Welsom

1
Vacuum deployment of MSRS Technologies CP1
polyimide 20-meter boom (source NASA)
Welsom Space Power Business Plan
A lucrative opportunity in PV solar arrays for
space based energy creation V5.7 23. April 2009
Breakthrough Technology for the fossil fuel free
economy
2
State of the Art in PV for space applications

• State of the art for PV power in space are
  GaInP/GaAs/GaInAs crystalline cells/arrays
• lt28 efficiency (a-Si lt10)
• 120-180 W/kg specific power for deployable arrays
  (too heavy for GW scale)
• Only two large suppliers Boeing and Sharp
• Up to 1000 /W market price for PV modules for
  communication satellites
• ISS Solar arrays were sold at 1700 /W!
• Market leader US Boeing Spectrolab, annual
  production lt 1.3MW or lt1 of total PV world
  market 1.3GWpa
• Space PV is today still a niche market, but with
  gt1 B annual turnover!

3
Driving forces in innovation for space PV

• Historically, push for smallest possible area for
  fear of space debris impact on communication
  satellites
• No thin film technology available that survives
  space environmental conditions up to date
• Highest areal efficiency for decades only path to
  improved performance
• But if one factor is not critical in space, it
  is SPACE! (after all it is called space by
  definition)
• Lower areal efficiency but superior weight
  dramatically pushes specific power W/kg, which is
  far more important in space applications due to
  launch cost of gt 10000/kg

History
W/m2
W/kg
4
Why is PV for space advancing so slowly?

• Extremely high entry barriers for newcomers due
  to complex space heritage requirements
• Bureacratic hurdles in government organisations
  like NASA, ESA preventing disruptive innovation
• Limited public private partnerships so far in
  driving innovation
• Perception based on historic experience, space
  applications are considered intrinsically long in
  transfer from laboratory to real use
• BUT
• Strong private US entrepreneurs entering the
  space market due to liberalization and lack of
  NASA funding, such as Richard Branson, Bigelow
  Aerospace, SpaceX are pushing innovation and
  increase market dynamics
• Global cooperations not only encouraged but
  actively pushed, unleashing unprecedented
  synergies in radical innovations such as SBSP

5
What is the key strength of Switzerland?

• Switzerland is the worlds pioneer in thin film
  photovoltaic basic research, pushed since 1994 by
  University of Neuchâtel, PV laboratory of IMT
• IMT ist the established long term strategic
  partner of Oerlikon OC Solar, operating the
  industrial PV RD Lab Oerlikon SPTec in Neuchâtel
  since 2003
• IMT is the scientific partner of Bertrand
  Piccards Solar Impulse Project
  www.solarimpulse.com
• A private consultant is expert technology and
  business consultant with relevant PV industry
  background including cost of ownership and
  manufacturing know how.

6
What led to the global WELSOM consortium?

• Independent discovery by US private entrepreneur
  Kevin Reed, looking for innovative solutions in
  retinal implant structures with photosensitive
  materials
• Unique UV sensitive polymers by US Mantech-SRS
  company proved of superior dual use also for
  large area PV thin film applications, discovered
  in 2005
• First scientific publication at PV conference in
  Hawaii 2006
• After intense lobbying pushed by Kevin Reed,
  global partners could be convinced to seriously
  look into a cooperation both in core group and
  supply chain
• Nearly two years of negotations led by Reed, a
  private consultant and IMT led to a worldwide
  exclusive technology contract for
  commercialization of thin film based PV
  technology for space applications, signed in
  September 2007
• Welsom has a global monopoly for ultralight
  advanced PV technology for space!

7
Welsom Executive summary

• Welsom Weightless Solar Modules, acronym by
  Consortium partners
• Welsom has proprietary technology to produce
  space solar power arrays that are 35 times
  lighter and 100 times smaller in stowed volume
  than existing arrays.
• Welsom will use this technology to produce solar
  power systems for space and high altitude
  applications in the 10-100 kW range.
• Our unique selling proposition (USP) Welsom can
  manufacture these leading products at one tenth
  of the price of our competitors.
• Welsom currently seeks 1.2M as the first stage
  of a 21.6M 3-tranche investment with a 5-year
  IRR of 48.
• The initial 1.2M investment can be returned in 4
  years with an IRR of 50. Optional is a right to
  convert cash contribution to equity after
  incorporation
• Preferred is MOU combining first two funding
  stages in one contract to extend planning
  security, 1.2M and 2.7M with separate equity
  conversion factor, release of second stage based
  on successful milestone 0 (proof of concept)

8
Company overview

• Welsom is currently organized as a contract among
  partners of a consortium with the intent to
  incorporate in Switzerland, HQ preferred in Zug.
• Consortium members include
• Institut de Microtechniques Photovoltaic
  Laboratories, University of Neuchâtel (IMT),
  Switzerland.
• Mantech-SRS Technologies, Inc. of Huntsville
  (MSRS), Alabama, USA
• SESCRC Bioengineering Research, Anaheim,
  California, USA
• Private business and PV technology consultant,
  Switzerland.

