EX-99 2 exhibit99.txt LETTER January 13, 2006 GenCorp Inc. P.O. Box 537012 Sacramento, California 95853-7012 Attn: Mr. J. Gary Cooper Chairman of the Corporate Governance & Nominating Committee c/o Secretary VIA EXPRESS MAIL Highway 50 and Aerojet Road Rancho Cordova, California 95670 Attn: Mr. J. Gary Cooper Chairman of the Corporate Governance & Nominating Committee c/o Secretary VIA FEDERAL EXPRESS RE: Notification of Director Nominees Dear Mr. Cooper: Jolly Roger Fund LP (the "Fund") hereby gives notice of its intention to nominate three individuals for election to the Board of Directors (the "Board") of GenCorp Inc. (the "Company") at the 2006 Annual Meeting of Shareholders, including any adjournments or postponements thereof or any special meeting that may be called in lieu thereof (the "Annual Meeting"). The Fund, an investment fund, is the record owner of 100 shares of common stock, $0.10 par value per share ("Common Stock"), of the Company and the beneficial owner of an additional 467,500 shares of Common Stock. The Fund intends to continue to hold these shares through the date of the Annual Meeting. Pirate Capital LLC ("Pirate Capital"), whose principal business is providing investment management services, is the general partner of the Fund. Thomas R. Hudson Jr. is the Managing Member of Pirate Capital. Pirate Capital is also the investment adviser to, and Mr. Hudson is a director of, Jolly Roger Offshore Fund LTD and Jolly Roger Activist Portfolio Company LTD, each an investment fund, which are the beneficial owners, respectively, of 2,656,300 and 580,200 shares of Common Stock. Pirate Capital is also the investment adviser to Mint Master Fund Ltd., an investment fund (together, with the Fund, Jolly Roger Offshore Fund LTD and Jolly Roger Activist Portfolio Company LTD, the "Funds"), which is the beneficial owner of 95,700 shares of Common Stock. Pirate Capital and Mr. Hudson, as the managing member of Pirate Capital, may be deemed to be the beneficial owners of the 3,799,800 shares of Common Stock that are collectively owned by the Funds. The business address for Pirate Capital and for the Funds is 200 Connecticut Avenue, 4th Floor, Norwalk, Connecticut 06854. According to the Company's Proxy Statement for its 2005 Annual Meeting, this notice must be given to the Company by January 18, 2006. This notice is being delivered prior to such deadline. The Fund does not acknowledge the validity of the requirement as it is set forth in the 2005 Proxy Statement, and the execution and delivery of this notice by the Fund shall not be deemed to constitute a waiver of the Fund's right to contest the validity of such requirement. The Fund, as the record owner and beneficial owner of shares of Common Stock, hereby gives notice of its intent to appear in person or by proxy at the Annual Meeting to nominate David A. Lorber, Todd R. Snyder and Robert C. Woods (the "Nominees") for election as directors. Certain additional information regarding the Nominees is set forth in Exhibit A. The Fund has no reason to believe that there is any impediment to this action under Ohio law, including the control share acquisition requirements set forth in Ohio Revised Code Section 1701.831, and reserves all rights if the Company purports to invoke any such provision. Pirate Capital, on behalf of the Funds, has entered into letters of agreement (the "Nominee Agreements") with each of the Nominees, pursuant to which Pirate Capital has agreed, subject to certain exceptions, to pay all costs of a proxy contest, and to indemnify and hold each Nominee harmless from and against any and all losses, claims, damages, penalties, judgments, awards, liabilities, costs, expenses and disbursements incurred in connection with such Nominee being a candidate for election to the Board. The Nominees will not receive any compensation from Pirate Capital or the Funds for their services as directors of the Company if elected. If elected, the Nominees will be entitled to such compensation from the Company as is provided to other non-employee directors, which compensation will be described in the Company's proxy statement furnished to shareholders in connection with