interacts. Therefore, Year
2000 compliance problems experienced by these entities could adversely affect
the results of the Company. At June 30, 1998, the Company estimates that
approximately 90% of its internally developed proprietary software has been
modified to make it Year 2000 compliant.
LABOR RELATIONS
United Steelworkers of America ("USWA") represents the production and
maintenance as well as the clerical and technical employees at the Company's
main production facility at Niles, Ohio. The current three year labor agreement
with the USWA expires on September 30, 1998. Negotiations for a new contract
have begun, and the Company is hopeful of reaching a mutually satisfactory
agreement prior to expiration of the current contract. Failure to do so could
have a material adverse impact upon the Company.
GENERAL INFORMATION
INTRODUCTION
This Proxy Statement/Prospectus is furnished in connection with the
solicitation by the Board of Directors of RMI of proxies to be voted at the
Special Meeting of Shareholders of the Company (the "Special Meeting") and any
adjournments thereof. This Proxy Statement/Prospectus also serves as the
Prospectus of RTI with respect to the offering of shares of RTI to shareholders
of the Company.
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<PAGE> 16
At the Special Meeting, shareholders will be asked to consider and vote
upon the Merger described in the Merger Agreement. A copy of the proposed form
of Merger Agreement is attached to this Proxy Statement/ Prospectus as Exhibit A
and is incorporated herein by reference. Under the terms of the Merger
Agreement, MergeCo, will be merged with and into the Company. The Company will
be the surviving corporation in the Merger and will become a wholly-owned
subsidiary of RTI. Upon consummation of the Merger, each RMI Common Share, or
fraction thereof, will be converted into one RTI Common Share, or fraction
thereof. The rights, preferences, privileges and restrictions of the RTI Common
Shares will be substantially identical to those of the RMI Common Shares being
converted.
SOLICITATION OF PROXY AND REVOCABILITY; VOTING SECURITIES DATE, TIME AND PLACE
OF SPECIAL MEETING
The Special Meeting will be held on September 30, 1998 at 11:00 a.m.
Eastern Daylight Savings Time at Mr. Anthony's, 7440 South Avenue, Boardman,
Ohio.
RECORD DATE AND VOTING RIGHTS
Only holders of record of RMI Common Shares stock at the close of business
on August 28, 1998 (the "Record Date") are entitled to notice of and to vote at
the Special Meeting. At the Record Date, there were 20,525,302 shares of RMI
Common Shares issued and outstanding.
Votes cast by proxy or in person at the Special Meeting will be counted by
an inspector of election appointed by the Board of Directors to act as an
election inspector for the Special Meeting. Shares represented by proxies that
reflect abstentions will be treated as present and entitled to vote for purposes
of determining the presence of a quorum. Abstentions, however, will not
constitute a vote "for" or "against" any matter. As a result, abstentions will
have the same effect as votes "against" the formation of any holding company.
Shares referred to as "broker non-votes" (i.e., shares held by brokers or
nominees as to which instructions have not been received from the beneficial
owners or persons entitled to vote and as to which the broker has physically
indicated on the proxy that the broker or nominee does not have discretionary
power to vote on a particular matter) will be treated as shares that are present
and entitled to vote for purposes of determining the presence of a quorum.
However, for purposes of determining the outcome of the formation of the holding
company, if the broker has physically indicated on the proxy that it does not
have discretionary authority to vote, those shares will be treated as not
present and not entitled to vote with respect to that matter (even though those
shares are considered present for quorum purposes and, consequently, will have
the effect of a vote "against" the matter. Any unmarked proxies, including those
submitted by brokers or nominees, will be voted "for" the formation of the
holding company.
Assuming the presence of a quorum, the shareholders present at the meeting
may continue to do business until adjournment, notwithstanding the withdrawal of
shareholders holding sufficient voting power to leave less than a quorum, if any
action taken (other than adjournment) is approved by at least a majority of the
voting power required to constitute a quorum.
VOTING BY PROXY
Regardless of whether or not shareholders plan to attend the meeting in
person, all shareholders of the Company are urged to use the enclosed proxy card
to vote their shares. The execution of a proxy will not affect the right to
attend the Special Meeting and vote in person. A person who has given a proxy
may revoke it at any time before it is exercised at the Special Meeting by
filing with the Company a written notice of revocation or a proxy in either case
bearing a later date or by attendance at the Special Meeting and voting in
person (or presenting at the meeting such written notice of the revocation of
the proxy). Attendance at the Special Meeting will not, by itself, revoke a
proxy.
ADJOURNMENTS
The Special Meeting may be adjourned, even if a quorum is not present, by a
majority of the votes of shareholders represented at the Special Meeting in
person or by proxy. In the absence of a quorum at the Meeting, no other business
may be transacted at the Meeting.
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Notice of the adjournment of a meeting need not be given if the time and
place thereof are announced at the meeting at which the adjournment is taken,
provided that if the adjournment is for more than 45 days, or if after the
adjournment a new record date is fixed for the adjourned meeting, a notice of
the adjourned meeting will be given to each shareholder of record entitled to
vote at the meeting. At adjourned meetings, any business may be transacted which
might have been transacted at the original meeting.
SOLICITATION OF PROXIES
The accompanying proxy relating to the meeting is being solicited by the
Board of Directors of the Company for use at the Special Meeting. This statement
and the accompanying proxy are being sent to shareholders on or about August 31,
1998.
The Company will bear the entire cost of preparing, assembling, printing
and mailing these proxy statements, the proxies and any additional materials
which may be furnished by the Board to shareholders. The solicitation of proxies
will be made by the use of the U.S. Postal Service and may also be made by
telephone, telegraph, or personally, by directors, officers and regular
employees of the Company who will receive no extra compensation for such
services. Arrangements also will be made with brokerage firms and other
custodians, nominees and fiduciaries to forward proxy solicitation material to
the beneficial owners of RMI Common Shares held of record by such persons and
the Company will reimburse such brokerage firms, custodians, nominees and
fiduciaries for reasonable out-of-pocket expenses incurred by them in connection
therewith. In addition, the Company has retained Georgeson & Company, Inc., a
proxy distribution and solicitation firm, to assist in the distribution and
solicitation of proxies for shares held in the names of brokers, banks and other
nominees, for a fee not to exceed $10,000 plus reimbursement of reasonable
out-of-pocket expenses.
PROPOSAL TO FORM A HOLDING COMPANY
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS
VOTE FOR APPROVAL OF THE MERGER AGREEMENT.
GENERAL
The Board of Directors believes that it is in the best interest of the
Company and its shareholders to reorganize the corporate structure of the
Company by creating a new holding company. The result of the restructuring will
be to have the Company become a separate wholly-owned subsidiary of the new
parent company, RTI, with the present holders of the RMI Common Shares becoming
holders of RTI Common Shares.
Following the Merger, the Company will continue to conduct its operations
substantially as it currently conducts such operations; however the Company may
cause some of its existing subsidiaries or divisions to be reorganized as
subsidiaries of the holding company. Although the immediate control of the
Company will change from the Company's present shareholders to RTI, the ultimate
control will remain unchanged, as the Company's present shareholders will, upon
completion of the Merger, become shareholders of RTI, owning the same relative
interest and having the same relative voting rights in RTI as they now own and
have in the Company. RTI Common Shares will be listed on the New York Stock
Exchange, just as the RMI Common Shares are currently listed, and RTI Common
Shares will be registered with the SEC pursuant to the Exchange Act. The
directors of RTI will be the same as the current directors of the Company.