9
Product summary

• Flexible, thin-film expanding-deployable solar
  arrays for space applications.
• Superior power density.
• Radiation resistant.
• Intra-panel connections etched in silicon.
• Modular design scalable to very large arrays.
• Two types of deployment concepts

Strategic partner for mass production of TF
contacting process required
10
Competitive advantage

• Flexible, thin-film expanding-deployable solar
  arrays for space applications.
• Exclusive access to NASA-developed LaRC-CP1 and
  MSRS-developed CORIN polymers
• Flight-tested with ultra lightweight superstrates
  and radiation resistance.
• Exclusive access to Oerlikon's terrestrial-based
  solar power array equipment
• Based on Welsoms relationship with IMT.
• Exclusive access to IMT's thin-film talent,
  know-how, and relevant IP.
• First mover advantages
• First thin-film, flexible arrays for space
  applications.
• Preparations underway for flight demonstration
  aboard Genesis-2 commercial space station.
• Will have production equipment ready to go
  shortly after flight testing.
• All the advantages result in a unique selling
  proposition for Welsom We can manufacture our
  products at one tenth of the price of our
  competitors!

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Comparative advantage
Crystalline silicon
Triple junction
Scarlet (stretched lens)
LaRC-CP1 a-SIH
CORINTM a-SiH
CIGS
Products ? ? Properties
Technology readiness
mature, in common usage
some flight experience
flown in ISS, lab cells tested
manufactured lab tested for atomic oxygen
lab cells have been tested
mature, in common usage
Cell efficiency at end-of life
8 - 10
24 - 30
24 - 30
8 - 9
8 - 9
12 - 14
Power density of array (W/kg)
20 - 40
80 - 180
150
1'370
1'370
120?
Radiation resistance GEO
low
high
high
superior
superior
high
low
high
unknown
low
high
high
Atomic oxygen resistance LEO
Scalability to large space arrays
limited by launch volume
limited by launch volume
difficult because of precision deployment
very easy
very easy
limited by array design
Relative cost
low - medium
high
very low
very low
medium
high
12
Industry outlook
13
Our demand assumptions
14
Demand and sales forecast
15
Major potential customers
16
Marketing plan

• Segments
• Start with New Space and gain credibility.
• Develop a niche in commercial communication
  satellites by moving to a multi-segment customer
  such as EADS Astrium.
• Leapfrog to other multi-segment customers to
  enter additional segments.
• Channels
• Use marketing managers where necessary.
• Utilize aerospace marketing firms in foreign
  markets.
• Pricing
• Start with 200 / W for New space ? 80 customer
  savings.
• Charge 400 / W after that ? 60 customer
  savings.
• Reduce price afterwards, as new competition
  demands.
• With our extremely high margins, there is plenty
  of room to manoeuvre!

17
Business model
? IMT RD is a very important part of the Welsom
business. Different applications and / or market
segments will require dedicated products. IMT
will receive a percentage of the after tax
profits, with a defined cap level for strategic
RD.
? MSRS will be the main supplier, with exclusive
delivery of glass coated with CP1 or CORIN
polymer. Processing of the 1.4 m2 modules will be
done by WELSOM, while the cell deposition will be
sub-contracted to provider(s) using Oerlikon
equipment. Solar modules will be directly sold to
integrators (e.g. Kayser Threde) or assembled by
MSRS into large arrays to be sold again to
satellite or HAA manufacturers.
18
Thin film solar module production
Clean room
19
Phases and milestones
20
Roadmap
21
Ownership and control

• Legal entity
• Currently a contractual consortium.
• Soon a corporation with Swiss headquarters in
  Zug.
• Ownership plan
• Consortium members 36
• Management 25
• Investor(s) 39
• Board of directors with representatives from
• Consortium
• Management
• Investor(s)
• Outside
• Scientific advisory board.

22
Financial results
23
Total capital needs
24
Return for investors
25
Risk summary
1.1 Business Market slow
6.2 Inadequate Project management
high
1.2 Business Competition
m-h
6.1 Insufficient stakeholder support
medium
l-m
low
5.2 High partner dependence
2.Resources insufficient
light
5.1 Partner out of business
l-m
medium
3.Organisation Grows too fast
4.2 Technology Space / lifetime
m-h
heavy
4.1 Technology 1.4 m2 array
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Risk assessment
Potential risks
Area
Likely consequences
Mitigation
P
C
Prod
Start sales process earlier
lm 2
mh 4
8
Sales targets missed
1. Business

• Market slow to materialize

• Competition

Financial issues (price,cost)
Price more agressively
l 1
mh 4
4
Closely monitor progress set up plan to find
resources quickly if case occurs.
lm 2
m 3
6
Need more staff ? impact on cost
Insufficient resources to execute project
2. Resources
3. Organisation
Put admin processes in place from beginning
m 3
lm 2
6
Company grows too fast Admin cannot keep up with
prodsales
Delays, customer dissatisfaction
lm 2
mh 4
8
Monitor program closely
Sales late
4. Technology

• Demo of 1.4 m2 array late

lm 2
mh 5
10
Step up QC
Production / delivery delay

• Space lifetime issues

5
Negotiate exit liability contract
Severe delay / alternative partner or material
search
l 1
h 5

• Partner out of business

5. External influences
Production delay / customer and reputation loss
lm 2
h 5
10
Negotiate delivery liability contract clause

• High dependence on partner

3
Production / delivery delay
l 1
m 3
Negotiate liability contract clause

• Insufficient stakeholder support

6. Project execution
Production / delivery delay
l 1
m 3
3
Step up QC and coaching

• Inadequate project management

• Probability high5 medium-high4
  medium3 low-medium2 low1
• Consequences heavy5 medium-heavy4 medium3
  light-medium2 light1

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Contact

• The detailed Businessplan can be obtained after
  signing an NDA with the Welsom Consortium
• Please contact
• Mr. Kevin Reed Msc. , CMO SESCRC/ Welsom Space
  Power
• 914 N. Fairview Street, Anaheim CA 92801
• Tel. [phone], Email kreed_at_welsomspacepo
  wer.com
• WELSOM consortium will be leading the discussions
  with investors