Environmental Energy Services, Inc. Settles With Continental Energy Corp.
OKLAHOMA CITY, Jul 31, 2002 /PRNewswire-FirstCall via COMTEX/ -- Environmental Energy Services, Inc. (OTC Bulletin Board: EESV), a Delaware Corporation, announced today it has settled all claims or interests of Continental Energy Corporation ("CICG") against EESV. Prior to the settlement, CICG held 5 million shares of EESV's Series A preferred stock that were convertible into 25.5 million shares of common stock, and all of the issued and outstanding Series A and B convertible debentures of WasteMasters, Inc. that were convertible into shares of EESV's common stock at a conversion price of $0.25 per share. The Series A and B Convertible Debentures have an original principal amount of $2,986,000, and had an outstanding balance in excess of $4,000,000 with the inclusion of accrued interest.
In addition, CICG held a judgment against WasteMasters, Inc. in the original amount of $350,443, and had obtained an order from the Bankruptcy Court in the Northern District of Texas, Dallas Division, that effectively allowed it to sell any shares of EESV common stock held by it or that were issuable upon conversion of any securities of WasteMasters, Inc., including the Series A Preferred Stock and/or the Series A and B Convertible Debentures, to the extent necessary to satisfy the judgment. CICG had already sold on the open market 4,500,000 shares of EESV common stock, and had initiated legal steps to convert EESV's Series A Preferred Stock into EESV common stock for the purpose of satisfying the judgment through additional open market sales of EESV common stock. EESV believes that the past and expected future sales of its common stock by CICG to satisfy the judgment had been a factor in depressing the market value of its common stock.
Under the settlement, an unaffiliated investor purchased all of CICG's interest in the Series A Preferred Stock, WasteMasters, Inc.'s Series A and B Convertible debentures, and any shares of EESV common stock issued or issuable thereunder. In consideration for providing its consent to the transaction, the investor conveyed the WasteMasters, Inc. Series A and B Convertible Debentures, and any shares or rights associated therewith, to EESV.
Leon Blaser, Chairman stated, "The final payment of this settlement finalizes our relationship with Continental. In addition, we no longer have the threat of a large block of stock being dumped into the market by a party whose only incentive is to raise cash as quickly as possible to close its bankruptcy. As announcements in the near future will demonstrate, we can now complete several acquisitions that have been worked upon for several months. When the threat of the block of stock hitting the market arose, it put a damper on the acquisitions since the sellers did not want to have their stock price fall unnecessarily. I'm extremely excited about our current opportunities."
CONTACT: Greg Holsted of Environmental Energy Services, Inc., +1-405-262-0800
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