There has been a scrap tire recycling business for years. However, the first stages of using recycled scrap tire rubber are not yet complete. Only 20% of scrap tires are used. About 10% are burned, usually for power generation. However scrap tires like coal are polluting fuels, so air quality issues can always be a problem. About 4% export our scrap tires to countries where the casings can be used in retread machines or the tires are sold as they are. Currently, about 2 percent of our scrap tires are made into crumb rubber that is used in molded products as well as modified rubberized asphalt applications. This gives a longer-lasting and more durable asphalt surface.

Stockpiles of scrap tires create health problems as they become breeding grounds for rodents, snakes, and mosquitoes, and also are serious fire hazards. This problem is serious, as scrap tires are generated in the USA annually at around 250 million. There are currently piles that amount to between 2-3 billion.

ATP-Advanced Technology Pallets, a Nevada Corporation (ATP), proudly presents its unique and patented RST-PAL Pallet. This pallet is made from recycled tire rubber. The ‘#8220’RST-PAL Pallet is stronger, more durable, and reusable than wooden pallets. It also saves you the cost of replacing, repairing, and disposing of wooden pallets. RSTPAL Pallets may have serial numbers and bar codes to allow for easy tracking and retrieval.

Dan Radke, the inventor of the RSTPAL pallets, has given ATP the patent rights (to the USPTO USPTO #08/680,476) to continue manufacturing and marketing them around the globe.

To provide durable and cost-effective products for all industries.

THE EXISTING CONTROL PROBLEM

• Plastic and wood pallets have a short life expectancy and high costs.
• Wood pallets often break and require replacement or repair after every trip.
• Wood absorbs liquids. It gains weight, breaks, and splinters. It’s also very difficult to clean.
• Industries are looking for durable and longer-lasting pallets.
• The environmental danger of scrap tire stockpiles is high.
• The current wood pallets consume over 3.5million trees annually.

THE SOLUTION

• RST PAL pallets are cheaper to buy and keep.
• RST-PAL pallets have a greater durability and are indestructible.
• RST-PAL pallets can support 15 times the load of a similar wooden pallet.
• RST-PAL pallets can be stacked, stacked, and are more durable and last longer.
• RST-PAL pallets, which are made from recycled scrap tire rubber and recycled plastics, are unique. They use a newly patented process that incorporates rubber, plastics, and a binder system.
• RST-PAL palettes are guaranteed for at least a decade.
• RST-PAL pallets have no competition worldwide.

TECHNOLOGY & PROCESS

• The materials process as well as the manufacturing of pallets were based on an USPTO 08/680.476 patent.
• International (PCT), patent protection filed.
• It is possible to source production line machinery.
• Raw materials are readily available and have been sourced.
• Flexible production lines enable the construction of various sizes of pallets, while ensuring high quality and yield.
• Product is ready to be produced. Qualification and R&D are complete.
• Process that is modular in nature allows for quick manufacturing expansion.
• Factory is environmentally clean without any waste stream.
• Prototypes of prototypes have been tested, built, and qualified.

THE MATERIAL

• U.S. consumption of pallets is 800 million a year (National Wooden Pallet and Container Association, NWPCA).
• RST–PAL pallets have the lowest cost per year compared to aluminum, plastic, and wood.
• Global Pallets-leasing Options Available
• Marketing must focus on both closed or open loop distribution systems.
• International licensing opportunities and markets (Internationally protected Patents).
• U.S. Government Agencies and Contractors markets.
• The U.S. government mandates product replacement using recycled products first.

MARKET QUOTATIONS

• ASAP is required to ensure that « #8220 » quality multi-trip pallets are reusable and not just single-use pallets. (Reference: NWPCA)
• Contractors doing business with the government are required to purchase “environmentally friendly” and “

recycled products” products first. (Reference: President Clinton Executive order)

SALES

• Different industries received positive feedback on prototypes.
• Potential sales pending investment and production ramp up.
• Certain markets are eligible for environmental incentives (Government sub-contractors).
• All licenses, permits, and governmental agency acquired or in support for project.

