Underground Solutions Announces New Management Team and Completion of Convertible Note Issue
Andy Seidel, former CEO of
USFilter, named CEO
New Notes are convertible at $0.08 per share
Pittsburgh, Pa. (December 14th, 2005) -
Underground Solutions, Inc. (Pink Sheets: symbol UGSI) announced
today that Andy Seidel has been named President and Chief
Executive Officer. Seidel is the former CEO of United States
Filter Corporation (USFilter), the nation's leading provider of
water and wastewater products, systems and services. Mark Smith,
who has led the Company since its inception, has become Chairman
of the Board.
Seidel is joined at UGSI by three former senior executives of
USFilter: Roop Jain, who has been appointed as Executive Vice
President and Chief Operating Officer; Steve Stanczak is the
Company's new Executive Vice President and General Counsel; and
Raj Patel, named as Executive Vice President and Chief Financial
Officer of the Company.
The Company also announced that it had completed an offering of
$2.0 million of Series B Convertible Notes. The Notes are
convertible into newly authorized shares of Series B Convertible
Preferred Stock at a maximum price of $0.08 per share. The new
series of Preferred Stock will be convertible into common stock
of the Company on a 1:1 basis, subject to standard anti-dilution
provisions. The Series B Notes were acquired by the four new
members of management; Smith; The Water Fund, LP, a New
York-based hedge fund; and Wynnefield Partners Small Cap Value,
LP I, a New York-based investment partnership which has
previously invested in the Company.
In addition to his past position as CEO of USFilter, Seidel is a
former director of USFilter (formerly NYSE: USF), Aqua America
(formerly known as Philadelphia Suburban - NYSE: WTR), and
National Waterworks, a leading water infrastructure distribution
company now owned by Home Depot. Seidel also served on the
Management Board of Veolia, S.A., the French-based water and
wastewater company. Mr. Seidel and the other executives left
USFilter earlier this year following its August 2004 acquisition
by Siemens A.G., of Germany.
Mr. Seidel stated, "Mark Smith and his team at Underground
Solutions™ have done a superb job in perfecting the Company's
patented Duraliner™ and Fusible PVC™ technologies, and we are
encouraged by the initial acceptance rate of the technologies in
the North American municipal water market. Nevertheless, there is
still an enormous effort required going forward to expand the
adoption of our innovative technologies and to achieve the market
penetration that will be required to meet our growth objectives.
Our new management team has the experience that will enable us to
achieve the main goal we have set for ourselves - rapidly growing
Underground Solutions™ into a leader in the water infrastructure
industry. We are very pleased to have this opportunity."
Mark Smith added, "After having guided Underground Solutions™
through its early development, I am pleased to turn over the
reins to a proven management team with many years of water and
wastewater experience. Our technologies are finding increased
acceptance in the municipal water industry, but the Company's
future success will be driven by our ability to expand our
customer base as rapidly as possible. The new management team
brings us the capabilities we need to meet the challenges we face
as a small company with a paradigm-changing technology."
Rod Parsley, Portfolio Manager of New York-based The Water Fund,
LP, noted, "We have been long-time believers in UGS'
technology solutions. However, as experienced value investors, we
believed that for the Company to succeed it was important to
bring in a preeminent management team knowledgeable in the
municipal marketplace. We believe Underground Solutions™ now has
arguably the best team in the industry, led by Andy Seidel. We
look forward to a long and rewarding relationship with the
Company."
Underground Solutions™ is an infrastructure technology and
pipeline rehabilitation company. The Company has developed and
continues to develop unique and proprietary technologies focused
exclusively on the underground infrastructure industry.
UGSI's products developed and successfully introduced into
the market to date include Duraliner™, Fusible C-900™, Fusible
C-905™ and Fusible PVC™.
Fusible C-900™, Fusible C-905™ and Fusible PVC™ are NSF-61
certified and cover a full range of piping diameters from 3 inch
to 48 inch to provide the only available method of installing a
continuous, monolithic, gasket-free PVC pipe or conduit capable
of being used in numerous trenchless (no-dig) or conventional
"open-cut" applications. Applications for this
revolutionary technology cover every aspect of piping
installations including both pressure and non-pressure situations
in the water, sewer, electrical, industrial and
telecommunications industries.
Duraliner™ is a unique patented process which allows the Company
to rehabilitate deteriorated water lines and other pressure pipes
with minimal excavation. It is the only pipeline renewal system
resulting in a "stand alone" structural lining capable
of handling internal minimum operating pressures of 150 psi.
Duraliner™ conforms to NSF 61 Standards for Drinking Water
Components/Health Effects and has a design life exceeding 100
years.
Certain statements in this news release contain forward-looking
information within the meaning of the Private Securities
Litigation Act of 1995. Such forward-looking statements involve
certain risks, assumptions and uncertainties, including the
inability to generate and secure the necessary product sales, or
the lack of acceptance of the company's products by potential
customers. In each case actual results may differ materially from
such forward-looking statements. The company does not undertake
to publicly update or revise its forward-looking statements even
if experience or future changes make it clear that any projected
results (expressed or modified) will not be realized.
Contact Information: Andy Seidel of Underground Solutions™, Inc.
phone: 724-353-3000
email: Toni Ziccarelli
[tziccarelli@undergroundsolutions.com]