the Annual Meeting. Each of the Nominees has executed a consent to being nominated for election as a director of the Company and to serve as a director of the Company if elected at the Annual Meeting. Copies of the consents executed by each of the Nominees are attached hereto as Exhibit B. The Fund reserves the right to nominate substitute or additional persons as nominees for any reason, including in the event that (1) the Board is expanded beyond its current size and/or (2) any of the current Nominees is unable for any reason (including by reason of the taking or announcement of any action that has, or if consummated would have, the effect of disqualifying any such Nominee) to serve as a director. Exhibit C sets forth the name of each of the Funds and Nominees that purchased or sold Common Stock within the previous two years, the dates of the transactions and the amounts purchased or sold. Except as disclosed herein or in any of the exhibits attached hereto, none of the Funds, Mr. Hudson or any of the Nominees: (i) owns any securities of the Company of record but not beneficially; (ii) owns beneficially any securities of the Company or any parent or subsidiary of the Company; (iii) has, nor do any of their associates have, any agreement or understanding with any person with respect to any future employment by the Company or its affiliates; (iv) has, nor do any of their associates have, any agreement or understanding with any person with respect to any future transactions to which the Company or any of its affiliates will or may be a party; (v) has, nor have any of their associates, engaged in or had a direct or indirect interest in any transaction, or series of similar transactions, since the beginning of the Company's last fiscal year, or any currently proposed transaction, or series of similar transactions, to which the Company or any of its subsidiaries was or is to be a party, in which the amount involved exceeds $60,000 and in which any of the persons listed in Item 404(a) of Regulation S-K ("Regulation S-K") had, or will have, a direct or indirect material interest; (vi) has, nor have any of their associates, been indebted to the Company or its subsidiaries at any time since the beginning of the Company's last fiscal year in an amount in excess of $60,000; (vii) has any substantial interest, direct or indirect, by security holdings or otherwise, in any matter to be acted upon at the Meeting proposed in this notice aside from their respective interests as shareholders of the Company; (viii) has borrowed any funds for the purpose of acquiring or holding any securities of the Company; (ix) is presently, or has been within the past year, a party to any contract, arrangement or understanding with any person with respect to securities of the Company, including, but not limited to, joint ventures, loan or option -2- arrangements, puts or calls, guarantees against loss or guarantees of profit, division of losses or profits, or the giving or withholding of proxies; (x) has, during the past 10 years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors); or (xi) has, during the past 5 years, been involved in any of the legal proceedings described in Item 401(f) of Regulation S-K. The term "associates" shall have the meaning as that term is defined in Rule 14a-1 of Regulation 14A under the Securities Exchange Act of 1934, as amended. Except as otherwise set forth in this notice, there are no material proceedings in which any of the Nominees or any of their associates is a party adverse to the Company or any of its subsidiaries, or proceedings in which any of the Nominees or their associates have a material interest adverse to the Company or any of its subsidiaries. None of the Nominees has ever served on the Board. Except as otherwise set forth in this notice, none of the Nominees or any of their associates has received any cash compensation, cash bonuses, deferred compensation, compensation pursuant to other plans or other compensation from, or related to, services rendered on behalf of the Company, or is subject to any arrangement described in Item 402 of Regulation S-K. Except as otherwise set forth in this notice, none