American Ecology Repurchases Preferred Stock; Investors Exercise Warrants to Partially Fund Repurchase.Business Editors BOISE, Idaho--(BUSINESS WIRE)--March 3, 2003 James R. Baumgardner, Senior Vice President and Chief Financial Officer of American Ecology Corporation (Nasdaq:ECOL ECOL es.comp.os.linux.* (newsgroups) ECOL Emmanuel Church of Lakewood (San Francisco, CA) ), today announced the Company had repurchased all its outstanding Series D Cumulative Convertible Preferred Stock Convertible Preferred Stock Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". ("Series D Preferred") and paid all accrued dividends on February 28, 2003. Concurrently, investors holding Series E warrants exercised over 2 million warrants, whose proceeds were used to partially fund the repurchase of the Series D Preferred. "The removal of this high cost and potentially dilutive capital from the Company's balance sheet materially improves its long term capital structure and earnings potential by eliminating $400 thousand in annual dividends," Baumgardner stated. The repurchase transaction required the coordination and approval of two investor groups and the Company's primary bank. The net effect of the transaction was cash outflow of $4.7 million. The transaction was funded by a combination of Series E warrant proceeds and cash on hand. Issued in 1995, the Series D Preferred carried an interest rate of 8 3/8% and allowed the Series D Preferred holders to convert their preferred shares Preferred shares Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders. See: Preferred stock. to common shares at a protected conversion rate. "The retirement of this preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. is a continuation of management's strategy to improve earnings, cash flow and strengthen the balance sheet," Baumgardner noted, concluding "While requiring $4.7 million in cash, the Company continues to possess sufficient financial wherewithal to fund its growth plan through cash from operations, cash on hand and untapped credit availability." American Ecology Corporation, through its subsidiaries, provides radioactive, PCB PCB: see polychlorinated biphenyl. PCB in full polychlorinated biphenyl Any of a class of highly stable organic compounds prepared by the reaction of chlorine with biphenyl, a two-ring compound. , hazardous and non-hazardous waste services to commercial and government customers throughout the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , such as nuclear power plants, steel mills, medical and academic institutions and petro-chemical facilities. Headquartered in Boise, Idaho, American Ecology is the oldest radioactive and hazardous waste Hazardous waste Any solid, liquid, or gaseous waste materials that, if improperly managed or disposed of, may pose substantial hazards to human health and the environment. Every industrial country in the world has had problems with managing hazardous wastes. services Company in the United States. This press release contains forward-looking statements that are based on our current expectations, beliefs, and assumptions about the industry and markets in which American Ecology Corporation and its subsidiaries operate. Actual results may differ materially from what is expressed herein and no assurance can be given that the company can successfully implement its core business growth strategy or generate future earnings. For information on factors that could cause actual results to differ from expectations and regarding the repurchase of Series D Preferred and exercise of Series E warrants, please refer to American Ecology Corporation's Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. , filed February 18, 2003, and Report on Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. filed February 28, 2003 with the Securities and Exchange Commission. |
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