On a precise hit, the target takes damage as normal and must choose either weapon, shield, armor or item (carried or held). The chosen item breaks. Armor does not break but becomes damaged. Each instance of damage to a suit of armor imposes a 1-point penalty to its protective value. When the armor's protection equals 0, it's broken.
If one of the combatants is a warrior, he may choose the item to break/damage with this effect. If both combatants are warriors, the higher level character gets to choose; if tied, the option goes to the defender.
A broken item, weapon, shield or suit of armor may be repaired by a skilled smith (though some circumstances make it impractical).