Patheon Restructures Bank Agreement

Patheon, Inc. has entered into an agreement with its lenders to restructure certain financial agreements under its North American loan facilities in an effort to continue its business.

The 12-month credit agreement, to be satisfied monthly, covers a six-month period from October 31, 2006 to March 31, 2007, at which point the company plans to have implemented a long-term improvement to its capital structure.

“With this amendment in place, Patheon has the financial flexibility to continue to operate our business effectively and in compliance with our loan agreements. At the same time, we will continue to pursue strategic alternatives that will serve the interests of our shareholders, clients, and employees,” said Mr. Riccardo Trecroce, chief executive officer, Patheon. “We are making progress on the strategic review process announced last month, and we intend to complete this process during the period covered by the amendment to the credit agreement.”

As of September 30, 2006, $252.4 million was outstanding under the North American loan facilities. As part of the amendment, the loan facility was reduced from $75 million to $60 million. Also, at September 30th, $42.3 million was borrowed under this facility. The company had $49 million of cash reserves at this time and according to the company,  is confident it has sufficient liquidity to carry on its business.