Hexion Specialty Chemicals, Inc. Announces Acceptance Of All Notes Tendered on or Before 11:30 A.M. on May 5, 2006 Pursuant to Its Tender Offers

COLUMBUS, Ohio--May 5, 2006--Hexion Specialty Chemicals, Inc. ("Hexion" or the "Company") announced today that it has exercised its right to accept for early payment all its outstanding 13 1/2% Senior Subordinated Notes Due 2010, 9 1/2% Senior Second Secured Notes Due 2010 and 8% Senior Secured Notes Due 2009 (collectively, the "Notes") tendered by 11:30 a.m. New York City time, on May 5, 2006. Pursuant to the terms of the Offer to Purchase and Consent Solicitation Statement dated April 20, 2006 and the related Consent and Letter of Transmittal (the "Offer Documents"), the Company has accepted for purchase and paid for $290,859,000 principal amount of the outstanding $328 million principal amount of its 13 1/2% Senior Subordinated Notes Due 2010, $199,801,000 principal amount of the outstanding $200 million principal amount of its 9 1/2% Senior Second Secured Notes Due 2010 (the "9 1/2% Notes") and $140 million principal amount of the outstanding $140 million principal amount of its 8% Senior Secured Notes Due 2009 (the "8% Notes").

In connection with the tender offers for the Notes, Hexion received the required consents with respect to the Notes to eliminate substantially all of the restrictive covenants and certain events of default included in the Indentures under which such Notes were issued. As a result, the consent condition has been satisfied with respect to the Notes. In addition, Hexion also announced that all conditions, including obtaining the financing to pay for the Notes and consents in accordance with the terms of the Offer Documents, have been satisfied. Accordingly, the supplemental indentures relating to the Notes containing the proposed amendments were executed by Hexion and each of the Trustees under the respective Indentures, and became operative upon Hexion's acceptance for purchase of the Notes tendered to date. In addition, in connection with the tender offers, Hexion solicited the consent of the holders of the 9 1/2% Notes and the 8% Notes to terminate all of the security interests securing the obligations under such Notes. All such security interests were terminated immediately after the acceptance for purchase of the 9 1/2% Notes and the 8% Notes by Hexion.

Notwithstanding Hexion's exercise of its early acceptance rights, the Tender Offers will remain open until midnight, New York City time, on May 1, 20067, 2006, unless extended by Hexion.

Hexion has retained Credit Suisse Securities (USA) LLC to act as Dealer Manager in connection with the tender offers and consent solicitations. Questions about the tender offers and consent solicitations may be directed to Credit Suisse Securities (USA) LLC at (800) 820-1653 (toll free) or (212) 538-0652 (collect). Copies of the Offer Documents and other related documents may be obtained from D.F. King & Co., Inc., the information agent for the tender offers and consent solicitations, at (800) 290-6426 (toll free) or (212) 269-5550 (collect).

The tender offers and consent solicitations are being made solely by means of the Offer Documents. Under no circumstances shall this press release constitute an offer to purchase or the solicitation of an offer to sell the Notes or any other securities of Hexion. No recommendation is made as to whether holders of the Notes should tender their Notes.

Forward Looking Statements

Certain statements in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Forward looking statements may be identified by the words "believe," "expect," "anticipate," "project," "plan," "estimate," "will" or "intend" and similar expressions. The forward-looking statements contained herein reflect our current views with respect to future events and are based on our currently available financial, economic and competitive data and on current business plans. Actual results could vary materially depending on risks and uncertainties that may affect the Company's operations, markets, services, prices and other factors as discussed in our SEC filings. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: economic factors such as an interruption in the supply of or increased pricing of raw materials due to natural disasters, competitive factors such as pricing actions by our competitors that could affect our operating margins, and regulatory factors such as changes in governmental regulations involving our products that lead to environmental and legal matters as described in our SEC filings. Additional factors that could cause actual results to differ materially from those in the forward-looking statements are discussed in our Form 10-K for the period ended December 31, 2005 under the caption "Forward-Looking and Cautionary Statements" under Item 7: Management's Discussion and Analysis of Financial Condition and Results of Operations. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as otherwise required by law.

About Hexion Specialty Chemicals

Based in Columbus, Ohio, Hexion Specialty Chemicals combines the former Borden Chemical, Bakelite, Resolution Performance Products and Resolution Specialty Materials companies into the global leader in thermoset resins. Hexion serves the global wood and industrial markets through a broad range of thermoset technologies, specialty products and technical support for customers in a diverse range of applications and industries. Hexion Specialty Chemicals is owned by an affiliate of Apollo Management, L.P. Additional information is available at www.hexion.com.