Daily Market Movers 10-11-11

GCLL
BBND, MVTG, WH, UNVC, NXOI, CDTI

Our Stocks to Watch today include Our Stocks to Watch today include GreenCell Inc. (OTCBB: GCLL), BigBand Networks Inc. (NASDAQ: BBND), Mantra Venture Group Ltd. (OTCBB: MVTG), WSP Holdings Ltd. (NYSE: WH), Univec Inc. (OTC: UNVC), Next 1 Interactive Inc. (OTCBB: NXOI) and Clean Diesel Technologies Inc. (NASDAQ: CDTI).

FEATURED COMPANY

GREENCELL INCORPORATED (OTCBB: GCLL)

Detailed Quote: http://www.otcpicks.com/quotes/GCLL.php

Company Profile: http://bit.ly/rjsQnf

GreenCell Inc., founded in 2009 and headquartered in Orlando, Florida is engaged in a joint venture with SenCer Inc. to develop, commercialize, and market SenCer's UltraTemp™ ceramic composite materials for home and transportation applications.

GCLL News:

October 11 - GreenCell, Inc. Announces New Hiring and Continued Expansion of the Company

GreenCell, Incorporated (OTCBB: GCLL) announced the hiring of Mr. Jason Voellinger as a process engineer for the scale-up of the ceramic igniter and other component lines.

Mr. Voellinger has 10 years experience in process engineering of advanced technical ceramics and is a graduate of Alfred University. His direct duties will be in developing the automation points for component manufacturing and integrating into the line.

Dan Valladao, Chairman and CEO, states "As we continue to work towards our first product distribution we anticipate continued expansion of the company which will help promote new jobs for the area."

STOCKS TO WATCH

BIGBAND NETWORKS INCORPORATED (NASDAQ: BBND)
"Up 74.41% in morning trading"

Detailed Quote: http://www.otcpicks.com/quotes/BBND.php

BigBand Networks provides broadband service providers with innovative digital video networking solutions designed to make it easier to move, manage and monetize video. These solutions are based on BigBand's video-networking platforms that are built to enable efficient and reliable delivery across a wide range of services, including digital TV, high definition TV, advanced advertising, IPTV, video-on-demand and interactive TV. BigBand has done business with more than 200 customers in North America, Asia and Europe — including eight of the ten largest cable and telco service providers in North America. BigBand is based in Redwood City, Calif., with offices worldwide.

BBND News:

October 11 - ARRIS Agrees to Acquire BigBand Networks in all Cash Transaction

Building Leadership in Video Networking

ARRIS Group, Inc.  (NASDAQ: ARRS) and BigBand Networks (NASDAQ: BBND) announced that they have entered into a definitive agreement whereby ARRIS will acquire BigBand Networks for a purchase price of $2.24 per share in cash. This equates to a diluted equity value of approximately $172 million, or $53 million net of estimated BigBand cash on hand.

With the addition of BigBand's experienced employees, this acquisition further extends ARRIS' capabilities in the processing, management and distribution of digital video content and represents an important acquisition of innovative technologies and significant R&D investments that are expected to accelerate time-to-market and increase opportunities for ARRIS in several fast growing product areas. These include the Converged Cable Access Platform (CCAP) architecture defined by CableLabs®, Local and Targeted Advertising, IP Video Distribution, and Advanced Video Processing and Compression.  BigBand's valuable patent portfolio, coupled with their expertise in digital video networking will enhance ARRIS' technological leadership as service providers move to an all IP Converged Network Architecture.

Upon closing, ARRIS anticipates rapidly optimizing BigBand's financial performance through meaningful operating synergies such as the elimination of public company costs and the alignment of sales, marketing, and R&D initiatives. ARRIS also anticipates that the transaction will be neutral to accretive on a non-GAAP basis for ARRIS shareholders by mid-2012 and will offer upside potential thereafter by addressing upcoming video network evolution opportunities with a more complete offering.

"We are both enthusiastic and optimistic about the BigBand acquisition because it builds on our stated business strategy of growing our current businesses into a more complete portfolio including a strong video product suite and investing in the evolution towards network convergence onto an all IP platform," said Bob Stanzione, ARRIS Chairman & CEO.  "In addition, the acquisition offers new opportunities to expand our customer base worldwide. We are delighted to welcome the BigBand employees to ARRIS."

