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Behrman Capital Portfolio Company Hunter Defense Technologies Acquires PowerSystems International, Inc.

NEW YORK, October 20, 2005 — Behrman Capital, a private equity investment firm based in New York and San Francisco, announced today that its portfolio company Hunter Defense Technologies, Inc., a manufacturer of military and homeland defense products, has acquired PowerSystems International, Inc. (PSI) in a transaction valued at approximately $40 million. Based in Natural Bridge Station, Virginia, PSI is a developer of power generation systems, power distribution and control equipment, and environmental control units for military applications.

Based in Solon, Ohio, Hunter is a leader in the design and manufacture of niche defense and homeland security products. Its primary product lines include nuclear, biological and chemical collective protection air filters and air filtration systems for military and homeland security applications, as well as highly engineered heating equipment for military vehicles, tents and shelters. In March of 2005, Hunter expanded its product line with the acquisition of Base-X, Inc., a leading manufacturer of rapidly deployable tactical shelters for military, medical, and homeland defense uses. The Base-X transaction was valued at approximately $80 million.

“PowerSystems International is a superb fit for Hunter Defense Technologies,” said Grant G. Behrman, Managing Partner of Behrman Capital. “As with the acquisition of Base-X, Inc. in March, Hunter’s acquisition of PSI enhances Hunter’s evolution into a complete solutions provider. PSI’s power generation and environmental control products are an excellent complement to the Base-X line of tactical shelters and Hunter’s filtration and heating equipment products.”

Vince Nardy, Chief Executive Officer of Hunter, said: “Base-X has been PSI’s largest customer for some time, and it is a logical next step for us to integrate our product offerings to provide a seamless and complete product line of mobile shelters with a range of power and environmental control options. In addition, by working with the team at PSI, we expect to accelerate our product development, bringing further growth to both businesses.”

“Joining forces with Hunter is a very positive step for us,” said Louis Zak, Chief Executive Officer of PSI. “As part of a larger organization, we will be able to further develop our own business with strong financial and organizational support and take advantage of a broader base of customers. I am delighted to be moving forward with the teams at Hunter and Base-X, with whom we’ve worked closely for years.” Mr. Zak is expected to continue with the combined company’s senior management.

Behrman Capital financed the transaction through a combination of debt and new equity. Hunter’s $15 million revolving credit facility has been expanded to $20 million. In addition, Hunter has added approximately $27.5 million to an existing term loan to help fund the acquisition.

Merrill Lynch Capital and Madison Capital Funding served as co-lead arrangers and joint book runners for the term loan. The financing is being provided by a consortium of approximately 20 lenders.

Goodwin Procter LLP acted as legal advisor to Behrman Capital and Hunter for this transaction. Williams Mullen, Washington, DC, represented PSI and its stockholders in the transaction.

Based in New York City and San Francisco, Behrman Capital was founded in 1991 by Grant G. and Darryl G. Behrman. The firm invests in management buyouts, leveraged buildups and recapitalizations of established growth companies. The company’s investments are focused primarily in four industries: information technology, contract manufacturing, outsourcing, and healthcare. The firm currently has a combined capital base of $1.8 billion.

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For Behrman Capital:
Michael Freitag / David Lilly
Kekst and Company
(212) 521-4800

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