Todd Pegelow & Kevin Creamer

Todd Pegelow & Kevin Creamer info@NZESystems.com

Certified Clean Energy Instructor
Sunshine Solar – Free Weekly Seminars
Sunshine Solar
Solar PV
Solar Thermal
100’s of
attendees to free
solar seminars.
$1.5M booked
sales in 2009.

[Market Pull]
Solar PV is nice …
… it will reduce my electric bill.
Solar Hot water is great but …
… can solar heat my house?
“Can solar get me off oil?”
“Can solar replace my gas furnace?”
“I hate my fuel bill!”
Sunshine Solar
Solar PV
Solar Thermal
100’s of
attendees to free
solar seminars.
$1.5M booked
sales in 2009.

[The Problem]
We can collect enough heat but ...
… there’s no way to store it!
Lack of storage prevents a solution.

[Imagine … ]
What if there was a way to meet …
… space heat and hot water needs with
free & renewable solar energy!

[Innovation]
First-to-market & Smart-Home ready
Disruptive & Enabling Technology
ThermalVault is an energy
storage appliance.
• high energy-density
• efficient heat exchange
• superior heat retention
• performance monitoring

[Innovation]
1 st Generation
Efficient & Hygienic Design
Innovative Thermal Media
Patent & Trademarks
Educational Campaign
2 nd Generation
Custom and proprietary designs
Nano-Tech Thermal Media IP
Build on established brand

[Impact]
ThermalVault’s
Storage Media is …
=
Modularity = Multiplied Impact
Renewable
Non-toxic
Bio-degradable
Non-corrosive
… and offers 100
years or more peak
performance.

[Scalability]
Building Integrated Thermal Storage
~ 10,000,000 BTUs
Community Scale
Federal, Military, Aerospace , Mobile, Waste Heat Recovery …
Mobile

Backup
Source
[Functionality]
Solar Thermal
Collectors
Domestic Hot Water Space Heat
Solar PV
+ Heat Pump

Temperature [Technology]
phase change
(melting)
Time & Energy Stored / Released
The phase change material at the
heart of ThermalVault provides
12X the BTU capacity of the
equivalent volume of water.
As an appliance, ThermalVault
will offer between 6x and 10x
the energy density of it’s
closest competitor.

[Consumer Benefit]
Instant Real Estate appreciation
50-100% Reduction in fossil fuel consumption
50-100% Reduction in heating costs
50-100% Emissions reduction
(Capitalize on potential carbon credits)
Smaller carbon footprint
Avoid most utility rate increases
Incentives reduce purchase price

[Energy Use]
Appliances &
Lighting
26%
Regrigeration
5%
AC 8%
39%
Source: 2005 US DOE
Energy Information Administration
PV
WIND
HYDRO
FUEL CELLS
BATTERIES
ThermalVault
U.S. Residential
Energy End Use
61%
Space
Heating
41%
Water
heating
20%

[Mission & Value]
Elevate solar from supplemental to PRIMARY heat source
Provide 600% - 1,000% gain in energy density
Achieve 30% fuel efficiency gains in legacy systems
Offer 50% - 100% savings with renewable energy
Be first-to-market
Continue to innovate

[Competitive Advantage]
MEDIA Water Petroleum-based ThermalVault
Performance Factor
(relative to water)
Eco Friendly
Footprint
Modularity
Energy Density / $
1 4 10
Availability Excellent NA Limited
Origin Worldwide Germany USA

[Competitive Advantage]
BTU Capacity
Footprint
Energy Density
Relative Cost
Relative Value
ThermalVault
415 gallons H20
80 gallons H20

[Prototypes]
First Prototype –
Fall 2009
Second Prototype –
Spring 2010
Coming Soon:
Greenhouse
Private Home
University
Tenant House

[Market]
1. Solar Thermal
Proactive & early-adopters
• Rebates, grants, tax credits, PACE
Required by code in some states
California Solar Initiative - Thermal:
• 300,000 homes by 2016
There are over 4.4 million Google searches monthly in the
US for solar heat, solar hot water, solar thermal, etc.