Initially, RTI is not expected to be an operating company and its assets
will consist principally of the capital stock of the Company. It will derive its
income principally from dividends from its subsidiaries and fees for services
rendered, if any, to its subsidiaries and from any interest on any loans to
subsidiaries. For the immediate future, all Company personnel will remain
principally Company employees and, to the extent such personnel perform services
for RTI or any other subsidiary, the Company will charge RTI or such subsidiary
for such services. Thereafter certain executive and administrative personnel may
become employees of the holding company with fees paid to the holding company by
the subsidiaries using such employees' services.
PLAN OF IMPLEMENTATION
To implement the restructuring, the Company has caused RTI, an Ohio
corporation, to be formed. MergeCo, an Ohio corporation, is a wholly-owned
subsidiary of RTI. RTI and MergeCo currently have no businesses or
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<PAGE> 18
properties of their own. MergeCo is a transitory corporation, formed solely to
effectuate the Merger, and will cease to exist upon completion of the Merger.
The Company, RTI and MergeCo have approved the Merger Agreement, which
provides that, subject to the satisfaction of certain conditions (including,
without limitation, shareholder approval of the Merger Agreement), the Company
will become a wholly-owned subsidiary of RTI as a result of the merger of
MergeCo with and into the Company. In the Merger, each of the RMI Common Shares,
or fraction thereof, will be automatically converted into one RTI Common Share,
or fraction thereof. RMI Common Shares issuable under the Company's 1989 Stock
Option Incentive Plan, the 1995 Stock Plan, the Employee Savings and Investment
Plan and the Bargaining Unit Employee Savings and Investment Plan will be issued
as RTI Common Shares after the Merger. None of the Company's debt will be
assumed by RTI in the Merger. A copy of the proposed form of Merger Agreement is
attached hereto as Appendix A.
As a result of the foregoing, after the Merger, (i) the current holders of
all of the outstanding stock of the Company will own all of the stock of RTI,
and (ii) RTI will own all of the outstanding stock of the Company, which
initially will constitute all or substantially all of RTI business and
properties. It is expected that RTI will acquire other operating subsidiaries in
the future.
A diagram illustrating the current structure and the proposed structure of
the new holding company organization is set forth below.
CURRENT STRUCTURE
_____________________
| |
| COMMON STOCKHOLDERS |
|_____________________|
|
__________|__________
| |
| RMI |
|_____________________|
PROPOSED STRUCTURE
_____________________
| |
| COMMON STOCKHOLDERS |
|_____________________|
|
__________|__________
| |
----------| RTI |---------
| |_____________________| |
| |
_________|___________ __________|__________
| | | |
| RMI | | FUTURE ACQUISITIONS |
|_____________________| |_____________________|
REASONS FOR THE FORMATION OF A HOLDING COMPANY
The holding company structure is intended to provide greater flexibility in
the management of existing and future business operations. The structure should
facilitate entry into new businesses and the formation of joint ventures and
other strategic alliances. Specifically, the reorganization into a holding
company format will permit the core titanium production and fabrication business
to be maintained separately from other businesses that the holding company may
acquire or initiate. This will permit each business unit to maintain a distinct
corporate culture to be managed without dilution of their unique
characteristics.
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The holding company structure is also intended to permit flexibility to
structure entities to take advantage of certain potential state and local tax
savings by separating business units that do business in certain localities from
business units in other jurisdictions. The holding company structure can also
create the opportunity to maintain separation between business units.
Additionally, the holding company structure can create an additional layer of
protection to guard the operating assets and income of each business unit from
the liabilities of the others.
As disclosed in the Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1998, which is incorporated herein by reference, the Company has
signed letters of intent to acquire Sierra Alloys Company, Inc. and New Century
Metals, Inc. If those transactions are consummated it is expected that they will
be acquired as subsidiaries of RTI, thus immediately taking advantage of the
holding company format.
PRINCIPAL TERMS OF THE MERGER
General. The following description of the principal terms of the Merger is
subject to and qualified in its entirety by reference to the terms of the Merger
Agreement, a copy of which is attached to this Proxy Statement/ Prospectus as
Exhibit A and is incorporated herein by reference. The consummation of the
Merger is subject to the condition, among others, that the principal terms of
the Merger Agreement are approved by the shareholders of the Company.
Effective Time of Merger. The Merger Agreement provides that the Merger
will become effective at such date and time as the requisite officers'
certificates and a copy of the Merger Agreement are filed with the Secretary of
State of the State of Ohio (the "Effective Time"). Such filing will not occur
until all the conditions to the Merger have been satisfied or waived. See
"Conditions to the Merger."
Conversion of Shares of Company Stock. Pursuant to the Merger Agreement
each RMI Common Share, or fraction thereof, issued and outstanding immediately
prior to the Merger will be automatically changed and converted into one RTI
Common Share, or fraction thereof.
Optional Exchange of Company Stock Certificates. After the Effective Time,
each holder of a certificate or certificates representing RMI Common Shares
immediately prior to the Merger may, but will not be required to, surrender the
same to the Transfer Agent, and thereupon each holder or transferee will be
entitled to receive a certificate or certificates representing the number of RTI
Common Shares equal to the number of RMI Common Shares surrendered.
Outstanding Certificates. Until surrendered or presented for transfer, each
outstanding stock certificate which, prior to the Effective Time, represented
RMI Common Shares will be deemed and treated for all corporate purposes to
represent the ownership of the same number of shares of RTI Common Shares as
though such surrender or transfer and exchange had taken place. Accordingly,
shareholders are not required to exchange such stock certificates.
Company Stock Transfer Books. The stock transfer books for RMI Common
Shares will be deemed to be closed at the Effective Time such that no transfer
of RMI Common Shares outstanding prior to the Effective Time will thereafter be
made on such books.
Post-Merger Rights of Holders. Following the Effective Time, the holders of
certificates representing RMI Common Shares outstanding immediately prior to the
Effective Time will cease to have any rights with respect to stock of the
Company and their sole rights will be with respect to the RTI Common Shares into
which their RMI Common Shares will have been converted in connection with the
Merger. The rights, preferences, privileges and restrictions of the RTI Common
Shares will be substantially identical to those of the RMI Common Shares being
converted.
CONDITIONS TO THE MERGER
The Merger will occur only if the Merger is approved by the requisite vote
of the Company's shareholders. See " -- Required Vote" below. In addition,
consummation of the Merger is subject to satisfaction or waiver of certain other
conditions, including the listing of RTI Common Shares on the New York Stock
Exchange upon official notice of issuance, the absence of the receipt of notice
from holders of more than ten percent of the outstanding RMI Common Stock that
such holders have exercised dissenters' rights, and receipt of an opinion
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<PAGE> 20
from Doepken Keevican & Weiss Professional Corporation that the Merger will
constitute a tax-free reorganization for federal income tax purposes.
REQUIRED VOTE
Approval of the Merger Agreement pursuant to which a holding company will
be formed requires the affirmative vote of at least two-thirds of the RMI Common
Shares outstanding. As of the Record Date there were 20,525,302 RMI Common
Shares outstanding. As a result, the affirmative vote of at least 13,683,535 RMI
Common Shares, is required to approve the Merger.
DISSENTERS' RIGHTS
The following is a summary of the principal steps which a shareholder must
take to perfect dissenters' rights under Section 1701.85 of the Ohio Revised
Code (the "ORC"). The summary is qualified in its entirety by Section 1701.85 of
the ORC, a copy of which is appended hereto as Appendix B. Failure to take any
one of the required steps may result in termination of the rights of the
shareholder under the ORC.
Exercise of dissenters' rights under the ORC may result in a judicial
determination that the "fair cash value" of the dissenting shareholder's shares
is higher or lower than the market value of the RTI Common Stock to be exchanged
for each share of RMI Common Stock in the Merger.
