Continental raises $4.6 million, redeems debentures.CALHOUN, Ga.--(BUSINESS WIRE)--Feb. 18, 1997--Continental American Transportation Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). :COAW) announced Tuesday that it has secured a $4.6 million equity infusion through the issuance of corporate series A 7% Convertible 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. . The non voting preferred shares pay a monthly dividend of 7% annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. and are convertible to restricted common stock upon the six month anniversary of the issuance. Thereafter, a maximum of 1/6 of the preferred stock may be converted each quarter for up to five years. The investment was made by a local private investor who will act as an outside consultant to the board of directors. The company will redeem convertible debentures and certain current liabilities incurred in conjunction with the 1996 acquisition of Carpet Transport. Timothy Holstein, chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , stated: "As long as our stock remains undervalued Undervalued A stock or other security that is trading below its true value. Notes: The difficulty is knowing what the "true" value actually is. Analysts will usually recommend an undervalued stock with a strong buy rating. , it is in the best interest of our shareholders to eliminate the dilutive effect that these debentures have caused. We look to 1997 with great anticipation, as many of the cost saving programs implemented in late 1996 are now beginning to take effect." Continental American Transportation Inc. is a trucking and logistics management company with operating subsidiaries engaged in the transportation of food, beverages and textiles. Continental ranks in the top 20 specialized trucking companies based on its present revenue base of $90 million in sales. This press release contains certain forward looking information that is subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Without limitation these risks and uncertainties include economic recessions or downturns in customers' business cycles, rapid fluctuations in fuel pricing or availability, increase in interest rates, and the availability of qualified drivers. Readers are urged to carefully review and consider the various disclosures made by the company in this press release and in the company's periodic reports on its form 10K and 10Q. CONTACT: Continental American Transportation Inc. Erik Bailey, CFO See Chief Financial Officer. , 706/625-4500 or Shareholder Relations, 407/647-8444, ext. 71 |
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