Profile, Cambridge Energy Waste Management, Ltd.

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Cambridge Entergy Waste Management, Ltd.
540 Frontage Road, Suite 3345
Northfield, Illinois 60093
voice: 1-800-931-9009 fax: 847-784-0038

Web site: http://www.cambridgewastemanagement.net
Email: info@cambridgewastemanagement.net

ENERGY

Cambridge Energy Waste Management, Ltd.

CAMBRIDGE ENERGY WASTE MANAGEMENT, LTD., (“CEWML”) was formed in recognition of the tremendous shortage of power and elimination of hazardous waste throughout the third world and many developing nations. CEWML maintains a firm conviction that the resultant demand for this energy and elimination of hazardous waste –combined with a lack of third world capital and free market expertise–engenders a unique, yet extreme profit potential for entrepreneurial developers. Despite the explosive industry growth and development of new power plants, however, the demand for additional energy and elimination of hazardous waste in these developing countries facilitates a wealth of opportunities.

Using their many years of financial, legal, business and marketing experience, the principals and founders of CEWML have developed strong relationships and contracted with a network of companies internationally renown in the energy industry, including engineering firms, equipment manufacturers, construction companies and financial institutions. In addition, CEWML has contracted with a network of independent agents residing in those countries with significant energy demands. Following considerable research, these agents have been selected on the basis of their reputation for integrity, past history of success and, extremely important, the respect they have attained from the leading government energy officials in their respective countries. By this process, CEWML has assembled a team possessing all of the necessary elements for the successful development of power projects worldwide.

The most important ingredient in power plant development and elimination of hazardous waste, of course, is the ability to secure adequate project financing. That is where the business acumen, financial experience and capital resources of CEWML completes the formula for a successful power plant and elimination of hazardous waste materials.

Business of:

CEWML’s has two mission. The first is to be an environmental technology corporation engaged in the commercialization and continued development of its Plasma Waste Converter (TM) (“PWC”) systems for the recycling, resources recovery, reduction and remediation of hazardous and non-hazardous organic and inorganic materials and wastes including radioactive wastes. Its second mission is the construction of energy power plants. The plants may utilize plasma or other more conventional means to produce the electric power.

The Company’s environmental technology positions it to the production and marketing of low cost waste minimization, resource recovery, and pollution prevention systems which process all forms of hazardous and nonhazardous organic and inorganic waste and by-products and convert most into valuable commodity products and constructions of power plants world wide. The Company has designed, and intends to sell Plasma Waste Converter (PWC) systems that achieve this mission at a relatively low cost, with operating performance that is far superior to environmental standards of the United States Environmental Protection Agency.

The Company is committed to the commercial development and worldwide use of its PWC Closed Loop Elemental Recycling equipment. The Company is in the business of selling and operating PWC systems. It is in the business of processing wastes of any sort; it is also in the waste treatment, storage, and disposal of hazardous waste.

Our staff has extensive contacts in the power generation industry. It was not to be our primary target, but from time to time we planned to market standard or even plasma coal-fired power plants. These activities were to be treated as secondary targets even though they might initially generate slightly more revenue than did our PWC systems. We felt that way because we could see sales of our PWC systems in the future increasing many times faster than they did for power plants. This would result in most of our business coming from the PWC systems.

Pending Business:

We completely underestimated how profitable our power generation contacts would be. In our first month, March of 2002, we signed joint venture agreements for two power plants that will costing $250 million to build and bring us in a conservatively estimated profit of over $500 million dollars over the next twenty five years after paying for the plants and finance charges This is not the end of it. We continue to negotiate and have serious discussions with others. (Additional details on these two ventures and on other power plants we are negotiating about are covered later on in this document.)

THE PLASMA WASTE CONVERTER SYSTEM

We will begin our explanation of the plasma waste conversion system by discussing plasma and its role in the process.

Plasma:

Plasma is the fourth state of matter. It occurs when a gas is heated to an extremely high temperature, 3,000 degrees and above. At such a high temperature, the gas ceases to exhibit many of the properties we normally associate with a gas and becomes plasma. Plasma is so thermally agitated (hot) that the gas has broken down to its basic ionic constituents. It is now able to pass electricity.

Plasma at 3000 degrees is extremely corrosive. It is trillions of times more corrosive than is a very strong acid at room temperature. Plasma produces an intense field of radiant energy that causes the dissociation (breaking apart) of the molecular bonds of solid, liquid and gaseous compounds or materials of both hazardous and non-hazardous wastes. This is often referred to as molecular dissociation. At the same time, the waste it reacts upon is transformed into products that end up very environmentally safe.

It is important to recognize that the process is not combustion or burning process, and that the system should not be confused with an incinerator or vitrification process. The dissociation process is caused by the intense energy field produced by the plasma gun (sometimes referred to as the torch or rod) operating within the PWC chamber. Under proper conditions, plasma can even be used to dispose of energetic components or devices such as dynamite or land mines. The proper conditions will vary depending on the waste being processed, but they always include carefully controlling the amount of oxygen to ensure there is not enough oxygen present to permit burning. This means either a very limited amount of oxygen or none at all.

