DNEPRO PRODUCTION PLANT

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• Soter Metallurgy
• DnepropetrovskUkraine

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SOTER METALLURGY

• High Purity Zirconium Tetrafluoride.
• Production by sublimation.

• The main asset of the Company is a
  currently-dormant industrial sublimation
  installation, Pritok-3.
• Facility capable of producing 120 tons of
  Zirconium Tetrafluoride annually.
• A group of specialists with unique know-how is
  ready to re-start the facility immediately.
• USA, United Kingdom, Japan, and France are the
  leading countries in the production of high
  purity zirconium tetrafluoride.

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Usage of High Purity Zirconium Tetrafluoride

• Primary use of zirconium tetrafluoride
• One of the structural components in various
  optics, such as lenses.
• One of the structural components in optic fibers.

• Additional uses
• Active medium for lasers,
• In production of electrolytes
• As the basis for fluorescent materials.

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Key factors of liquidity

• Production of high purity Zirconium (content of
  hafnium between 0.002 and 0.005)
• Stable market (demand still exceeds supply)
• Production can be ramped up very quickly thanks
  to high availability of raw materials and
  production facilities
• Lack of competitors in the region (ex-USSR)
• Team of specialists with unique know-how

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Main financial and technical indicators

• Production facilities can process 5 sublimations
  (purifications) per month
• Each sublimation takes 4 days (96 hours)
• Each sublimation requires 3 tons of raw material,
  and produces 2.5 tons of output, for a total
  plant production of 12.5 tons per month
• Cost of production is 200,000 per tonThis is
  43 lower than a similar plant in the USA that
  produces lower purity output
• Raw materials cost 50,000 per ton
• Monthly cost of raw materials is,
  therefore, 750,000
• All other monthly costs will not exceed 250,000
• We believe the plant can throw off 1,500,000 net
  per month

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Prospects of production

• Source of raw materials is a mine at the
  Volnogorsk field, which requires fluoridation at
  another facility (Zirkony) nearby. We believe
  that the process could be streamlined in order to
  increase the number of sublimations, and,
  therefore, overall production of Zirconium
  Tetraflouride.
• There are many other important uses of Zirconium
  Tetrafluoride beyond optic fibers Zeiss glass,
  radiation-resistant glass for nuclear and medial
  purposes, and also food utensils. Finally, it is
  also used as an additive for metallurgy, and in
  the production of the worlds best paints.
• While the plant is currently configured for
  production of ultra-pure (gt99.999) zirconium
  tetrafluoride, it may also be modified to produce
  other ultra-pure substances for industry,
  perfumes, medicine, etc.
• Hafnium is the main byproduct in the production
  of zirconium tetrafluoride. We have not
  considered the benefits of producing this
  material in this presentation.

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Investment proposal

• The proposal is to take a 50 stake in Soter,
  costing 6,000,000.
• The main asset of Soter is an industry-leading
  sublimation process, and a group of specialists
  capable of operating it
• Estimated annual production is 120 tons of
  Zirconium Tetrafluoride
• All proceeds from the sale of the stake will be
  used to get the plant running again, acquiring
  raw materials, and organizing sales.
• The Fund will keep its presence in the Company
  after the deal.

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Contacts

• Fund Manager
• Volodymyr Bobylyev
• vb_at_epfcapital.com
• 38 067 209 80 20
• 18/14. V.Khvoika str. CORP 2. Office 243 Ukraine
  Kiev 04080