Any shareholder of record whose shares are not voted for adoption of the
Merger Agreement may be entitled, if the Merger is consummated, to be paid the
"fair cash value" of such shares held of record on the record date. To be
entitled to such payment, such shareholder must serve a written demand therefor
upon Crystal Revak, Director of Investor Relations, RMI at 1000 Warren Avenue,
Niles, OH 44446 on or before the tenth day after the shareholder vote adopting
the Merger Agreement and must otherwise comply with Section 1701.85 of the ORC.
The Company will not inform shareholders of the expiration of the ten-day period
and, therefore, dissenting shareholders are advised to retain this Proxy
Statement/Prospectus. A vote for adoption of the Merger Agreement constitutes a
waiver of dissenters' rights. Submission of a properly executed proxy without a
designation of "against" or "abstain" will constitute a vote for the Merger
proposal. Failure to vote does not constitute a waiver of dissenters' rights.
The required written demand must specify the shareholder's name and address and
the number of RMI Common Shares held of record on the record date and the amount
claimed as the "fair cash value" of the shares. Voting against adoption of the
Merger Agreement will not of itself constitute a written demand as required by
section 1701.85 of the ORC.
If the Company requests, dissenting shareholders must submit their share
certificates to the Company within 15 days after the making of such request for
endorsement thereon by the Company of a legend that demand for appraisal has
been made. Such certificates will be returned promptly to the dissenting
shareholder by the Company. The Company intends to make such a request to
dissenting shareholders.
If RMI and any dissenting shareholder cannot agree on the "fair cash value"
of the RMI Common Shares, either may, within three months after service of the
demand by the shareholder, file a complaint in the Court of Common Pleas of
Trumbull County, Ohio, for a determination of the "fair cash value" of such
shareholder's RMI Common Shares. The Court, if it determines that the dissenting
shareholder is entitled to be paid the "fair cash value" of the RMI Common
Shares, may appoint one or more appraisers to determine its value. If the Court
approves the appraisers' report, judgment will be entered therefor, and the
costs of the proceeding, including reasonable compensation to the appraisers,
shall be assessed or apportioned as the Court considers equitable. "Fair cash
value" is the amount which a willing seller, under no compulsion to sell, would
be willing to accept, and which a willing buyer, under no compulsion to
purchase, would be willing to pay, but in no event in excess of the amount
specified in the shareholder's demand. "Fair cash value" will be determined as
of the last business day prior to the day on which the shareholder vote is taken
at the Special Meeting and will exclude any appreciation or depreciation in
market value of RMI Common Shares resulting from the Merger proposal. The
Company does not intend to file a complaint for a determination of "fair cash
value." Therefore, if the Company and the dissenting shareholder do not reach
agreement as to the "fair cash value" of the dissenting shareholder's RMI Common
Shares, the dissenting shareholder must timely file such a complaint in order to
have the Court make a determination of the "fair cash value" of such
shareholder's RMI Common Shares under the ORC.
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The right of any dissenting shareholder to be paid the "fair cash value" of
RMI Common Shares will terminate if: (i) for any reason the Merger, although
adopted by shareholder vote, does not become effective; (ii) the dissenting
shareholder fails to serve an appropriate timely written demand upon the
Company; (iii) the dissenting shareholder does not, upon request of the Company,
timely surrender certificates for an endorsement thereon of a legend to the
effect that demand for the "fair cash value" of such RMI Common Shares has been
made; (iv) the demand is withdrawn by the dissenting shareholder, with the
consent of the Board of Directors of RMI; (v) the dissenting shareholder and the
Company shall not have come to an agreement as to the "fair cash value" of the
RMI Common Stock and neither shall have filed a complaint in the Court as
described above; or (vi) the dissenting shareholder has otherwise not complied
with the requirements of Section 1701.85 of the ORC.
From the time a dissenting shareholder's demand is made until the
termination of the right arising from that demand, all rights accruing from such
RMI Common Shares, including dividend and voting rights, shall be suspended. If
the right to receive "fair cash value" is terminated by reason of the failure of
the Merger to be consummated, all such shareholder's rights with respect to RMI
Common Shares shall be restored to the shareholder. If the Merger is
consummated, the dissenting shareholder's rights shall consist solely of the
right to receive the "fair cash value" of his RMI Common Shares and he shall
have no right to continue to hold RMI Common Shares.
NO CHANGE IN DIVIDEND POLICY
RMI has not paid dividends since the second quarter of 1991. When the
Merger takes effect, it is expected that there will be no change in dividend
policy. The amount and timing of the dividends on the RTI Common Shares will
depend primarily on the earnings of RTI subsidiaries, principally the Company,
and any restrictions on the payment of dividends applicable to RTI and/or its
subsidiaries (including, without limitation, the Company). The declaration and
payment of future dividends and the amount thereof will be dependent upon RTI's
results of operations, financial condition, cash requirements, future prospects
and other factors, deemed relevant by the Board of Directors.
Initially, the funds required by RTI to operate following the Merger are
expected to be derived primarily from dividends paid by the Company to RTI as
the sole shareholder of the Company. It is anticipated that such cash dividends
paid by the Company to RTI will be sufficient to enable RTI to meet its
operating expenses.
TERMINATION AND AMENDMENT OF MERGER AGREEMENT
The Merger Agreement may be terminated at any time prior to the Effective
Time by action of the Board of Directors. Subject to applicable law, the Merger
Agreement may be amended, modified or supplemented at any time prior to the
Effective Time by mutual consent of the Boards of Directors of the Company, RTI
and MergeCo.
DIRECTORS AND OFFICERS OF THE COMPANY AND RTI
The persons who are the current directors of the Company are also the
directors of RTI.
Following the Special Meeting, the directors of the Company and RTI will
elect officers of the Company and RTI, respectively, to serve until their
successors are elected and qualified. Such additional officers of RTI and the
Company as the Board of Directors considers advisable may be elected or
appointed from time to time.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following discussion generally summarizes certain of the federal income
tax consequences of the Merger under the Internal Revenue Code, as set forth in
the tax opinion obtained from Doepken Keevican & Weiss Professional Corporation,
counsel to the Company and to RTI. This discussion does not cover all possible
tax consequences relating to the Merger and does not address the tax
consequences under state or local law, or special tax consequences to particular
shareholders having special situations. Accordingly, shareholders are urged to
consult with their own tax advisors regarding the effect of the Merger on them
personally.
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Subject to the foregoing limitations and based on certain representations
made by the Company, the Company has been informed that, for federal income tax
purposes:
(a) The merger of MergeCo into the Company and the issuance of RTI
Common Stock in connection therewith as described herein will constitute a
tax-free reorganization under Section 368(a)(1) of the Internal Revenue
Code of 1986, as amended;
(b) No gain or loss will be recognized by holders of RMI Common Shares
who receive RTI Common Shares in exchange for the RMI Common Shares which
they hold;
(c) The holding period of RTI Common Shares received in exchange for
RMI Common Shares will include the holding period of the RMI Common Shares
for which it is exchanged, assuming that the RMI Common Shares are capital
assets in the hands of the holder thereof at the time of the Merger; and
(d) The tax basis of RTI Common Shares received by shareholders of the
Company pursuant to the Merger will be the same as the tax basis of the RMI
Common Shares exchanged therefor.
Shareholders are urged to consult with their own tax advisors with respect
to all tax consequences of the Merger. Expenses incurred by any shareholder
arising from disputes with the Internal Revenue Service or any state or any
foreign tax agency over the tax consequences of the Merger will not be borne by
the Company or RTI.