The PWC Process:

A brief description of the Plasma Waste Converter system is covered below. For more details, please go to our web site at http://cambridgewastemanagement.net. Other excellent descriptions of the process can be found at http://www.vriffx.com/peps/index.htm This is the site for Vanguard Research Inc. Additional information is available at: http://plasma.org. Vanguard is a firm with whom we have an alliance.

The waste feeder delivers measured amounts of low or oxygen free waste feed into the PWC reactor chamber. The reactor chamber is a ceramic brick -lined cylinder about as high as it is wide. On the top are located one, or for very large systems, several wands. These wands are rods that extend into the reaction chamber. The wands’ function is to pass electricity into the plasma, and then direct the plasma flow into the chamber. As the wand passes the plasma gas it receives jolts of electricity. This makes the plasma glow in a very bright light that resembles a flame. The plasma is then directed to flow past the tip of the wand down towards the bottom the chamber. Below the flame is a pool of molten liquid. The plasma glow widens out as it touches the molten pool.

From the side, the waste is fed into the chamber. It comes in contact with the plasma and disintegrates into a gas and a liquid. The quantity of gas versus liquid varies depending on the contents of the waste. In almost all cases, there will be much greater quantity by weight of gas produced than of liquid. A typical ratio is 300 weights of gas to one of liquid. A high ratio is vital for the success of the process, because the gases ultimately will almost all be converted into water or carbon dioxide and passed harmlessly into the environment. As far as the liquid pool, it will from time to time be tapped and poured into wheeled ladles positioned directly under the pool. The liquid will solidify to a harmless inert mass that can be safely stored in any landfill.

The hot gasses from the chamber are directed into a gas scrubber. The scrubber rapidly lowers the temperature of the gasses entering it from a temperature of more than 1000 to 200 degrees. Large quantities of water are passed through the gasses in the scrubber. In a few feet, the gasses are cleansed of impurities as they exit the scrubber. At the same time, the scrubber converts the hydrogen and gasses into a clean Syn-gas. It is done so quickly that there is no time for toxic impurities such as dioxin to be formed. The Syn-gas exiting the scrubber can either be burned in a thermal oxidizer (a stack) to produce clean stack gasses, or it can be used as fuel by an electric generating system.

The determination of which system is used is based on several factors. The amount of gas produced, and its energy (BTU) content. If it is a small waste conversion plant, it may not be cost-effective to have an electric generating system. If the waste is not rich in organic materials, its gas may not contain enough energy to justify a power generation system. Feeds rich in organic wastes have so much energy in their Syn-gas that there is an excess amount of electricity that can be sold. After part of it is used to power the wand. For example, one plant studied uses ten megawatts for its wands and has an additional twenty-two megawatts it can sell.

The water in the scrubber picks up impurities from the gas. The water treatment system removes these impurities. The water can then be recycled back into the scrubber. The impurities are in the form of solids. These are filtered out in a press and then added to the waste and fed back through the PWC system.

All these processes require careful control. The PWC control center has at least three computer screens of data at all times to monitor the system. Very little has been mentioned about all the sensors and controls throughout the system, but they are there. There is even a screen that shows a video camera that views directly into the reactor chamber. The wands have controls that can move them in all three directions. If the operator sees a wand that is not perfectly aligned with the waste stream, it can be adjusted.

Plant Ratings:

Plasma plants are rated in the number of tons of waste they can process in twenty-four hours. A ten-ton plant will process ten tons of waste in a day. The wands electrical requirements of such a plant are about 50,000 watts per ton. Note: throughput is dependent on the waste being processed. A waste rich in organic wastes will come close or even accede its ten-ton capacity while a waste containing many inorganic elements may have a lower throughput.

Pollution Reduction

The CEWML system, in the process of converting the molecules of hazardous wastes into valuable commodity products, destroys wastes totally and irreversibly. This “total and irreversible destruction” capability is extremely important and imperative in most hazardous waste applications. This results in an amazing improvement in pollutant reduction compared to other waste hazard systems. For example, a large incinerator strives to reduce pollutants to a four nines level, or 99.9999 percent level. The PWC process reduces pollutants to the 99.9999999 percent level known as the seven nines level. So far, there are no environmental requirements for the seven nines level, even though for some pollutants it has been known it would be beneficial. Technology could not provide it. Now that Plasma Waste treatment is available. It is anticipated that seven nines environment requirements will soon be put

DIVERSITY OF WASTE FEEDSTOCKS

Hazardous waste. The EPA estimated that more than 20 million tons of waste generated annually in the U.S. alone is classified as hazardous or toxic under the Resource Conservation Recovery Act (“RCRA”) or the Toxic Substance Control Act (“TSCA”). The costs of the hazardous waste treatment and disposal methods range from about $900 to more than $2,000 per ton. These numbers do not include the additional processing, handling, packaging and management costs sustained by the hazardous waste generator within its facility prior to final disposal. The CEWML processing cost, including capital cost, labor and energy, is estimated to be about 36 cents per pound, or about $720 per ton for small scale industrial systems, and to be less expensive in larger scale facilities.

