VISTA, Calif., June 4,
2014 /PRNewswire/ -- Eco Building Products, Inc. (OTC Pink: ECOB)
(OTCQB: ECOB), a manufacturer of treated wood products that are
protected against fire, mold/mycotoxins, fungus, rot-decay, wood
ingesting insects and termites by our proprietary eco-friendly
WoodSurfaceFilm™ and FireResistantCoating™ technology
(collectively "Eco Red Shield™"), today announced it has entered
into definitive agreements for up to $3.4M in financing to support filling a backlog
in purchase orders from Major Big Box Customer and to increase
production capacity at its manufacturing facilities stemming from a
growing demand for Eco Red Shield
treated lumber at its Major Customer following a successful Second
Pilot commercial launch program.
Under the terms of the agreements, the Company will receive up
to $1.4M in capital in equal
installments of $350,000 over the
next four months, to support the filling of backlogged orders and
meet increasing demand for Eco Red
Shield, with the goal of reaching sales of $1.5M in the fourth month, which will potentially
put the Company in a cash flow positive position. Concurrently, the
Company received equity financing of $800,000 in two tranches to support the expansion
in production capacity at its core manufacturing facilities from
$750,000 in production capacity per
month to $2,000,000 per month, as
well as retire approximately $300,000
in convertible debt financing previously entered into on
unfavorable terms. In addition, the Company will enter into an
expandable revolving credit facility agreement for $1.2M to support its supply chain that will allow
the Company to confidently increase its marketing efforts and
demonstrate long term sustainability to its Major Big Box
Customer.
"This funding represents a transformational milestone for the
Company from a revenue growth and sales trajectory standpoint,"
said Steven Conboy, President &
CEO of Eco Building Products. "We now have the capital needed to
meet a recent dramatic increase in demand for Eco Red Shield from our Major Big Box Customer,
who is now in a position to begin aggressively marketing our
product to its massive customer base as an optimized solution to
meet key unmet needs in the $60B
North American lumber industry. We have positioned ourselves
extremely well to meet an expected continued surge in demand for
fire-resistant and mold-resistant lumber in the new construction
industry, especially in light of recent wildfires in San Diego County and mold-related housing
condemnations following Hurricane Sandy in New Jersey and Long Island. We believe
Eco Red Shield has the potential to
replace existing entrenched chemical products in the wood treatment
industry, with the potential to reach over $1B in sales."
In February 2014, the Company
expanded its distribution channels in a Second Pilot program with
its Major Customer to 104 stores from an original Initial Pilot
program of 10 stores in November
2013. The significant increase in orders for Eco Red Shield since that time has caused the
Company to consider strategic options to fuel an expected rapid
growth in demand following the completion of the successful Second
Pilot roll-out.
According to Wood Markets, the North American lumber industry is
expected to grow to over $60B in
2015, up 40% from 2009. It is widely acknowledged that the most
significant unmet category in the lumber industry is for fire
resistant and mold-resistant wood that will improve the safety and
longevity of new housing construction. Eco
Red Shield provides a comprehensive,
environmentally-friendly, risk-mitigating solution that has the
potential to replace the current standard in the $2.7B wood coating
chemicals industry, while producing safe and ecologically-friendly
products for the millions served annually by the lumber
industry.
About Eco Building Products, Inc.
Eco Building Products, Inc. is a manufacturer of treated wood
products that are protected against fire, mold/mycotoxins, fungus,
rot-decay, wood ingesting insects and termites by our proprietary
eco-friendly chemistry utilizing ECOB WoodSurfaceFilmTM
and FRC™ technology (Fire Retardant Coating), (collectively
"Eco Red Shield").
Eco Red Shield utilizing patent
pending technology is the ultimate in wood protection,
preservation, and fire safety to building components constructed of
wood; from joists, beams and paneling, to floors and ceilings.
Safe Harbor Statement: This press release may contain
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 (the "Act"). In
particular, when used in the preceding discussion, the words
"believes," "expects," "intends," "plans," "anticipates," or "may,"
and similar conditional expressions are intended to identify
forward-looking statements within the meaning of the Act, and are
subject to the safe harbor created by the Act. Any statements made
in this news release other than those of historical fact, about an
action, event or development, are forward-looking statements.
Forward looking statements involve known and unknown risks and
uncertainties, which may cause the Company's actual results in
future periods to be materially different from any future
performance that may be suggested in this release. ECOB takes no
obligation to update or correct forward-looking statements, and
also takes no obligation to update or correct information prepared
by third parties.
Company
Contact
Eco Building Products, Inc.
Phone: 1 888 Red Shld (888-733-7453)
Email: info@ecob.net
Web Site: http://www.ecob.net
Investor Relations Contact
Arthur Douglas & Associates,
Inc.
Arthur Batson
Phone: +1-407-478-1120
SOURCE Eco Building Products, Inc.