1. 1May 25, 2010 Hardwood Plywood Adhesives for meeting CARB Exempt Status Earl Payton Sales Manager

2. 2May 25, 2010 Introduction Need for a Lower Fuming Adhesive Systems Adhesive Design Strategy ULEF Adhesives Designing an NAF polymer NAF Adhesive Conclusions

3. 3May 25, 2010 Market Drivers for a CARB Exempt System What are the drivers? –The hardwood plywood markets have seen increasing regulation on formaldehyde emissions since onset of CARB –There are advantages (reduced testing) associated with using a ULEF or NAF system. –Market pull from end users as the general public becomes more conscious of “green” products. –US National Standard on the horizon?

4. 4May 25, 2010 Hexion Design Philosophy Constraints: –System must be compatible with existing production and environmental equipment in customer’s facility. –Must be capable of passing HPVA HP-1 2004 “3 cycle soak” test. The Hexion design philosophy is to find the most economical solution that satisfies all performance and regulatory requirements. Hexion like other adhesive companies seeks to provide the market with solutions that are also a wise choice environmentally.

5. 5May 25, 2010 Hexion’s Commercially Available ULEF Resins ULEF 600-05 ULEF 600-04

6. 6May 25, 2010 ULEF 600-05 Designed for CARB I compliance CARB Phase I, Phase II and exempt status Typical fuming levels = 0.03 - 0.06

7. 7May 25, 2010 ULEF 600-04 Design for CARB Phase II Lower fuming than 05 Phase II, Exempt status Typical fuming levels = 0.01 - 0.04

8. 8May 25, 2010 ULEF RESINS Low emitting (CARB Phase II, exempt) 3-cycle durability performance Mix potlife advantages Similar press cycles as pre-CARB UF’s Similar gluing parameters as pre-CARB UF’s Similar mix resin solids and total solids Flexibility of fortification with melamine resin Mix pH modifiers to reduce HP heat requirements

9. 9May 25, 2010 Thoughts on NAF Adhesive Design Commercial systems for Hardwood plywood –Soy/ Polyamidoamine-epichlorohydrin (PAE) systems –Crosslinking polyvinyl acetate Both systems above have positive attributes to offer; in building an adhesive system we need to follow the needs of the panel manufacturers and their downstream markets.

10. 10May 25, 2010 Development of a NAF Polymer for Hardwood Plywood Adhesive Each adhesive developer must play to strengths. As a result of multiple acquisitions Hexion has a broad technology portfolio it can pull from to develop new adhesive systems. This NAF system is a result of a cross divisional effort to apply acrylic latex polymer technology to the wood composites industry. The new adhesive is adapted from an acrylic latex originally developed for the coatings industry. Produced using emulsion polymerization with a non volatile content of ~47%, a viscosity of less than 100 cps and neutral pH. The latex is combined with a protein source, usually soy based, using a mill’s existing mixing and applications equipment to produce a glue mix between 17,000 and 25,000 cps depending on ratios..009 to.025 ppm

11. 11May 25, 2010 Adhesive Mix for Hardwood Plywood Adhesive Mix Water Latex emulsion Base (pH modifier) Soy component Mix Characteristics 42% non volatile content Viscosity 17,000-25,000 cps 8.8-9.2 lbs/gal

12. 12May 25, 2010 Glue Mix

13. 13May 25, 2010 Layered Bonding Evaluation

14. 14May 25, 2010 Hexion Adhesives

15. 15May 25, 2010 Ecobind emission levels: –in composite wood products below the most stringent global standards –comparable to natural wood while meeting performance requirements Ecobind resins: –can be used with existing mill equipment –have excellent shelf life –provide physical properties comparable to traditional binder solutions Ecobind: Cost Effective Emissions Solutions

16. 16May 25, 2010 Conclusions The market will find the most economical solution that satisfies all performance and regulatory requirements. Hexion offers ULEF adhesives designed to meet CARB Exempt An acrylic latex has been developed with thermal and hydrophobic properties sufficient to pass HPVA HP-1 2004 “3-cycle soak” test for the hardwood plywood industry. This NAF adhesive is cost competitive with other NAF systems and is low emitting. We continue to optimize the formulations for the best cost/performance ratio. The adhesive systems are compatible with existing hardwood plywood mixing and production equipment.