Non-Hazardous wastes and by-products. The EPA estimated that other categories of industrial waste including RCRA “special wastes,” industrial waste by-products, non-hazardous waste and municipal solid waste create a total non-hazardous and industrial waste market of approximately 13 billion tons annually. Materials classified as RCRA special wastes are generated primarily by the mining, and oil and gas industries, manufacturing industries, cement kilns and coal-fired electric utilities. Special wastes, while not currently categorized as hazardous, are not generally environmentally benign and do pose a risk to the public health and safety. They are regulated separately under state law and these wastes are materials that can be safely and economically processed and remedied using CEWML system.

Other waste. The Plasma Waste Converter can be utilized to process and minimize the volume of Low Level Radioactive Waste (“LLRW”), which can also be further contaminated by other hazardous waste components. CEWML demonstrations on LLRW surrogate waste streams have shown volume reductions of approximately 300 to 1, thereby minimizing the volume of the LLRW solid material for decay-storage or for disposal. Present methods of volume reduction include compaction and incineration that produce overall volume reductions of about 8 to 1. The CEWML system does not reduce radioactivity of the LLRW nor does any other system, but CEWML does reduce the volume of that waste to such a degree that it is reasonable for some LLRW generators, such as utilities, labs and hospitals, to store the reduced LLRW material on-site for the required decay period (usually ten “half lives”). The CEWML system can increase a site’s storage capacity by factors of hundreds to one. A site using CEWML that has only 2 years of LLRW storage capacity left will now have 200 or more years of storage capacity.

THE PWC MARKET

The primary PWC market is for the elimination of waste (especially hazardous waste) and the generation of electric power. The marketing effort will concentrate on Europe, Asia and Africa. These areas tend to have a higher population density. There is less opportunity for them to simply “hide their wastes” than there is in the U.S.

Market Size:

The estimated present cost of disposal of waste materials is over US$200 billion a year. The cost in the US alone is $48 billion. Conservative estimates in Europe, Asia, and Africa are projected at $140 billion a year. These estimates are for all not just hazardous wastes. The cost of plasma disposal tends to be on the higher end of disposal costs. It is, however, justified by the more effective job it does, because there is no toxic waste left and usually only a fiftieth or less of the solid wastes left by the process compared to other methods. One must also understand that a good part of the cost is in collection. Taking these factors into account, it is estimated that only 11% of the waste disposal systems are actually available to plasma systems. That is over $15 billion a year.

Market Growth:

It is projected that there is a two percent annual growth in waste. The World Bank and other agencies are endeavoring toward a clean up of the environment. The eleven percent portion of the entire waste disposal cost should grow in the next few years to fifteen and eventually higher to twenty and even twenty-five billion in the next ten to fifteen years.

As Plasma Waste Converters go online, confirm their capability, and gradually become more efficient with experience their actual share could be even higher.

Market Share:

Right now the commercial Plasma Waste Converter is in its infancy. Figures of commercial plants are kept confidential. The rough projection is that there are less than 100 tons per day commercial Plasma Waste Converter plants operating on a daily basis in the entire world.

CEWML’s Role in the Market:

The Company has marketing orders for three plants with a capacity of 42 tons per day and anticipates doubling that in the next two months. The word “marketing” (rather than sales) has been used deliberately on the advise our lawyers. By marketing, it is meant that we have signed commitments for each of the three orders, with agreed-upon prices and configurations, and that our customers have financing and their government’s approval. Fabricators of the plants have agreed on a price that will give the Company a satisfactory profit on each of the projects. However, there still are other considerations. In one case, the government has approved our plant, but needs details on the building that will house it before it can complete final approval.

A conservative estimate of market share is at 40% of the world’s total usage during the next few years. This success is in part by offering to become a “surrogate mother” for part of the industry, and, indeed, the Company may well end up serving the entire industry. This is especially true since the Company has all knowledge, skills and commitment in place to complete a Plasma Waste Converter plant.

Capabilities Needed:

CEWML’s high percentage of total market share might make it appear we are perfectly positioned as we now in the marketplace. This would be true if the industry stayed static. But, it will mature and evolve. Competitors will emerge with capable staffs and appropriate funding. The task ahead is to keep a considerable lead before the competition races ahead. To accomplish this end we must do the following:

1. FORM ADDITIONAL ALLIANCES IN THE INDUSTRY

An agreement exists with a plasma-fabricating firm to do most of their marketing within our target market. CEWML has purchased a European plasma-marketing firm and has strong relationships with many other firms in the energy, financial and governmental fields. However, the Company is still relatively weak in the waste disposal field, and needs to do more in this area. In financing, the Company’s many contacts require education on plasma waste conversation. Additional alliances with other plasma-fabricating firms would be helpful. CEWML will solve this by purchasing at least one such firm. Later, we can consider buying additional firms.

