SOURCE: Woodward Governor Company

Woodward Governor Company

October 15, 2009 13:22 ET

Agreement Reached on Settlement of Government Investigation of MPC

FORT COLLINS, CO,--(Marketwire - October 15, 2009) - Woodward Governor Company (NASDAQ: WGOV) announced today that MPC Products Corporation (now doing business as Woodward MPC), a wholly owned subsidiary acquired by Woodward in October 2008 ("MPC"), has reached an agreement with the U.S. Department of Justice ("DOJ") to resolve the criminal and civil claims related to the previously announced investigation of MPC's pre-June 2005 government contract pricing practices.

"I am pleased that the DOJ has approved this agreement, which is consistent with the previously disclosed settlement in principle that was reached by MPC before Woodward acquired MPC last October," said Chairman and Chief Executive Officer Thomas A. Gendron. "The misconduct at issue occurred several years prior to Woodward's acquisition of MPC, and involved individuals who are no longer employees of MPC. Woodward is firmly committed to a culture of integrity. Through our strong ethics and compliance programs, we will continue to drive this culture into all aspects of our business and our entire membership to ensure compliance with government contracting rules."

In settlement of the criminal and civil cases, MPC is to pay approximately $25 million in restitution and fines, which was previously accrued by Woodward as part of the acquisition; the purchase price for MPC was also reduced by this amount. As part of the negotiated settlement, MPC will also plead guilty to one count of mail fraud related to its pre-June 2005 government contract pricing practices and has agreed to conditions of a two-year probation.

The civil settlement was approved by the United States District Court in the Northern District of Illinois (the "District Court") on October 7, 2009. The criminal case plea agreement, including sentencing, remains subject to approval by the District Court. If the Court approves the plea agreement, all matters related to the DOJ investigation will be concluded.

About Woodward

Woodward is an independent designer, manufacturer, and service provider of energy control and optimization solutions used in global infrastructure equipment. We serve the aerospace, power generation and distribution, and transportation markets. Our systems and components optimize the performance of commercial aircraft; military aircraft, ground vehicles and other equipment; gas and steam turbines; wind turbines; reciprocating engines; and electrical power systems. The company's innovative fluid energy, combustion control, electrical energy, and motion control systems help customers offer cleaner, more reliable and more cost-effective equipment. Our customers include leading original equipment manufacturers and end users of their products. Woodward is headquartered in Fort Collins, Colo., USA. Visit our website at www.woodward.com.

Information in this press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties, including, but not limited to, statements regarding the receipt of approval by the District Court and the ability of Woodward's ethics and compliance programs to prevent and detect future violations. Readers are cautioned that these forward-looking statements are only predictions and are subject to risks, uncertainties, and assumptions that are difficult to predict. Factors that could cause actual results and the timing of certain events to differ materially from the forward-looking statements include, but are not limited to, risks related to Woodward's dependence on continued business with the U.S. government, contract termination or non-renewal risks, the receipt of approval by the District Court, Woodward's ability to comply with the terms of the civil and criminal settlement and related administrative agreement, Woodward's ability to implement ethics and compliance programs that prevent or detect noncompliance with applicable laws and other risk factors described in Woodward's Annual Report on Form 10-K for the year ended September 30, 2008 and subsequently filed Quarterly Reports on Form 10-Q.

Contact Information

  • CONTACT:
    Rose Briani-Burden
    Business Communications
    815-639-6282

    Woodward Governor Company
    1000 East Drake Road
    Fort Collins, Colorado 80525, USA
    Tel: 970-482-5811
    Fax: 970-498-3058