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CONFIDENTIAL Baker Solar Introduction Spring 2010.

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Presentation on theme: "CONFIDENTIAL Baker Solar Introduction Spring 2010."— Presentation transcript:

1 CONFIDENTIAL Baker Solar Introduction Spring 2010

2 CONFIDENTIAL 2 Solar PV Is Evolving From A High Profit Specialty Market To A Commodity Market Solar Glut is putting pricing pressure on solar factories, creating a need for solar producers to reduce their costs while increasing output New factories with lower production and CapEx costs are under development around the world New factories need high production at low cost to survive High cost factories are closing Commodity focused production-strategy needed for solar factories to thrive

3 CONFIDENTIAL 3 Baker Solar Was Founded by M.E. Baker in 2008 to Help Drive Down Solar Factory & Production Costs M.E. Baker Company has been a world leader in high-volume, wet-process equipment for more than 30 years Baker produces efficient, productive tools for producing high-end printed-circuit- boards, flexible circuits, and electro-formed components Bakers technology base providing high-volume precision wet process tools can be utilized by solar factories who traditionally have purchased high-cost, lower- volume semiconductor-derived tools Baker has a deep legacy satisfying challenging applications at leading companies like 3M, Northrop-Grumman, Lockheed-Martin, Sanmina-SCI, Amphenol, Parlex (now Johnson Electric), and others. Baker Solar division was founded by Baker in 2008 to take existing technologies to photovoltaic (PV) solar markets, where they will improve costs and throughput in all types of PV Silicon wafer & ingot manufacturing Solar cell manufacturing Thin film manufacturing

4 CONFIDENTIAL 4 Baker Solar Is A New Business Founded On 80 Years Of Experience In Wet Process Equipment Founded in 2008 Batch & In-line Wet Process Solutions for Solar Wafer & Cell Production Wide Range of Tools & Applications: Raw Silicon Etch Wafer Cleaning Etching Texturing Resist Stripping Etchback Electroless Metallization Baker SolarMEI M.E. Baker Founded in 1986, collaboration between MacDermid Chemical Company & Höllmüller In-line wet-process tools for electronics applications Very high performance tools for demanding applications Wide Range of Modular Tools & Applications: Printed Circuit Board High Volume Flex Circuit Electroforming Acquired by Baker in 2006 Founded in 1919 by Morris E. Baker, as a plating equipment and supplies company Modular, automated batch systems for a wide range of applications beginning in 1970s Printed Circuit Board Electroforming General Metal Finishing Plating

5 CONFIDENTIAL Baker Has Deep Wet Process Experience & We Are Leaders In Wet Process Tools Complete in-house plastic fabrication capabilities 30,000 square foot facility, Springfield, VT Dedicated machine tools for forming plastic tanks utilizing state-of-the-art constructions Wegener forming, bending & butt welding tools Minimal hand welding CNC Routers, Lathes, and Mills Complete in-house electrical fabrication capabilities Full range of wet-process automation solutions Baker MaxiM Control System Chemistry maintenance based on time, unit volume, sensors, online analysis (titrations, etc.) Operators stations with remote supervisory control and long-term tracking &trending Automatic chemistry polishing & recycling Large ($1 million +) inventory of spare parts Deep experience etching, plating and cleaning difficult parts & components Installations worldwide Consistently delivering high-performing systems for challenging customers & applications 3M, Sanmina, Boeing, Cherry Semiconductor, Northrop Grumman, GE, Teradyne, Lockheed Martin, Evergreen Solar, Mobil Solar (older tool, in daily operation up to 2009) many more high-end customers

6 CONFIDENTIAL We Have 30 Years Of In-Line, Horizontal Wet-Process Systems Experience In-line system business originally founded as a joint-venture with Höllmüller (Germany) Full-line of in-line systems have been developed, more than 300 systems installed worldwide Key applications include printed-circuit and electroforming: Etch, Develop, Strip, Plate, Chemical Mill Continuous innovation leading to lowest cost of ownership : Separate sumps for higher process consistency Front-mounted drive-train for easier maintenance Non-oscillating, high-performance manifolds Fluid Head dryers Touchless wafer guides Class leading process precision, accuracy & quality High resolution etching Edge-to-edge consistency of etch

7 CONFIDENTIAL 7 Why Solar: Photovoltaic Electricity Is Nearing The End Of The Beginning Solar electricity is entering a growth phase due to strong economics Photovoltaic (PV) electricity is well understood, 50+ year history Long-term cost improvement trends are driving down the cost of solar Solar electricity is now competitive with utilities in some markets Government programs are also helping drive demand U.S. Investment tax credits offset 30% of system cost, program extended thru 2016 Net-metering / feed-in-tariffs allow consumers to sell excess electricity back to utility Germany & California pay above market rates for excess electricity Ongoing cost improvement programs will soon make solar economic in more places Prices Have Declined With Volume, Fueling More Growth Solar Electricity Will Soon Cost Less Than Utility Power NREL Projections for 2015 Red Areas Have PV-Electricity Costs Below Utility Without Subsidies