2. INCREASE IN-HOUSE TECHNICAL CAPABILITIES

CEWML must add to its in house staff of plasma engineers, and will start out hiring plasma-engineering consultants and then as business permits full time employees. Later, there are plans to have a Plasma R&D laboratory where the Company can develop and demonstrate plasma capabilities.

3. INCREASE CAPABILITIES FOR FINANCING PROJECTS

Financing can pose concerns. The Company plans to work on a reasonable profit margin on projects. It may be possible to finance part of these projects ourselves using bridge financing.

4. INCREASE VISIBILITY

CEWML must increase the Company’s visibility in every way that is practical. Details on how this can be accomplished will be generated later.

5. INCREASE SALES FORCE

As business increases, the Company will increase its sales team, and will hire multi-lingual salespeople who will collectively feel comfortable marketing anywhere in the world.

MARKET TARGETS

The initial industrial targeted markets include the chemical and petrochemical industries, metal processing and manufacturing industries, hazardous and non-hazardous waste process treatment facilities, hospital infectious and hazardous waste generators, pharmaceuticals, and applications involving mixed and contaminated post-consumer plastics. However, many more hazardous waste markets for the CEWML systems have also been identified and ashown on the next page.

CEWML HAZARDOUS WASTE MARKETS

Hazardous waste is a natural by-product of all industrialized societies. In many cases, what may appear to be the most innocuous manufacturing process ordangerous services, do in fact, produce hazardous and waste substances. The hazardous waste market is diverse and not centered in any one industry or industrial category. It is comprised of almost the entire industrial spectrum in the U.S. and abroad. The industrial categories shown below comprise those that are now identifiable. The Company knows who and where its potential hazardous waste customers are. For example, the Company maintains a detailed and comprehensive database of hazardous waste generators by state in the U.S. For example, the State of New Jersey reports that in that state alone, there are some 30,000 documented hazardous waste generators. The database will be employed in the Company’s day-to-day activities.

MANUFACTURING INDUSTRIES PRODUCING HAZARDOUS WASTES:

The Ordinance and Accessories Industry
The Food and Kindred Products Industry
The Textile Mills Products Industry
The Apparel and other Finished Products Made From Fabrics
The Furniture & Fixtures Industry
The Paper & Allied Products Industry
The Printing, Publishing and Allied Industries
The Chemical and Allied Products Industry
The Petroleum Refining and Related Industries
The Rubber and Miscellaneous Plastic Products Industry
The Stone, Clay and Glass Products Industry
The Primary Metal Industries
The Fabricated Metal Products Industry
The Machinery except Electrical Machinery Industry
The Transportation Equipment Industry
The Professional, Scientific, & Controlling Instruments; Photographic & Optical;Goods; Watches & Clock Industry
The Miscellaneous Manufacturing Industries

NON-MANUFACTURING INDUSTRIES PRODUCING HAZARDOUS WASTES:

The Metal Mining Industry The Crude Petroleum, Natural Gas & Services Industry
The Water Transportation Industry
The Electric, Gas, & Sanitary Services Industry
The Banking Industry (contaminated properties)
The Medical and Other Health Services Industries

Future Market Targets:

The CEWML system is also cost-effective for processing many non-hazardous wastes such as Municipal Solid Waste (MSW), although this market is not expected to be the initial focus of the Company. Nevertheless, Americans generate billions of tons on non-hazardous solid waste each year. In 1992, we produced 13 million tons of waste, including waste requiring some form of processing and disposal. The Company has produced preliminary designs for MSW facilities as large as 3,000 tons per day, and early discussions are now in progress with a 500-ton per day CEWML MSW Recourse Recovery Center. MSW is a major renewable resource and a good commodity hazardous waste generator, and therefore a good customer candidate, well suited for the CEWML elemental recycling process.

Governments have all sorts of waste that would be found in industry, along with hazardous materials such as: explosives (“energetics”), chemical warfare weapons (“Agent”), radioactive wastes, diseased plants, animals and organisms, lethal viruses, confiscated drugs and other materials such as contaminated sludge and solids, at military facilities and military base closure sites.

Negotiations in Progress:

Cambridge is in negotiations for several other power facilities.

In China we are negotiating for two 200 MW plants to be located near Beijing. They will be half natural gas and the other half coal.

We are negotiating with Mongolia for 400 MW hydro plant. (It will require a dam)

We are negotiating with Ghana for a 400 MW hydro plant. (It will require a dam.)

We again want to again remind the reader that we believe our biggest future will be in plasma and waste disposal. Doubling the amount of business one does in power plants is a bigger feat than increasing PWC ten fold.