PALLET COST COMPARISON – OVER FIVE YEARS

• Significant savings can be made by using RSTPAL pallets. They cost $22 per RSTPAL pallet, compared to $133 for wooden pallets over 5 years. (See topic 4.2.

INVESTMENT REQUIRED. USE OF FUNDS

• $6M investment to 35% ownership. Efficiency estimated at 12-18 months.
• As long as the plan for expansion is not affected, 50% of net profit after taxes will be distributed to shareholders in dividends starting in the second year. The remaining 50% will be dedicated for growth.
• The funds raised will be used to fund plant operations, marketing, and sales.

With two production lines, the first year will produce 1,137,000 units with a projected net profit exceeding $8 million.

INVESTOR DISCUSSION

• Projections show the return on original investment in less time than two years.
• Based on the discounting of five year’s net earnings to current value, this valuation is approximately six-times.
• Present Value of five years of projected net earnings at a 25% discount (incl. The risk factor is $98 Million.
• In five years, less than 1% market share achieved with five plants.
• Projected revenue of approximately $402 million.
• Projected net profits (before taxes) approximately $178 Million
• Strong, professional management team with highly-skilled consultants.
• Exit Strategy alternatives: (a) IPO after two years; (b) Acquisition; (c) Private ownership with a long horizon of profits.

RST-PAL Pallets — MANUFACTURED FROM RECYCLED SCRAP TIRE RUBBER

TO CLEAN UP AMERICA’#8217’S SCRAP TIRE

1.1 Mission

ATP is a company that manufactures and markets pallets from recycled tires. Patent protection for the manufacturing process and product is available worldwide.

Both pallet users and manufacturers of commodities, as well as industries that use pallets to distribute their products, require a stronger and more long-lasting pallet. According to the National Wooden Pallet and Container Association, a wooden pallet can be used for one to two trips before it needs to be replaced or repaired. Pallet users are often forced to purchase pallets because of their short lifecycle.

The United States has a lot of scrap tire stockpiles. They are a breeding ground for rodents and mosquitoes and can be a danger to the environment.

ATP will reduce risks from scrap tire stocks and will conserve some of 3.5 million trees annually harvested to produce wooden pallets. ATP will locate its manufacturing facilities in rural areas near major metropolitan areas where there is the greatest need for employment.

ATP will make profits and give excellent returns to its investors, while financing aggressive growth to increase production every year. ATP will provide a safe, fair, and creative environment for employees that encourages creativity, innovation, and diversity.

1.2 Objectives

1. To create two production lines at Stamford, Texas’ first plant. These will produce 1.2million pallets annually. Net income projected to exceed $8 million.
2. To increase production annually by opening a new plant with two additional lines of product each year for years 2 through 5.
3. Achieve targeted market share of 0.15% in the first production year to 0.75% by the end of year five. The U.S. produces 800 million pallets annually.
4. First year projected market share of 0.15% is expected to bring net profits of $8 million (before taxes), and 0.

Net profits of $66million are expected to be generated from 75% market share by year five. For the first five production years, total profits before taxes are expected to reach $173 million.

1.3 Keys to Success

These are the reasons ATP can succeed:

• A pallet market exists in the United States that is currently worth more than 800 million pallets annually. It is estimated that about 60% of all pallets in the United States are hardwood. These are ATP&#8217’s most targeted customers.
• RSTPAL pallets have the lowest cost per year compared to plastic or wooden pallets.
• RSTPAL pallets are patent-protected, durable, virtually indestructible and can hold more than 15 times the weight as wooden pallets.
• For years, RST-PAL pallets will be guaranteed
• Pallets, which are well-known, needed and established products, can be introduced to the market without introducing a brand new product. RST PAL pallets don’t represent a new product. However, they are far better, more durable and more long-lasting than other similar products on the market. The advertising and marketing costs will remain low as the RST-PAL pallets are introduced to pallet users through trade shows and conventions, with ATP’s sales representatives located in targeted marketing regions. Dallas/Fort Worth (Texas) is the first targeted region. It is located close to Stamford.
• The U.S. government has mandated, through an executive order, a “buy recycled first” for all government agencies and contractors, including the Department of Defense and Department of Transportation. ATP will target federal and state agencies to market RST-PAL pallets.