"The BigBand team is proud of its accomplishments over the last 12 years in developing innovative products that enable the transmission of digital television to consumers around the world," said Amir Bassan-Eskenazi, BigBand President and CEO. "We are excited to see this legacy live on and generate broader opportunities with continued innovation in media processing as part of the world-class product and service offerings provided by the ARRIS organization."

The acquisition will be conducted by means of a tender offer for all of the outstanding shares of BigBand, which is expected to commence within ten business days and will be subject to customary closing conditions, including the acquisition by ARRIS of a majority of BigBand's shares and the receipt of antitrust clearance in the United States if applicable.

The board of directors of BigBand has unanimously recommended that the shareholders of BigBand accept the offer.  Redpoint Ventures and ValueAct Capital Partners, holders of 32% of the outstanding shares of BigBand, have agreed to tender their shares in the offer and to vote their shares in favor of the merger agreement and against any other transaction, subject to the provisions of the agreement. Completion of the transaction is expected to occur in late 2011.

UBS Investment Bank is acting as exclusive financial advisor and Troutman Sanders LLP is acting as legal counsel to ARRIS on this transaction. Centerview Partners, LLC is acting as the exclusive financial advisor and Wilson Sonsini Goodrich & Rosati, P.C. is acting as legal counsel to BigBand on this transaction.

ABOUT ARRIS

MANTRA VENTURE GROUP LIMITED (OTCBB: MVTG)
"Up 64.29% in morning trading"

Detailed Quote: http://www.otcpicks.com/quotes/MVTG.php

Mantra, through its group of sustainable energy, carbon reduction and consumer product subsidiaries, is active in the green technology marketplace with an innovative, multi-faceted approach focused on profitability through sustainability. By aggressively seeking out new technologies and innovating solutions for a cleaner earth for everyone, Mantra intends to provide a highly profitable and environmentally responsible investment for its shareholders.

MVTG News:

October 10 - AlumiFuel Power, Inc. Makes Further Advancements in Its Portable Power System Development

Mantra Gives PCT Patent Update

Mantra Venture Group Ltd. (OTCBB: MVTG) (Frankfurt: 5MV) ("Mantra")  announced that its flagship carbon utilization technology known as the Continuous Co-Current Electro-Chemical Reduction of Carbon Dioxide (ERC) PCT# WO 2007/041872 A1, has advanced to the examination phase in the process for world-wide patent recognition.  The United States of America, Australia, Europe, China, and India have all commenced the examination process.

"We are excited to give our shareholders an update on our patent application.  This represents the next step in getting our leading edge technology recognized by patent offices worldwide," stated Larry Kristof, President and CEO of Mantra.

ERC, the Continuous Co-Current Electro-Chemical Reduction of Carbon Dioxide, is a cutting edge technology for utilizing CO2 generated by industries and other large CO2 emitters such as power plants.  This technology takes the CO2 that is being generated by these various large emitters and converts it into valuable products. The ERC process will help emitters reduce their carbon footprint, reduce future potential carbon associated costs and provide a new source of revenue from the conversion of CO2 emissions into saleable materials.

There are currently 27 Billion metric tonnes of CO2 emitted annually from fossil fuel combustion which represents an inexhaustible supply. One of the products produced by the ERC process is formic acid (HCOOH).  This is the strongest organic acid available and has numerous beneficial qualities and uses. Existing uses include the following: Farming and animal feed to sterilize and prevent disease, Insecticides, Leather treatment, De-icing of runways which offers no corrosion as with salt and better grip on plane wheels, Cleaning products, Pulp and paper production, and Pharmaceuticals.  Future uses include: Precursor chemical into green plastic production, Fuel cells, and formic acid as hydrogen storage medium.

Chemical and electrochemical conversion of CO2 into value-added chemical feedstocks and intermediates is attractive in terms of fossil fuel avoidance. It is estimated that the total CO2 emissions avoidance potential of this pathway is about 0.3 Gt/y (billion tonnes per year). The figure defines a reasonable initial target market for ME, the use 0.3 Gt/y of CO2 to make a similar volume of high value chemicals. An additional assumption is that these chemicals will have an average market value of $1,450 per tonne: giving a market value of $300 billion. This is in reasonable conformity with the ME projections ($350bn) arrived at by a totally different route.

Electro reduction of CO2 (ERC) promises to be deployable and practical: it has a low carbon footprint, is scalable and is economic in its use of electric energy. It has the ability to make a number of high value chemical products.