THE POWER GENERATION MARKET

So far the standard non plasma power generation market has generated 90% of our projected revenue. We completed two joint ventures. The first was in China.   In March 2002, Cambridge International, Ltd. entered into a joint venture agreement which was subsequently assigned to Cambridge Energy Group with Ya Tai, Ltd. to build a 36-MW cogeneration power plan in the Qu Zhou, Zhejiang Province, China. Under the terms of the agreement, Cambridge Energy will receive 90% of the cash flow for the first fifteen years and will receive 50% of the cash flow for the next five years.   The plan will revert to Ya Tai at the end of 20 years following completion.   Ya Tai will contribute $6,000,000 of the capital required to construct the plant, Cambridge Energy will contribute the remainder amount.     Ya Tai has guaranteed Cambridge Energy a minimum annual distribution of not less than $4,500,000 for the first ten years following plant completion and $2,500,000 during the subsequent five years irrespective of the actual cash flow of the plant.    The EPC and operations and maintenance contractor will like guarantee the minimum annual distributions to Cambridge Energy.

Full political risk coverage is to be issued by a consortium to be comprised of the Multilateral Investment Guarantee Agency, AIG, Reliance National and/or Chubb Group.   Coverage will include a failure-to-honor- declaration indemnifying the lender in the event the Chinese governmental entities fail to make the require payments under the power and/or steam purchase agreements or guarantee.   Additionally, Cambridge Energy has applied for a guarantee of the principal and interest payments from MIGA.

Details:

This plant will cost Cambridge $35 million to build. We believe Cambridge will be able to borrow the money at favorable terms because of the Ya Tai guarantee to Cambridge Energy a minimum annual distribution of not less than $4,500,000 for the first ten years following plant completion and $2,500,000 during the subsequent five years irrespective of the actual cash flow of the plant. After paying the loan we believe Cambridge should earn over $5 million dollars a year for the 20 years of the contract.

The second joint venture was with the Ukraine.   In March 2002, Cambridge International, Ltd. entered into a joint venture entitled Cambridge/Chigirin Energy, Ltd. with three Ukrainian Governmental Agencies, namely the Departments of Energy, Gas and Transportation for a 252 MW combine-cycle power plan to be built in Chigirin, Ukraine.   This agreement has been assigned to Cambridge Energy.   The term of the agreement is for 25 years.   Under the joint venture, Cambridge Energy will receive 90% of the cash flow for the first 15 years following completion of the plant and 50% of the cash flow for the remaining 10 years.   The plant will revert to the Ukraine government at the end of the 25-year term.   The Ukraine government will contribute the land and Cambridge Energy will contribute $8,000,000 in the form of a loan to be amortized over a 10-year term with annual interest rate of $14%.

The Ministry of Electricity and Electrification of Ukraine, as well as Inkomenk Bank, located in Kiev and Privatbank, located in Dnipropetrovsk will issue their joint and several absolute and unconditional guaranty to pay all principal and interest of the Cambridge Energy note.   This loan guaranty will be separate and apart from, and not conditioned upon, any other aspect of the project.

Full political risk coverage will be issued by AIG, Reliance National, or the Chubb Group.     Coverage will include a failure-to-honor- declaration indemnifying the lender in the event the guarantors fail to make the guaranteed minimum annual payment under the joint venture agreement.   The project will also be covered by a financial guaranty bond in the amount of the outstanding principal.

Details:

Cambridge Energy is seeking to borrow $215,000,000 for this project and is in discussion with several major international banks relating to financing. We believe Cambridge will be able to borrow the money at favorable terms because of the Ukraine guarantee on the loan. After paying the loan we believe Cambridge should earn over $18 million dollars a year for the 25 years of contract.

BACKGROUND OF THE CEWML DEVELOPMENT

The CEWML management team has been designing, manufacturing, and marketing engineered solid-waste capital equipment to the waste industry worldwide since 1969. That experience includes the development and marketing of capital equipment for hazardous, non-hazardous, and radioactive wastes, industrial by-products and recycled process. The Plasma Waste Converter is the culmination of the experience of the management team over the past 33 years in the waste equipment industry.

Some of the Company’s management team have also been consultants, designers, and manufacturers of solid waste systems for the U.S. Navy from 1973 to 1993, and waste industry equipment consultants for special programs for Union Carbide, the NY City Department of Sanitation, Nippon IDC, New York Life, Metropolitan Life, AutoPak, the City of Mount Vernon and others. The capital equipment experience since 1969 includes:

Various waste material handling systems:

The Company’s interest in the application of plasma technology to the waste industry arose as a result of Edward A. Sakoff, chairman of the Company (See “Management”) reading a technical article in the 1970s. The article stated the two Atomic Energy Commission fusion scientists, Mr. Bernard Eastlund and Mr. William Gough speculated that plasma might be able to be used to blast waste back into its constituent atoms, and that they (the atoms) could be reclaimed for total reuse. The scientists also speculated that the technology would not be commercially developed until the year 2000. While harboring an abiding interest in plasma technology since the 1970's, the more intensive commercial development effort by the Company occurred in the late 1980's.

EIGHTEEN BENEFITS AND ADVANTAGES THAT MANAGEMENT BELIEVES SET CEWML APART FROM OTHER TECHNOLOGIES:

1. The price of the system and its operating costs are significantly less expensive than many of the present costs being experienced by the industry.

2. Hazardous and non-hazardous wastes (organic and inorganic) solids, liquids, sludges, and gases can be safely and economically processed without producing harmful, illegal or noxious emission, effluents or residues. The various forms of the wastes can even be processed at the same time.