ARTICLES OF INCORPORATION, CODE OF REGULATIONS AND RIGHTS OF SHAREHOLDERS
The Articles of Incorporation and Code of Regulations of RTI are
substantially identical to the Articles of Incorporation and Code of
Regulations, respectively, of the Company. As a result, there will be no
substantive difference in the rights of shareholders of RTI from the rights as
they exist for shareholders of the Company.
EXCHANGE ACT FILINGS
Following the Merger, RTI will be a reporting company under the Exchange
Act.
FINANCIAL STATEMENTS
No consolidated financial statements of RTI are presented herein since RTI
presently has no assets or liabilities other than the stock of MergeCo. and any
pro forma consolidated financial statements of RTI would reflect no change from
the financial statements of RMI Titanium prior to the implementation of the
restructuring plan.
LEGAL OPINION
Doepken Keevican & Weiss Professional Corporation, as counsel for the
Company and RTI, has rendered an opinion to the effect that the RTI Common
Shares offered in this Proxy Statement/Prospectus will be validly issued, fully
paid, and nonassessable.
EXPERTS
The financial statements incorporated in this Prospectus by reference to
the Company's Annual Report on Form 10-K for the year ended December 31, 1997
have been so incorporated in reliance on the report of PricewaterhouseCoopers
LLP, independent accountants, given on the authority of said firm as experts in
auditing and accounting.
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APPENDIX A
AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER, dated as of August 20, 1998, (this
"Agreement"), is entered into by and among RMI TITANIUM COMPANY, an Ohio
corporation ("RMI Titanium"), RTI INTERNATIONAL METALS, INC., an Ohio
corporation ("RTI"), and RMI ACQUISITION COMPANY, an Ohio corporation
("MergeCo").
WHEREAS, RMI Titanium has an authorized capitalization consisting of
30,000,000 shares of Common Stock, $0.01 par value (the "RMI Titanium Common
Stock"), of which there were 20,525,302 shares issued and outstanding as of
August 28, 1998; and
WHEREAS, RTI has an authorized capitalization consisting of 30,000,000
shares of Common Stock, $0.01 par value (the "RTI Common Stock"), of which 100
are issued and outstanding and are owned by RMI Titanium, and no shares of which
are held in RTI's treasury; and
WHEREAS, MergeCo has an authorized capitalization consisting of 100 shares
of Common Stock, $.01 par value (the "MergeCo Common Stock"), all of which are
issued and outstanding and are owned by RTI, and no shares of which are held in
MergeCo's treasury; and
WHEREAS, RMI Titanium and MergeCo desire to effect a merger of MergeCo with
and into RMI Titanium with RMI Titanium surviving such merger (the "Merger")
pursuant to Section 1701.78 of the Ohio General Corporation Law (Ohio Revised
Code sec. 1701.01 et seq. is referred to in this Agreement as the "General
Corporation Law"); and
WHEREAS, the Boards of Directors of RMI Titanium, RTI and MergeCo have
approved and recommended to their respective stockholders the Merger in
accordance with this Agreement and Plan of Merger, and the stockholders of RMI
Titanium, RTI and MergeCo have adopted this Agreement and Plan of Merger by
affirmative vote or unanimous written consent in accordance with the General
Corporation Law; and
WHEREAS, the Board of Directors of RTI has adopted resolutions approving
the conversion of shares of RMI Titanium into RTI Common Stock;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein, the parties hereto, intending to be legally
bound, covenant and agree as follows:
ARTICLE I
THE MERGER
SECTION 1.1. THE MERGER. Upon the terms and subject to the conditions of
this Agreement, at the Effective Time (as defined in Section 1.2) in accordance
with Section 1701.78 of the General Corporation Law, MergeCo shall be merged
with and into RMI Titanium and the separate existence of MergeCo shall thereupon
cease. RMI Titanium shall be the surviving corporation in the Merger (the
"Surviving Corporation") and shall succeed to and assume all of the rights and
obligations of MergeCo in accordance with the General Corporation Law. The name
of the Surviving Corporation shall be RMI Titanium Company.
SECTION 1.2. EFFECTIVE TIME OF THE MERGER. Upon the satisfaction of the
conditions set forth in Article VI of this Agreement, a certificate of merger
shall be duly executed by each of RMI Titanium and MergeCo and filed with the
Secretary of State of Ohio pursuant to Section 1701.81 of the General
Corporation Law. The Merger shall become effective at the time of such filing
(the "Effective Time") with the Secretary of State of Ohio pursuant to Section
1701.81 of the General Corporation Law.
SECTION 1.3. EFFECTS OF THE MERGER. At the Effective Time of the Merger,
the effects of the Merger shall occur as provided in Section 1701.82 of the
General Corporation Law. Without limiting the generality of the foregoing, and
subject thereto, at the Effective Time, the name, identity, existence, rights,
privileges, powers, franchises, properties and assets of RMI Titanium shall
continue unaffected and unimpaired, and the separate existence of MergeCo shall
cease and all of the rights, privileges, powers, franchises, properties and
assets of MergeCo shall be vested in RMI Titanium.
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ARTICLE II
THE SURVIVING CORPORATION
SECTION 2.1. ARTICLES OF INCORPORATION. At the Effective Time, the
Articles of Incorporation of RMI Titanium, as in effect on the date thereof,
shall be the articles of incorporation of the Surviving Corporation after the
Effective Time until thereafter changed or amended as provided therein or by the
General Corporation Law.
SECTION 2.2. CODE OF REGULATIONS. At the Effective Time, the Code of
Regulations of RMI Titanium, as in effect on the date thereof, shall be the Code
of Regulations of the Surviving Corporation after the Effective Time until
thereafter changed or amended as provided therein or by the General Corporation
Law.
SECTION 2.3. DIRECTORS. The directors of RMI Titanium immediately prior to
the Effective Time shall be, from and after the Effective Time, the directors of
the Surviving Corporation until their successors shall have been duly elected or
appointed and qualified or until their earlier death, resignation or removal in
accordance with the Surviving Corporation's Articles of Incorporation and Code
of Regulations.
SECTION 2.4. OFFICERS. The officers of RMI Titanium immediately prior to
the Effective Time shall be, from and after the Effective Time, the officers of
the Surviving Corporation until their successors shall have been duly elected or
appointed and qualified or until their earlier death, resignation or removal in
accordance with the Surviving Corporation's Articles of Incorporation and Code
of Regulations.
ARTICLE III
CAPITAL STOCK OF THE CONSTITUENT CORPORATIONS;
EXCHANGE OF CERTIFICATES
SECTION 3.1. EFFECT ON CAPITAL STOCK. (a) As of the Effective Time, by
virtue of the Merger and without any action on the part of RMI Titanium, MergeCo
or RTI or any holder of the capital stock of RMI Titanium, MergeCo or RTI, the
following shall occur:
(i) each issued and outstanding share of RMI Titanium Common Stock
shall be converted into the right to receive one share of RTI Common Stock;
(ii) each issued and outstanding share of MergeCo Common Stock shall
be converted into the right to receive one share of the Common Stock of the
Surviving Corporation; and
(iii) each share of RTI Common Stock issued and outstanding prior to
the Effective Time of the Merger shall be canceled and the holder thereof
shall be entitled to receive an amount equal to the initial subscription
price paid therefor.
(b) As of the Effective Time, all shares of RMI Titanium Common Stock
issued and outstanding immediately prior to the Effective Time shall no longer
be outstanding and shall be automatically canceled and retired and shall cease
to exist, and each holder of a certificate formerly representing shares of RMI
Titanium Common Stock ("RMI Titanium Certificate") shall cease to have any
rights with respect thereto, except the right to receive shares of RTI Common
Stock into which their shares of RMI Titanium Common Stock have been converted
by the Merger.