WSP HOLDINGS LIMITED (NYSE: WH)
"Up 13.73% in morning trading"

Detailed Quote: http://www.otcpicks.com/quotes/WH.php

WSP Holdings develops and manufactures seamless Oil Country Tubular Goods (OCTG), including seamless casing, tubing and drill pipes used for on-shore and off-shore oil and gas exploration, drilling and extraction, and other pipes and connectors. Founded as WSP China in 1999, the Company offers a wide range of API and non-API seamless OCTG products, including products that are used in extreme drilling and extraction conditions. The Company's products are used in China's major oilfields and are exported to oil producing regions throughout the world.

WH News:

October 11 - WSP Holdings Announces Second Quarter 2011 Results

WSP Holdings Limited (NYSE: WH) ("WSP Holdings" or the "Company"), a leading Chinese manufacturer of API (American Petroleum Institute) and non-API seamless casing, tubing and drill pipes used in oil and natural gas exploration, drilling and extraction ("Oil Country Tubular Goods" or "OCTG"), and other pipes and connectors, today announced its unaudited financial results for the second quarter ended June 30, 2011.

"The second quarter saw an overall increase in our revenues from the first quarter of 2011, mainly due to an increase in sales of API products in China. Export sales also increased in the second quarter of 2011 due to an increase in sales of non-API products to Venezuela. We are encouraged by the overall increase in our revenues that resulted from increases in domestic and export sales," commented Mr. Longhua Piao, the Chairman and CEO of WSP Holdings. "We expect to see a gradual increase in our export sales of both API and non-API products to countries in South America, Middle East and Central Asia as we continue to build upon our success in these new international markets."

WSP Holdings reported revenues of $185.5 million in the second quarter of 2011 compared to $131.2 million in the first quarter of 2011 mainly due to an increase in revenues generated from domestic sales. Domestic sales and international sales accounted for 57.5% and 42.5%, respectively, of total revenues for the second quarter of 2011.

On a quarter-over-quarter basis, domestic sales increased mainly due to an 83.7% increase in domestic sales volume. Export sales increased quarter-over-quarter due to an increase in sales of non-API products to Venezuela, which led to a 9.2% increase in international sales volume and a 2.3% increase in average selling prices.

On a year-over-year basis, domestic sales increased due to a 10.1% increase in average selling prices and a 15.1% increase in domestic sales volume. Export sales increased year-over-year due to a 52.9% increase in international sales volume, mainly attributable to an increase in sales of non-API products to Venezuela, and a 3.3% increase in average selling prices.

API and non-API product sales accounted for 58.2% and 23.7%, respectively, of total revenues in the second quarter of 2011. Higher quarter-over-quarter sales revenues from API product sales were primarily due to a 30.6% increase in sales volume, offset by a 6.8% decrease in average selling prices. Non-API sales revenues increased quarter-over-quarter due to a 93.5% increase in sales volume, offset by a 1.9% decrease in average selling prices. Sales of other products comprising mainly green pipes increased 74.2% quarter-over-quarter mainly due to a 14.7% decrease in average selling prices and 104.2% increase in sales volume.

API sales revenues increased slightly year-over-year primarily due to a 9.4% increase in average selling prices, offset by a 6.1% decrease in sales volume. Non-API sales increased year-over-year primarily due to a 242.2% increase in sales volume and a 6.6% increase in average selling prices.

Gross margin in the second quarter of 2011 was 3.6%, compared to 9.1% in the first quarter of 2011 and 5.6% in the second quarter of 2010. Lower quarter-over-quarter and year-over-year gross margins were primarily due to an increase in raw material costs, which resulted in higher costs of revenues in the second quarter of 2011.

Operating expenses in the second quarter of 2011 were $16.9 million, down 17.2% from $20.4 million in the first quarter of 2011 and up 27.0% from $13.3 million in the second quarter of 2010. Selling and marketing expenses were $6.1 million, compared to $5.4 million in the first quarter of 2011 and $4.9 million in the second quarter of 2010. General and administrative expenses were $10.9 million, compared to $15.5 million in the first quarter of 2011 and $11.1 million in the second quarter of 2010. The quarter-over-quarter decrease in general and administrative expenses was primarily due to a reduction of bad debt provision in the second quarter of 2011.

Loss from operations was $10.1 million in the second quarter of 2011, compared to loss from operations of $8.5 million and $5.8 million in the first quarter of 2011 and the second quarter of 2010, respectively.

