ECO2 Plastics, Inc. reported earnings results for the third quarter and nine months ended September 30, 2009. For the quarter, the company reported revenues of $1.4 million versus $2.5 million during the same period in 2008. Net losses from operations were $9.6 million for the quarter versus $3.3 million during the same period in the prior year. Excluding a one-time impairment of assets related to the closing of the plant during the quarter, net losses from operations were $2.0 million for the quarter versus $3.3 million during the same period in the prior year. For the nine months, the company reported that net losses were $10.0 million versus $12.8 million for the prior year. Revenues for the nine months were $3.0 million in 2009 versus $5.4 million in 2008. Excluding a one-time impairment of assets related to the closing of the plant, net losses were $6.1 million for nine months ended September 30, 2009 versus $9.6 million for the prior year.

ECO2 Plastics, Inc. announced the approval by the Board of Directors to relocate and upgrade the company's current production facility to a new location in Northern California. In conjunction with this plan, the company closed its existing facility in Riverbank, CA. A total of 47 employees were laid off and the Company has begun dismantling existing equipment. The company currently retains a total of 11 employees. The company has identified a suitable site for the new facility as well as new equipment that will be installed alongside certain existing equipment in order to complete an improved production line. The company has not yet, however, made final decisions as to the site location or equipment vendor. The company projects that development of the new plant will require approximately $9 million in new capital, including some funds required to pay currently outstanding accounts payable. The company expects that a significant portion of this amount can be financed through equipment lease and other commercial credit facilities, while the balance of the requisite funding will need to be sourced from equity or debt investors. The company expects that the newly developed plant will generate recycled plastic in sufficient volume and at sufficient quality and yield, along with an efficient cost of production, such that the business will operate profitably following completion of the new facility and achievement of targeted production volumes.

On September 8, 2009, ECO2 Plastics Inc. received loans in the total amount of $500,000. These loans were made pursuant to secured promissory notes secured by all of the assets of the company. The notes accrue interest at a rate of 8% per annum, are due and payable on October 31, 2009. Several of the purchasers of Notes have previously invested in the Company, including Peninsula Packaging, LLC and Trident Capital Inc., each of whom has a representative on the Board of Directors of the Company.