Omnitek Engineering Corporation, a developer of natural gas engines and diesel-to-natural gas conversion systems, has entered into a definitive agreement with investors for a private placement of common stock and warrants to raise approximately $5.0 million in gross proceeds.
Under the terms of the financing, the company will issue shares of common stock at a price of $2.12 and warrants to a group of investors at an exercise price of $3.88, with a five-year term. Merriman Capital, Inc. acted as the sole placement agent in connection with the transaction.
The completion of this financing will greatly accelerate the build out of our national network of diesel-to-natural-gas conversion facilities. There is enormous pent-up demand for truck engine conversions in the US market, as well as other substantial opportunities, including power generators, irrigation pumps, and other diesel powered equipment.
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Funk noted that diesel engines have a service life of up to 20 years, and that routine overhauls are required and service budgets established in advance. By converting these diesel engines to operate on natural gas during a routine service overhaul, Omnitek can offer truck operators a compelling return on investment with much lower fuel costs and cleaner combustion, he said.
Source: Green Car Congress
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