3. The volumetric waste reduction for most solid wastes is approximately 300 to 1.

4. The system’s environmental performance is far safer than U.S. EPA standards and regulations.

5. The system can do on-site remediation of toxic “hot spots” (contaminated properties) and landfills, and return those properties to the market for sale in a safe, and habitable condition. Landfills contain resources that can be safely processed and recovered (mined) as commodity products by the CEWML PWC.

6. The system will improve the public health and safety, and will not produce the harm that arises from incinerators and landfills.

7. For many wastes, the system produces commodity products for sale or use, such as: metals, specialty inorganics, and a valuable clean synthesis gas (Plasma Converted Gas).

8.The system reduces the cost and risk (related to hazardous materials and compounds processed) to the corporation, agency, and organizational entity from the “perpetual liability” that accompanies hazardous waste generation, treatment, transportation or disposal.

9. It reduces the personal risk of fines and imprisonment (related to hazardous materials and compounds), to such persons as corporate officers, managers, and officials (Potential Responsible Parties, the PRPs) “who knew or should have known” about a waste disposal transgression within their purview.

10. The systems can be produced in various configurations which will allow them to be used aboard ship for marine applications, in a truck for mobile applications, and in stationary configurations ranging in capacity measured from pounds per hour to thousands of tons per day.

11.The system can be operated intermittently a few hours per day as needed, or around the clock, without many of the difficulties and costs arising in other technologies when operated in that manner.

12.When processing hazardous and non-hazardous wastes of the Municipal Solid Waste type, the system will produce about four units of energy for each unit of electrical energy consumed in the PWC chamber. When processing highly carbonaceous wastes such as tires (rubber), the system will produce about 10 units of energy for each unit of electrical energy driving the process.

13. Unlike other technologies, no catalysts or associated costs are required by the system.

14.The system can process Low Level Radioactive Waste, and can reduce its volume by factors of hundreds to one. The system does not reduce radioactivity.

15. The system can achieve “total and irreversible destruction” of hazardous, toxic, and dangerous compounds and wastes, and lethal viruses, bacteria and prions.

16. RCRA (Resource Conservation Recovery Act) recycling exemptions may be available where the resultant products produced are being used in an industrial process or to make a product.

17. The employment of the CEWML system will allow the user to conform to Zero Discharge criteria, serving to enhance the good environmental community relations of the user. The receipt of the Zero Discharge Award, can benefit the user’s image in the marketplace.

18. The system is “inherently safe.” Unlike an incinerator and other disposal waste processes, as soon as the electricity is turned off to the PWC, the primary PWC process stops.

SALES STRATEGY:

The Company’s primary sales revenues will be produced by the combination of the equipment purchase price supplemented by ongoing usage, or tolling fees. The tolling fees will be based on the hourly metered runtime, the data for which will be automatically reported by to the Company for billing purposes by an onboard computer through phone lines. Depending on the customer’s application, tolling fees may range between five cents per pound, and be compiled by electrical meter power-on time. There will be minimum monthly tolling fees embodied in the sales agreement after the first few systems are operating in commercial applications.

The two principal target markets that will be penetrated by CEWML will be 1) government facilities, and 2) industrial facilities (see “CEWML Target Markets”). Sales to government facilities and agencies will be conducted primarily by CEWML executives. Sales to industrial and non-governmental customers will be managed by the Company and conducted by commissioned representatives working (under agreements) in close collaboration with the Company. The strategic use of specialized commissioned representatives in the sale of waste industry capital equipment is a marketing activity with which the Company’s management has long and successful experience. The use of representatives will allow the Company to penetrate the industrial markets with the greatest speed, breadth, and depth of coverage. The use of commissioned representatives in the formative years of the Company’s anticipated growth is financially beneficial in keeping the cost of producing sales as a variable expense rather than a fixed expense, and on balance, favoring the preservation of cash in these early years. Sales through representatives to customers will be conducted by the Company, with the price set by the Company, with assistance of the representative.

National and international CEWML sales are also anticipated from the Company’s strategic alliance partners.

The Company has also appointed Distributors who will operate in an “area” of prime responsibility. An “area” maybe a geographic area or an industrial are (market segment). The Distributor will buy the system from CEWML and add its markup to produce the price to the customer. Distributors will be used in parts of the world inconvenient for CEWML direct sales. A Distributor will be required to be relatively self sufficient and will have the obligation to acquire an industrial-sized demonstration system to support its sales activities. The Distributor will also be responsible for installation and service. In some cases, where the Company has agreed to exclusivity, the Distributor will be required to produce a minimum annual sales dollar volume in order to maintain the Distributorship. In addition, the Distributor will be required to sign a non-disclosure agreement and a non-compete agreement. Distributors have the obligation to have a facility in which to conduct PWC demonstrations for potential customers.

The Company believes that the market for its systems overseas is larger than the U.S. market, and in many respects has economic and environment imperatives for the purchase of CEWML systems in newly industralizing countries (“NICs”) that are even more compelling than those in the U.S. According to the World Bank, each year the world’s population increases by thirty-three million people.