Net interest expense was $10.0 million in the second quarter of 2011, compared to $7.4 million in the first quarter of 2011 and $6.9 million in the second quarter of 2010. Higher year-over-year net interest expense was mainly attributable to an increase in borrowings and interest rate, and partially due to a reduction in the capitalization of interest expense with the completion of certain construction projects.

The Company recorded an income tax expense of $1.4 million in the second quarter of 2011, compared to income tax benefit of $0.07 million in the second quarter of 2010.

Net loss attributable to WSP Holdings was $19.2 million in the second quarter of 2011, compared to net loss of $13.7 million and $12.0 million in the first quarter of 2011 and the second quarter of 2010, respectively.

Basic and diluted loss per ADS were both $0.19 in the second quarter of 2011, compared to basic and diluted loss per ADS of $0.13 and $0.12 for both in the first quarter of 2011 and in the second quarter of 2010, respectively.

Six Month Results

Revenues for the first six months of 2011 were $316.7 million, up 62.4% from revenues of $195.0 million in the first six months of 2010. Gross profit was $18.6 million for the first six months of 2011, compared to gross loss of $6.7 million for the first six months of 2010. Gross margin was 5.9%, compared to a negative 3.4% for the first six months of 2010. Operating loss was $18.6 million for the first six months of 2011, compared to operating loss of $28.5 million for the first six months of 2010. Net loss attributable to WSP Holdings was $33.0 million for the first six months of 2011, compared to net loss attributable to WSP Holdings of $39.0 million for the first six months of 2010. Basic and diluted loss per ADS were both $0.32 for the first half of 2011, compared to basic and diluted loss per ADS of $0.38 for both in the first half of 2010.

Financial Condition

As of June 30, 2011, the Company had cash and cash equivalents of $32.4 million, compared to $48.7 million as of December 31, 2010. Restricted cash totaled $214.0 million as of June 30, 2011, compared to $142.0 million as of December 31, 2010. As of June 30, 2011, the Company had short term borrowings of $721.5 million and long term borrowings of $122.8 million, compared to $596.5 million and $135.9 million, respectively, as of December 31, 2010. The Company has been carefully monitoring its liquidity to ensure that its anticipated working capital needs over the next few quarters are met by renewing and seeking to increase the existing lines of credit while taking appropriate cost-cutting measures. The Company has recently entered into a syndicated bank credit facility agreement with certain commercial banks for up to RMB3.5 billion (approximately $547.9 million). Out of this amount, RMB2.86 billion (approximately $447.7 million) of the syndicated loan facility has been approved and made immediately available to the Company, while the remaining balance of RMB640 million (approximately $100.2 million) is subject to the banks' further approval over the next three years. The Company will be subject to continued compliance with certain bank loan covenants including maintaining certain required financial ratios and has pledged certain assets to the banks as collateral. This syndicated loan facility allows the Company to replace certain of its existing short-term borrowings with mid-term working capital loans and helps the Company to improve its current cash flow position and liquidity.

Accounts receivable and inventory totaled $261.0 million and $259.8 million, respectively, as of June 30, 2011, compared to $200.0 million and $240.7 million, respectively, as of December 31, 2010. As of June 30, 2011, total assets were $1,528.1 million, total liabilities were $1,259.8 million and total equity was $268.3 million.

Capital expenditures incurred for the six months ended June 30, 2011 were $70.6 million and were funded mainly through medium- and long-term bank loans. The Company has almost completed its major capital expenditure projects and will continue to re-evaluate and revise its capital expenditure plan based on the prevailing economic conditions and future expectations, as well as the availability of funding.

Update on New Production Facility

WSP Pipe Company Limited ("WSP Pipe")
Construction of an OCTG pipe manufacturing and sales facility at WSP Pipe, the Company's wholly-owned subsidiary in the Thai-Chinese Rayong Industrial Zone, Thailand, is near completion. The first of two hot-rolling production lines with a combined production capacity of 200,000 tonnes per year commenced trial production in the second quarter of 2011, whereas the second hot-rolling production line was completed and commenced trial production in the third quarter of 2011.

