GE Announces Details for Anticipated Completion of Spin-Off and Subsequent Merger of its Transportation Business

Subject to the satisfaction or waiver of customary closing conditions, on the distribution date for the spin-off, GE will distribute all of the shares of SpinCo common stock to GE shareholders as of the record date by means of a pro rata distribution.

As previously announced, immediately following the spin-off, SpinCo will merge with a subsidiary of Wabtec Corporation (NYSE: WAB), and SpinCo will continue as the surviving company. It is currently expected that 8.7 billion shares of SpinCo common stock will be distributed to GE shareholders as of the record date in connection with the spin-off, and each share of SpinCo common stock will be converted into the right to receive pursuant to the merger a number of shares of Wabtec common stock determined in accordance with the previously executed merger agreement. Based on the number of shares of GE common stock outstanding on December 31, 2018 and the number of shares of Wabtec common stock outstanding on a fully diluted basis as of such date, as a result of these transactions GE shareholders would receive approximately 0.005403 of a share of Wabtec common stock for each share of GE common stock held as of the record date.

The actual number of shares of Wabtec common stock that GE shareholders will receive with respect to each share of GE common stock will be determined based on the number of shares of GE common stock outstanding on the record date for the distribution and the number of shares of Wabtec common stock outstanding on a fully diluted basis immediately prior to the closing of the merger. No fractional shares of Wabtec common stock will be issued in the merger, and instead GE shareholders will receive cash in lieu of any fractional share. 

The spin-off and the merger are currently expected to occur on February 25, 2019, subject to certain closing conditions being satisfied as of the closing date.

Upon completion of the merger, GE shareholders are expected to collectively own approximately 24.3% of the outstanding shares of Wabtec common stock, and current Wabtec shareholders are expected to collectively own approximately 50.8%. GE will own Wabtec common stock and Wabtec non-voting convertible preferred stock, which together represent approximately a 24.9% economic interest in Wabtec. 

These percentages and the exchange ratio above are calculated on a fully-diluted, as-converted and as-exercised basis, and assume that the number of shares of Wabtec common stock outstanding on such basis immediately prior to the closing of the merger will be equal to the number of shares of Wabtec common stock outstanding on such basis as of December 31, 2018 and the number of shares of GE common stock outstanding on the record date for the distribution is equal to the number of shares outstanding on December 31, 2018. 

No action is required by GE shareholders to receive their shares of Wabtec common stock in the merger. GE shareholders will not be required to surrender their shares or pay for any shares of Wabtec common stock that they receive and will retain all of their shares of GE common stock and associated rights. 

Two-Way Trading to Begin for GE Common Stock on the NYSE
GE has been advised by the New York Stock Exchange (the “NYSE”) that, beginning on or about February 14, 2019, and continuing through and including the closing date of the merger, which is expected to be February 25, 2019, there will be two markets in GE common stock on the NYSE: a “regular way” market and an “ex-distribution” market. During this period of two-way trading in GE common stock, a GE shareholder can sell the right to his or her Wabtec common stock that he or she will receive pursuant to the merger in a “when issued” market. These trading options are outlined in further detail below.

If, during the period of two-way trading, a GE shareholder sells shares of GE common stock in the “regular way” market (under GE’s NYSE symbol, “GE”), the shareholder will be selling both his or her shares of GE common stock and his or her right to receive shares of Wabtec common stock pursuant to the merger.

If, during this period of two-way trading, a GE shareholder sells shares of GE common stock in the “ex-distribution” market (under the temporary NYSE symbol “GE WI”), the shareholder will be selling only his or her shares of GE common stock and will be retaining his or her right to receive shares of Wabtec common stock pursuant to the merger.

A GE shareholder also has the option of selling his or her right to shares of Wabtec common stock and to retain his or her shares of GE common stock during this period in the “when issued” market. This option will be available under the temporary NYSE symbol “WAB WI”.

Trades under the symbols “GE WI” and “WAB WI” will settle after the closing date of the merger. If the merger is not completed, all trades under these symbols will be cancelled.

In all cases, investors are encouraged to consult with their financial advisors regarding the specific implications of selling shares of their GE common stock or the right to receive shares of Wabtec common stock on or before the closing date of the merger.

Additional details about the spin-off and the merger may be found in the registration statement on Form 10 filed by SpinCo with the U.S. Securities and Exchange Commission (the “SEC”) in connection with the spin-off, available at http://www.sec.gov

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