of the relationships regarding the Nominees described in Item 404(b) of Regulation S-K exists or has existed. To the knowledge of the Fund, there are no relationships involving any of the Nominees or any of their associates that would have required disclosure under Item 402(j) of Regulation S-K had the Nominees been directors of the Company. There are no family relationships (as defined in Section 401(d) of Regulation S-K) between any Nominees and any director or officer of the Company or person nominated by the Company to become a director or executive officer. If the Fund proceeds with a solicitation of proxies in support of the nominations, it is anticipated that the Funds and Pirate Capital, as well as certain employees of Pirate Capital, would be participants in such solicitation, and would engage a proxy solicitation agent whose fees and number of employees to be employed for such solicitation would be agreed upon at the time of such engagement. The business address of each such employee would be the same as that of the proxy solicitation agent. Pirate Capital, on behalf of the Funds, would bear the cost of such proxy solicitation, but would intend to seek reimbursement for the cost of such solicitation from the Company if any of the Nominees are elected as directors. Pirate Capital does not intend to seek shareholder approval for such reimbursement. While no precise estimate of this cost can be made at the present time, Pirate Capital currently estimates that it would spend a total of approximately $500,000 for such solicitation of proxies, including expenditures for attorneys, proxy solicitation agents, and advertising, public relations, printing, transportation and related expenses. As of the date hereof, Pirate Capital has not incurred any solicitation expenses. In addition to soliciting proxies by mail, proxies may be solicited in person, by telephone or facsimile, through advertisements or otherwise. The information included herein and in the exhibits attached hereto represents the Fund's best knowledge as of the date hereof. The Fund reserves the right, in the event such information shall be or become inaccurate, to provide corrective information to the Company as soon as reasonably practicable, although the Fund does not commit to update any information which may change from and after the date hereof. If this notice shall be deemed for any reason by a court of competent jurisdiction to be ineffective with respect to the nomination of any Nominee at the Annual Meeting, or if any individual Nominee shall be unable to serve for any reason, this notice shall continue to be effective with respect to the remaining Nominees and as to any replacement Nominees selected by the Fund. In addition, the Fund requests written notice no later than 12:00, noon, on January 17, 2006 of any alleged defects in this notice and reserves the right, following receipt of such notice, to challenge and/or attempt to cure any such alleged defect. -3- Please direct any questions regarding the information contained in this notice to Marc Weingarten of Schulte Roth & Zabel LLP, 919 Third Avenue, New York, New York 10022, (212) 756-2280. Very truly yours, JOLLY ROGER FUND LP By: Pirate Capital LLC, its General Partner By: /s/ Thomas R. Hudson Jr. ------------------------------- Name: Thomas R. Hudson Jr. Title: Managing Member cc: Terry L. Hall David A. Lorber Todd Snyder Robert C. Woods -4- Exhibit A 1. David A. Lorber, 27. Mr. Lorber has been a Director and Senior Investment Analyst at Pirate Capital LLC, an investment manager, since October, 2003. Prior to joining Pirate Capital, Mr. Lorber was an Analyst at Vantis Capital Management LLC, a money management firm and hedge fund, from September, 2001 to May, 2003. Prior to that, Mr. Lorber held an Associate position at Cushman & Wakefield, Inc. Mr. Lorber earned his B.S. from Skidmore College in 2000. Mr. Lorber's principal business address is 200 Connecticut Avenue, 4th Floor, Norwalk, Connecticut 06854. 