OTD - O2Diesel Adds an Additional $6.5 Million of Funding and Highlights Fiscal Year 2005 Results
Thursday April 20, 9:04 am ET
NEWARK, DE--(MARKET WIRE)--Apr 20, 2006 -- O2Diesel Corporation (AMEX:OTD - News), a pioneer in the development of cost-effective, cleaner-burning, diesel fuels for centrally fueled fleets of all types, today announced the highlights of the Company's financial results for the year ended December 31, 2005. The Company is also pleased to announce the signing of two agreements for $6.5 million of additional financing.
Year-end Results:
For the fiscal year ended December 31, 2005, the Company reported revenues of $195,607 as compared to revenues of $127,451 for the same period of 2004, while showing sequential improvements on a quarterly basis throughout 2005. The Company reported a net loss of $7.5 million, or ($0.22) per share for the year ended December 31, 2005 as compared with a net loss of $6.7 million, or ($0.23) per share for the same period of 2004.
At December 31, 2005, the Company had nearly $5 million on the balance sheet consisting of $1.4 million in cash and cash equivalents and $3.5 million in restricted cash, compared to $1.2 million from a year ago. Working capital stands at $3.8 million compared to a negative working capital of ($106,693) a year ago. Shareholders equity stood at approximately $4.0 million at year-end 2005 compared to $141,000 at the end of 2004. These results do not include the recent agreements for $6.5 million of financing.
The Company's independent registered public accounting firm has inserted an explanatory paragraph related to a going concern uncertainty into their Audit Report in the Company's Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005 noting that the Company will require additional equity to continue as a going concern. As a result the Company has recently entered into agreements for $6.5 million of financing and is working toward completing an additional financing to have the going concern removed from future filings.
The Company has been pursuing various equity investments and following discussions over several weeks it has entered into two separate agreements on April 6, 2005. The first is a Common Stock and Warrant Purchase Agreement with UBS AG London (www.UBS.com) for 5,333,333 shares of its common stock, for total proceeds of $4,000,000. As part of this sale, the company will also issue warrants to purchase 2,666,667 shares of common stock at an exercise price of $0.825 per share. The warrants expire forty-two months after the date of issuance.
The second independent Common Stock and Warrant Purchase Agreement was also entered into on April 6, 2005 with Standard Bank PLC London (www.standardbank.com), for 3,333,333 shares of its common stock, for total proceeds of $2,500,000. As part of this sale, the company will also issue warrants to purchase 1,666,667 shares of common stock at an exercise price of $0.825 per share. The warrants expire forty-two months after the date of issuance.
The company anticipates that these financings will close within 30 days.
"As indicated in our Form 10-KSB and previous filings, we intended to raise additional capital in 2006 in order to meet our ongoing working capital needs and meet our shareholder equity requirements," said Alan Rae, O2Diesel's President and CEO. "We are very pleased to secure both of these investments from such recognized institutions adding to our institutional shareholders base and it further confirms that we are firmly on the way to securing the funds we need to execute our business plan."
"Over the course of the previous year we have reached several key milestones, while reaching the first anniversary of O2Diesel(TM)'s use at a number of our customers with positive feedback and results to date. Our relationship with Abengoa, Europe's largest BioEthanol producer, to develop and market our O2Diesel fuel in Europe coupled with the growing need in the US to develop alternative fuels has greatly enhanced the Companies exposure over the past year and further confirmingO2Diesel(TM) as a viable, commercial, clean burning and renewable alternative to regular diesel fuel for centrally fueled fleets in the US and abroad."
More About O2Diesel: The Company and Its Fuel Technology
O2Diesel Corporation (AMEX:OTD - News) and its U.S. subsidiary O2Diesel, Inc., is a pioneer in the commercial development of a cleaner-burning diesel fuel alternative that provides exceptional performance and environmental qualities for centrally fueled fleets and off-road equipment of all kinds. Engineered and designed for universal application, O2Diesel(TM) is an ethanol-diesel blend that substantially reduces harmful emissions without sacrificing power and performance. Extensive independent and government-recognized laboratory and in-use field tests have demonstrated the effectiveness of O2Diesel(TM) -- the introduction of this cost-effective, cleaner-burning diesel fuel is now underway in the United States and other global markets. For more information please refer to www.o2diesel.com.
