SUSTAINABILITY

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• SUSTAINABILITY
• February 13, 2009

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• R.F. Rick Shangraw, Jr., PhD
• Vice President of Research and Economic Affairs
• Arizona State University

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Lubricants to Biofuels Chemical Feedstocks
fromPhotosynthetic Bacteria

• Contact Information Neal Woodbury
• Nwoodbury_at_asu.edu
• Team Leaders Wim Vermaas, Bruce Rittman, Deirdre
  Meldrum, Roy Curtiss

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A Variety of Useful Chemical Feedstocks Can Be
Made Using Photosynthetic Microbes

• Lipids
• Biodiesel (or green diesel)
• Jet fuel
• Lubricants
• Surfactants (detergents)
• Cooking oils
• Isoprene
• Hydrogen
• Polyhydroxybutarate
• Bioplastics

• Carbohydrates
• Food additives
• Bioplastics
• Proteins
• Animal feed
• Food additives
• Carotenoids
• Other specialty chemicals

But what to focus on?
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• Biolubricants The low hanging fruit
• 37.4 MM tons used annually
• Relatively high margin compared to liquid fuels
• Relatively low production level can allow
  market entry
• More channels to the marketplace
• Benign regulatory path compared to food oils
• Relatively un-crowded area in the renewable
  space

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The Key PlayerThe cyanobacterium, Synechocystis
sp. PCC 6803
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Why Bacteria Instead of Plants?
vs.
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Comparison of Solar Energy Conversion In Plants,
Microalgae and Si-based PV
Data derived from http//www.hort.purdue.edu/newcr
op/duke_energy/dukeindex.html and http//www.green
fuelonline.com/gf_files/performance20Summary20Re
port.pdf
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Advantages of Photosynthetic Bacteria vs. Plants

• superior energy conversion yield
• independent of arable land
• low water usage
• facile genetic engineering
• CO2 from power plants can be used
• wide range of possible products/high purity
• rapid growth (short generation time)
• no limitation on seasonal growth
• efficient recycling of nutrients

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TID Project Phasing
Phase 1 (yrs 1-2)
Benchtop Photobioreactors
Phase 2 (yrs 3-5)
Notional Location to Depict Size
Phase 3 (yrs 5)
Commercial scale deployment
Rooftop Photobioreactors
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Next Steps

• Our business plan exploits investments made
  (gt5M) in
• this technology to date.
• Presently at a 4,000 liter scale bioreactor
• Market entry requires 3 logs greater scale.
• We need to raise 25 to 30 million for a three
• year project that will demonstrate ability to
  scale.
• Continuing improvements to the bacteria will
• increase yields and lower costs.

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Technology for Production of the Natural Pigment
and Antioxidant - Astaxanthin
Present at ASU Technology Forum by Qiang Hu
Milton Sommerfeld Laboratory for Algae Research
and Biotechnology Arizona State
University February 13, 2009
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Astaxanthin

• Naturally occurring carotenoid pigment
• Powerful biological antioxidant
• Anti-Inflammatory and stress-releasing agent
• UV light protection
• US FDA approved as a food coloring
• Food dye within the European Commission

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Astaxanthin Market Opportunities
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Astaxanthin Problems

• High production costs
• - Photobioreactors
• - Processing
• - Product stability
• Low bioavailability
• - 8 30
• - short shelf-life
• High sale price
• - 6,000 10,000/kg

Algatech
Parry Nutraceuticals
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Astaxanthin Solutions

• Improved algal strains
• Highly efficient photobioreactors
• Optimized production protocol

• Reduced Cost
• capital gt60
• operational gt30
• Improved bioavailability
• 60 90
• longer shelf-life
• Lower sale price
• gt 2000/kg

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Competitive Advantages
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Business Model

• First market segment will be animal feed sector,
  then nutraceutical and cosmetics, followed by
  pharmaceutical sector
• Establish strategic alliances with major
  customers, thereby
• providing them with bulk quantities of
  Haematococcus biomass
• and/or pure astaxanthin
• Funding/investment sources SBIR, SFAz, equity
  financing, venture capital investment, individual
  investors, etc.
• Joint-venture with strategic partners

Exit Strategy

• IPO in 2014
• Possible M A
• JV with strategic partner/s

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IP Status

• Patents filed
• Wall-less Haematococcus mutant and
  uses
• (PCT filed March 31, 2006)
• Photobioreactor and uses therefore
• (PCT filed on February 20, 2007)
• Trademark and trade secret protection