2. Todd R. Snyder, 43. Mr. Snyder has been a Managing Director of Rothschild Inc., an international investment banking and financial advisory firm, since March, 2000. Before joining Rothschild, Mr. Snyder was a Managing Director and earlier held other positions in the Restructuring and Reorganization group at Peter J. Solomon Company. Prior to joining Peter J. Solomon Company, Mr. Snyder was a Managing Director at KPMG Peat Marwick in the Corporate Recovery group. Prior to his move to investment banking, Mr. Snyder practiced law in the Business Reorganization department of Weil, Gotshal & Manges. Mr. Snyder graduated with honors from Wesleyan University and received a Juris Doctor from the University of Pennsylvania Law School. Mr. Snyder's principal business address is 1251 Avenue of the Americas, 51st floor, New York, New York 10020. 3. Robert C. Woods, 54. Mr. Woods has been an Investment Banker at Cornerstone Capital Advisors, a real estate investment bank, since 1987. From 1983 to the present, Mr. Woods has also been a real estate developer for Palladian Partners, a real estate development company. At both Cornerstone and Palladian, Mr. Woods' experience includes developing and financing master planned communities. From 1980 to 1983 he was a Project Manager and Vice President of Development for Hines Interests LLC, a real estate development company, and from 1979 to 1980 Mr. Woods was a Project Manager for Trammell Crow, a real estate development company. Mr. Woods was also a consulting professor of real estate finance at Stanford University from 2000 to 2005. Mr. Woods holds an MBA from the College of William and Mary and other advanced degrees from Stanford University, and is a Chartered Financial Analyst. Mr. Woods' principal business address is 27900 Altamont Circle, Los Altos Hills, California 94022. Exhibit B CONSENTS OF NOMINEES CONSENT OF NOMINEE The undersigned hereby consents to being named as a nominee for election as a director of GenCorp Inc. (the "COMPANY"), in the proxy statement and other materials concerning the undersigned's nomination in connection with the solicitation of proxies from shareholders of the Company to be voted at the 2006 annual meeting of shareholders of the Company or special meeting of shareholders regarding the election of directors, including any adjournments or postponements thereof, and further consents to serve as a director of the Company, if elected. /s/ David A. Lorber ----------------------- Name: David A. Lorber CONSENT OF NOMINEE The undersigned hereby consents to being named as a nominee for election as a director of GenCorp Inc. (the "COMPANY"), in the proxy statement and other materials concerning the undersigned's nomination in connection with the solicitation of proxies from shareholders of the Company to be voted at the 2006 annual meeting of shareholders of the Company or special meeting of shareholders regarding the election of directors, including any adjournments or postponements thereof, and further consents to serve as a director of the Company, if elected. /s/ Todd R. Snyder -------------------------- Name: Todd R. Snyder CONSENT OF NOMINEE The undersigned hereby consents to being named as a nominee for election as a director of GenCorp Inc. (the "COMPANY"), in the proxy statement and other materials concerning the undersigned's nomination in connection with the solicitation of proxies from shareholders of the Company to be voted at the 2006 annual meeting of shareholders of the Company or special meeting of shareholders regarding the election of directors, including any adjournments or postponements thereof, and further consents to serve as a director of the Company, if elected. /s/ Robert C. Woods ---------------------------- Name: Robert C. Woods Exhibit C PURCHASES AND SALES OVER PAST TWO YEARS The following table sets forth the name of each of the Funds and Nominees who purchased or sold Common Stock within the previous two years, the dates of the transactions and the amounts purchased or sold: JOLLY ROGER OFFSHORE FUND LTD. Trade Date Quantity 08-30-2004 500 09-02-2004 16,200 09-17-2004 15,000 09-20-2004 50,000 09-23-2004 7,000 09-27-2004 5,000 09-27-2004 5,000 09-28-2004 3,200 09-28-2004 2,800 09-29-2004 6,300 09-29-2004 5,000 09-29-2004 4,900 09-30-2004 5,000 09-30-2004 8,000 10-05-2004 25,000 10-06-2004 15,700 10-07-2004 