CEWML systems are designed in configurations that make their ability to be factory-made and shipped to overseas markets reasonable and desirable. The Company will continue to engage, by written agreement, commissioned sales representatives overseas as it does for the U.S. market. The Company’s management conflicts with earlier discussion has many years of international marketing experience, including licensing, in manufactured capital equipment, and is anticipating the likelihood of a limited number of license agreements for certain areas of the world, where market penetration can be best maximized by a CEWML licensee, as compared to export to that area.

The Company does not intend to seek participation with the customer in the offsets or revenues that may be generated from the commodity products produced by the system. Those financial benefits will be enjoyed by the customer as an additional financial incentive to acquire CEWML systems. The Company will receive the initial revenue from the purchase of the system, plus the ongoing tolling fees from the processing of the materials, based on metered (electrical usage) operating time.

Leasing will be employed on a case by case basis. The Company does not intend to hold or finance leases itself.

The Export Import Bank of the U.S. has expressed interest in supporting the Company’s overseas sales by its financing guarantee program.

COMPETITION:

The Company’s market for its Plasma Waste Converter systems is based on its cost-effective waste minimization, pollution prevention, and its recycling and recovery of valuable commodity products from the hazardous, non-hazardous and noxious wastes being generated in the industrialized and transitional countries of the world.

There are other technologies in various stages of development that claim to achieve some, but not all, of the objectives achieved by the Company’s system. However, it is the Company’s belief that many of these technologies are limited to narrow and specific

Our executive officers, directors and key employees and their business experience follows:

Richard P. Luzin,   From 1982 to present, Mr. Luzin has been a real estate developer for J.R. Developers, Inc. and Affiliated Companies, real estate development firms.   Mr. Luzin attended the University of Illinois from 1957 to 1958.   Mr. Luzin attended Northwestern University from 1958 to 1960.   Mr. Luzin is a licensed real estate salesperson. Mr. Luzin has been a member of the board of directors of the Illinois Police Federation from 1967 to present and has been president of the Illinois Police Federation from 1969 to present.   Mr. Luzin has been president and director of the Federal Credit Union from 1969 to present.

Bernard M. Filler.   Mr. Filler is an experienced Consultant, Project Director and Business, Financial, and Legal Advisor. He has worked extensively on acquisitions, senior project and corporate management assignments, financings, workouts and international joint ventures. Mr. Filler is licensed in law, securities and insurance and is a Certified Financial Planner. He has served as a senior executive of public and private companies and has been the President and Managing General Partner of many private investment partnerships. Mr. Filler graduated with Honors from The University of Illinois (B.S. Accounting) and from Stanford University School of Law (JD and Order of the Coif). He has served as International Project Director for Cambridge Energy International, Ltd. and affiliated with business since 1998. He is also affiliated as Senior Project Director with Paradigm Group, a private investment banking and financial services firm.

Deyun Chen.   Mr. Chen received a Bachelor of Arts degree in the English language from SISU, Shanghai, China in 1962.   Mr. Chen continued his studies at SISU.   In 1965, Mr. Chen received a Master of Arts degree in English Linguistics.   In 1974-1975, Mr. Chen attended the Advanced Teachers' Training Program in English Linguistics & Rhetorics.   Mr. Chen received his Ph.D. in English Linguistics & Bilingual Translation in 1979.

From 1990 to 1998, Mr. Chen was a visiting scholar on cultural exchange program at Slippery Rock University.    Mr. Chen was also a course developer for the cultural exchange program at Indiana University of Pennsylvania.   From 1980 to 1990, Mr. Chen worked as a liaison officer for the Foreign Affairs Bureau, Ministry of Machine-Building & Electronics, China.    From 1972 to 1980, Mr. Chen worked as a chief interpreter and translator for the Shanghai Foreign Affairs Bureau in Shanghai, China.

THE TEAM APPROACH TO WORLDWIDE

ENERGY PROJECTS

These are some of the companies that we have built

STRATEGIC ALLIANCES

UXB International, Inc.

Ensign-Bickford Company

Vanguard Engineering

STRATEGIC ALLIANCES:

Below are listed the strategic alliances CEWML has entered to help further develop the Company’s market scope and penetration. Pursuant to separate agreements entered into with each strategic partner, they have agreed to mutually seek opportunities that may utilize CEWML’s proprietary process and the particular expertise and know-how of the other companies in its field. In general, each of the agreements provide for the negotiation, on a non-exclusive basis, for the formation of mutually agreeable business arrangements concerning the commercialization of the CEWML process, and the termination by either company upon written notice, except for survival of confidentiality, and intellectual property provisions. Each of CEWML and the other companies have conducted due diligence with respect to each others technology in accordance with the confidentiality provisions of the agreements. Each brings special well-proven skills and capabilities to the Company, and are important to the future success of the Company.

BURNS AND ROE ENTERPRISES, INC. AND SARGENT & LUNDY, LLC.

