ECO2 Plastics, Inc. Announces Bridge Financing up to $5 Million in Convertible
Notes
SAN FRANCISCO, Aug. 28 /PRNewswire-FirstCall/ -- ECO2 Plastics, Inc.
(OTC Bulletin Board: ECOO) announced today that it is engaging in a bridge
financing of $3.5 to $5 million in Convertible Notes due March 31, 2009. The
Company sold $550,000 of notes and related common stock warrants at an initial
closing on August 22, 2008 and expects the balance of the financing to close
by September 15, 2008. The purposes of the financing are (i) to purchase new
equipment for the Company's proprietary CO2 cleansing equipment and other
critical spare parts and equipment; (ii) to reduce trade payables; and (iii)
to fund continuing operations. The Company undertook the financing primarily
due to higher than expected equipment and installation costs and working
capital requirements related to the expansion of production capacity in the
Company's Riverbank, California processing plant. This financing will also
help fund additional current and future projects and also support the
Company's ability to meet its ongoing cash and working capital needs.
The convertible notes to be offered in this transaction will not be
registered under the Securities Act of 1933, as amended (the "Securities Act")
and may not be offered or sold in the United States absent registration or an
applicable exemption from registration requirements. The convertible notes
are being offered and sold solely to certain accredited investors in a private
placement pursuant to Rule 506 under the Securities Act. This announcement
does not constitute an offer to sell or the solicitation of an offer to buy
such notes and is issued pursuant to Rule 135c under the Securities Act of
1933.
This press release may contain forward-looking statements. The Company
wishes to caution readers that certain important factors may have affected and
could in the future affect the Company's actual results and could cause the
Company's actual results for subsequent periods to differ materially from
those expressed in any forward-looking statement made by or on behalf of the
Company. The Company's ability to raise capital necessary to continue to fund
operations is subject to various factors, and it cannot guarantee that it will
be able to successfully close the planned financing within the timelines and
in the amounts indicated, on terms acceptable to the Company, or at all. If
the Company is unable to raise necessary capital, it will need to reduce
operating expenses, delay plans to expand production capacity, and its ability
to respond to unanticipated requirements and continue operations would be
limited, all of which would have a material adverse effect on the Company's
business, financial condition and results of operations. Even if the Company
raises the capital from the financing as planned, there can be no assurance
that the equipment will be successfully installed and implemented in a timely
manner, that production capacity will be successfully expanded, or that the
company will not have other unanticipated cash needs in the near term. This
press release is qualified in its entirety by cautionary statements and risk
factor disclosures contained in the Company's Securities and Exchange
Commission filings, including in its Quarterly Report on Form 10-Q for the
period ended June 30, 2008.
SOURCE ECO2 Plastics, Inc.
ECO2 Plastics, Inc., +1-415-829-5984, press@eco2plastics.com
