CHARLESTON, S.C., Nov. 9, 2004 (PRIMEZONE) -- Wastech, Inc. (Pink Sheets:WTCH) (the "Company") today announced that it has declared and will pay two (2) dividends of one-fifth (1/5th) of a share of Series A Preferred Stock to all such lawful holders of record of Series A Preferred Stock. Following the consecutive dividends, the Company will automatically convert the Series A Preferred Stock into ten (10) shares of Common Stock.
The Company has 152,889 shares of Series A preferred Stock, originally issued by Corporate Vision, Inc. ("CVI"), and converted into shares of Series A Preferred Stock of the Company by virtue of its holding company reorganization effected as of March 18, 2004. No current officer, director, employee or affiliate of Wastech beneficially owns Series A Preferred Stock.
The terms of the Series A Preferred Stock were set forth in a corporate resolution of the board of directors of CVI, dated August 17, 1998, summarized as follows:
If the Company fails to have $2,000,000 or more pre-tax earnings for the twelve months ended June 30, 2002, exclusive of extraordinary items and non recurring items, or upon the failure of the Company's Common stock Does not trade for at least $10.00 for ten days between June 30, 2002 and August 15, 2003, then the company will declare a dividend on each Series A Preferred Stock of one-fifth share of Series A preferred stock. The Company will declare a similar dividend on the Preferred Stock unless the Common Stock trades above $10.00 per share for 20 consecutive days after July 15, 2003 but before August 15, 2003, or if the Company fails to have pre-tax earnings of $2,000,000 exclusive of extraordinary and non-recurring items.
As the Common Stock of CVI never traded above $10.00 per share at any time in the periods described in the resolution, nor did CVI have pre-tax earnings of $2,000,000 or more during the years ended June 30, 2002 or 2003, the Company has declared and duly authorized the dividends, the record date of which shall be August 15, 2003.
The resolution creating the Series A Preferred Stock additionally provided that all shares of Series A Preferred Stock outstanding as of September 1, 2003 will be automatically converted into ten (10) shares of Common Stock. Accordingly, the Company has authorized such conversion.
The dividends and the conversion result in the issuance of 14.4 shares of Common Stock for every share of Series A Preferred Stock outstanding, totaling 2,201,601.6 shares of new issue Common Stock of the Company. When actually issued, however, the Company has agreed that all fractional shares are to be rounded-up to the nearest whole share.
The Company has directed its stock transfer agent to disseminate a "Letter of Transmittal" to all registered shareholders of record of Series A Preferred Stock, detailing the instructions and procedures to be followed for a valid and effective conversion into Common Stock.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements contained in this news release which are not historical facts may be "forward-looking statements" that involve risks and uncertainties which could cause actual results to differ materially from those currently anticipated. For example, statements that describe Wastech's hopes, plans, objectives, goals, intentions, or expectations are forward-looking statements. The forward-looking statements made herein are only made as of the date of this news release. Numerous factors, many of which are beyond Wastech's control, will affect actual results. Wastech undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances. This news release should be read in conjunction with Wastech's annual report on Form 10-KSB for the fiscal years ended December 31, 2002, 2001 and other filings with the U.S. Securities and Exchange Commission.