Replies to post #4733 on EcoSphere Technologies Inc. (fka ESPHQ)

[curt56]

Logic, I found this in the report to confirm what you have stated.

"In May 2011, the Company received notice that Southwestern Energy, its largest customer, would not be renewing the work orders for our first generation EF 10s after their terms expire in November 2011 and January 2012 respectively. We have currently engaged in discussions with Hydrozonix LLC with respect to Hydrozonix leasing the EF 10s. In turn, we understand that Hydrozonix has been engaged in discussions with Southwestern Energy with respect to Hydrozonix operating the EF 10s on behalf of Southwestern Energy. As of the date of this Report, no definitive agreements have been entered into with regard to the future use of the EF 10s."

[Recognizer]

Yes
One of our significant customers (who accounted for 87% of revenue in the current quarter) notified us they would like to use the new EF 80s in place of the existing EF10s on their frac sites going forward. This customer was very instrumental in driving the design and development of the new EF 80 for better utilization and more wells completed per month with the higher flow rate and better utilization design. The customer has notified EES that it will comply with the current arrangement and agreed upon two year contract to full term but will not renew a new contract strictly with the EF 10s and has expressed an interest in renegotiating with our new Hydrozonix licensee for the deployment of the EF 80s on frac sites and EF10s on produced water sites. This customer is expected to be a Hydrozonix customer after Hydrozonix accepts the EF 80s. The customer has provided for the test site. One-half of the units will be removed in November 2011 and the balance in January 2012. We are pursuing an agreement to lease the two EF 10 fleets currently in operation to Hydrozonix. If we are able to complete the leasing arrangement, our revenue and the associated operating expenses will decline accordingly. If we are unable to complete a leasing transaction for the EF 10s, the decline in revenue will be greater.

[Logic1]

Curt, Recognizer thank you again for your comments re Southwestern Energy.