SECTION 3.2. EXCHANGE PROCEDURES. (a) As soon as practicable after the
Effective Time, each holder of an outstanding RMI Titanium Certificate shall,
upon surrender of such RMI Titanium Certificate to ChaseMellon Shareholder
Services, the transfer agent of the Surviving Corporation (the "Transfer
Agent"), be entitled to receive a certificate or certificates representing the
number of shares of RTI Common Stock ("RTI Certificate") into which the shares
of RMI Titanium Common Stock previously represented by such RMI Titanium
Certificate have been converted pursuant to this Agreement. The Transfer Agent
shall accept such RMI Titanium Certificates upon compliance with such reasonable
terms and conditions as the Transfer Agent may impose to effect an orderly
exchange thereof in accordance with normal exchange practices.
(b) If any RTI Certificate is to be issued to a person or entity other than
the person or entity in whose name a surrendered RMI Titanium Certificate is
registered, it shall be a condition of such issuance that (i) the RMI Titanium
Certificate so surrendered shall be properly endorsed, with signature guaranteed
or otherwise in proper form for transfer, and (ii) the person or entity
requesting such delivery shall have paid to RTI any transfer or other taxes
required by reason of by reason of such delivery to a person or entity other
than the registered holder of the
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RMI Titanium Certificate surrendered or shall have established to the
satisfaction of RTI that such taxes either have been paid or are not payable.
(c) Until surrendered and exchanged in accordance with this Section 2.2,
each RMI Titanium Certificate shall be deemed at any time after the Effective
Time to represent the ownership of the same number of shares of RTI Common Stock
as though such surrender or transfer and exchange had taken place. Holders are
not required to exchange stock certificates.
SECTION 3.3. CLOSING OF RMI TITANIUM'S TRANSFER BOOKS. After the date on
which the Effective Time occurs, there shall be no further transfer on the stock
transfer books of RMI Titanium of any RMI Titanium Certificate and if any RMI
Titanium Certificate is presented to the Secretary of the Surviving Corporation
for transfer, such RMI Titanium Certificate shall be canceled and exchanged for
a RTI Certificate in accordance with this Agreement.
SECTION 3.4. DISSENTING RMI TITANIUM SHAREHOLDERS. Each holder of one or
more shares of RMI Titanium Common Stock who shall have been a record holder of
such shares as of the date fixed for the determination of shareholders entitled
to notice of the Shareholders Meeting and who shall have delivered to RMI
Titanium, not later then ten days after the date on which the vote on this
Agreement was taken at the Shareholders Meeting, a written demand for payment to
such holder of the fair cash value of such shares in compliance with Sec.
1701.85 of the General Corporation Law, and whose such shares shall not have
been voted in favor of adoption of this Agreement, shall cease to have any of
the rights of a shareholder in respect to such shares except the right to be
paid the fair cash value of such shares and any other rights bestowed under
Sections 1701.84 and 1701.85 of the General Corporation Law. However, any such
shareholder who shall validly withdraw such shareholder's written demand for
payment of the fair cash value of such shares pursuant to Sections 1701.84 and
1701.85 of the General Corporation Law will thereupon be reinstated to all such
shareholder's rights as a shareholder in respect of such shares as of the date
of delivery of such shareholder's written demand to RMI Titanium, subject to the
provisions of Section 2.1 of this Agreement, and will be entitled to receive the
RTI Common Stock into which such shareholder's RMI Titanium Common Stock were
converted as of the Effective Time pursuant hereto.
ARTICLE IV
CERTAIN AGREEMENTS
SECTION 4.1. REGISTRATION OF HOLDING COMPANY SHARES. At or prior to the
Effective Time, RTI shall register under the Securities Act of 1933, as amended,
the maximum number of RTI Common Shares required to be exchanged for RMI
Titanium Common Stock pursuant to this Agreement.
SECTION 4.2. STOCK PLANS. At or prior to the Effective Time, RTI shall
assume RMI Titanium's 1989 Stock Option Incentive Plan and the 1995 Stock Plan
(the "Stock Plans") with amendments thereto as deemed appropriate by the
respective Boards of Directors of RMI Titanium and RTI, including all
obligations associated with any valid options ("Options") to purchase or right
to receive under restricted stock awards shares of RMI Titanium Common Stock
under the Stock Plans. Thereafter, each such Option to purchase RMI Titanium
Common Stock shall be the valid and enforceable option to purchase such number
of RTI Common Stock (instead of RMI Titanium Common Stock) at a purchase price
per RTI Common Stock equal to the purchase price per RMI Titanium Common Stock.
In addition, thereafter each such Option to purchase RMI Titanium Common Stock
shall be the valid and enforceable Option to purchase such number of RTI Common
Stock at a purchase price per share of RTI Common Stock equal to the purchase
price per share of RMI Titanium Common Stock. Except as set forth above, each
such Option shall be on the same terms and conditions and have the same
provisions which are contained therein immediately prior to the Effective Time.
At or prior to the Effective Time, RMI Titanium and RTI shall take all necessary
steps to cause shares of RMI Titanium Common Stock, if any, to be issued with
respect to each of the RMI Titanium Employee Savings and Investment Plan and the
RMI Titanium Bargaining Unit Employee Savings and Investment Plan to be issued
as shares of RTI Common Stock.
SECTION 4.3. ELECTION OF DIRECTORS. The sole shareholder of RTI, shall,
subsequent to the adoption and approval of this Agreement as provided in Section
6.1, but prior to the Effective Time, duly convene a meeting of the sole
shareholder of RTI (or act by written consent of such shareholder in lieu of a
meeting) and shall take or cause to be taken all action necessary, in accordance
with the Code of Regulations of RTI and the General
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Corporation Law, to install as Directors of RTI, who shall serve until the next
annual meeting of shareholders of RTI or until their respective successors have
been elected and qualified, all persons who are then current directors of RMI
Titanium.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
SECTION 5.1. MERGECO. MergeCo represents and warrants to RMI Titanium and
to RTI as follows:
(a) MergeCo is a corporation duly formed, validly existing and in good
standing under the laws of the State of Ohio. MergeCo has the corporate
power and authority to execute, deliver and carry out the terms and
provisions of this Agreement and has taken all necessary corporate action
to authorize the execution, delivery and performance of this Agreement.
MergeCo has duly authorized, executed and delivered this Agreement and this
Agreement constitutes the legal, valid and binding agreement of MergeCo,
enforceable in accordance with its terms.
(b) MergeCo does not own any property or assets and does not conduct
any business.
(c) The entire authorized capital stock of MergeCo consists of 100
shares of common stock, $0.01 par value per share. As of the date of this
Agreement and as of the Effective Time, (i) 100 common shares of MergeCo
are and will be issued and outstanding, all of which shares are owned of
record by RTI, and (ii) no common shares of MergeCo are or will be held in
treasury.
SECTION 5.2. RTI. RTI represents and warrants to RMI Titanium and to
MergeCo as follows:
(a) RTI is a corporation duly organized, validly existing and in good
standing under the laws of the State of Ohio. RTI has the corporate power
and authority to execute, deliver and carry out the terms and provisions of
this Agreement and has taken all necessary corporate action to authorize
the execution, delivery and performance of this Agreement. RTI has duly
authorized, executed and delivered this Agreement and this Agreement
constitutes the legal, valid and binding agreement of RTI, enforceable in
accordance with its terms.
(b) RTI does not own any property or assets other than the common
shares of MergeCo and does not conduct any business.