[Market]
1. Solar Thermal
2. Water Heater Replacements
8,000,000 replacements annually
Strong focus on high efficiency
Growing focus on renewable
Source: US Department of Energy – Water Heater Market Profile | 2009

[Market]
1. Solar Thermal
2. Water Heater Replacements
3. New Residential Construction
~800,000 single family
~300,000 units in multi-unit buildings
1,100,000 annually
Source: US Department of Energy – Water Heater Market Profile | 2009

[Market Metrics]
US Residential Approximate Estimated
Water Heater Market Market Size Average Market
2008 Price Revenue
Solar Thermal Installations (1) 14,716 $ 1,500 $ 22,074,000
Water heater replacements 8,000,000 $ 450 $ 3,600,000,000
Residential Construction Completions
New Single Family 819,000 $ 450 $ 368,550,000
Units in Multi-Unit Bldgs 301,000 $ 450 $ 135,450,000
$ 4,126,074,000
NOTE: Domestic Residential Water Heater Market ONLY
(1) US D.O.E. Energy Information Administration
Domestic solar thermal collector shipments - 2008

[Go-To-Market Model]
2011 2012 2013
Premium Solar Thermal Market
Solar Installers, dealers, online sales, manufacturers reps.
PPA / SREC / Renewable Energy Project Market
project managers, business development execs
HVAC Efficiency Market
established distributors, architects, engineers, builders
Renewable Energy Systems
manufacturers, systems designers

[Financials]
Annual
Projections 2010 2011 2012 2013 2014 2015
Unit Sales - 712 2,737 5,910 9,091 12,811
Ave. Daily Production 3 12 26 40 57
Revenues $0.00 $3.64 $12.70 $26.67 $39.56 $53.72
Cost of Goods Sold $0.00 $1.38 $5.47 $12.22 $19.43 $28.31
Gross Margin $0.00 $2.26 $7.23 $14.45 $20.13 $25.41
Gross Margin (%) 62% 57% 54% 51% 47%
EBITDA ($0.80) $0.44 $3.90 $8.84 $12.35 $15.19
Cumulative ($0.36) $3.55 $12.39 $24.74 $39.93
($ in millions)
Manufacturing, Assembly & Distribution are Outsourced.

Assumptions:
[Revenue Projections]
Millions
$35
$30
$25
$20
$15
$10
$5
$0
$5
~ $1.1M deep @ month 11
Cash flow positive
~ month 19
Earnings
1 7 13 19 25 31 37 43 49 55 61
• MSRP ~ 70% of “closest competition”
• Phased MSRP reductions planned
• Costs projected to increase over time
• Payroll < 20% of gross revenues
• Sales & Marketing ~ 8% of gross revenues
Earnings
Month

[Funds Allocation]
Sources:
$1.75M Series A Equity
Phased in over
first 12 months
Up to $5.0M
Growth Capital
Uses: First 12 months
Technology Development $ 80,000
Distributor's Materials $ 53,514
Sales & Marketing $ 200,000
Legal $ 106,167
Team Compensation $ 727,772
Profit Sharing $ 28,580
Facility $ 141,811
Total $ 1,337,847

[Risks & Mitigants]
RISK
Customer Adoption
Supply Interruption
Competition
Under-capitalization
Mitigating Action
Education, Education, Education
Multiple Regional Suppliers
First-to-Market, Aggressive
Branding & Marketing Campaign,
Continued Innovation
Network of private investors
Line of credit

[Founders]
Kevin Creamer: Exec VP, Manufacturing
20 years in materials, manufacturing and logistics.
Founded startup @ Sunshine Solar in 2008.
Became a certified solar instructor in 2009.
Co-inventor of ThermalVault.
Todd Pegelow: Exec VP, Strategic Development
Engineering degree from RIT
16 years in semiconductors & software
Startup experience (12 years) software company; $15M+/yr.
Co-inventor of ThermalVault.

