PRESENTATION TO CPAC

July 15, 2008

Dr. George Kellergeorge.keller@matricresearch.com

800-611-2296

Chemical and Environmental Technologies

Health and Life Sciences Advanced Engineering Systems

Life-changing Research and Development

www.matricresearch.com

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MATRIC’s Mission and Vision

Mission

To create high-quality, life-changing science and technology and develop spin-off businesses that will bring technology advances to the market.

Vision

To become a leading non-profit research, development and engineering center with a major local, national and international economic impact from created technologies.

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MATRIC Business Areas

Chemical and Environmental TechnologiesBusiness Area

Health and Life Sciences

Business Area

Advanced Engineering

Systems Business Area

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MATRIC Enterprise

Non-Profit R&D

corporation

For-profit commercial R&D corporation

Holding company to commercialize IP

Full service professional

engineering firm

Technical consulting firm

Confidential Information--Not to Be Disclosed without Written Permission of MATRIC

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MATRIC’s Contract and Personnel Growth

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Project One-Liners

Biodiesel plant technologyIsosorbide process developmentCO2 removal from power plant stack gasNon-biological cellulose hydrolysisA new ballistic-property polymerNASA: robotics, IV&V, UAV control systemsAdvanced heat-pipe conceptsClean-up of natural gas, land-fill gas and coal-seam gasHaz-op, safety and environmental studiesBio-warfare capture agentsAppalachian Land Restoration Center New breathing apparatus for miners trapped in coal minesMedical smart cardLitigation

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Biodiesel Process Development

BEST Energies from Madison, WI hired MATRIC in 2006 to:– Develop a continuous biodiesel process

in our laboratories– Benchmark a variety of homogeneous

catalysts– Extend the technology for a variety of

feedstocks– Create a process engineering package– Oversee construction of an 8M gal per

year plant in Cashton, WIMATRIC has signed a long-term Strategic Alliance Agreement with BEST Energies to be their exclusive partner for research, development and process engineeringMATRIC was also granted a license for a 20M gal per year biodiesel plant

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Biodiesel: A Progress Report

We began basic lab work in March, 2006.Today, the plant is through the initial demonstration stage, with demonstration using alternative feeds during the rest of the year.Outstanding characteristics:– Continuous process, reducing investment by ~ 40%.– Process can accept not only refined soy oil, but also

crude soy oil, crude corn oil, fats, renderings, etc.– Process is designed and constructed to exacting

Dow/Union Carbide quality standards.– Process will be licensed by BEST Energies around

the world.

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Pilot Plant

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Reaction and Stripping

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Storage Tank Farm

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Truck Unloading and Loading Racks

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Isosorbide: A New Polymer Intermediate

MATRIC is partnered with the Iowa Corn Promotion Board to develop polymers from corn.Project is funded by a US Department of Agriculture/Department of Energy grant.Jobs: process development, pilot scale operation and market introduction.

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Isosorbide: A Progress Report

Isosorbide is a double-dehydration/rearrangement of sorbitol to form a two-ring, two-hydroxyl compound which has potential use as a co-monomer for polyesters. No process to make it has ever been commercialized on large scale.Chemistry and separations development have been spectacularly successful. Target product purity has been demonstrated.ICPB requested that we operate a facility to produce 50 pounds per month, followed by a pilot plant producing in the range of 500-1000 pounds per month. The first facility is in full operation, and the second should be in operation by the end of this summer.

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Summary

We have developed remarkable improve-ments in biodiesel technology and demonstrated these improvements on commercial scale – and in a surprisingly short time.We have demonstrated a commercial route to an exciting new, glucose-based polymer intermediate, isosorbide, and have begun small-scale production for customer sampling.We have demonstrated the power of doing process engineering and economics in parallel with research and development.

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MATRIC’s Contract and Personnel Growth

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MATRIC’s Corporate Organization

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MATRIC innovators are awarded equity positions in

start-up companies

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Chemical and Environmental Technologies Business Area

Core CapabilitiesRadical Process InnovationCatalysisProcess and Plant ImprovementProduct & Prototype Development and OptimizationScale-up and CommercializationIntellectual Property DevelopmentBusiness Strategy Development, Technology Plans and Market Introduction

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About MATRIC

MATRIC is a 501(c)(3) non-profit researchand development corporation.38 member Board of Directors include:

• four university presidents• CEOs and presidents of several private

sector corporations• Research Triangle Institute and Diversa

Currently MATRIC has a staff of 80+– 30 PhD-level researchers– 25+ average years of experience

MATRIC has a focus on commercialization of technologies and intellectual property.

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Example Projects:Cellulosic Ethanol

MATRIC is developing new pretreatment technology to convert wood to ethanol.Chemical process breaks down cellular materials so that enzymes can access sugars to make ethanol.This process step is the hardest and is the most challenging for cellulosic ethanol.

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Example Projects—Carbon Capture

MATRIC has worked with the Department of Energy to develop novel technology to capture carbon dioxide in fossil fuel plants.MATRIC’s rapid temperature swing adsorption concept uses nanostructures to efficiently remove CO2.

Up to 70% of the cost for carbon sequestration is in the capture process at

the power plant

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MATRIC’s Early History

Early 2002: Research Triangle Institute is identified as a possible model for an R & D institute here.Mid 2002: RTI executive visits, recommends that we establish such a facility in the Kanawha Valley. Planning begins.August 2003: MATRIC is incorporated as a 501(c)(3) non-profit research institute.April 2004: MATRIC hires its first full-time employee, Keith Pauley, as its CEO. A one-room office is established in the BIDCO incubator in Charleston.January 2005: MATRIC moves to Building 701.June 2007: MATRIC moves to Building 740.

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Where Do We Go From Here?

We will continue to expand – to at least 100 in ’08. A number of new BS’s, MS’s and PhD’s will be added. We have opened a satellite office in Oak Ridge, TN.We will increase our international presence.We are negotiating with Dow to obtain significantly more space at the Technology Park.We will expand project work at the interface between chemical and biological technologies.Income from our spin-outs and IP packages will begin to fund a major in-house research effort, especially in the chemical and environmental technologies.We will remain solvent.

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Seven Essential Reasons for MATRIC’s Success

BIDCO’s initial supportFoundation, business and individual initial financial supportSpace available at the Dow Technology ParkInspirational leadershipIntense mission orientationLarge, highly skilled workforce availableExcellent relations with customers

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Carbon Dioxide Recovery via RapidTemperature Swing Sorption

Heretofore, temperature-swing adsorption was thought to be impractical for bulk gas separations.Reasons: (1) Heat liberated during adsorption raises the temperature of the adsorbent to the point that capacity is severely limited. (2) The times to heat and cool the bed in passing from adsorption to desorption and vice versa is very long for large processes – hours or more. This severely limits productivity.Our research has led to practical solutions to both of these problems. Economic comparison with ethanolamine absorption indicates a potential to reduce energy usage by ~50%.A new concept of selectively sorbing – dissolving –certain gases into polymers has been formulated, and work has begun to make such systems practical.