Operational Environment and Business Outlook

Crude oil prices have traded between $91 and $100 a barrel until end of July 2011, down from highs of $114 a barrel in April, 2011. According to statistics from Baker Hughes, a top-tier oilfield service company, worldwide rig counts have been increasing. US rig counts reached 2,012 as of October 7, 2011, up from 1,671 as of October 8, 2010 while international rig counts reached 1,174 as of September 2011, up from 1,120 as of September 2010. The global economic uncertainty, as intensified by the series of political developments in North Africa and the Middle East, had caused oil prices to continue trending upward steadily since the beginning of 2011. However, oil prices began to fluctuate and trade below $100 a barrel in the second quarter of 2011 amid signs of slowing global economic growth and growing concerns of a European debt crisis. In mid-August 2011, oil prices fell to their lowest levels in six months to below $80 a barrel as US investors worried about another recession after the downgrade of the US credit rating by Standard & Poor's before rising to barely above $80 a barrel most recently in early October 2011. On the whole, oil prices are expected to continue fluctuating in the near term due to escalating disruption to oil production in the OPEC nations before rising gradually in the longer term as global economic growth leads to higher demand for oil.

On the international front, WSP Holdings has been successful in its efforts to pursue new opportunities and broaden its customer base, especially in South America, Middle East and Central Asia. The Company expects to secure more contract wins in South America this year as it is currently bidding for more tenders in Venezuela and Ecuador. The Company also expects to see a gradual improvement in sales to North America in the second half of 2011 once its subsidiaries in Houston and Thailand reach targeted utilization and volume levels.

On the domestic front, WSP Holdings continues to develop and launch new series of non-API products for commercial use and focus mainly on customers in areas such as Xinjiang Autonomous Region, Sichuan Province and Shaanxi Province, which provide opportunities for sales of higher-margin, non-API products. The Company plans to launch certain new series of non-API products in the near term for trial testing at major domestic oilfields and expects to see a further improvement in domestic sales of non-API products.

UNIVEC INCORPORATED (OTC: UNVC)
"Up 25.00% in morning trading"

Detailed Quote: http://www.otcpicks.com/quotes/UNVC.php

Univec, Inc., through its subsidiaries, produces, licenses, and markets medical products in the United States and internationally. It primarily provides auto-disable and safety syringes. The company offers 1 cc AD-syringe for aspirating and non-aspirating applications, which are used for dispensing dosages of allergy, immunization, and insulin medicines. It also manufactures and markets sliding sheath syringes that are designed to protect patients and healthcare workers from needle stick injuries; and bifurcated needle safety syringes, which are used in administering smallpox vaccines in response to bio-terrorist threats. Univec markets its auto-disable syringes and sliding sheath safety syringes to private hospitals, health facilities, and distributors in the United States, as well as to governments of developing countries. In addition, it assists pharmaceutical companies in marketing, fulfillment, and tracking drug samples via an online system connecting pharmacies and managed payment providers. The company was founded in 1992 and is based in Baltimore, Maryland.

UNVC News:

September 23 - Univec Inc. Files Form 8-K

On September 1, 2010, Univec Inc. (OTC: UNVC) entered into a Securities Purchase Agreement (the "Securities Purchase Agreement") with AJW Partners, LLC, AJW Partners II, LLC, New Millennium Capital Partners III, LLC, AJW Master Fund, Ltd. and AJW Master Fund II, Ltd. (collectively, the "Investors"). Under the terms of the Securities Purchase Agreement, the Investors purchased an aggregate of $60,000 in 12% callable convertible secured notes (the "Notes").

For more information, visit http://bit.ly/nAnZHx.

NEXT 1 INTERACTIVE INCORPORATED (OTCBB: NXOI)
"Up 35.54% in morning trading"

Detailed Quote: http://www.otcpicks.com/quotes/NXOI.php

Next One Interactive, Inc. (NXOI) is a multi faceted media company specializing in Travel and Real Estate. Next One plans the delivery of targeted content via multiple digital platforms including Satellite, Cable, Broadcast, Broadband and mobile. In today's digital market Next One Interactive delivers information and entertainment to consumers. The company business plan calls for multiple revenue streams from real estate and travel content delivery including transactional commissions, referral fees, advertising and sponsorship. The multiple revenue streams and integrated media platforms allow for the delivery of measurable return on investment to its advertisers, sponsors and business partners.

