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Hy-Drive Technologies Ltd. (HGS-V)
MISSISSAUGA, ON, June 10 /CNW/ - Hy-Drive Technologies Ltd. ("Hy-Drive" or the "Company") is pleased to announce the following summary of recent events and developments as highlighted at its Annual General & Special Meeting of Shareholders ("AGM") held this week. In addition, Hy-Drive is pleased to provide the following update on its previously announced private placement of units of the Company ("Private Placement").
Hy-Drive's Hydrogen Generating System (HGS) is designed to reduce fuel consumption and emissions on heavy duty trucks by adding hydrogen to the air/fuel mixture, which acts as an accelerant to improve the efficiency of the burn.
Hy-Drive continues to focus its efforts with respect to its initial product on pre-2007 Caterpillar ("CAT") C12, C13 and C15 engines, both ACERT and non-ACERT. The number of Class 8 engines that are Caterpillar built prior to 2007 represents the largest share of the Class 8 market for those years and Hy-Drive considers that to represent the market opportunity for its technology. According to the R.L. Polk & Co. Commercial Vehicle Report, December 2009, there are over 4 million Class 8 trucks in North America. In addition, approximately 9 million commercial vehicles were reported in Classes 3 to 7.
Hy-Drive is pleased to report the following:
- Marketing Campaigns - Hy-Drive has developed a marketing campaign
directed at fleets with Caterpillar engines. The campaign includes
the development of new marketing materials, a redesigned website,
attendance at strategic truck trade shows and a direct mail campaign
(the "Direct Mail Campaign") aimed specifically at fleets that are
believed to have CAT engines in their trucks.
- 90 Day Risk Free Trials - The Direct Mail Campaign targets thousands
of fleets in North America. Hy-Drive believes that if fleets with CAT
engines try Hy-Drive's third party validated HGS, they will confirm
the savings in fuel and emissions and should be incented to buy the
product for their fleets. Currently, Hy-Drive has nine trials of
varying numbers of HGS in process with fleets of a size up to 900
trucks. Hy-Drive estimates that as little as one-half of 1% of the
Class 8 CAT engines could represent a potential market of over 5,000
possible HGS sales.
- Australian Market Re-entry - Hy-Drive, through its sales agent,
Sparta Capital, has re-entered the Australian market. The Class 8
truck market in Australia is estimated to be about 100,000 vehicles
and Caterpillar's share of the pre-2007 engines on the road there is
estimated to be significant. Fuel prices in Australia are higher than
Canada and the USA, which the Company believes potentially represents
a strong market opportunity for HGS sales.
- Other Markets - Hy-Drive estimates there are over 2 million Class 8
trucks in operation in the European Union ("EU"). Hy-Drive's current
plans call for the Company to develop product for the various engines
types used in that market after it has developed product for North
America. Engines used in the EU comprise a number of brands not
currently sold in North America. Fuel prices are higher in the EU and
potentially represent a strong economic case to buy Hy-Drive's fuel
- Third-Party Validation - Hy-Drive believes it is unique in having a
hydrogen generating system with an integrated management module
validated following both SAE/TMC Type II and Type IV protocols. These
represent the on-road industry standards for measuring the efficacy
of a product claiming fuel consumption reductions. The validation was
conducted by Professional Service Industries, Inc. ("PSI") a large US
based engineering consultancy. The previously announced results of
those tests on Class 8 trucks confirmed 10.47% and 11.9% reductions
in fuel consumption, respectively, and 39.53% and 45% reductions in
opacity, a measure of particulate matter in the exhaust. (Please see
press releases dated March 25, 2010 and August 6, 2009 )
- Product Development - Hy-Drive currently has product under
development for use with certain pre-2007 Detroit Diesel engines and
the Company currently intends to follow that with a product for
similar Cummins engines. The development of HGS products for those
types of engines, in conjunction with CAT engines, is expected to
represent the vast majority of the pre-2007 Class 8 market and
potentially represent a strong opportunity for HGS sales.
- Intellectual Property - Hy-Drive has filled a patent application for
its integrated management module.
- Government Incentives - Hy-Drive has filed an "Intent to Verify" with
the US Environmental Protection Agency. This application is intended
to be the start of the verification process to have the HGS verified
as a Diesel Retrofit Technology. Verification of the product, if
successful, could qualify buyers of the HGS for various possible
subsidies or tax credits available from federal, state, provincial
and city programs to reduce emissions.
Private Placement Update
Hy-Drive today completed a second tranche of its previously announced "best efforts" Private Placement and has issued Cdn$169,000 of units ("Units") of the Company, on a non-brokered basis, bringing the total gross proceeds raised, to date, to $4,197,000.
As previously announced, Hy-Drive initially issued $4,028,000 of Units of a maximum of $5 million of Units, pursuant to the Private Placement, with net proceeds to be used by the Company for working capital, marketing and production of HGS units, production of the mining HGS and for capital expenditures required to complete the development of IP for engine platforms other than Caterpillar.
Pursuant to the Private Placement, the Company has issued a total of 13,990,000 Units, including 566,333 Units today, at a price of Cdn$0.30 per Unit. Each Unit was comprised of one common share (a "Share") of the Company and one-half of one warrant (a "Warrant") with each whole Warrant exercisable for one Share of the Company at an exercise price of Cdn$0.46 per share for a period of five years. The Company may issue additional Units pursuant to the Private Placement.
All securities issued or issuable pursuant to the Private Placement today are subject to a hold period expiring on October 11, 2010, in accordance with the policies of the TSX Venture Exchange and applicable securities laws.
Hy-Drive is a technology firm that has developed a proprietary, patented hydrogen generating system. Hy-Drive's Hydrogen Generating System ("HGS(TM)") generates and injects hydrogen gas into a regular internal combustion engine, enhancing the combustion process by allowing fuel to burn more efficiently and completely. For more information, please visit www.hy-drive.com.
Cautionary Note Regarding Forward-Looking Information
This news release contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, information concerning Hy-Drive's market and product development plans as well as the Company's private placement and its intended use of the net proceeds therefrom. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects", or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "does not anticipate", or "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur", or "be achieved". Forward-looking information is based on the opinions and estimates of management at the date the information is made, and is based on a number of assumptions and subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. Many of these assumptions are based on factors and events that are not within the control of Hy-Drive and there is no assurance they will prove to be correct. Factors that could cause actual results to vary materially from results anticipated by such forward-looking information include risks associated with Hy-Drive's business, including, without limitation, factors relating to the marketing, development and commercialization of Hy-Drive existing and prospective product lines, regulatory approvals and requirements, changes in foreign exchange and interest rates, government regulation, environmental risks, capital expenditures, intellectual property, operating or technical difficulties, availability of skilled labour and equipment, and changes in project parameters as plans continue to be refined as well as those risk factors discussed in Hy-Drive's Management's Discussion and Analysis for the period ended March 31, 2010 at www.sedar.com. Although Hy-Drive has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Hy-Drive undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking information.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE HY-DRIVE TECHNOLOGIES LTD.
For further information: For further information: Fred M. Florence, COO & CFO, Hy-Drive Technologies Ltd., Tel: (905)542-3024 ext. 257, email@example.com