Fox Paine’s United American Energy agrees to merge with an affiliate of CSFB private equity

Oct. 2, 2003 — United American Energy Holdings Corp. (UAE) and Fox Paine & Co., LLC (Fox Paine), which manages funds that control a majority stake in UAE, announced today that UAE has entered into an all-cash merger agreement with an affiliate of DLJ Merchant Banking Partners III, L.P. and its affiliated co-investors, each managed by Credit Suisse First Boston Private Equity (CSFB Private Equity), the principal investing arm of Credit Suisse First Boston.

UAE, a developer, acquirer, and operator of electric power generating facilities, owns and operates six operating projects, as well as a 50% interest in American Ref-Fuel Company LLC (American Ref-Fuel), one of the largest owners and operators of waste-to-energy facilities in the United States.

“Over the past four and a half years, UAE’s management team and our partner Fox Paine have transformed the company by dramatically adding to UAE’s net ownership of generating capacity and significantly increasing operating income and free cash flow during this time,” stated David Goodman, UAE’s Chief Executive.

“We are pleased that our efforts have created a valuable enterprise which has been able to consistently increase shareholder value.”

Saul A. Fox, Chief Executive of Fox Paine and Chairman of the Executive Committee of the Board of Directors of UAE added: “We are delighted with our investment in UAE and our association with UAE’s extraordinary, world class management team. The success of the UAE/Fox Paine partnership has been clearly reflected in the progress of the company over the past four years.” Since Fox Paine acquired its initial stake in UAE in March of 1999, the Company completed five acquisitions aggregating $850 million and financings totaling over $1.6 billion facilitating this growth.

CSFB Private Equity also announced that it had entered into agreements to sell several interests and assets it will be acquiring through the merger. Subject to the completion of the merger with UAE and certain other conditions, CSFB Private Equity has agreed to sell interests in five UAE-operated projects to a subsidiary of Delta Power Company, LLC (“Delta Power”), an owner, developer and manager of electric power generation facilities in the United States. In addition, CSFB Private Equity has entered into an agreement to sell interests in UAE’s power generating facility in Mecklenburg, Virginia, to an affiliate of Delta Power and an affiliate of John Hancock Financial Services Inc. (“John Hancock”), subject to the completion of the merger with UAE and certain other conditions.

Following the closing of the merger with UAE and these subsequent transactions, CSFB Private Equity will retain UAE’s 50% indirect interest in American Ref-Fuel. Affiliates of CSFB Private Equity currently own an indirect 25% interest in American Ref-Fuel through MSW Energy Holdings, LLC. Upon the closing of this transaction, CSFB Private Equity expects to indirectly own a majority of the economic interests in American Ref-Fuel.

The consummation of the merger is subject to customary closing conditions, including approvals from federal and state regulatory agencies. Consumation of the UAE merger is not conditioned on the completion of, or approval for, the subsequent sales to Delta Power and John Hancock. Financial terms of the transactions were not disclosed. UAE anticipates that the closing of the merger to occur by early 2004.

About UAE: United American Energy Holdings Corp. is a privately held company that develops, acquires, owns and manages electric generating facilities, including gas-fired cogeneration, hydroelectric generation, and generation powered by coal and solid waste fuels. UAE holds a 50% ownership interest in American Ref-Fuel LLC, the largest municipal solid waste-to-energy company in the Northeast.

About Fox Paine: Fox Paine & Company, LLC manages investment funds in excess of $1.5 billion, providing equity capital for corporate acquisitions, company expansion and growth programs and management buyouts.

The Fox Paine funds are managed on behalf of over 50 leading international financial institutions, including major governmental and corporate pension systems, Fortune 100 companies, major life and property and casualty insurance and reinsurance companies, money center and super regional commercial banks, investment banking firms, and university endowments. Fox Paine was founded in 1997 by Saul A. Fox, a former general partner of Kohlberg Kravis Roberts & Co., and W. Dexter Paine, III, a former general partner of Kohlberg & Co.

About CSFB Private Equity: CSFB Private Equity, the global private equity arm of Credit Suisse First Boston, is the largest private equity manager in the world, with more than $29 billion of assets under management. CSFB Private Equity is comprised of investment funds that focus globally on leveraged buyouts, mezzanine, real estate and venture capital investments as well as primary and secondary purchases of interests in private investment funds. CSFB Private Equity includes the family of DLJ Merchant Banking funds and the Sprout funds as well as the Private Fund Group, which is dedicated to raising investment capital for global private investment firms.

CSFB Private Equity also provides Customized Fund of Funds services, designing tailor-made solutions for institutional and high net worth investors. CSFB Private Equity maintains offices in New York, Los Angeles, Menlo Park, Chicago, San Francisco, Houston, London, Buenos Aires, Hong Kong and Tokyo.

About Delta Power: Privately owned Delta Power Company, formed in 1997, owns interest in and manages fourteen operating power projects in the U.S., with installed capacity of approximately 1,675 MW. Delta Power has become a leading midsize U.S. independent power producer headquartered in Morristown, N. J., with additional offices in California, New Mexico, Texas, Michigan and Florida.

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