By John Stang
Perma-Fix Environmental Services has borrowed $2.5 million from one of its shareholders to be used for general working capital.
The Atlanta-based nuclear services provider recorded the April 1 transaction in a May 9 10-Q filing with the U.S. Securities and Exchange Commission.
The unsecured loan is from shareholder Robert Ferguson, who is also a consultant for Perma-Fix’s Test Bed Initiative for processing low-activity radioactive tank waste from the Department of Energy’s Hanford Site in Washington state. Corporate spokesman David Waldman said this is a normal business transaction. “Perma-Fix has completed a lending transaction as necessary to support sustained growth of the company pursuant to our strategic plan,” he wrote in an email.
Perma-Fix declined to elaborate on the loan beyond what is in its SEC filing.
The loan has a term of two years with an annual fixed interest rate of 4 percent, according Perma-Fix’s SEC filing. The company made its first monthly payment of $208,333 in principal and interest on May 1. The loan will be a lower priority in paying creditors in the event of bankruptcy, default, or other insolvent proceedings, the filing said.
Ferguson served as chairman and CEO Nuvotec USA from 1998 to 2007, when the company was sold to Perma-Fix and became Perma-Fix Northwest in Richland, Wash. That followed a long career in industry and government, including the Atomic Energy Commission and Department of Energy, with several positions at Hanford.
The Perma-Fix Northwest facility provides treatment of low-level radioactive and mixed waste.
Perma-Fix also issued a warrant to Ferguson to allow him to buy up to 60,000 shares of common stock at $3.51 per share — an offer that expires April 1, 2024. This warrant is on top of Perma-Fix issuing 75,000 shares of common stock to Ferguson as part of the raising capital transaction relating to the loan. On Friday, Perma-Fix’s stock price was $4.
Earlier this year, the Department of Energy issued a $4.8 million, 10-month contract task order for a venture featuring Perma-Fix, Oak Ridge, Tenn.-based Aerostar Perma-Fix TRU Services, for the second phase of the Test Bed Initiative for processing low-activity radioactive tank waste at Hanford.
The Test Bed Initiative is a demonstration project to chemically treat and solidify Hanford tank waste equivalent to low-level radioactive waste in a grout-like substance. After being processed, it would be shipped to Waste Control Specialists in Texas for disposal. The first test phase, involving 3 gallons of Hanford tank waste, is finished.
The second phase tackling 2,000 gallons of waste is expected to be completed in the fourth quarter of this year, Perma-Fix President and CEO Mark Duff said in a May 9 teleconference with investors and analysts. A potential third phase would treat up to 100,000 gallons of low-activity waste.
Perma-Fix said last week that revenue fell from $12.7 million in first-quarter 2018 to $11.7 million in its latest earnings period. That generated an operating loss of $624,000, down year over year from operating income of $317,000. Net loss attributable to common stockholders landed at $672,000, $0.06 per share, versus a gain of $136,000, $0.01 per share, last year.
