American Ordnance Unveils Development Project At Milan.

Business Editors

MILAN, Tenn.--(BUSINESS WIRE)--Jan. 25, 2000

American Ordnance LLC (AO), announced today an agreement to investigate additional commercial opportunities for the Milan Army Ammunition Plant. The agreement focuses on how assets at the plant, including land, buildings and equipment, can be used to develop new business opportunities for the Milan facility and for the local region.

AO has a facility-use contract allowing the use of the 22,436 acre government-owned facility located in West Tennessee, approximately 100 miles from Memphis. AO is a joint venture company owned and operated by General Dynamics Ordnance Systems, Inc. (GDOS) and Day and Zimmermann, Incorporated. The Pendulum Management Company LLC (PMC) has been retained to coordinate the undertaking. Pendulum will work with state and local officials as well as the U.S. Army to maximize the value of the Tennessee facility.

PMC is an asset management company dedicated to assisting clients to recognize and maximize the value of facility assets. Mr. Rick Schweitzer, Program Manager - Facilities Use &Services at American Ordnance, stated, &uot;AO selected PMC for this mission because of their experience and proven ability in projects of a similar nature in scope and magnitude. AO has a similar contract with PMC at the Iowa Army Ammunition plant. PMC's management team is quite familiar with the challenges involved in an endeavor such as Milan represents.&uot;

Mr. Sid Saunders of Pendulum said, &uot;PMC welcomes this additional partnering opportunity with AO. PMC has found that the many army ammunition plants located within the U.S. offer an excellent opportunity for established businesses and for new business start-up companies. PMC is happy to be a part of the rebirth of these U.S. Army facilities. These projects are unique because of the facility size, their ideal locations with convenient distribution access and their close proximity to highways, railways and airways. These facilities have available infrastructure and ready-to-use assets, including qualified personnel&uot;. Saunders continued, &uot;PMC will determine what assets are suitable for redevelopment and then determine how existing facilities and equipment can be assimilated either into the already established government sector or into the private/commercial sector.&uot;

Redevelopment at the site began in 1999 with the arrival of East Camden and Highland Railroad, a supplier of railcar switching and storage services. In addition to the agreement with Pendulum, AO is in various stages of direct negotiations with several other companies interested in leasing facilities.

New incentives such as the U.S. Army Guaranteed Loan Program and other state and federal grants make facilities at the Milan Army Ammunition plant attractive for use by industry. Applicability of this loan program will be explored with all potential qualifying tenants.

Mr. Schweitzer of AO stated, &uot;Milan is an ammunition load, assemble and pack (LAP) facility that makes every effort to meet tomorrow's goals today. We supply the most up-to-date facilities, equipment and experience to our clients. We have always strived for excellence in production of products and now as we enter this diversification effort of attracting new business to our base, we plan to put forth a world class marketing effort. AO looks forward to working with and actively assisting the Pendulum management team.&uot;

For additional information on Milan or the diversification project, contact Mr. Schweitzer, American Ordnance, at 800/517-8282 or 901-686-6486, email: [e-mail] or Mr. Sid Saunders, Pendulum Management Company LLC, 800/797-7483, email: [e-mail].