UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
January 18, 2000
Waste Systems International, Inc.
(Exact name of Registrant as specified in its charter)
Delaware 0-25998 95-4203626
(State or other jurisdiction (Commission File (I.R.S. Employer
of incorporation) Number) Identification No.)
420 Bedford Street, Suite 300
Lexington, MA 02420
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code:
(781) 862-3000
ITEM 5. OTHER EVENTS.
On January 18, 2000, Waste Systems International, Inc. (the "Company")
announced that it had commenced an exchange offer in which it is offering to
issue shares of a newly designated series of convertible preferred stock in
exchange for the Company's 11 1/2% Senior Notes due 2006, 11 1/2% Series B
Senior Notes due 2006 and 7% Convertible Subordinated Notes due 2005. The
exchange offer, which is being made to all holders of the Notes and are subject
to certain closing conditions, will expire at 5:00 p.m. New York City time on
February 14, 2000, unless extended by the Company. The Company's press release
announcing such event is attached hereto as Exhibit 99.1 and an excerpt from the
exchange offering memorandum, filed as an exhibit to Schedule 13E-4 filed on the
date hereof, summarizing the terms of the exchange offers and the Series E
Convertible Preferred Stock, is attached hereto as Exhibit 99.2.
Exhibits
99.1 Press Release of the Company dated January 18, 2000
99.2 Excerpt from the exchange offering memorandum, filed as an exhibit to a
Schedule 13E-4 filed on the date hereof, summarizing the terms of the
exchange offers and the Series E Convertible Preferred Stock
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
WASTE SYSTEMS INTERNATIONAL, INC.
Date: January 18, 2000 By: /s/James L. Elitzak
James L. Elitzak
Vice President and Chief Financial Officer
<PAGE>
Exhibit 99.1
Waste Systems International, Inc.
Lexington Office Park, 420 Bedford Street, Suite 300, Lexington, MA 02420
Tel: 781-862-3000; Fax 781-862-2929
FOR IMMEDIATE RELEASE:
Contacts: Waste Systems International, Inc.
Brian Norris, Director of Investor Relations
Telephone: 781-862-3000
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WASTE SYSTEMS INTERNATIONAL, INC. ANNOUNCES
COMMENCEMENT OF EXCHANGE OFFER
Lexington, Massachusetts, January 18, 2000 - Waste Systems International, Inc.
("WSI") (NASDAQ: WSII), a fully integrated non-hazardous solid waste management
company, today announced the commencement of an Exchange Offer for its
$50,000,000 Convertible Subordinated Notes due 2005 and its $100,000,000 Senior
Notes due 2006. The Convertible Subordinated Notes and the Senior Notes can be
exchanged into shares of the Company's newly designated Series E Convertible
Preferred Stock that will carry an 8% dividend which is payable in kind or cash
at the option of the Company. The preferred stock, which is redeemable at any
time by the Company, can be converted into shares of the Company's common stock
at a price of $8.00 per share at any time at the option of the holder and can be
mandatorily converted by the Company if its common stock closing price equals or
exceeds $8.00 for a period of twenty consecutive trading days. The Exchange
Offer will expire at 5:00 p.m., New York City time, on Tuesday, February 14,
2000.
WSI is a fully integrated non-hazardous solid waste management company. The
Company currently has operations in Eastern New England, Central Pennsylvania,
Vermont, Upstate New York, and Baltimore, Maryland / Washington D.C. which serve
approximately 73,000 commercial, industrial, and residential customers. The
Company is also evaluating other acquisitions and opportunities in the
Mid-Atlantic and Northeastern markets.
Certain matters discussed in the press release, including statements with regard
to acquisition and growth plans, and prospects, are "forward-looking statements"
intended to qualify for the safe harbors from liability established by the
Private Securities Litigation Reform Act of 1995. Forward-looking statements are
inherently uncertain and subject to risks. Such statements should be viewed with
caution. Among the important factors that could cause actual results to differ
materially from those indicated by such forward-looking statements are the
Company's history of losses, substantial increased leverage, uncertain ability
to finance the company's growth, ability to identify, acquire and integrate
acquisition targets, ability to manage growth, limitations on landfill
permitting and expansion, dependence on management, competition, geographic
concentration of operations, seasonality, environmental and government
regulations, potential environmental liability and adverse effect of
environmental regulation, potential adverse community relations, performance or
surety bonds and letters of credit, environmental impairment liability
insurance, adequacy of accruals for closure and post-closure costs, capital
expenditures, Year 2000 compliance, and the other risk factors detailed from
time to time in the Company's periodic reports and registration statements filed
with the Securities and Exchange Commission. The Company makes no commitment to
disclose any revisions to forward-looking statements, or any facts, events or
circumstances after the date hereof that may bear upon forward-looking
statements.