(c) RTI is the sole beneficial owner of 100 common shares of MergeCo.
(d) The entire authorized capital stock of RTI is 30,000,000 RTI
Common Shares and 5,000,000 Preferred Shares. As of the date of this
Agreement, and as of immediately prior to the Effective Time, (i) 100 RTI
Common Shares and no Preferred Shares are or will be outstanding and (ii)
no RTI Common Shares and no Preferred Shares are held in treasury.
SECTION 5.3. RMI TITANIUM. RMI Titanium represents and warrants to RTI and
to MergeCo as follows:
(a) RMI Titanium has the corporate power and authority to execute,
deliver and carry out the terms and provisions of this Agreement and has
taken all necessary corporate action to authorize the execution, delivery
and performance of this Agreement. RMI Titanium has duly authorized,
executed and delivered this Agreement and this Agreement constitutes the
legal, valid and binding agreement of RMI Titanium, enforceable in
accordance with its terms.
(b) RMI Titanium is the sole beneficial owner of 100 common shares of
RTI.
ARTICLE VI
CONDITIONS TO MERGER
The consummation of the Merger is subject to the satisfaction, in the sole
judgment of the Board of Directors of RMI Titanium, of the following conditions
prior to the Effective Time:
SECTION 6.1. SHAREHOLDER APPROVAL. This Agreement shall have received the
approval of at least two-thirds of the issued and outstanding RMI Titanium
Common Stock entitled to vote.
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SECTION 6.2. NEW YORK STOCK EXCHANGE. RTI shall have received approval
for the listing of the RTI Common Stock on the New York Stock Exchange upon
official notice of issuance.
SECTION 6.3. PERFORMANCE OF AGREEMENTS. MergeCo and RTI shall have
performed all their respective obligations and agreements required by this
Agreement to be performed by them at or prior to the Effective Time.
SECTION 6.4. TAX MATTERS. RMI Titanium shall have received an opinion of
Doepken Keevican & Weiss, satisfactory in form and substance to RMI Titanium, as
to such matters relating to the tax consequences of the transactions
contemplated by this Agreement as the Board of Directors of RMI Titanium may
deem advisable including, without limitation, an opinion of such counsel to the
effect that the Merger constitutes a "reorganization" within the meaning of
Section 368(a)(1) of the Internal Revenue Code.
SECTION 6.5. OPINION OF COUNSEL. RMI Titanium shall have received an
opinion of Doepken Keevican & Weiss, satisfactory in form and substance to RMI
Titanium, to the effect that:
(a) each of MergeCo and RTI is a corporation duly formed, validly
existing and in good standing under the laws of the State of Ohio;
(b) RMI Titanium is a corporation validly existing and in good
standing under the laws of the State of Ohio;
(c) this Agreement has been duly authorized, executed and delivered
by, and is a valid and binding agreement or obligation of, each of RMI
Titanium, MergeCo and RTI;
(d) neither the execution and delivery of this Agreement nor the
performance by RMI Titanium, MergeCo, or RTI, respectively, of any of its
obligations hereunder will conflict with such company's Articles of
Incorporation or Code of Regulations;
(e) the RTI Common Stock required to be issued and delivered by RTI
upon the Merger are duly authorized and will, when issued as contemplated
in this Agreement, be validly issued, fully paid and nonassessable.
SECTION 6.6. DISSENTING SHARES. RMI Titanium shall not have received
notice from the holder or holders of more than ten percent (10%) of the
outstanding RMI Titanium Common Stock, in the aggregate, that such holder or
holders have exercised or intend to exercise its or their dissenters' rights
under Section 1701.85 of the General Corporation Law and the time for the
holders of RMI Titanium Common Stock to give such notice shall have expired.
SECTION 6.7. MISCELLANEOUS APPROVALS. RMI Titanium, MergeCo and RTI, as
appropriate, shall have received all orders, consents and approvals,
governmental or otherwise, which in the opinion of RMI Titanium, are required by
law or advisable to the consummation of the Merger, except for filings in
connection with the Merger and any other documents required to be filed after
the Effective Time.
SECTION 6.8. NO PROHIBITION. None of RMI Titanium, MergeCo or RTI shall be
subject to any order or injunction of a court of competent jurisdiction that
prohibits the consummation of the transactions contemplated by this Agreement or
that would make the consummation of the Merger by RMI Titanium, MergeCo or RTI
illegal.
SECTION 6.9. STEPS TO EFFECT MERGER. Upon the satisfaction or waiver by
RMI Titanium of each of the conditions set forth in this Article VI, the
officers of each of RMI Titanium, MergeCo and RTI shall take all steps necessary
in order to make effective the Merger as provided herein.
ARTICLE VII
MISCELLANEOUS
SECTION 7.1. TAX FREE REORGANIZATION. The Merger is intended to constitute
a tax-free reorganization within the meaning of Section 368(a) of the Internal
Revenue Code of 1986, as amended, and this Agreement is intended to constitute a
plan of reorganization.
SECTION 7.2. ASSIGNMENT. Neither this Agreement nor any right, interest or
obligation hereunder may be assigned by any of the parties hereto and any
attempt to do so shall be null and void.
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SECTION 7.3. NO THIRD PARTY BENEFICIARY. The terms and provisions of this
Agreement are intended solely for the benefit of each party hereto and their
respective successors or permitted assigns, and it is not the intention of the
parties hereto to confer third-party beneficiary rights upon any other person or
entity.
SECTION 7.4. AMENDMENT, DEFERRAL AND ABANDONMENT. (a) The parties hereto,
by mutual consent of their respective Boards of Directors, may amend, modify or
supplement this Agreement in writing at any time prior or subsequent to the
adoption and approval of the Agreement by the shareholders of RMI Titanium and
prior to the Effective Time; provided, however, that no such amendment,
modification or supplement shall affect the rights of the respective
shareholders of the parties hereto in a manner which is materially adverse to
such shareholders in the judgment of the respective Boards of Directors of the
parties hereto.
(b) Notwithstanding the adoption and approval of this Agreement by the
shareholders of RMI Titanium, RTI or MergeCo, consummation of the transactions
provided for herein may be deferred by the Board of Directors of RMI Titanium at
any time prior to the Effective Time, if such Board of Directors determines that
such deferral would be in the best interests of RMI Titanium or its
shareholders.
(c) Notwithstanding the adoption and approval of this Agreement by the
shareholders of RMI Titanium, this Agreement may be terminated, and the Merger
and other transactions provided for herein may be abandoned, by the Board of
Directors of RMI Titanium at any time prior to the Effective Time if such Board
of Directors determines that such abandonment would be in the best interests of
RMI Titanium or its shareholders. In such event, this Agreement shall forthwith
be wholly void and of no effect and there shall be no liability with respect to
this Agreement on the part of any party hereto or any of their respective
directors, officers, employees or shareholders.
SECTION 7.5. WAIVER. Any term or condition of this Agreement may be waived
at any time by the party that is entitled to the benefit thereof, but no such
waiver shall be effective unless set forth in a written instrument executed by
or on behalf of the party waiving such term or condition. No waiver by any party
hereto of any term or condition of this Agreement, in any one or more instances,
shall be deemed to be or construed as a waiver of the same or any other term or
condition of this Agreement.
SECTION 7.6. TERMINATION. At any time prior to the Effective Time, this
Agreement may be terminated and abandoned by the parties. In the event of the
termination of this Agreement, this Agreement shall forthwith become void and
there shall be no liability on the part of any of the parties hereto or their
respective officers or directors.
