GreenMan Signs Letter of Intent to Acquire Tire Processor

GreenMan Technologies, Inc. announced that it has executed a letter of intent containing an exclusive option to acquire certain operating assets of Tires Into Recycled Energy and Supplies, Inc. The exclusive purchase option is exercisable during the next 15 to 24 months if certain predetermined financial performance criteria are met by TIRES, Inc.

In return for the exclusive purchase option, GreenMan issued $200,000 of common stock which will be applied towards the purchase price of the assets if the acquisition is successfully closed or forfeited if the option is not exercised.

GreenMan has agreed to lease, with an option to buy, certain pieces of tire processing equipment owned by TIRES, Inc. and has executed a multi-year agreement to supply TIRES, Inc. rubber feedstock material from GreenMan's Georgia and Tennessee plants.

In addition, the parties have agreed to use a previously issued $350,000 "good faith deposit" to prepare and move the leased equipment for use. TIRES, Inc. is a leading crumb rubber producer with crumb rubber production capacity approaching 60 million pounds per year.

Bob Davis, GreenMan's president and CEO, stated, "The synergies between our two companies are significant. It has always been our intention to establish value added production capacity in the Southeastern United States in order to meet the increasing demand for higher value crumb rubber materials where we now manage over 15 million scrap tires per year. TIRES, Inc. has a proven track record of producing and selling high quality crumb rubber into highly diversified markets. This relationship allows us to immediately leverage each of our strengths immediately with the potential for strong accretive performance by joining our two companies on a more permanent basis in the near future."

Mr. Davis added, "The tire processing equipment we are leasing from TIRES, Inc. will be deployed within the next 60 days to our Tennessee location allowing us to significantly increase the number of tires we can process locally. In addition, we will be able to produce higher value added crumb rubber feedstock and clean steel through installation of a waste wire processing system similar to equipment operating in our Georgia, Iowa and Minnesota plants."

David Forrester, TIRES Inc.'s CEO, said, "Our core business is production of the highest quality crumb rubber in the industry. This relationship with GreenMan allows us to focus even more completely on our core business now that we have secured access to a reliable supply of high quality feedstock necessary to meet our growing demand. The successful joining of our two companies would blend industry expertise in a powerful and we think optimal fashion."