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GreenShift Transfers Stake in Electronics Recycling Company to INSEQ Corp 12/20/2005 11:50:01 AM
MOUNT ARLINGTON, N.J., Dec 20, 2005 (BUSINESS WIRE) -- GreenShift Corporation (GSHF) today announced its plans to transfer its 80% stake in Electronic Scrap Recycling Corporation ("ESRC"), an Indiana-based full service recycler of electronic components, to INSEQ Corporation (INSQ).
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GreenShift expects the transfer to occur immediately after its acquisition of ESRC stock, which is planned to close this week. GreenShift, who currently owns about 70% of INSEQ, will receive additional INSEQ common shares equal to an additional 5% stake in INSEQ in return for the transfer.
ESRC currently provides full service electronic waste ("e-waste") recycling, logistics and Certified Data Destruction services to public and private sector clients out of its 125,000 square foot facility in Elkhart, Indiana.
"This transfer is an important part of our plans to consolidate the activities of a number of GreenShift's portfolio companies based on their respective core competencies," said Kevin Kreisler, GreenShift's chairman and chief executive officer. "INSEQ's business model is to directly facilitate the more efficient use of natural resources. Essential elements of this are building and selling innovative green products and enabling the resale of secondary materials. Our investment in ESRC is strategic to both."
E-Waste Recycling
Obsolete electronic equipment is a rapidly expanding problem in today's economy. As technology continues to make significant leaps, the life cycle of electronic products shortens dramatically. The National Safety Council estimates that over 500 million obsolete computers will be discarded in the United States alone. Additional electronic devices such as cell phones, office machines and a host of other products present problems not only to the environment, but to the businesses, individuals and organizations that must deal with their disposal. In addition to the bulk materials such as plastic and steel, electronics also contains significant amounts of toxic materials including lead, mercury, arsenic, chromium and more.
Kreisler added: "ESRC's business model is based on building, owning and operating innovative e-waste processing systems that utilize a number of proprietary technologies to enhance operating efficiencies. ESRC also plans to build and sell custom e-waste recycling systems that accomplish this on a distributed basis for targeted third party clients. ESRC's existing volumes of e-waste and positive cash flows are strategic to our existing technologies, their technology has some fascinating potential, their approach to the market is dead on, and their business presents INSEQ with a platform to acquire significant market share. We are excited by this investment and we intend to provide INSEQ with the resources it needs to scale the ESRC business."
Ferrofluid Separation
ESRC is developing a proprietary new ferrofluid process that is capable of preferentially separating targeted compounds from a mixed solid waste stream. Ferrofluids are liquids that are comprised of nanoscale magnetic particles suspended in a carrier fluid and exhibit novel properties when exposed to specific magnetic fields. Conductivity, viscosity and volatility can all be manipulated through the selection and sizing of the particles and the application of specific magnetic fields.
Importantly, ESRC's ferrofluid process can enable the preferential separation of targeted compounds out of a mixed micron sized powder. This can be important because GreenShift's Tornado Generator(TM) technology cost-effectively grinds, desiccates, and atomizes solid and liquid wastes and other materials into micron sized powders.
ESRC plans to use its ferrofluid process, the Tornado Generator(TM) technology, GreenShift's existing plastics and metal separation and other technologies, and some conventional process technologies to dramatically decrease capital costs and improve operating efficiencies for processing e-wastes.
Technology and Manufacturing Rights
Under GreenShift's agreement with ESRC, ESRC will assign its technologies and intellectual property rights to GreenShift Industrial Design Corporation ("GIDC"), a wholly owned GreenShift company, who will in turn provide ESRC (and now INSEQ) with non-exclusive license rights to all current and future GIDC technologies, including its Tornado Generator(TM) and plastic and metal waste separation technologies.
About GreenShift Corporation
GreenShift Corporation (GSHF) is a publicly traded business development company (BDC) whose mission is to develop and support companies and technologies that facilitate the efficient use of natural resources and catalyze transformational environmental gains.
BDCs are regulated by the Investment Company Act of 1940 and are essentially publicly-traded equity funds where shareholders and financial institutions provide capital in a regulated environment for investment in a pool of long-term, small and middle-market companies through the use of senior debt, mezzanine financing, and equity funding. GreenShift plans to use equity and debt capital to support and drive the value of its existing portfolio of companies and to make investments in a diversified mix of strategically compatible growth stage public and private businesses and technologies. Additional information regarding GreenShift Corporation is available online at www.greenshift.com.
Safe Harbor Statement
This press release contains statements, which may constitute "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Those statements include statements regarding the intent, belief or current expectations of GreenShift Corporation, and members of their management as well as the assumptions on which such statements are based. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. Important factors currently known to management that could cause actual results to differ materially from those in forward-statements include fluctuation of operating results, the ability to compete successfully and the ability to complete before-mentioned transactions. The company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results.
SOURCE: GreenShift Corporation
GreenShift Corporation Jim Grainer, 973-398-8183 President and Chief Financial Officer Fax: 973-398-8037 investorrelations*greenshift.com www.greenshift.com
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