Q2Power Technologies Inc. (OTCQB: QPWR) announced today it had entered into a binding letter of intent with ERTH Products LLC and its sister company, Exceptional Products Inc. (the "ERTH Companies"), for the acquisition of the ERTH Companies by Q2Power.
Under the letter of intent, the ERTH Companies have granted Q2Power a 90-day exclusivity period to finalize the terms of the acquisition and secure commitments for funding required to close the transaction. The exclusivity period may be extended for an additional 275 days if the parties reach agreeable terms, which have already been discussed in detail between the parties, and Q2Power provides an investment deposit equal to approximately 5% of the presumed purchase price.
The ERTH Companies are leaders in the manufacturing of agricultural compost and sustainable soils from waste water biosolids in the southeastern United States. ERTH owns and operates a composting facility in Plains, GA, to which it diverts biosolids from nine waste water treatment plants that would normally go to landfill, and with this recycled feedstock produces over 75,000 cubic yards per year of Class A compost sold to local farms under the brand name ERTH Foods®. Exceptional Products sells engineered soils produced from ERTH Food® compost to the construction and landscape industry, specifically blended for their structural, water and nutrient retention, and other LEED building requirements. According to a recent Research & Markets report, the global market for these soil products is projected to reach $7.8 billion by 2021, being driven by soil productivity, water conservation and pollution concerns in the United States and worldwide.
"ERTH is a perfect fit for Q2Power as it provides us with an excellent platform to grow a profitable composting and sustainable soil manufacturing business nationwide," stated Q2Power's Chairman, Kevin Bolin. "ERTH is a widely respected leader in the industry, and one of only a handful of manufacturing companies focusing on the use of engineered soils in sustainable landscape construction and green building projects. We believe that their strong and established business model can be duplicated in multiple markets. This has potential for being an excellent transaction for Q2Power shareholders, which would include the founders of the ERTH Companies."
"We are excited to work with Q2Power over the following months to reach terms that will allow us to join forces and build a great company together," stated ERTH's founder, Wayne King Sr. "We have known Kevin Bolin for years, and believe he is an extremely capable leader with a proven track record of successful transaction funding, acquisitions, and public company growth."
In May the parties signed an initial term sheet contemplating a licensing arrangement between the parties. This new letter of intent with an expanded focus supersedes that earlier document.
About Q2Power: Q2Power seeks to become a leading provider of waste management services for small-scale waste water treatment plants and other producers of methane and organic waste. Q2Power's current pilot staged combined heat and power (CHP) technology can be deployed with minimal time and expense at thousands of small-scale facilities that must dispose of waste such as methane, biogas and other used fuels at increasingly greater costs and regulatory burdens. Through acquisitions and strategic alliances, Q2Power also seeks to convert biosolid waste from water treatment plants into beneficial reuse products such as Class A compost and engineered soils.
For more information about Q2Power, please visit: www.q2p.com
