Basin Water, Inc. Signs Sale Agreement with Amplio Filtration Holdings, Inc. and Files Voluntary Petition Under Chapter 11
July 16 2009 - 8:36AM
Business Wire
Basin Water, Inc. (NASDAQ:BWTR) announced today that it has
signed an asset purchase agreement to sell substantially all of its
assets to Amplio Filtration Holdings, Inc., a Delaware corporation
and an affiliate of the Amplio Group, an international operator and
investor in renewable energy and liquid filtration businesses. In
order to facilitate the sale process, Basin Water has filed a
voluntary petition for relief under Chapter 11 of the United States
Bankruptcy Code. Basin Water anticipates that the Chapter 11 filing
will allow it to complete the sale under Section 363 of Chapter 11
of the Bankruptcy Code to Amplio Filtration Holdings, Inc. or to
another buyer who is determined by the Bankruptcy Court to have
offered a higher and better bid for the assets of the Company.
Basin Water expects that the sale will close in the third quarter
of this year. During this process, the Company expects to continue
normal business operations consistent with its obligations as a
Chapter 11 debtor-in-possession under the jurisdiction of the
Bankruptcy Court. Basin Water expects to continue to sell, design
and build custom water and air treatment solutions and provide
uninterrupted customer service to those customers with whom it has
water service agreements (WSAs). The Company will continue paying
suppliers for goods and services provided after the bankruptcy
filing date and, subject to approval by the Bankruptcy Court, the
Company will pay all wages and benefits for active employees
without interruption.
According to Michael M. Stark, President and CEO of Basin Water,
the Chapter 11 process will allow the Company to continue providing
its pay-for-performance environmental solutions to its customers in
municipal and industrial markets while the business completes a
structured sale of the Company�s assets. �We are grateful for the
continuing support of our customers, our suppliers and our alliance
partners as we undertake the Chapter 11 sale process. We have
always been committed to providing reliable solutions for our
customers, and we will continue to live up to those commitments as
we go through this process. We do not anticipate any significant
disruptions to our business and, subject to the approval of the
Bankruptcy Court, intend to pay our vendors promptly for goods and
services provided after the filing. What is more, we plan to be
very active in the marketplace, developing new business
opportunities and executing new contracts with our prospective
customers,� he said. �We expect to emerge from this process as a
new company in the financial position to continue our mission of
providing guaranteed environmental solutions on a
pay-for-performance basis and achieving low lifecycle costs in
meeting our customers� needs,� he added.
Terms of Asset Purchase Agreement
Under the Asset Purchase Agreement, Amplio Filtration Holdings,
Inc. would purchase substantially all of the Company�s assets and
assume certain of the Company�s obligations associated with the
purchased assets through a supervised sale under Section 363 of the
Bankruptcy Code. The purchase price is Two Million Dollars
($2,000,000), but is subject to higher and better bids, approval of
the Bankruptcy Court and customary closing conditions. The Company
plans to engage in a robust bidding process with any and all
interested parties. Those interested in submitting bids should
contact Andrew F. Viles, Managing Director, Head of US M&A,
Canaccord Adams, 99 High St., Boston, MA 02110, 617.371.3715, or
the Company in writing at 9302 Pittsburgh Avenue, Suite 210, Rancho
Cucamonga, CA 91730, as soon as possible, as competing bids are
expected to be due by August 20, 2009.
The Chapter 11 filing by the Company was made July 16, 2009, in
the United States Bankruptcy Court for the District of Delaware, in
Wilmington, Delaware. Basin Water�s legal advisors with respect to
the Chapter 11 filing are Young Conaway Stargatt & Taylor, LLP
and Latham & Watkins LLP.
About Basin Water
Basin Water, Inc. designs, builds and implements systems for the
treatment of contaminated groundwater, industrial process water and
air streams from municipal and industrial sources. It provides
reliable sources of drinking water for many communities, and the
ability to comply with environmental standards and recover valuable
resources from process and wastewater streams. Basin Water has
developed proprietary, scalable ion-exchange, biological and other
treatment systems that effectively process contaminated water and
air in an efficient, flexible and cost effective manner. Additional
information may be found on the Company's web site:
www.basinwater.com.
Forward Looking Statements
This press release contains forward-looking statements made in
reliance on the safe harbor provisions of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. These statements may
be identified by their use of words, such as "estimate," "expect,"
"intend," "anticipate" and other words and terms of similar
meaning, in connection with any discussion of the Company's
financial statements, business, financial condition, results of
operations or liquidity, or the bankruptcy process. Actual results
may differ materially from these expectations due to various risks
and uncertainties, including: the Company�s ability to fund its
working capital needs through the bankruptcy process, obtaining
Bankruptcy Court approval of the Asset Purchase Agreement and the
consummation of the transactions contemplated thereby in a timely
manner, the ability to complete the Chapter 11 process in a timely
manner, the Company�s ability to continue to operate in the
ordinary course and manage its relationships with its creditors,
noteholders, vendors, employees and customers given the Company�s
financial condition and the bankruptcy filing, the ability to limit
the amount of time the Company�s management and officers devote to
restructuring, in order to allow them to run the business and
retain a number of the Company�s key managers and employees, the
Company's ability to manage its capital to meet future liquidity
needs and continue operations, the effectiveness of any cost-saving
measures by the Company, the Company's limited operating history,
significant operating losses associated with certain of the
Company's contracts, the Company's ability to renegotiate loss
contracts with its customers, changes in governmental regulation
that may affect the water industry, particularly with respect to
environmental laws, and changes in the board of directors and
management members. More detailed information about these risks and
uncertainties are contained in the Company's filings with the
Securities and Exchange Commission, including the company's Annual
Report on Form 10-K/A for the year ended December 31, 2008 and
subsequent Quarterly Reports on Form 10-Q, as amended. There can be
no assurance that the Company can remain in possession of its
assets and control of its business as a debtor-in-possession and
that a trustee will not be appointed to operate the business of the
Company. The Company�s current business relationships and
arrangements, and the Company�s ability to negotiate future
business arrangements may be adversely affected by the filing of
the bankruptcy petition. The Company cautions readers not to place
undue reliance on any forward-looking statements, which speak only
as of the date on which they are made. The Company assumes no
obligation to update these forward-looking statements to reflect
any change in future events.
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