Converted Organics Inc Coin

Converted Organics, Inc. (NASDAQ: COIN) Eliminates Debt with ...

Strategic acquisitions are sweet; in conjunction with M in debt savings, it’s even sweeter. Converted Organics, Inc. has announced the company will be wiping away a total of M in debt, M in liabilities and approximately M in future interest and lease payments. The lease payments are related to the company’s manufacturing Facility in Woodbridge, NJ, and in addition, Converted expects to add 0K in cash to the balance sheet. The series of transactions that led to the restructuring involves an agreement with the Oppenheimer Rochester National Municipals and Oppenheimer New Jersey Municipal Fund to settle .5M of municipal bond debt in exchange for 17,500 shares of Converted’s preferred stock. While the shares are restricted, they are also convertible into common stock at the rate of 1,842 shares of common for every one share of preferred stock. If all conversions were to be made, the two Oppenheimer funds would become the largest shareholders. Converted was also able to secure 0K from the two funds, although it’s really more like a return. The company already paid Oppenheimer the money in connection with its interest payment obligations under the municipal bonds. Converted was also able to establish a second debt-for-equity transaction, cleansing more than M worth of outstanding debt with American Capital Management, the owner of the Woodbridge Facility in Gonzales, CA. The company will be issuing common shares to ACM in exchange for eliminating the claims and lease liabilities relating to the facility. For a young small-cap, clean technology company like Converted, the move signals some confidence among its vendors and partners for the company’s businesses growth, expansion, and eventual profitability. “We are pleased to have Oppenheimer Funds join our shareholder base and look forward to their support as we build our business” said Edward J. Gildea, Chairman, President and CEO of Converted Organics. Converted uses its proprietary High Temperature Liquid Composting (HTLC) system, a proven, state-of-the-art microbial digestion technology, to process various biodegradable food wastes into dry pellet and liquid concentrate organic fertilizers that help grow healthier food and improve environmental quality. Last month, the agro business acquired 100% of TerraSpehere Systems, a clean technology group that helps to promote the sustainable consumption of natural resources by maximizing plant production and optimizing crop yields, while improving environmental footprints through the reduction of carbon emissions and fuel use associated with traditional crop production and distribution. That acquisition was also made with stock and equity from Converted, diluting existing shareholders shares and driving the stock price to a 52-week low of $ .36 a share. Shares of the company’s common stock, traded under the symbol COIN on the Nasdaq Exchange, are posting a slight rebound, trading up 4% on the day at $ .58 a share. The preferred shares, trading under the symbol COINZ, however, are posting an 11% loss today at just $ .08 a share.

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