# # #
Exhibit 99.2
SUMMARY OF THE EXCHANGE OFFERS
The Exchange The Company is making the following offers:
Offers
o an offer to exchange up to 82,699 shares of its
Series E Convertible Preferred Stock for
$77,500,000 principal amount of, and accrued but
unpaid interest on, the Senior Notes;
o an offer to exchange up to 24,009 shares of its
Series E Convertible Preferred Stock for
$22,500,000 principal amount of, and accrued but
unpaid interest on, the Series B Senior Notes; and
o an offer to exchange up to 51,719 shares of its
Series E Convertible Preferred Stock for
$49,551,240 principal amount of, and accrued but
unpaid interest on, the Subordinated Notes.
All Notes must be properly tendered and accepted to be
exchanged. All Notes that are validly tendered and, in
the case of the Subordinated Notes, not validly
withdrawn, will be exchanged for one (1) share of
Series E Convertible Preferred Stock per each $1,000
principal amount of, and accrued but unpaid interest
on, the Notes. The Company will not issue fractional
shares, but will pay cash in lieu thereof, for any
portion of the principal of, and accrued but unpaid
interest on, the Notes tendered by a holder that are
not a multiple of $1,000. To date, there is $22,500,000
principal amount of Senior Notes, $77,500,000 principal
amount of Series B Senior Notes and $49,551,420 amount
of Subordinated Notes outstanding. The Company will
issue the Series E Convertible Preferred Stock promptly
after the expiration of the exchange offers.
Expiration Date The exchange offers will expire at 5:00 p.m., New
York City time, on February 14, 2000, unless extended,
in which case the term "expiration date" shall mean the
latest date and time to which the Company extends the
exchange offers.
Conditions to The exchange offers are subject to certain conditions including:
that the exchange offers the Exchange do not violate any applicable law or
applicable interpretation of law of the staff of the Offers Securities and
Exchange Commission; that the Company receive a waiver of certain covenants in
the
Senior Notes Indenture necessitated by the exchange
offers; that no litigation materially impairs our
ability to proceed with the exchange offers; and that
the Company obtain all the governmental approvals the
Company deems necessary to conduct and complete the
exchange offers.
The Company may terminate the exchange offer if, after
using its best efforts, the Company fail to meet any of
the conditions to the exchange offer.
Resale of The shares of Series E Convertible Preferred Stock issued in the
exchange offer New Series E may not be offered for resale, resold or otherwise
transferred except in Convertible compliance with the registration and
prospectus delivery provisions of the Preferred Stock Securities Act, or
pursuant to an exemption therefrom.
The shares of common stock issuable upon conversion of
the Series E Convertible Preferred Stock may not be
offered for resale, resold or otherwise transferred
except in compliance with the registration and
prospectus delivery provisions of the Securities Act,
or pursuant to an exception therefrom.
Procedures for Holders who wish to tender their Notes for exchange in one or
more of the exchange Tendering Notes offers, must transmit to the exchange
agent, The Bank of New York, on or before the
expiration date, either:
o a properly completed and duly executed letter of
transmittal, or a facsimile of the letter of
transmittal, together with their Notes and any
other required documentation, to the exchange agent
at the address set forth in the exchange offering
memorandum under the heading "The Exchange
Offers--Exchange Agent," and on the front cover of
the letter of transmittal; or
o a computer generated message transmitted by means
of The Depository Trust Company's Automated Tender
Offer Program system and received by the exchange
agent and forming a part of a confirmation of book
entry transfer in which such holder acknowledges
and agree to be bound by the terms of the letter of
transmittal.
By executing the letter of transmittal, each holder of
Notes will make certain representations to the Company
Acceptance Subject to certain conditions, the Company will accept
for exchange any and all Notes which are validly
tendered in any of the exchange offers and, in the case
of the Subordinated Notes, not withdrawn, before 5:00
p.m., New York City time, on the expiration date.
Withdrawal Rights Holders may withdraw the tender of their
Subordinated Notes at any time before 5:00 p.m., New
York City time, on the expiration date, subject to
compliance with the procedures for withdrawal.
Certain Federal The Company believes that the exchange of the Notes for shares
of Series E Convertible Income Tax Preferred Stock will not be a taxable
exchange for United States federal income tax Consequences purposes, but holders
should consult their tax adviser about tax consequences of the exchange.
Exchange Agent The Bank of New York, the trustee under the
indenture governing the Senior Notes and the Series B
Senior Notes, is serving as the exchange agent. The
address, telephone number and facsimile number of the
exchange agent are set forth in the exchange offering
memorandum on page 67 under the heading "The Exchange
Offers--Exchange Agent."
