Quercus Makes $10 Million Equity Investment in Dynamotive

VANCOUVER, British Columbia--(BUSINESS WIRE)--Dynamotive Energy Systems Corporation (OTCBB:DYMTF), a leader in biomass-to-biofuel technology, announced today that it has completed a $10.5 million equity financing with Quercus Trust, an environmentally oriented fund, and several other private investors. Ardour Capital Inc. of New York served as financial advisor in the transaction.

Under terms of the transaction, Quercus Trust invested $10 million and other private investors $500,000 to acquire 11.4 million shares of Dynamotive common stock at $0.9215 per share. They also received five-year warrants, with three-year anti-dilution rights, for up to a total of 4.56 million additional shares at $1.06 per share. The shares are restricted securities under the Securities Act of 1933 and were sold pursuant to applicable exemptions.

“The Quercus funding comes at an important time for Dynamotive,” said Andrew Kingston, president and chief executive officer, “as this significant cash investment by a sophisticated, alternative-energy-oriented investor provides additional working capital to help speed our progress on major activities currently under way.”

“This capital infusion,” Mr. Kingston continued, “allows us to concentrate on growing the company, investing in new project initiatives, and accelerating our market penetration in the U.S. and in Europe, where we are developing further projects.”

Mr. Kingston noted that the company has two BioOil^® biofuel plants in Canada, one of which is now ramping up production, and the other is nearing completion of an upgrade. The company is also working to finalize plans for two major biomass-to-electricity complexes in Latin America.

About BioOil^® Biofuel

BioOil^® is an industrial fuel produced from cellulose waste material. When combusted it produces substantially less smog-precursor nitrogen oxides (‘NOx’) emissions than conventional oil as well as little or no sulfur oxide gases (‘SOx’), which are a prime cause of acid rain. BioOil^® and BioOil Plus™ are price-competitive replacements for heating oils #2 and #6 that are widely used in industrial boilers and furnaces. They have been EcoLogo certified, having met stringent environmental criteria for industrial fuels as measured by Environment Canada’s Environmental Choice Program. BioOil^® can be produced from a variety of residue cellulosic biomass resources and is not dependent on food-crop production.

About Dynamotive

Dynamotive Energy Systems Corporation is an energy solutions provider headquartered in Vancouver, Canada, with offices in the USA, UK and Argentina. Its carbon/greenhouse-gas-neutral fast pyrolysis technology uses medium temperatures and oxygen-free conditions to turn dry, waste cellulosic biomass into BioOil^® for power and heat generation. BioOil^® can be further converted into vehicle fuels and chemicals. For further information, please visit the company’s website at www.dynamotive.com.

Forward-Looking Statement

Statements in this news release concerning the company’s business outlook or future economic performance; including the anticipation of future plant start-ups, partnerships, consortiums, teaming agreements, government assistance, other anticipated cash receipts, revenues, expenses, or other financial items; and statements concerning assumptions made or expectations as to any future events, conditions, performance or other matters, are “forward-looking statements.” Forward-looking statements are by their nature subject to risks, uncertainties and other factors which could cause actual results to differ materially from those stored in such statements. Such risks, uncertainties and factors include, but are not limited to, changes in energy prices, availability of capital, and the company’s ability to access capital on acceptable terms or any terms at all, changes and delays in project development plans and schedules, customer and partner acceptance of new projects, changes in input pricing, competing alternative energy technologies, government policies and general economic conditions. These risks are generally outlined in the company’s disclosure filings with the Securities and Exchange Commission.