Summary of GENCORP INC - Yahoo! Finance

Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation

Item 1.01 Entry into a Material Definitive Agreement.

On January 28, 2013, GenCorp Inc. (the "Company") completed its previously announced offering of $460 million aggregate principal amount of 7.125% Second-Priority Senior Secured Notes due 2021 (the "Notes"). The Notes were sold to qualified institutional buyers in accordance with Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and outside the United States in accordance with Regulation S under the Securities Act.

Escrow Agreement

On January 28, 2013, the Company entered into an escrow agreement (the "Escrow Agreement") by and among the Company and U.S. Bank National Association, as trustee under the indenture governing the Notes (in such capacity, the "Trustee"), as escrow agent (in such capacity, the "Escrow Agent"), and as bank and securities intermediary. Pursuant to the Escrow Agreement, the Company has caused the gross proceeds from the sale of the Notes (after deducting underwriting discounts), plus an amount sufficient to fund a Special Mandatory Redemption (as defined below) on February 28, 2013, including accrued interest on the Notes, to be deposited into an escrow account, pending the consummation of the acquisition by the Company of United Technologies Corporation's Pratt & Whitney Rocketdyne business (the "Acquisition"). Pursuant to the Escrow Agreement, the Company will continue to deposit accrued interest on the Notes on a monthly basis until the satisfaction of the conditions to release such proceeds from escrow.

Amounts in the escrow account will be pledged to the Trustee for its benefit and for the benefit of the Noteholders and, upon satisfaction of certain conditions, including the consummation of the Acquisition, will be released to fund, in part, the Acquisition and to pay related fees and expenses.

In the event that the conditions to the release of the escrow, including the consummation of the Acquisition, are not satisfied on or prior to July 21, 2013 (subject to a one-month extension), or the Company notifies the Escrow Agent that it will not pursue the consummation of the Acquisition, or the Company fails to make any of the aforementioned deposits into the escrow account, the Notes will be subject to the special mandatory redemption (the "Special Mandatory Redemption") at a price equal to 100% of the initial issue price of the Notes, plus accrued and unpaid interest from January 28, 2013 to, but not including, the date of the Special Mandatory Redemption.

The description of the Escrow Agreement contained herein does not purport to be complete and is qualified in its entirety by reference to the full text of the Escrow Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.

Indenture

The Notes were issued pursuant to an indenture, dated as of January 28, 2013 (the "Indenture"), by and among the Company, its wholly-owned subsidiary Aerojet-General Corporation ("Aerojet"), as guarantor, and U.S. Bank National Association, a national banking association, as trustee and collateral agent.

The Notes mature on March 15, 2021 and bear interest at a rate of 7.125% per annum, payable semi-annually in cash in arrears on March 15 and September 15 of each year, beginning March 15, 2013. The Notes will be redeemable at the Company's option, in whole or in part, at any time prior to March 15, 2016 at a price equal to 100% of the principal amount, plus any accrued and unpaid interest to the date of redemption, plus a "make-whole" premium. Thereafter, the Company may redeem the Notes, at any time on or after March 15, 2016, at redemption prices (expressed as percentages of principal amount) set forth below plus accrued and unpaid interest and additional interest, if any, thereon, to the applicable redemption date, if redeemed during the twelve-month period beginning March 15 of the years indicated below:

                       Redemption
Year                     Price

2016                     105.344 %
2017                     103.563 %
2018                     101.781 %
2019 and thereafter      100.000 %

In addition, before March 15, 2016, the Company may redeem up to 35% of the original aggregate principal amount of the Notes at a redemption price equal to 107.125% of the aggregate principal amount of the Notes, plus accrued interest, with the proceeds from certain types of public equity offerings.

The Notes are guaranteed by Aerojet. Following the consummation of the proposed Acquisition, the Notes will be fully and unconditionally guaranteed on a second-priority senior secured basis by each of the Company's existing and future subsidiaries that guarantee its obligations under the Company's existing senior secured credit facility (the "Senior Credit Facility").

Prior to the consummation of the Acquisition, the Notes will be secured by a first priority security interest in the escrow account and all deposits and investment property therein. Following the consummation of the Acquisition, the Notes will be secured on a second-priority basis by the assets (other than real property) that secure the Company's and its guarantors' obligations under the Senior Credit Facility, subject to certain exceptions and permitted liens.

Upon the occurrence of a change of control (as defined in the Indenture), if the . . .