30,000 10-07-2004 6,000 10-07-2004 5,000 10-11-2004 45,900 10-13-2004 25,000 10-13-2004 5,000 10-13-2004 3,900 10-13-2004 1,100 10-14-2004 1,700 10-14-2004 100 10-19-2004 15,000 10-20-2004 3,200 10-20-2004 15,000 10-20-2004 10,000 10-21-2004 25,000 10-21-2004 6,800 10-22-2004 25,000 10-22-2004 9,500 10-22-2004 8,600 10-22-2004 3,900 10-25-2004 25,000 10-26-2004 20,800 11-01-2004 7,100 11-02-2004 25,000 11-02-2004 25,000 11-02-2004 24,800 JOLLY ROGER OFFSHORE FUND LTD. Trade Date Quantity 11-02-2004 200 11-03-2004 25,000 11-03-2004 25,000 11-03-2004 25,000 11-03-2004 25,000 11-03-2004 25,000 11-05-2004 10,000 12-02-2004 500 12-06-2004 3,700 12-06-2004 3,300 12-06-2004 1,700 12-06-2004 1,300 12-06-2004 5,000 12-06-2004 5,000 12-06-2004 5,000 12-06-2004 5,000 12-06-2004 5,000 12-06-2004 5,000 12-06-2004 5,000 12-06-2004 5,000 12-06-2004 5,000 12-06-2004 5,000 12-07-2004 9,100 12-07-2004 3,800 12-07-2004 10,000 12-07-2004 10,000 12-07-2004 10,000 12-07-2004 10,000 12-09-2004 15,000 12-09-2004 5,000 12-09-2004 5,000 12-09-2004 3,000 12-09-2004 2,000 12-10-2004 10,000 12-10-2004 25,000 12-14-2004 900 12-14-2004 4,100 12-14-2004 3,000 01-11-2005 25,000 01-11-2005 25,000 03-31-2005 100 03-31-2005 24,900 03-31-2005 23,700 03-31-2005 22,800 03-31-2005 2,100 03-31-2005 1,100 03-31-2005 200 JOLLY ROGER OFFSHORE FUND LTD. Trade Date Quantity 03-31-2005 100 04-07-2005 26,700 04-07-2005 26,000 04-07-2005 300 04-19-2005 400 04-19-2005 5,000 04-19-2005 600 04-20-2005 15,000 04-25-2005 5,000 04-26-2005 5,000 04-26-2005 3,000 04-27-2005 400 04-27-2005 100 04-27-2005 9,100 04-27-2005 5,000 04-27-2005 4,900 04-28-2005 5,000 04-29-2005 11,700 04-29-2005 6,000 04-29-2005 5,000 04-29-2005 5,000 04-29-2005 5,000 04-29-2005 5,000 04-29-2005 3,100 04-29-2005 2,000 04-29-2005 19,000 04-29-2005 13,300 05-02-2005 4,900 05-02-2005 100 05-02-2005 15,000 05-02-2005 5,000 05-02-2005 5,000 05-02-2005 5,000 05-03-2005 1,300 05-04-2005 25,000 05-05-2005 5,000 05-10-2005 25,000 05-10-2005 5,000 05-12-2005 5,000 05-12-2005 5,000 05-12-2005 25,000 05-12-2005 5,000 05-26-2005 500 05-31-2005 10,100 06-01-2005 30,000 06-01-2005 26,000 06-21-2005 19,000 07-06-2005 64,400 JOLLY ROGER OFFSHORE FUND LTD. Trade Date Quantity 07-07-2005 41,000 07-07-2005 39,500 07-07-2005 60,600 07-07-2005 53,800 08-05-2005 10,700 08-12-2005 15,000 08-19-2005 9,000 08-23-2005 200 08-24-2005 7,000 08-25-2005 400 08-26-2005 1,400 08-31-2005 4,700 09-22-2005 4,000 09-29-2005 10,000 10-25-2005 1,100 10-27-2005 6,900 10-31-2005 10,000 11-08-2005 1,100 11-14-2005 10,000 11-16-2005 47,600 11-17-2005 4,800 11-18-2005 2,100 11-18-2005 50,000 11-18-2005 9,100 11-21-2005 50,000 11-23-2005 16,500 11-29-2005 49,300 11-30-2005 15,300 12-02-2005 46,600 12-05-2005 30,500 12-06-2005 25,000 12-07-2005 80,000 12-08-2005 47,800 12-09-2005 2,200 12-12-2005 6,800 12-13-2005 38,100 12-14-2005 128,200 12-15-2005 40,500 12-19-2005 46,400 12-20-2005 5,900 12-22-2005 13,100 12-27-2005 25,000 12-28-2005 400 12-29-2005 35,500 12-30-2005 32,000 01-03-2006 53,700 JOLLY ROGER FUND LP Trade Date Quantity 08-30-2004 100 08-30-2004 400 09-02-2004 13,000 09-17-2004 10,000 09-20-2004 30,000 09-23-2004 5,000 09-23-2004 6,000 09-23-2004 5,000 09-23-2004 5,500 09-30-2004 5,000 10-05-2004 1,400 10-05-2004 10,000 10-05-2004 5,000 10-05-2004 2,300 10-06-2004 200 10-06-2004 4,800 10-06-2004 400 10-07-2004 20,000 10-08-2004 30,900 10-12-2004 25,000 10-20-2004 100 10-20-2004 5,500 10-20-2004 1,300 10-20-2004 13,400 10-20-2004 8,700 10-20-2004 6,700 10-21-2004 7,700 10-22-2004 25,000 10-22-2004 24,100 10-22-2004 900 10-25-2004 25,000 10-29-2004 10,000 11-02-2004 5,000 11-03-2004 25,000 11-03-2004 25,000 11-03-2004 25,000 11-04-2004 25,000 11-04-2004 1,100 11-05-2004 17,700 12-13-2004 25,000 12-14-2004 5,000 01-11-2005 25,000 09-22-2005 1,000 10-10-2005 7,500 12-07-2005 20,000 04-07-2005 (23,100) 04-07-2005 (25,000) MINT MASTER FUND, LTD. Trade Date Quantity 09-29-2004 4,600 09-29-2004 400 10-15-2004 7,700 10-15-2004 5,000 10-15-2004 18,000 10-20-2004 10,000 11-16-2004 100,000 03-17-2005 (50,000) JOLLY ROGER ACTIVIST PORTFOLIO COMPANY LTD Trade Date Quantity 01-04-2006 100,000 01-05-2006 159,000 01-06-2006 235,900 01-09-2006 85,300