NXOI News:

October 6 - Real Estate Video On Demand Network Successfully Launched and Now Expanded to Three Additional Cities

Next 1 Interactive, Inc. (OTCBB: NXOI) announced that Next 1, in combination with its partner RealBiz Media, completed a flawless testing period of its "Home Tour Network" Video On Demand (VOD) platform in Los Angeles and Washington, D.C. The technical test launch passed with flying colors, resulting in 100% of the submitted local home listing videos and advertisements playing error free, on the Cable TV platform.

Passing the test phase with 100% success has allowed the Company to accelerate its intended path to roll out and has now gone live in three additional cities — Hartford, Providence, Rhode Island and San Diego — bringing the total cities operating in the Home Tour Network to five. The company is targeting Las Vegas and Phoenix in the coming months, as it works towards its ultimate goal of 100 cities nationwide by the end of 2012.

The Company is also pleased that the revenue model has gone into effect. As a result of passing this critical stage, the initial costing structure for showcasing 15-20 second property listing video on the Home Tour Network will be between $40 and $50 per month. The costing structure is based upon the Cable VOD market reach in each city. Our technology allows real estate brokers to automatically create 15-20 second home listing videos from their desktop on the fly. With a maximum of 1,000 listings per city, this platform should provide realtors who are early adopters a unique and affordable marketing advantage to showcase their property listings.

Furthermore, in addition to listing fees, the company will capture additional revenue from pre-roll and mid-roll advertising from real estate professionals and those industries interested in reaching consumers at or near their time of home transition.

"Based on our extensive experience creating visual marketing assets for real estate professionals over the last five years, it was obvious to us that the industry needs a new medium to reach consumers more efficiently and cost effectively. We are very confident that our vast business relationships in the trade will help us accelerate the adoption rate of this new and exciting media channel" says, Steve Marques, CEO of Home Tour Network VOD.

ABOUT REALBIZ MEDIA

RealBiz Media, Phoenix, Arizona, is the leading provider of rich media and image content delivery for the Real Estate Industry. RealBiz Media is focused on providing both integrated and interactive solutions for the seamless creation of High Resolution Media tours and videos for web and wireless. This technology allows automatic distribution to Franchise Corporations, MLS Associations and Search Engines like YouTube, Social Networks and TV. RealBiz Media's rich media content is supported by their (IPG) Image Processing Group delivering patented imaging technologies that are now being deployed in over 20 million digital cameras and mobile devices. RealBiz360 continues to add to its outstanding reputation as a technology leader in advanced imaging and content delivery and now has offices in Phoenix, AZ; Toronto, Canada and Baia Mare, Romania.

CLEAN DIESEL TECHNOLOGIES INCORPORATED (NASDAQ: CDTI)
"Up 31.31% in morning trading"

Detailed Quote: http://www.otcpicks.com/quotes/CDTI.php

Clean Diesel is a vertically integrated global manufacturer and distributor of emissions control systems and products, focused on the heavy duty diesel and light duty vehicle markets. Clean Diesel utilizes its proprietary patented Mixed Phase Catalyst (MPC®) technology, as well as its ARIS® selective catalytic reduction, Platinum Plus® fuel-borne catalyst, and other technologies to provide high-value sustainable solutions to reduce emissions, increase energy efficiency and lower the carbon intensity of on- and off-road engine applications. Clean Diesel is headquartered in Ventura, California, along with its wholly owned subsidiary, Catalytic Solutions, Inc., and currently has operations in the U.S., Canada, U.K., France, Japan and Sweden.

CDTI News:

October 11 - Clean Diesel Technologies, Inc. Announces Selected Preliminary Third Quarter 2011 Financial Results

Enters into Discretionary Equity Commitment with Lincoln Park Capital

Clean Diesel Technologies, Inc. (NASDAQ: CDTI) ("Clean Diesel"), a cleantech emissions reduction company, announced that selected unaudited preliminary third quarter 2011 financial results. Clean Diesel also announced that it has entered into an equity purchase agreement with Lincoln Park Capital Fund, LLC, a Chicago-based institutional investor firm.

The October 15, 2010 business combination with Catalytic Solutions, Inc. (or "CSI"), which Clean Diesel refers to as the "Merger" was accounted for as a reverse acquisition. Accordingly, Clean Diesel's (the legal acquirer's) consolidated financial statements are now those of CSI (the accounting acquirer), with the assets and liabilities and revenues and expenses of legacy Clean Diesel being included in CSI's financial statements effective from October 15, 2010, the closing date of the Merger. As such, the amounts discussed below for periods prior to the Merger are those of CSI and its consolidated subsidiaries, with amounts of legacy Clean Diesel operations included from the date of the Merger.