8 CONFIDENTIAL 8 Why Solar: Consumers, Businesses & Utilities Will Install Electricity Generating Systems That Pay For Themselves $0.206 / KWh; NStar electricity rate $0.19 / KWh; PV Solar Cost* * 25 year system life, 7% discount rate, 30% tax credit, $5.5 WattPeak installed cost, 0.6% annual O&M cost, 18% capacity factor Solar Already Makes Economic Sense In Some Markets While Electricity Costs Are Growing Steadily, and… …The Cost Of Solar Is Declining

9 CONFIDENTIAL 9 Why Solar Processing Equipment: Pick & Shovel Vendors Thrive In Fast Growing Markets Strong demand for PV-electricity systems has created a large and growing market for solar processing equipment Currently the solar market supports hundreds of factories, but only a handful of equipment producers for key process steps Processing equipment has higher barriers to entry than cell and panel production As market matures weaker factories will disappear and survivors will need new & improved equipment to compete Companies with the know-how to increase factory output and productivity have built large, profitable businesses in short timeframes Equipment companies are profitable, delivering EBITDA typically between 10% and 20% of sales A ready market has developed for selling these growing equipment companies at strong valuations Solar Equipment Deals Enterprise Value Notes Applied Materials Acquisition of HCT $483 million HCT makes wafer-slicing equipment Applied Materials Acquisition of Baccini $334 million Baccini makes traditional silicon wafer metallization equipment based on silver paste Centrotherm PV Acquisition of CTTS 137 million Centrotherm acquired sister furnace company. 18X EBITDA, 1.3X Sales. GT Solar, IPO $420 million GT produces ingot manufacturing equipment and is a turn-key equipment supplier to silicon cell producers. Strong Exits Are Possible For Solar Equipment Companies The Solar Equipment Market Is Poised For Growth

10 CONFIDENTIAL 10 Why Baker Solar: Strong Wet-Process Equipment Legacy & Design Improvements Will Fuel Strong Growth We produce wet-process equipment used to make solar cells & panels Wet process is about 20% of solar equipment market, $500 Million/year Our products and technologies cover all solar wet-chemistries Focus is on high-end, high-volume productivity enhancing in-line tools Cleaning, Etching, Texturing, & Electroless plating for metallization Reduce wafer breakage & chemical consumption, increase process consistency One of three vendors worldwide with significant in-line experience We spun-out from M.E. Baker, easing market entry M.E. Baker has a deep design archive, technical capabilities, and know-how from 80 years producing wet-process equipment Equipment complexity limits others ability to enter market Deep relationships with major chemical suppliers allow for immediate co-marketing We are raising the bar in wet-process Improved wafer guides improve process yield and are patentable Many small improvements and design refinements also increase equipment productivity and decrease operating costs All M.E. Baker Intellectual Property has been transferred to Baker Solar New processes for texturing & metallization will improve cell efficiency

11 CONFIDENTIAL Horizontal Wet-Process Tool Details Modular design & construction Fast design & build cycle Conveyor process widths from 650 to 1550mm Standard Polypro tank construction Reinforced tanks and Kynar construction available for high-temperature operation All plastic construction available for Solar applications Multiple substrate handling options Discrete devices Cut-sheet foils & films Roll-to-roll foils & films Each system is designed and built to customer needs Throughput based on process needs Process dwell times determine length of tool & speed Typical max speeds of 3 m/min, infinitely adjustable Slower speeds reduce length of tool for same dwell time

12 CONFIDENTIAL 12 Baker Solar Offers Advantages To Solar Factories Low cost of ownership High grade of standardization Low/no adjustments needed during preventive maintenance Low chemical consumption Flexible modular designs Quickly & efficiently built to customers chemistries High-speed systems improve throughput Patentable guide system improvements fish-scale horizontal guides touchless vertical control in flood zones

13 CONFIDENTIAL 13 Baker Solar In-line Process Development Systems LabTool: Lab-scale etch & rinse system Two lanes One primary process chamber Usually setup for spray-processing for wet-etching Spray station followed by cascading-rinse & drier Near production speeds, fewer lanes than full production system FlexTool: Modular process development system Two primary process chambers First chamber usually spray-processing with cascading rinse Second chamber is flood station with 2X dwell time of spray chamber Two-stage cascade rinse with fluid-head drier Inspection station between modules allows for single-station processing by either station Conveyor delivered with 3 lane wide conveyor, but with only two-lane guides installed Low cost retro-fit for future wafer size changes Etching, texturing, electroless development, test, & optimization Plumbing designed for quick-chemistry changeovers Sumps can be designed for quick swap-out