SECTION 7.7. COUNTERPARTS. This Agreement may be executed simultaneously
in two or more counterparts, each of which shall be deemed an original, but all
of which shall constitute but one and the same instrument.
SECTION 7.8. SEVERABILITY. Should any clause, paragraph, sentence,
Section, subsection or Article of this Agreement be judicially declared to be
invalid, unenforceable or void, such decision will not have the effect of
invalidating or voiding the remainder of this Agreement, and the parts or parts
of this Agreement so held to be invalid, unenforceable or void will be deemed to
have been stricken herefrom by the parties hereto, and the remainder will have
the same force and effectiveness as if such stricken part or parts had never
been included herein.
SECTION 7.9. ENTIRE AGREEMENT. This Agreement sets forth all of the
promises, conditions, agreements, understandings, warranties and representations
among the parties hereto with respect to the transactions completed hereby, and
supersedes all prior agreements, arrangements and understandings among the
parties hereto, whether written, oral or otherwise. There are no promises,
agreements, arrangements understandings, warranties or representations, oral or
written, express or implied, among the parties hereto concerning the subject
matter hereof except as set forth herein.
SECTION 7.10. APPLICABLE LAW. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF OHIO, AS APPLICABLE, WITHOUT GIVING
EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
SECTION 7.11. HEADINGS. The headings in the Articles and Sections of this
Agreement are inserted for convenience only and shall not constitute a part
thereof.
A-6
<PAGE> 29
IN WITNESS WHEREOF, each of the parties has executed this Agreement as of
the date first written above.
<TABLE>
<S> <C>
ATTEST: RMI TITANIUM COMPANY
By:
- -------------------------------------------- --------------------------------------------
Secretary Name:
ATTEST: RTI INTERNATIONAL METALS, INC.
By:
- -------------------------------------------- --------------------------------------------
Secretary Name:
ATTEST: RMI ACQUISITION COMPANY
By:
- -------------------------------------------- --------------------------------------------
Secretary Name:
</TABLE>
A-7
<PAGE> 30
CERTIFICATION
The undersigned, Secretary of RMI Titanium Company, does hereby certify
that the holders of at least two-thirds of the outstanding stock of RMI Titanium
Company entitled to vote thereon has voted in favor of this Agreement and Plan
of Merger.
------------------------------------
Richard M. Hays, Secretary
CERTIFICATION
The undersigned, Secretary of RTI International Metals, Inc., does hereby
certify that all of the outstanding stock of RTI International Metals, Inc.
entitled to vote thereon has consented in writing to the adoption of this
Agreement and Plan of Merger.
------------------------------------
Richard M. Hays, Secretary
CERTIFICATION
The undersigned, Secretary of RMI Acquisition Company, does hereby certify
that all of the outstanding stock of RMI Acquisition Company entitled to vote
thereon has consented in writing to the adoption of this Agreement and Plan of
Merger.
------------------------------------
, Secretary
A-8
<PAGE> 31
APPENDIX B
1701.85 RELIEF FOR DISSENTING SHAREHOLDERS; QUALIFICATION; PROCEDURES. --
(A)(1) A shareholder of a domestic corporation is entitled to relief as a
dissenting shareholder in respect of the proposals described in sections
1701.74, 1701.76, and 1701.84 of the Revised Code, only in compliance with this
section.
(2) If the proposal must be submitted to the shareholders of the
corporation involved, the dissenting shareholder shall be a record holder of the
shares of the corporation as to which he seeks relief as of the date fixed for
the determination of shareholders entitled to notice of a meeting of the
shareholders at which the proposal is to be submitted, and such shares shall not
have been voted in favor of the proposal. Not later than ten days after the date
on which the vote on the proposal was taken at the meeting of the shareholders,
the dissenting shareholder shall deliver to the corporation a written demand for
payment to him of the fair cash value of the shares as to which he seeks relief,
which demand shall state his address, the number and class of such shares, and
the amount claimed by him as the fair cash value of the shares.
(3) The dissenting shareholder entitled to relief under division (c) of
section 1701.84 of the Revised Code in the case of a merger pursuant to section
1701.80 of the Revised Code and a dissenting shareholder entitled to relief
under division (E) of section 1701.84 of the Revised Code in the case of a
merger pursuant to section 1701.801 of the Revised Code shall be a record holder
of the shares of the corporation as to which he seeks relief as of the date on
which the agreement or merger was adopted by the directors of that corporation.
Within twenty days after he has been sent the notice provided in section 1701.80
or 1701.801 of the Revised Code, the dissenting shareholder shall deliver to the
corporation a written demand for payment with the same information as that
provided for in division (A)(2) of this section.
(4) In the case of a merger or consolidation, a demand served on the
constituent corporation involved constitutes service on the surviving or the new
entity, whether the demand is served before, on, or after the effective date of
the merger or consolidation.
(5) If the corporation sends to the dissenting shareholder, at the address
specified in his demand, a request for the certificates representing the shares
as to which he seeks relief, the dissenting shareholder, within fifteen days
from the date of the sending of such request, shall deliver to the corporation
the certificates requested so that the corporation may forthwith endorse on them
a legend to the effect that demand for the fair cash value of such shares has
been made. The corporation promptly shall return such endorsed certificates to
the dissenting shareholder. A dissenting shareholder's failure to deliver such
certificates terminates his rights as a dissenting shareholder, at the option of
the corporation, exercised by written notice sent to the dissenting shareholder
within twenty days after the lapse of the fifteen-day period, unless a court for
good cause shown otherwise directs. If shares represented by a certificate on
which such a legend has been endorsed are transferred, each new certificate
issued for them shall bear a similar legend, together with the name of the
original dissenting holder of such shares. Upon receiving a demand for payment
from a dissenting shareholder who is the record holder of uncertified
securities, the corporation shall make an appropriate notation of the demand for
payment in its shareholder records. If uncertified shares for which payment has
been demanded are to be transferred, any new certificate issued for the shares
shall bear the legend required for certificated securities as provided in this
paragraph. A transferee of the shares so endorsed, or of uncertificated
securities where such notation has been made, acquires only such rights in the
corporation as the original dissenting holder of such shares had immediately
after the service of a demand for payment of the fair cash value of the shares.
A request under this paragraph, by the corporation is not an admission by the
corporation that the shareholder is entitled to relief under this section.