Burns and Roe and Sargent & Lundy, are one of the world’s leading engineering and construction firms, and are clear leaders in the field of engineering, design, construction for electric utilities, waste to energy, nuclear utilities, wind power, co-generation, industrial, chemical and research facilities, both domestic and international. Burns and Roe has more than 700 technical and 300 administrative and office personnel in its Oradell, New Jersey headquarters. It has offices in six countries around the world. CEWML and Burns and Roe, along with Sargent & Lundy, will undertake projects that require sales, engineering, construction and financing of CEWML-based facilities.

ENERGY RESEARCH CORPORATION (ERC):

ERC is a public company preeminent in the field of the development, manufacturing and the marketing of Molten Carbonate (“MC”) fuel cells. Fuel cells are battery like systems that convert hydrogen gas directly into DC electricity. The PCG produced by the CEWML PWC can be used directly in ERC’s fuel cells. CEWML and ERC will cooperate in the technical development and sales of systems that convert wastes into fuel cell gas to produce electricity. In June, 1996, ERC put the world’s largest MC fuel cell online in California.

NORTHEAST UTILITIES SERVICE COMPANY (NU):

The Company has signed a Memo of Understanding with NU that provides a future opportunity for the sale of CEWML systems by NU to NU’s electrical customers. NU has a field sales force of 130 salespersons for its New England service area. NU is a major electrical utility, and a public company whose stock is traded on the NY Stock Exchange. CEWML and NY are in the process of setting specifications for the purchase by NU of its first CEWML PWC for a Connecticut application.

ONTARIO HYDRO LTD.:

Ontario Hydro, a Canadian corporation, is one of the largest electric utilities in the world. Ontario Hydro Technologies (OHT), a business unit of Ontario Hydro, is a scientific technical research and development laboratory employing approximately 350 scientists, engineers and technicians located in Toronto, Ontario. OHT assists CEWML in new product development and in special customer opportunities for thermo-chemical and nuclear waste applications.

ENSIGN-BICKFORD COMPANY:

Ensign-Bickford, founded in 1836, is a preeminent explosives manufacturing, engineering and services company with extensive experience and expertise in the field of advanced explosives, detonation and ordinance science and technologies for both private and government sector markets. The Company and Ensign-Bickford are working together to obtain contracts to sell equipment, products and services of both companies to process and destroy various forms of chemical weapons, demilitarization wastes and unexploded ordnance worldwide. The companies have also been working together on non-incineration systems for the destruction of the U.S. Chemical Weapons Stockpile.

CHASE ENVIRONMENTAL CORPORATION:

Chase Environmental is a private company headquartered in Louisville, KY comprised of engineers and scientists with extensive expertise in operating, siting, and permitting radioactive waste processing facilities. Chase will assist the Company in the production of sales of the Company’s systems to customers generating radioactive wastes.

BAUER HOWDEN INC.:

Bauer Howden is manufacturing CEWML systems in the U.S. in a modern, fully integrated, 90,000 square foot manufacturing and engineering facility in Avon, CT. This facility is also fully qualified as a production facility in manufacturing compliance with the military and government specifications of the U.S. and many nations of the world. Bauer Howden has a team of its own technical service people strategically located in various market areas outside of the U.S. and these service people will assist in the installation, maintenance and training that may be required by CEWML customers.

CALUMET COACH COMPANY:

Calumet Coach of Calumet City, IL is a privately held company that has been building mobile units in both semi-trailer, and self-propelled configurations for the past fifty years serving special health care, military and industrial applications throughout the world. The agreement calls for the incorporation of the PWC’s into various semi-trailer and self-propelled mobile configurations. These systems will process hazardous wastes that reside in remote locations.

TECHNICAL ADVISORY BOARD:

The Company has established a Technical Advisory Board comprised of five members with relevant experience in the areas of chemistry, chemical engineering, mechanical engineering, polymer engineering, combustion and environmental technologies, hazardous materials processing and management and governmental affairs, all of which relate to the business of the Company.

Some of the members of the Technical Advisory Board serve as consultants to the Company under consulting agreements. The agreements stipulate that all new information, engineering and research results and inventions produced by the particular consultant’s work supported by the Company will be the property of the Company and that all information arising out of the consultation will be treated as confidential and will not be disclosed without the permission of the Company. The consultants generally receive compensation for their work at rates ranging from $1,000 to $2,500 per day. To the Company’s knowledge, none of its Technical Advisory Board members, including those that serve as a consultant to the Company, has any conflict of interest between his obligations to the Company and his other obligations.

Multitrade Group, Inc
Power & Processor Developers/Operators
P.O Box 272- Ridgway, VA 24148

Nuovo Pignone

A Leader in the manufacturing of Gas Turbines

We are the independent professional services firm THINKING POWER… EXCLUSIVELY for electric power clients for 110 years.

Sargent & LundyLLC is a worldwide leader in professional services for the electric power industry. Our distinctive capabilities provide domestic and international clients and partners with a thoroughly reliable source of comprehensive expertise.

Cambridge Energy Waste Management, Ltd.
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