and stroked to 9.4 liters for most applications]) multi-fuel engines that will make significant improvements in energy utilization (mpg), reliability, and reduction in CO2 emissions. Energy utilization improvements are initially expected to be on the order of 15-20% and eventually achieve as much as 40-50%. Reducing engine component count through the use of new technologies will increase reliability and improve DyneGen engines by 25% initially and up to 50% ultimately. The reduction in CO2 emissions is estimated to be in the order of 25% to 100%. Getting to 100% CO2 reduction will be achieved through burning the worldâ€:tm:s second most common chemical, NH3, and through new fuels development.

The anticipated product releases utilize the 460 cubic inch displacement (CID) block with over 40,000,000 hours (24x7x52) of runtime in the field. The control systems, valves, injectors and tanks covering the first two product releases are also proven technologies. The technical risk inherent in this plan is only the integration of these proven technologies and the market risk is very low.

The Opportunity There has been, over the last few decades, significant effort in developing internal combustion and turbine engines that will burn anhydrous ammonia. The interest springs from two strategic issues: the dwindling availability of fossil fuels and the price volatility of those fuels. More recently, the development of those engines has been undertaken by major industrial firms such as Case, Caterpillar, John Deere, Cummins, etc. At the same time, significant research has gone into new methods of improving anhydrous ammonia production.

In the case of availability of fossil fuels, oil, in particular, whether or not one subscribes to the peak oil theory that has oil production peaking this decade, the threat of sharp reductions in the supply of oil from global or regional conflict is real. All indications are that the demand (and therefore the price) of oil will resume its long term climb.

Anhydrous ammonia holds significant potential as a fuel and therefore is well suited as an alternative solution to fossil-based fuels.

The assumptions for the DyneGen business plan are: - anhydrous ammonia is and will be competitively priced compared to fossil fuels and - it is readily available in the markets that the venture is selling into.

The advantages of anhydrous ammonia are: - it is ‘greenâ€:tm: on combustion - the potential for virtually unlimited domestic production and - as new technologies for anhydrous ammonia production are developed, some of which will be from renewable sources, the price will be less coupled to that of fossil fuels and therefore will be hedged.

The DyneGen Strategy:

To profitably grow the business organically, using the following plan:

Development:

The focus over the next 12 months is to complete the design and production of a prototype engine. The engine currently under development is a standard 460 cubic inch engine block being modified to use new technology injectors, controls, and a bi-fuel delivery system to allow it to burn natural gas first and then anhydrous ammonia. This engine will demonstrate the technical feasibility of using new technologies that will improve engine efficiency and reduce emissions.

Product commercialization:

The innovations of this engine include the removal and substitution of most of the valve operating mechanics, basically eliminating the components which are leading causes of engine failure. Our American-made ‘flagshipâ€:tm: base engine has been specifically tailored for constant industrial use with changes and enhancements to increase the cooling, oiling, longevity and overall reliability - it is the backbone for our offering. Over 200,000,000 cumulative hours of runtime in the field operating on natural gas - and the control systems, valves, injectors and tanks are proven technologies from over 180,000 units in operation worldwide.

Deployment:

Our initial product release will utilize the time-tested 460 cubic inch displacement (CID) block, bored and stroked to 9.4 liters (573 in3) and operating on natural gas. It will also have the capability to be switched to run on anhydrous ammonia. Domestic natural gas is abundant and a desired alternative to foreign oil and ammonia is commonly used throughout the agricultural/farming industry. Initially, we envision the engines to be deployed as irrigation pump and auxiliary generator drivers. Later plans include engines for over-the-road transportation vehicles.

Management:

While the organizational strategy is to run very lean, critical skills will be added, including additional engineering. The DyneGen senior management team bring together deep experience in engine design and manufacturing, product development, large scale manufacturing and sales and marketing. We average over 20 years of industrial experience.

Investment Highlights:

Industry leader... DyneGenâ€:tm:s engine and engine management system is clearly ahead of the competition — currently estimated at roughly one to two years. The engine is significantly more efficient than conventional ICEâ€:tm:s. All evaluations of the technology, thus far, show development and cost leadership.

Speed to market... DyneGen has a significant lead built in versus the conventional technologies. However, we recognize that there is a compelling need to accelerate the deployment to gain market advantage. To that end, we are working on accelerating the development and commercialization of the units and will have resources specifically allocated for that purpose. DyneGenâ€:tm:s management team is focused on a rapid deployment ‘footprintâ€:tm: through the development of already established, national, dealer networks.

High growth opportunity... The timing of the product and technology could not be better. The new Administration has promoted investment in a wide array of new alternative fuels engines and the interest in an ICE capable of running on anhydrous ammonia is extremely high. DyneGen has a perfect market window with a proven management and engine development team to capitalize on the extraordinary opportunity.

The Efficiencies... Energy utilization improvements are initially expected to be on the order of 15-20% and eventually achieve as much as 40-50% over current technologies. Reducing engine component count through the use of new technologies will increase reliability and improve DyneGen engines by 25% initially and up to 50% ultimately. The reduction in CO2 emissions is estimated to be in the order of 25%, achieving 100% when run on anhydrous ammonia.