Hercules will respond later this month to claims by the U.S. General Accounting Office that it overcharged the U.S. Air Force by $1.1 million on two contracts.

The government claims that Hercules allowed a subcontractor, HR Textron, to use out-of-date or incomplete pricing data that led to overcharges in contracts for the Peacekeeper Missile Stage III motors."We are taking this matter very seriously and believe we have a strong case in defending our position," a press release said.

The press release said Hercules has performed on schedule, met all cost targets and cooperated fully with government auditors.