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Pro Forma Financials
NPV 16 - 17 M (i 40)
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Interim Management Team

• CEO Qiang Hu, Ph.D.
• Professor of Applied Biological Sciences at
  ASU
• 20 years of experience in algae research
• Extensive RD experience in algal
  biotechnology
• Expert in photobioreactor system design and
  algal mass culture
• Author/co-author of over 40 research papers
• Co-inventor of 11 patents
• Technology transfer resulted in 2.6M upfront
  license fees to ASU

• CSO Milton Sommerfeld, Ph.D.
• Professor of Applied Biological Sciences at
  ASU
• 40 years of experience in algae research and
  biotechnology
• Expert in algal physiology and mass culture
• Author/co-author of more than 260 publications
• Co-inventor of 10 patents
• Technology transfer resulted in 2.6M upfront
  license fees to ASU

• Marketing and Sales?
• -
• -

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Electrolyte solvent additives for high-voltage
Lithium-Ion Batteries
Austen Angell Regents Professor Dept. of
Chemistry Biochemistry
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Overview of the Battery Market

• Sales in the Lithium Battery market were 7B in
  2007 (1.10B Primary, 5.9B secondary)
• Unit shipments of Secondary lithium-ion
  batteries predicted to grow from 1.76 billion to
  nearly 3.99 billion units in 2013
• (Source Frost Sullivan, 2008)
• Automotive markets emerging (A123, Johnson
  Controls/Saft Advanced Power Solutions)

• Global Battery Market Past Performance

• Hybrid Vehicle Sales

Source http//www.electricdrive.org/index.php?tg
articlestopics7
Source Market Avenue, 2007
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Applications

• Automotive batteries
• - must be rechargeable and preferably deliver
  high voltages, e.g. greater than 4.5 VDC, to
  provide adequate power to the motor
• Smaller, thinner rechargeable batteries with the
  same runtime as existing technologies.
• Portable devices such as laptops and mobile
  phones.
• Other energy storage devices.
• Defense and Aerospace applications in low
  temperature environments.

Source Batteryuniversity.com, 2006
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Li-ion Advantages

• High energy density (Wh/kg) Results in slim
  3mm (low profile) designs.

Source Batteryuniversity.com, 2006
Source National Institute of Standards and
Technology, 2005.

• Higher voltages than Ni-MH etc single cell
  replaces multiple.
• No memory effect
• Low self-discharge

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Technology Solution Overview

• ASUs sulfone additives create lithium ion
  battery electrolytes with higher ionic
  conductivity.
• Fluorinated and non-fluorinated sulfones are
  added to tetraalkylammonium based ionic liquid to
  form alkyl sulfone.
• Lithium salt is dissolved in alkyl sulfone to
  form the electrolyte.

• Vinylene carbonate (VC) is used to promote solid
  electrolyte interface (SEI) formation.

• Propylsulfone (PS) is added to lower the
  viscosity of the solution.

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Performance

• Wide electrochemical windows gt 5V for high
  voltage applications.
• Low melting points lt 2C
• High cyclability

State-of-the-art
Our system
1M LiTFSI in MEMS
Cut-off voltage for S-o-Art cell
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Advantages

• Lower melting point (lt 2 C vs. 35 C for
  existing technologies)
• can use a single solvent in applications over a
  broader temperature range
• Equal to state-of-the-art cyclability -
  critically important property
• long service life, high reliability, lower long
  term costs.
• Lower viscosities, higher conductivities, in
  prospect (fluorination)
• A cell with a lower viscosity solution will
  recover to its previous energy capacity after
  being subjected to high current discharges.
• The promise of higher energy density.
• Based on wide electrochemical potential. (Toyota
  aims at 5V hybrid).
• Higher Oxidation Resistance!!!
• Li-ion battery fires have been attributed to
  electrical shorting
• ASU battery materials (fluorinated) are also
  used as component of fire extinguishers!
• Outstanding proposal reviews from DOE

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Patent Status

• IP Protection US/international patents pending
• Inventors Austen Angell and colleagues
• Contact Bill Loux (bloux_at_azte.com), PH
  480.884.1992
• Phil Dowd (pdowd_at_azte.com), PH 480.884.1982