Approves Voluntary Delisting From NYSE AMEX LLC SOUTHAMPTON, Pa.,
April 27 /PRNewswire-FirstCall/ -- Environmental Tectonics
Corporation (NYSE AMEX LLC: ETC) ("ETC" or the "Company") today
reported that, on April 24, 2009, the Company entered into a
transaction with H.F. Lenfest that provides for the following upon
the satisfaction of certain conditions, including the receipt of
the approval of the Company's shareholders to certain components of
the transaction: (i) a $7,500,000 credit facility to be provided by
Mr. Lenfest to ETC, $2,000,000 of which had previously been
advanced but which is restricted as to use; (ii) exchange of the
$10 million subordinated note held by Mr. Lenfest, together with
all accrued interest and warrants issuable under the subordinated
note, and all Series B Preferred Stock and Series C Preferred Stock
held by Mr. Lenfest, together with all accrued dividends thereon,
for a new class of preferred stock, Series E Preferred Stock, of
the Company (the "Series E Exchange"), and (iii) the guarantee by
Mr. Lenfest of all of ETC's obligations to PNC Bank, National
Association ("PNC Bank") in connection with an increase of the
existing $15,000,000 revolving line of credit with PNC Bank (the
"PNC Credit Facility") to $20,000,000, and in connection with this
guarantee, the pledge by Mr. Lenfest to PNC Bank of $10,000,000 in
marketable securities. Aggregate advances in excess of $4.5 million
under this new credit facility, the Series E Exchange and the
increase in the PNC Credit Facility are conditioned upon, among
other things, the approval of ETC's shareholders to (i) an increase
in the number of authorized shares of ETC from 20,000,000 to
50,000,000, (ii) the Series E Exchange, and (iii) the restoration
of Mr. Lenfest's voting rights with respect to all preferred and
common shares currently held by him or issuable as part of this
transaction. In consideration for entering into this credit
facility, the Company issued to Mr. Lenfest 55 shares of a new
class of preferred stock (stated value $1,000 per share), the
Series D Preferred Stock, of the Company. The terms of such credit
facility, as well as the terms of the Company's new Series D
Preferred Stock and Series E Preferred Stock are more fully set
forth in a Form 8-K that the Company expects to file with the
Securities and Exchange Commission (SEC) later today. Additionally,
the reader is encouraged to reference the Company's Current Report
on Form 8-K dated February 20, 2009 and filed with the SEC on
February 26, 2009, for more details on the $2,000,000 which had
been previously advanced. William F. Mitchell, ETC's President and
Chairman, stated, "Gerry Lenfest has been a long-time investor and
member of the Board of our Company. He was instrumental in allowing
ETC to obtain major refinancing in 2003 and he has provided us
additional financial backing at many critical times since then. I
regard this financing transaction as a major step forward for ETC.
It will strengthen our balance sheet and provide us the capability
to both bid and perform on major contracts in the future. My
wholehearted thanks go out to Gerry for his invaluable support." On
April 23, 2009, ETC's Board of Directors decided to voluntarily
delist its common stock from NYSE AMEX LLC ("AMEX") and on April
24, 2009, the Company notified AMEX of its decision. The Company
currently anticipates that it will file with the Securities and
Exchange Commission and AMEX a Form 25 relating to the delisting of
its common stock on or about May 19, 2009, with the delisting of
its common stock becoming effective ten days thereafter.
Accordingly, the Company anticipates that the last day of trading
of its common stock on AMEX will be on or about May 29, 2009. The
Company is currently in discussions to have its common stock quoted
for trading on the Over-the-Counter Bulletin Board. The Board of
Directors' decision to voluntarily delist its common stock from
AMEX resulted from a compliance issue related to certain terms and
conditions as contained in the proposed issuance of Series E
Preferred Stock as referenced above. ETC was not able to secure the
Lenfest financing transaction on terms that would allow ETC to
comply with the AMEX listing rules. The Board regrets that a
transaction suitable to the AMEX could not be reached but the Board
feels the Lenfest transaction is critical to the Company's
continued operation and growth. Given the light trading volume of
its common stock, the Company believes that investors will be
adequately served by other alternatives such as the
Over-the-Counter Bulletin Board. The Company also expects that,
going forward, the delisting of its common stock will provide it
with greater corporate flexibility and will allow it to deploy more
resources to its core business operations. ETC designs, develops,
installs and maintains aircrew training systems (aeromedical,
tactical combat and general), disaster management training systems
and services, entertainment products, sterilizers (steam and gas),
environmental testing products, hyperbaric chambers and related
products for domestic and international customers. This press
release includes forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. These
forward-looking statements are based on ETC's current expectations
and projections about future events. These forward-looking
statements are subject to known and unknown risks, uncertainties
and assumptions about ETC's and its subsidiaries that may cause
actual results, levels of activity, performance or achievements to
be materially different from any future results, levels of
activity, performance or achievements expressed or implied by these
forward-looking statements. These forward-looking statements
include statements with respect to the Company's vision, mission,
strategies, goals, beliefs, plans, objectives, expectations,
anticipations, estimates, intentions, financial condition, results
of operations, future performance and business of the company,
including but not limited to, (i) potential additional funding by
Lenfest and PNC, (ii) the potential delisting of the Company's
common stock from the American Stock Exchange as a result of the
Company's failure to comply with the AMEX listing standards, (iii)
projections of revenues, costs of materials, income or loss,
earnings or loss per share, capital expenditures, growth prospects,
dividends, capital structure, other financial items and the effects
of currency fluctuations, (iv) statements of our plans and
objectives of the Company or its management or Board of Directors,
including the introduction of new products, or estimates or
predictions of actions of customers, suppliers, competitors or
regulatory authorities, (v) statements of future economic
performance, (vi) statements of assumptions and other statements
about the Company or its business, (vii) statements made about the
possible outcomes of litigation involving the Company, (viii)
statements regarding the Company's ability to obtain financing to
support its operations and other expenses, and (ix) statements
preceded by, followed by or that include the words, "may," "could,"
"should," "looking forward," "would," "believe," "expect,"
"anticipate," "estimate," "intend," "plan," or the negative of such
terms or similar expressions. These forward-looking statements
involve risks and uncertainties which are subject to change based
on various important factors. Some of these risks and
uncertainties, in whole or in part, are beyond the Company's
control. Factors that might cause or contribute to such a material
difference include, but are not limited to, those discussed in the
Company's Annual Report on Form 10K, for the fiscal year ended
February 29, 2008 in the section entitled "Risks Particular to Our
Business." Shareholders are urged to review these risks carefully
prior to making an investment in the Company's common stock. The
Company cautions that the foregoing list of important factors is
not exclusive. Except as required by federal securities law, the
Company does not undertake to update any forward-looking statement,
whether written or oral, that may be made from time to time by or
on behalf of the Company. Contact: Duane D. Deaner, CFO Tel:
215-355-9100 (ext. 1203) Fax: 215-357-4000 ETC - Internet Home
Page: http://www.etcusa.com/ DATASOURCE: Environmental Tectonics
Corporation CONTACT: Duane D. Deaner, CFO of Environmental
Tectonics Corporation, +1-215-355-9100, ext. 1203, or Fax,
+1-215-357-4000 Web Site: http://www.etcusa.com/
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