[The Team]
Steve Young – Interim CEO/HVCFI Consultant
Executive mentor; Exec VP Carrier Corp Asia-Pacific;
Pres. Praxair Energy Solutions; Navy commander
Les Neumann – Board Member, HVCFI liaison
Managing Director at HVCFI; President of
Business-Forensics, LLC; COO at VRSIM;
Chairman & CEO of Interpreter Communications, Inc
Bernard Karp – Interim CFO; CPA & Attorney
Karp, Ackerman, Skabowski & Hogan, PC – Hudson, NY
Kevin Fancher – Director Engineering
BS, Humbolt State, Environmental Resource Engineering
John Lonczak – Interim Director of Marketing
Fortune 500 marketing, product development,
manufacturability expert

[Thank You!] Welcome …
to the dawn of a new era
in renewable thermal
energy solutions –
enabled by the same
innovative spirit that
brings us ThermalVault.
Contacts:
Todd Pegelow : TPegelow@NZESystems.com
Kevin Creamer: KCreamer@NZESystems.com
Will you join us?

Thank You!
END OF PRESENTATION | BACKUP SLIDES FOLLOW

[Test Bench]
[Temperature °C]
53
52
51
50
49
48
47
46
45
Energy
stored in
water
Energy stored
in Test System
10:48 11:16 11:45 12:14 12:43 13:12 13:40 14:09 14:38
ThermalVault
H2O
[time]
Test Bench System = ~300% greater energy density
Prototype = >600% greater energy density

[Financial Assumptions]
Two standard model sizes
Scalable custom unit sizes
MSRP reductions every six months
20% Dealer discount
0.25% Month-over-month increases in product cost from suppliers
2.5% Return rate
2.5% Month-over-month increase in payroll, team growth to handle volumes
20% Maximum cost of payroll as a percentage of gross revenues
10% Profit sharing based on Gross Sales Revenues
1.5% Month-over-month growth in distribution costs
8% Sales & Marketing budget as a percentage of gross revenues
1.5% Month-over-month increase in facilities related expenses
Investment capital phased in over course of first 12 months
50% of retained earnings to be distributed when pool exeeds $ 1,500,000.00
Revenue multiplier used in valuation calculation is: 1.2
49% Bonus for Series A equity investment

[Product Family]
Two Standard Models
• Residential
• Commercial
Units may be combined in series or parallel to
scale storage capacity
Custom Installations from in-ground residential to
industrial tower to centralized or distributed
community storage will be engineered as needed.

Assumptions:
[Unit Sales]
900
800
700
600
500
400
300
200
100
0
2 units/day
units sold monthly
15 units/day
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51
40 units/day
month
units sold
• Direct sales & marketing first 18-24 months
• Outsourced regional manufacturing & distribution
• Primary customer is a trained installer

[Financials – Investor Returns - Graphs]
$10,000,000
$8,000,000
$6,000,000
$4,000,000
$2,000,000
$0
$2,000,000
$4,000,000
Investors' Total Return
1 7 13 19 25 31 37 43 49 55 61
Break Even
Risk Neutral
Total Return = Cash Distributions + Equity
Investors' Total Return
month

[Financials – Sales Projections]
8 units per day

[Financials – Sales Projections]
42 Units/Day

[Consumer Benefit]
Sample Solar Thermal System 300,000 BTU/Day
Collectors $12,000
Controls & Plumbing $2,000
ThermalVault $6,500
Installer’s Markup $9,500
Gross Installed Price $30,000
Incentives & Tax Credits ~50%
Net Installed Price $15,000
Savings - 65% on $2,500 $135/mo
Payback Period ??
CO 2 savings (20 years) 154 tons
=$2,300 - $3,000 savings over
conventional solar storage!
Requires only ¼ the footprint.
P.A.C.E. Program
Offers consumers
Zero Down and
payback starting Day #1