EXTRACTING VALUE FROM BIOMASS THE ECONOMICS OF THE HCL CLEANTECH SX CHEMICAL APPROACH

2 Biomass Biomass “soup” (sugars, lignin & tall oils) Economically efficient Separation Sugars Lignin Tall Oils THE CHALLENGE IN BIOMASS CONVERSION PROCESSES

3 Acid recovery Counter- current Hydrolysis > 98% yield Sugar > 98% yield Lignin solids X NO SOUP! >97% yield Tall Oils Tall Oil extraction Acid recovery ? HCL CONVERSION PROCESS: EFFICIENT SEPARATION & ACID RECOVERY

The Bergius Process During the late 30’s, Friedrich Bergius, a German Nobel Prize winner, developed a production scale technology used by Germany to convert biomass to fermentable sugars & bio-fuel in WW2. The Bergius process was reliable but costly due to the use of water for recovering the acid. HCL’s CONVERSION PROCESS IS BASED ON PROVEN TECHNOLOGY HCL CleanTech’s innovations: Low cost recovery of the HCl as gas Deacidification of lignin using no water Extraction of the tall oils at low cost and high yield Refining of the wood sugars to higher purity then corn sugars Recovery of all the solvents through low cost “kidney” operations 4

THE HCL CLEANTECH PROCESS Contains more energy than is needed for the plant, opportunities for higher value products HCL Biomass Feed Sized and Extracted Conc. HCL hydrolysis at low temperature 95-97% Yield Proprietary Lignin Recovery Non dilutive HCl recovery Proprietary Acid Recovery Separating HCL from hydrolyzate using proprietary extractant Hydrolyzate streamLignin stream Product Hydrolyzate to Fermentation Lignin Solids Tall Oils High concentration of fermentable sugars (45-55%), key for production of biofuels and bioproducts Opportunities for biofuels and bioproducts 5 “Kidney” unit

Sugars Hydrolyzate Monomers & Oligomers Refining De-oligomerization Mono-saccharides C6 + C5 Further Separation/Purification 6 THE HCL PROCESS (continued)

HCL’S PROCESSES EMIT 83% LESS CARBON THAN CORN BASED SUGARS 7

~ 17% lower costs* than corn dextrose Comparable quality to corn dextrose >80% fewer carbon emissions for unit of carbohydrate X Does not compete with crops for food HCL’s commercially proven technology produces low cost cellulosic fermentable sugars that will enable commercial production of biofuels and bio-products 8 * Basis: $4/bu and logs with $50/dry ton SUMMARY : HCL CLEANTECH’S ADVANTAGES

Feedstock0.27t/d dry wood (GA pine) Sugars produced0.20 t/d dry basis Total of lbs Hydrolysis sectionContinuous & automated 5-6 weeks 24/5 Acid recovery & sugar prod Not continuous & batch 6-8 weeks 5 day/wk 10hr/d Scale upSmall Size Integrated Commercial Plant LocationSouthern Research Institute, Durham, NC HCL DEMO PLANT 9 HYDROLYSIS UNIT EXTRACTION UNIT

HCL CLEANTECH’S COMMERCIALIZTION ROADMAP 10 Demo plant Proof of concept Small scale commercial plant Profitability scalability 1 st commercial plant Multiple commercial plants Commercial- ization Expansion Goal Phase Status In operations Site selected Engineering begun Operational – 2Q/13 Financing secured Federal/state siting negotiations

HCL CLEANTECH COMMERCIAL PLANTS 11 Feedstock (t/y) ~44,000 t/y dry wood chips 20% as Pins and Fines ~ 510,000 dry tons wood chips, pins and fines, forest residue Output (t/y) ~30,000 sugars (approx. 85% C6) ~13,500 lignin ~2,650 tall oils ~352,000 sugars (approx. 85% C6) ~155,000 lignin ~26,500 tall oils Small Com’l plant Large Com’l plant

ABOUT HCL CLEANTECH HCL CleanTech Ltd was incorporated December 2007 to develop the production of low cost cellulosic sugars. HCL CleanTech Inc,. incorporated March 2009, wholly owns HCL CleanTech Ltd. Burrill & Co., Khosla Ventures and a group of investors led by Zohar Gilon have participated in our Series A financing. HCL employs ~25 people, mostly in R&D. Project engineering, project management, cost control and procurement done by CH2M HILL. HCL CleanTech has offices in Israel and at the Biofuels Center at North Carolina, and 2 lab pilots in Israel and the UK. HCL CleanTech and Virent Energy Systems Inc. have been awarded a $900,000 grant to demonstrate cellulosic sugars as feedstocks for “drop-in” biofuels and bioproducts from BIRD Energy, a program for U.S. - Israel joint renewable energy development funded by the U.S. DOE, the Israeli Ministry of National Infrastructures, and the BIRD Foundation. 12

Eran Baniel – Founder and CEO: Former CEO of LifeWave, Desk-Trainer & U.L.A. (lighting) Prof. Aharon Eyal – Founder, CTO and Co-inventor: Prof. of Applied Chemistry at Hebrew Univ., ~190 inventions, senior advisor to global industrial firms, intensive activity in renewable energy Robert Jansen (EU) – Head of engineering: 33 years of experience in the corn/wheat/sugar processing & fermentation at Tate & Lyle, vast experience & achievements in improving energy efficiency Noa Lapidot, Ph.D – Executive Vice President, R&D 19 years of R&D managerial positions in technology start up companies (CollPlant, Intec Pharma, Sol-Gel Technologies, Electric Fuel) Michael Zviely, Ph.D. – Vice President R&D: 24 years of industrial R&D experience (Israel Chemicals, Frutarom Israel, and OL Industries, China) Gilad Sokolov – Vice President Business Development: 15 years of legal, strategy (McKinsey & Co.), and BD experience (Poalim and Leumi Banks) Yoram Shkedi – Vice President Operations (Israel) Over 25 years of managerial experience in IBM and various international High Tech Companies THE HCL CLEANTECH TEAM 13

THANK YOU 14