CLEVELAND, May 12 /PRNewswire-FirstCall/ -- Oglebay Norton Company today announced that it has signed a definitive purchase agreement to sell six of its nine marine vessels. The agreement includes long- term contracts for transporting limestone from the company's Michigan quarries. Closing of the sale is subject to regulatory clearance; therefore, terms of the agreement have not been disclosed. In addition, the company stated that it intends to sell its remaining three vessels and is in negotiations with a potential buyer.
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The company also announced an agreement with Wolverine Power Cooperative. The company has granted Wolverine Power with an option to purchase approximately 440 acres of previously mined property at its Calcite quarry in Rogers City, Michigan. Over the next two years, Wolverine Power will explore the feasibility of a base load plant using Circulating Fluidized Bed (CFB) technology, a clean coal technology as defined by the U.S. Department of Energy at the Calcite site. In addition to the sale of the property to Wolverine Power, the company would provide high quality chemical limestone to support the CFB technology along with the infrastructure to receive / handle waterborne solid fuel. Additional terms of the agreement have not been disclosed. Wolverine Power Cooperative is a not-for-profit generation and transmission electric cooperative headquartered in Cadillac, Michigan.
Michael Lundin, President and CEO, Oglebay Norton Company stated, "We continue to execute our strategy of expanding on our current markets and developing new markets for our limestone and limestone fillers businesses, while maximizing the profitability of our sand and lime businesses. The sale of the vessels will enable us to pay down our debt which will further strengthen our balance sheet. Upon the closing of the sale, we will be well positioned to refinance our existing debt. We also remain committed to redeeming the convertible preferred stock in the near future."
Michael Lundin also stated, "We are excited about the relationship that we have developed with Wolverine Power and look forward to assisting them in the evaluation of a base load power plant on our Calcite property. We believe that this project will provide many opportunities for Wolverine, for the Rogers City community and for us."
Oglebay Norton Company, a Cleveland, Ohio-based company with a 150-year tradition of service, provides essential minerals and aggregates to a broad range of markets, from building materials and environmental remediation to the energy and metallurgical industries. For more information, see http://www.oglebaynorton.com/.
Safe Harbor Statement
Certain statements contained in this release are "forward-looking" in that they reflect management's expectations and beliefs regarding the future performance of the Company and its operating segments. Such forward-looking statements are subject to uncertainties and factors relating to the Company's operations and business environment, all of which are difficult to predict and many of which are beyond the control of the Company. The Company believes that the following factors, among others, could affect its future performance and cause actual results to differ materially from those expressed or implied by forward-looking statements made by or on behalf of the Company: (1) the effectiveness of the Company having restructured its debt to provide adequate liquidity to sufficiently improve the Company's financial position; (2) weather conditions, particularly in the Great Lakes region, flooding, and/or water levels; (3) fluctuations in energy, fuel and oil prices; (4) fluctuations in integrated steel production in the Great Lakes region; (5) fluctuations in Great Lakes and Mid-Atlantic construction activity; (6) economic conditions in California or population growth rates in the southwestern United States; (7) the Company's ability to complete its cost reduction initiatives; (8) the outcome of periodic negotiations of labor agreements; (9) changes in the demand for the Company's products due to changes in technology; (10) the loss, insolvency or bankruptcy of major customers, insurers or debtors; (11) difficulty in hiring sufficient staff that is appropriately skilled and licensed, particularly for the vessel operations; (12) changes in environmental laws; (13) an increase in the number and cost of asbestos and silica product liability claims filed against the Company and its subsidiaries and determinations by a court or jury against the Company's interest; (14) the insolvency of insurers, the effects of any coverage litigation with insurers or the adequacy of insurance; (15) changes in Federal or State law with respect to asbestos or silica product liability claims; and (16) risks related to the low trading volume of the Company's stock and the de-registration of the Company's common and convertible preferred stock with the United States Securities and Exchange Commission.
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