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Earth Sciences Intends to Spin-Off Subsidiary ADA-ES; Launch of New Company Will Focus Investment Interests on Supplying Key Environmental Technology

Business Wire, March 10, 2003

Business Editors

LITTLETON, Colo.--(BUSINESS WIRE)--March 10, 2003

Earth Sciences, Inc. (OTCBB:ESCI) today announced that its Board of Directors approved the spin-off of environmental technology and specialty chemicals company ADA-ES, Inc. ("ADA-ES") as a separate company.

The spin-off will enable ADA-ES to capitalize on the market potential relating to pending mercury emission regulations and the Company's recent successes in this area.

Upon effectiveness of the required Form 10-SB SEC filing, Earth Sciences intends to distribute 100% of the outstanding shares of ADA-ES to Earth Sciences shareholders of record on the record date, which the Earth Sciences Board of Directors expects to establish later this month. Under the proposed arrangement, Earth Sciences shareholders will receive one share of ADA-ES common stock for every 10 shares of Earth Sciences common stock held on the close of business on the record date as a distribution that is expected to be tax-free. Earth Sciences shareholders entitled to the distribution will receive whole shares of ADA-ES common stock, rounded up to account for fractional shares.

Immediately after the planned distribution, Earth Sciences will no longer own shares of ADA-ES, but will retain its interest in several mineral resources and prospects in the Western U.S., as well as a currently idled chemical facility in Calgary, Alberta, and shareholders of Earth Sciences will own shares of the new ADA-ES entity in addition to their shares of Earth Sciences. ADA-ES expects its shares to initially trade on the OTC Bulletin Board, upon the effectiveness of the Form 10-SB SEC filing. The proposed spin-off is subject to a number of contingencies and Earth Sciences reserves the right to revoke the proposed spin-off at any time prior to the distribution date. There can be no assurances that the proposed spin-off will actually occur.

ADA-ES provides proprietary environmental technology to the electric power industry. The Company's most significant growth opportunity stems from its state-of-the-art technology that allows electric plants to meet pending Environmental Protection Agency regulations on mercury emissions from coal-fired boilers. The Department of Energy ("DOE") has projected that this industry will grow to $2 billion to $5 billion annually, subject to pending regulations with an expected compliance date of 2007.

During 2001 and 2002, ADA-ES conducted the first full-scale demonstrations of sorbent-based mercury control at four different power plants. The tests, which were conducted as part of a comprehensive $6.8 million mercury emissions control program awarded to ADA-ES by the DOE's National Energy Technology Laboratory, were co-funded by five major utilities. Importantly, the tests demonstrated the potential to produce mercury removal levels as high as 90% for both Eastern and Western coals.

As a follow on to this effort, ADA-ES was awarded a $2 million program to conduct a year-long demonstration at a Southern Company plant. In addition, the DOE announced in January of 2003 that ADA-ES will be the technology provider and receive approximately $10 million during a five-year $50 million program that will be conducted at the Wisconsin Energies Presque Isle Power Plant. To assist in the commercialization of this technology, ADA-ES recently announced joint marketing agreements with NORIT Americas and Alstom Power.

By way of background, ADA-ES' initial product line -- a family of specialty chemical blends that lowered particulate emissions from power plants burning inexpensive coals from the Powder River Basin ("PRB") in Wyoming -- was awarded the 2001 J. Deane Sensenbaugh Award by the Air and Waste Management Association in recognition of outstanding achievement in the field of air pollution control. In 2002, ADA-ES launched its second product, a specialty chemical designed to improve combustion of PRB coals. This product, which is now being marketed through a joint venture with Arch Coal, Inc., was successfully demonstrated at five plants during 2002. Several plants are expected to use this product on a full-time basis during 2003.

For the year ended December 31, 2002, ADA-ES recorded revenues of $5.7 million and net income of $469,000. More detailed financial information will be provided to shareholders in a news release and conference call planned for March 21, 2003.

About ADA-ES

Headquartered in Littleton, CO, ADA-ES develops and implements proprietary environmental technology and specialty chemicals that mitigate the environmental impact from electric power and industrial companies while reducing operating costs.

This press release may contain forward-looking information within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The United States Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for such forward-looking statements in this document that are based on information the Company believes reasonable, but such projections and statements involve significant uncertainties. Actual events or results -- including operating results -- could differ materially from those discussed in the forward-looking statements as a result of various factors including but not limited to changing market demand for ADA-ES chemicals and systems and changes in technology, laws or regulations, demand for the company's securities, and other factors discussed in the company's 2001 Form 10-KSB and recent 10-QSBs.

COPYRIGHT 2003 Business Wire
COPYRIGHT 2008 Gale, Cengage Learning
 

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