Use of Proceeds The Company will not receive any proceeds
from the issuance of the shares of Series E Convertible
Preferred Stock. The Company is making this exchange
offer solely to reduce the outstanding debt obligations
of the Company.
SUMMARY OF THE TERMS OF THE SERIES E CONVERTIBLE PREFERRED STOCK
Issuer: Waste Systems International, Inc.
Type of Security: Series E Convertible Preferred Stock (the "Series E
Convertible Preferred Stock")
Total Number of 158,427 shares of Series E Convertible Preferred Stock
Shares Offered:
Conversion Rate: The conversion rate will be the liquidation
preference divided by the greater of (i) $8.00, or (ii)
an amount equal to a 33% premium over the closing sale
price of the Company's common stock on the trading day
immediately preceding issuance of the Series E
Convertible Preferred Stock.
Price Per Share: $1,000 per share of principal amount of, and accrued
but unpaid interest on, Notes.
Dividends: The holders of the Series E Convertible Preferred Stock
will be entitled to receive an 8% accruing dividend,
compounded annually, payable in arrears, at the
Company's option either (i) in cash, subject to the
limitations and restrictions contained in the
documents governing the Notes and the Company's credit
facility or, (ii) in additional
shares of Series E Convertible Preferred Stock.
Liquidation In the event of the liquidation or winding up of the
Preference: Company, the holders of the Series E Convertible
Preferred Stock will be entitled to receive in
preference to all other outstanding capital stock
(except for the Series
D Convertible Preferred Stock), an amount per share of
Series E Convertible Preferred Stock equal to $1,000
plus the dividends accrued on the Series E Convertible
Preferred Stock but not paid. A consolidation or a
merger of the Company or a sale of all or substantially
all of its assets will be deemed to be a liquidation
for purposes of the liquidation preference.
Optional The shares of Series E Convertible Preferred Stock will
Redemption: be redeemable at any time in whole but not in part for
cash at the option of the Company at 100% of the
liquidation preference at any time.
Optional Subject to receipt of approval of the Company's
Conversion: stockholders in the event Nasdaq requires such approval,
the holders of shares of Series E Convertible Preferred
Stock will have the right to convert their Series E
Convertible Preferred Stock, at their option, at any
time, into shares of common stock.
Mandatory The Company will have the right to request the holders
Conversion: of Series E Convertible Preferred Stock to convert their
shares of Series E Convertible Preferred Stock into
shares of common stock, at the conversion rate then in
effect, in the event the closing sale price of the
common stock equals or exceeds the conversion price for
twenty consecutive trading days.
Voting Rights: Subject to receipt of approval of the Company's
stockholders in the event Nasdaq requires such
approval, the holders of Series E Convertible Preferred
Stock will vote with holders of shares of common stock
and Series D Preferred Stock on an as-converted basis
on all matters brought before the shareholders.
Registration Rights: Holders of at least 33% of the outstanding
Series E Convertible Preferred Stock may require, on
one occasion, that the Company use its reasonable best
efforts to file a registration statement covering the
public sale of common stock (an "S-3 Demand"); provided
that the Company will have the right to delay or
suspend such an S-3 Demand under certain circumstances
for a period or periods not in excess of 120 days each
in the aggregate in any 12-month period.
In addition, the holders of the Series E Convertible
Preferred Stock will be entitled to unlimited
"piggyback" registration rights, at the Company's
expense, on registrations of common stock initiated by
the Company or any other class of investors holding
demand registration rights.
In the event of any "cut-back" in the number of shares
of common stock to be offered in any registration, the
holders of the Series E Convertible Preferred Stock
shall be treated on a basis comparable to all other
holders of common stock to be sold in such public
offering; provided that (i) holders of Series E
Convertible Preferred Stock shall not in any event take
priority over the Company and (ii) any holder
exercising "piggyback" registration rights shall be
cut-back prior to any holder exercising demand
registration rights with respect to such offering.
References in this exhibit to the "Company" refer to Waste Systems
International, Inc. The term "Senior Notes" refers to the 11 1/2% Senior Notes
due 2006 of the Company originally issued on March 2, 1999 and currently
outstanding. The term "Series B Senior Notes" refers to the 11 1/2% Series B
Senior Notes due 2006 of the Company originally issued August 11, 1999. The term
"Subordinated Notes" refers to the 7% Convertible Subordinated Notes due 2005 of
the Company originally issued on May 13, 1998. The term "Notes" refers to the
Subordinated Notes, Senior Notes, the Series B and Senior Notes collectively.