(B) Unless the corporation and the dissenting shareholders have come to an
agreement on the fair cash value per share of the shares as to which the
dissenting shareholder seeks relief, the dissenting shareholder or the
corporation, which in case of a merger or consolidation may be the surviving or
new entity, within three months after the service of the demand by the
dissenting shareholder, may file a complaint in the court of common pleas of the
county in which the principal office of the corporation that issued the shares
is located or was located when the proposal was adopted by the shareholders of
the corporation, or, if the proposal was not required to be submitted to the
shareholders, was approved by the directors. Other dissenting shareholders,
within that
B-1
<PAGE> 32
three-month period, may join as plaintiffs or may be joined as defendants in any
such proceeding, and any two or more such proceedings may be consolidated. The
complaint shall contain a brief statement of the facts, including the vote and
the facts entitling the dissenting shareholder to the relief demanded. No answer
to such a complaint is required. Upon the filing of such a complaint, the court,
on motion of the petitioner, shall enter an order fixing date for a hearing on
the complaint and requiring that a copy of the complaint and a notice of the
filing and of the date for hearing be given to the respondent or defendant in
the manner in which summons is required to be served or substituted service is
required to be made in other cases. On the day fixed for the hearing on the
complaint or any adjournment of it, the court shall determine from the complaint
and form such evidence as is submitted by either party whether the dissenting
shareholder is entitled to be paid the fair cash value of any shares and, if so,
the number and class of such shares. If the court finds that the dissenting
shareholder is so entitled, the court may appoint one or more persons as
appraisers to receive evidence and to recommend a decision on the amount of the
fair cash value. The appraisers have such power and authority as is specified in
the order of their appointment. The court thereupon shall make a finding as to
the fair cash value of a share and shall render judgment against the corporation
for the payment of it, with interest at such rate and from such date as the
court considers equitable. The costs of the proceeding, including reasonable
compensation to the appraisers to be fixed by the court, shall be assessed or
apportioned as the court considers equitable. The proceeding is a special
proceeding and final orders in it may be vacated, modified, or reversed on
appeal pursuant to the Rules of Appellate Procedure and, to the extent not in
conflict with those rules, Chapter 2505, of the Revised Code. If, during the
pendency of any proceeding instituted under this section, a suite or proceeding
is or has been instituted to enjoin or otherwise to prevent the carrying out of
the action as to which the shareholder has dissented, the proceeding instituted
under this section shall be stayed until the final determination of the other
suit or proceeding. Unless any provision in division (D) of this section is
applicable, the fair cash value of the shares that is agreed upon by the parties
or fixed under this section shall be paid within thirty days after the date of
final determination of such value under this division, the effective date of the
amendment to the articles, or the consummation of the other action involved,
whichever occurs last. Upon the occurrence of the last such event, payment shall
be made immediately to a holder of uncertificated securities entitled to such
payment. In the case of holders of shares represented by certificates, payment
shall be made only upon and simultaneously with the surrender to the corporation
of the certificates representing the shares for which the payment is made.
(C) If the proposal was required to be submitted to the shareholders of the
corporation, fair cash value as to those shareholders shall be determined as of
the day prior to the day on which the vote by the shareholders was taken, and,
in the case of a merger pursuant to section 1701.80 or 1701.801 of the Revised
Code, fair cash value as to shareholders of a constituent subsidiary corporation
shall be determined as of the day before the adoption of the agreement of merger
by the directors of the particular subsidiary corporation. The fair cash value
of a share for the purposes of this section is the amount that a willing seller
who is under no compulsion to sell would be willing to accept and that a willing
buyer who is under no compulsion to purchase would be willing to pay, but in no
event shall the fair cash value of a share exceed the amount specified in the
demand of the particular shareholder. In computing such fair cash value, any
appreciation or depreciation in market value resulting from the proposal
submitted to the directors or to the shareholders shall be excluded.
(D)(1) The right and obligation of a dissenting shareholder to receive such
fair cash value and to sell such share as to which he seeks relief, and the
right and obligation of the corporation to purchase such shares and to pay fair
cash value of them terminates if any of the following applies:
(a) The dissenting shareholder has not complied with this section, unless
the corporation by its directors waives such failure;
(b) The corporation abandons the action involved or is finally enjoined or
prevented from carrying it out, or the shareholders rescind their adoption, of
the action involved;
(c) The dissenting shareholder withdraws his demand, with the consent of
the corporation by its directors;
(d) The corporation and the dissenting shareholder have not come to an
agreement as to the fair cash value per share, and neither the shareholder nor
the corporation filed or joined in a complaint under division (B) of this
section with the period provided in that division.
B-2
<PAGE> 33
(2) For purposes of division (D)(1) of this section, if the merger or
consolidation has become effective and the surviving or new entity is not a
corporation, action required to be taken by the directors of the corporation
shall be taken by the general partners of a surviving or new partnership or the
comparable representatives of any other surviving or new entity.
(E) From the time of the dissenting shareholder's giving of the demand
until either the termination of the rights and obligations arising from it or
the purchase of the shares by the corporation, all other rights accruing from
such shares, including voting and dividend or distribution rights, are
suspended. If during the suspension, any dividend or distribution is paid in
money upon shares of such class or any dividend, distribution, or interest is
paid in money upon any securities issued in extinguishment of or in substitution
for such shares, an amount equal to the dividend, distribution, or interest
which, except for the suspension, would have been payable upon such shares or
securities, shall be paid to the holder of record as a credit upon the fair cash
value of the shares. If the right to receive fair cash value is terminated other
than by the purchase of the shares by the corporation, all rights of the holder
shall be restored and all distributions which, except for the suspension, would
have been made shall be made to the holder of record of the shares at the time
of termination.
B-3
<PAGE> 34
===============================================================================
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY ANY
SECURITIES IN ANY JURISDICTION IN WHICH SUCH AN OFFER OR SOLICITATION WOULD BE
UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Summary................................ 1
Market Price Data...................... 3
Selected Financial Information......... 4
Forward Looking Statements............. 5
Risk Factors........................... 5
General Information.................... 8
Proposal to Form a Holding Company..... 10
General.............................. 10
Plan of Implementation............... 10
Reasons for the Formation of a
Holding Company................... 11
Principal Terms of the Merger........ 12
Conditions to the Merger............. 12
Required Vote........................ 13
Dissenters Rights.................... 13
No Change in Dividend Policy......... 14
Termination and Amendment of Merger
Agreement......................... 14
Directors and Officers of the Company
and RTI........................... 14
Certain Federal Income Tax
Consequences...................... 14
Articles of Incorporation, Code of
Regulations and Rights of
Shareholders...................... 15
Exchange Act Filings................. 15
Financial Statements................... 15
Legal Opinion.......................... 15
Experts................................ 15
Appendix A -- Agreement and Plan of
Merger............................... A-1
Appendix B -- Section 1701.85 of the
Ohio Revised Code.................... B-1
</TABLE>
===============================================================================
===============================================================================
21,007,468 SHARES
RTI INTERNATIONAL
METALS, INC.
COMMON STOCK
----------------------------------------------
PROSPECTUS/PROXY STATEMENT
----------------------------------------------
AUGUST 31, 1998
===============================================================================
<PAGE> 35
PLEASE MARK
YOUR VOTE AS [ X ]
INDICATED IN
THIS EXAMPLE
This Proxy Card, when properly executed, will be voted in the manner
directed herein. If no direction to the contrary is indicated, it will be voted
"FOR" the approval of the merger and the formation of the holding company.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR:
1. Approval of the merger of RMI Acquisition Company into RMI Titanium Company
pursuant to which RMI Titanium Company will become the wholly-owned
subsidiary of RTI International Metals, Inc.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
Signature(s) Dated: , 1998
------------------------------------- ---------
Please sign EXACTLY as your name appears hereon. When signing as fiduciary or
corporate officer, give full title. Joint owners should both sign.
- --------------------------------------------------------------------------------
* FOLD AND DETACH HERE *
<PAGE> 36
RMI TITANIUM COMPANY
1000 WARREN AVENUE, NILES, OHIO 44446
PROXY FOR SPECIAL MEETING TO BE HELD
SEPTEMBER 30, 1998
SOLICITED ON BEHALF OF THE DIRECTORS OF RMI TITANIUM COMPANY
The undersigned hereby appoints ROBERT M. HERNANDEZ, JOHNH. ODLE,
TIMOTHY G. RUPERT AND RICHARD M. HAYS, or any of them, proxies to vote all
shares of Common Stock which the undersigned is entitled to vote with all powers
which the undersigned would possess if personally present, at the Special
meeting of Shareholders of RMI Titanium Company on September 30, 1998, and any
adjournments thereof, upon such matters as may properly come before the meeting.
SHAREHOLDERS ARE REQUESTED TO COMPLETE, DATE AND SIGN THIS PROXY CARD AND TO
RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED.
PLEASE COMPLETE, DATE AND SIGN THE REVERSE SIDE.
* FOLD AND DETACH HERE *