14 CONFIDENTIAL We Are The Leader In Flexible-Substrate, Roll-to-Roll Wet Process Systems Proprietary Roll-to-Roll processing systems for flexible substrates: Cleaning Etching / surface preparation Coating Plating Developing & resist stripping Very high-volume systems for demanding applications: worldwide equipment supplier for 3M inkjet circuit production Very high performance systems: Vertical tools orient web vertically to minimize gravity based contamination Wide range of web-handling experiences in horizontal & vertical tools, webs to 1550 mm wide System control & fluid handling delivers very-high performance processing with very fine pitch and precise plating thicknesses

15 CONFIDENTIAL Baker High-Performance Vertical Roll-to-Roll Plater Simplified Schematic Rectifier Unwind Wind Powered bandolier moves conductive fingers at same speed as web Conductive fingers automatically clip & unclip to top of web Wind/Unwind stands move web through system and maintain tension Anode Cathode Cathode current flows through fingertips to web, anodes in process tank Process tanks have wide entry & exit slots which allows some solution to leak out, only solution touches web inside tool Overflow solution is captured and returned to sump In-tank chemistry is constantly re- cycled and distributed in-tank with flood bars Web temp controlled in each section by heating & cooling process solution

16 CONFIDENTIAL 16 Eric Roiter: President, Baker Solar BA with Honors, Economics Williams College Board of Directors, IPC Suppliers Council (Chicago, IL) 2007 – present Negotiated and closed exclusive distribution arrangement with WKK International for representation in Asia, 2006 Negotiated and closed two M.E. Baker acquisitions, 2002 – 2006 Peter dEntremont: Director of Corporate Development, Baker Solar BSME UVA, MBA with Highest Distinction from the Amos Tuck School of Business at Dartmouth Senior Associate at Watermill Advisors, responsible for market research, strategy development, management and execution for Watermills Advisory mandates, 2003 – 2008 Held operational and strategic roles in private equity backed companies for more than 12 years, 1991 – 2003 Significant operational experience implementing operational and strategic plans Stephen Roiter: President, M.E. Baker Company 20+ Years as President of M.E. Baker BSEE Tufts, MBA University of Chicago National Board Member, Metal Finishing Suppliers Association Past President & Board of Governors, Longwood Cricket Club, Brookline, MA Michael Chilson: General Manager, M.E. Baker Company BSBA Eastern Nazarene College, MBA Franklin Pierce College Engineering & Operations management experience includes senior positions at Wang Laboratories, Parlex Corp., Unitrode Inc., Gould Inc. Product, Business Development and General Manager at MacDermid Equipment Colonel, Field Artillery Massachusetts Army National Guard (30 years – retired reserve) Our Management Team Has Deep Industry Experience

17 CONFIDENTIAL 17 Progress To Date: We Have Hit The Ground Running We have accepted orders from multiple solar companies Evergreen Solar: $400,000 pilot-scale silicon etch tool Early-stage new technology company: flexible substrate plating tool Alta Devices: $350,000 multi-purpose inline processing tool Equity Solar: $250,000 multi-purpose inline processing tool We have established marketing partnerships MacDermid Chemical Company: co-marketing program MacDermid will market our tools alongside their solar chemicals Initial focus on electroless nickel and silver metallization systems Signed confidentiality agreement with WKK International for solar applications in Asia WKK is M.E. Bakers Asian distributor & trading agent GT Solar: Preferred Supplier of inline wafer cleaning tools We are currently discussing potential projects with 1366 Technologies, XSunX, Taconic These capital-limited new technology companies are developing improved processing techniques for silicon-solar-cells resulting in less-expensive, more efficient cells Going slowly in this market until our wet-test system is ready for use Wet-test will offer unique opportunity to these partners to prove new technologies in real-life conditions

18 CONFIDENTIAL 18 Summary: Baker Solar Is Building The Next Great Solar Equipment Company Baker Solar is ready to profit from solars strong production growth curve Proprietary technologies Industry experts engaged Partnerships begun with GT Solar, Dow Chemical, and MacDermid Chemical Initial products are here today, orders have already been taken Ongoing discussions with several large potential customers who need improved equipment and new suppliers Baker will offer improved systems Next step is to build demonstration systems to prove to market etching, texturing, and metallization capabilities and unlock orders Designs are in-process We are working with leading solar producers to outfit their next factories Improved equipment, costs, & processes will make our customers more competitive as the market grows & matures

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