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American Pacific Completes Acquisition of Aerojet Fine Chemicals
Wednesday November 30, 5:43 pm ET

LAS VEGAS, Nov. 30 /PRNewswire-FirstCall/ -- American Pacific Corporation announced today that it has completed the previously announced purchase of the Aerojet Fine Chemicals fine chemicals business (the "Business") of GenCorp Inc., an Ohio corporation through the purchase of substantially all of the assets of Aerojet Fine Chemicals, LLC, a Delaware limited liability company ("AFC") and the assumption of certain liabilities of the Business.

The purchase price for AFC was $114.0 million plus a contingent payment of up to $5.0 million and the assumption by American Pacific of certain liabilities. Of this purchase price, $88.5 million was paid in cash at closing and $25.5 million was a subordinated seller note (which accrues interest on a payment-in-kind basis) issued at closing. The contingent payment of up to $5.0 million will be based on AFC achieving specified earnings targets in the twelve-month period ending September 30, 2006. Depending on the performance of AFC, there may be an interim adjustment. In addition, American Pacific reimbursed the seller $17.4 million, subject to adjustments, for the capital investment that the seller incurred in excess of the $19.0 million threshold. Furthermore, American Pacific paid the seller $2.4 million, subject to adjustments, for net working capital received in excess of $10.0 million pursuant to the working capital adjustment set forth in the amended purchase agreement.

AFC is a leading manufacturer of active pharmaceutical ingredients and registered intermediates under cGMP guidelines for commercial customers in the pharmaceutical industry. Its facilities in California offer specialized engineering capabilities including high containment for high potency compounds, energetic and nucleoside chemistries, and chiral separation using the first commercial-scale simulated moving bed in the United States. In fiscal 2004, AFC reported sales of approximately $66 million.

"We are very excited about the closing of this transaction. The fine chemicals business we have acquired complements our existing specialty chemical and energetic product portfolio. I am confident that this acquisition provides us with a strong presence in fast growing pharmaceutical markets," said John R. Gibson, CEO of American Pacific.

Concurrent with the closing of this transaction, the Company entered into a first lien credit agreement with Wachovia Bank, National Association, as administrative agent, Bank of America, N.A., as syndication agent, Wachovia Capital Markets, LLC, as sole lead arranger and sole book runner and certain other lenders for a $75 million secured revolving credit and term loan facility and a second lien credit agreement with Wachovia Bank, National Association, as administrative agent, Bank of America, N.A., as syndication agent, Wachovia Capital Markets, LLC, as sole lead arranger and sole book runner and certain other lenders for a $20 million secured term loan facility. The Company borrowed $85 million from these two credit facilities to finance the acquisition of the Business. Also concurrent with the closing of this transaction, and in recognition of his contribution to the successful completion of the purchase of Business, the Company entered into an Employment Agreement with Mr. Seth Van Voorhees, the Company's Vice President and Chief

Financial Officer, to be effective December 1, 2005, with an initial term until October 1, 2008.

Source: American Pacific Corporation

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