Industrial Services of America, Inc., a company that buys, processes and markets ferrous and non-ferrous metals and other recyclable commodities, announces that it has entered into a definitive agreement to sell substantially all of its assets to River Metals Recycling LLC, a subsidiary of The David J. Joseph Company.

The purchase price is $23,300,000, less certain payoff amounts relating to taxes, encumbrances, and assumed capital leases, and is subject to a net working capital adjustment. The Company expects the net proceeds available for distribution to shareholders following the payment of debt, transaction costs and other expenses to be an estimated $1.15 to $1.35 per share, in one or more distribution installments. The mid-point of this range represents a 70% premium to the Company’s closing stock price on the business day immediately prior to this announcement and a 38% premium to the Company’s average closing stock price over the past thirty trading days. These estimates are subject to a number of factors, including the Company’s operating results up until the closing.

The Transaction follows an extended process in which a special committee of the Company’s board of directors explored strategic alternatives available to the Company and evaluated sale opportunities with the advice and assistance of its financial advisor, Conway MacKenzie Capital Advisors LLC. The Transaction was unanimously approved by the Company’s board of directors.

The Transaction is subject to satisfaction or waiver of closing conditions set forth in the purchase agreement, including approval by the Company’s shareholders. The Company will call and hold a shareholders’ meeting seeking to obtain this approval. The closing of the Transaction is also conditioned on the issuance of a storm water permit and agreed order on terms not materially different from those currently being discussed with the state agency in connection with the Company’s efforts to ensure future compliance with the stormwater permit at one of its facilities. The Company expects the Transaction to close in late fourth quarter 2019 or early first quarter 2020.

Although Todd Phillips, the Company’s CEO, is not expected to join River Metals, River Metals intends to hire substantially all of ISA’s employees immediately after the closing of the Transaction. The Company does not expect any changes for ISA’s valued customers and suppliers. ISA will continue to operate in the normal course until the Transaction closes.

Todd Phillips, the Company’s CEO, stated: “ISA has a long and proud history, dating back to its founding by Harry Kletter in the mid-1950s. I’m excited that the ISA legacy will live on within River Metals and The David J. Joseph Company. As the consolidation of the domestic steel recycling industry continues, our board, its special committee and management became convinced that combining the ISA business with River Metals will lead to the best outcome for our shareholders, our employees, our customers and our suppliers.”

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