Preliminary total revenues for the third quarter of 2011 are expected to be in excess of $14.7 million, or up over 34%, as compared to $10.9 million in the third quarter of 2010 and up over 25% as compared to $11.5 million in the second quarter of 2011. Revenue for the quarter for Clean Diesel's Heavy Duty Diesel Systems division ("HDD") is expected to grow in excess of 50% as compared to the same period a year ago, and is expected to be higher than the second quarter of 2011. HDD revenues have benefited from continued strength in sales to the material handling and mining sectors and strong growth in North American retrofit sales and sales in the London Low Emission Zone ("LEZ"). HDD revenue includes approximately $0.3 million of sales from the legacy Clean Diesel business as a result of the Merger.  The Catalyst division external sales are expected to be slightly lower than a year ago, but are expected to be higher than the second quarter of 2011 as a result of the recovery of Clean Diesel's Japan-based customer's production volumes in August and September, following the earthquake and ensuing tsunami that occurred in March 2011. Including interdivisional sales of catalyst products, which were eliminated in consolidation, sales for this division are expected to grow in excess of 40% in the third quarter of 2011 when compared to the same quarter in 2010.

Clean Diesel's preliminary results remain subject to finalization by its management and review by its outside independent accountants. While a wide range of results remains possible, Clean Diesel continues to expect its revenues to grow for 2011. Total revenue for 2011 is likely to be heavily weighted to late in the year as a result of the currently expected timing of anticipated sales in the London LEZ. Clean Diesel currently expects to release full results for its third quarter ended September 30, 2011, on or about November 10, 2011.

Clean Diesel also announced today that on October 7, 2011, it entered into a purchase agreement (the "Purchase Agreement") with Lincoln Park Capital Fund, LLC ("LPC"). Under the Purchase Agreement, Clean Diesel has the option, at its sole discretion, to sell to LPC, from time to time, up to $10.0 million of its common stock over a 30-month period. Clean Diesel has the right, but not the obligation, to direct LPC to make purchases of Clean Diesel's common stock in amounts up to $0.5 million, which can be accelerated to amounts up to $1.5 million depending on Clean Diesel's share price and other conditions as set forth in the Purchase Agreement. Clean Diesel intends to use the net proceeds from the sale of common stock under the Purchase Agreement for working capital and general corporate purposes.

Clean Diesel is required to file a registration statement with the U.S. Securities and Exchange Commission covering the sale of the shares that may be issued to LPC under the Purchase Agreement. Once the registration statement is effective, LPC is obligated to make purchases as Clean Diesel directs in accordance with the Purchase Agreement, which may be terminated by Clean Diesel at any time, without cost or penalty.

"Driven by excellent execution by our team and demand across our customers, our preliminary third quarter revenue performance was strong," stated Charles Call, Clean Diesel Technologies, Inc., Chief Executive Officer. "Based upon the preliminary results, we experienced solid sequential revenue growth in both our Heavy Duty Diesel Systems and Catalyst businesses."

"In 2011, we made the strategic decision to invest in product development, sales and marketing to enable growth and to take advantage of the opportunities that are underway in the London Low Emission Zone and the U.S. market for our Heavy Duty Diesel Systems," said Mr. Call. "Many of these investments have contributed to our results in the first nine months of 2011, and we believe they will continue to support growth in the fourth quarter of 2011 and beyond. In order to assure that we have sufficient working capital to manage the expected growth for the remainder of the year and into 2012, we entered into a purchase agreement with LPC that provides us with the flexibility we may need to strategically grow the business. With the current uncertain global economic environment, we believe this agreement provides insurance for us to meet potential needs for working capital due to the London LEZ programs in 2011 and the California Truck & Bus Rule in 2012 and beyond."

A more detailed description of the Purchase Agreement and transaction with LPC is set forth in Clean Diesel's Current Report on Form 8-K to be filed with the SEC as of the date of this press release.

ABOUT LINCOLN PARK CAPITAL

LPC is an institutional investor headquartered in Chicago, Illinois. LPC's experienced professionals manage a portfolio of investments in public and private entities. These investments are in a wide range of companies and industries emphasizing life sciences, energy and technology. LPC's investments range from multiyear financial commitments to fund growth to special situation financings to long-term strategic capital offering companies certainty, flexibility and consistency.