Water Management Solution Reducing Pipe Corrosion and Water Leakage

America’s drinking water system is estimated to face a nearly $11 billion annual shortfall to replace aging facilities near the end of their useful lives.

The 2009 American Water Co. report explains that “new solutions are needed for what amounts to nearly $1 trillion in critical drinking water and wastewater investments over the next two decades.

The Problem
The United States and countries worldwide are facing massive failures in their water and sewer pipe infrastructure.

This corrosion-related failure costs billions of dollars per year to repair or replace. A 2002 Congressional study stated that water and waste water corrosion costs are more than $50.7 billion annually and growing exponentially. Leakage in existing pipe infrastructure accounts for approximately 15% of current water bills.

Additionally, current methods for repair and/or replacement of the pipes are both expensive and unsafe — in violation of current OSHA regulations. (See OSHA letter dated 7/22/2010.)

The Solution
The Bevel-Sert, designed and patented by Infra-Tect, when utilized to connect infrastructure pipes, specifically addresses the corrosion and safety issues as well as water leakage.

This product is designed to make the pipe joint electrically discontinuous, thereby reducing the corrosion rate to less than 10% of current rates. This effectively extends the useful life of water and sewage pipes up to eleven times longer than their current lifespan. In addition, the Bevel-Sert provides an improved seal for pipe connections, effectively reducing leakage at the pipe connections.

The current methodology in the construction or repair community is to take a gas-powered cut-off saw and grind a bevel onto the end of the pipe. This practice is in violation of current OSHA guidelines, which means every municipality, water, or sewer company and contractor must now either engage in dangerous (OSHA prohibited), time-consuming bevelling with a hand-held grinder or utilize the Bevel-Sert.

Utilization of the Bevel-Sert is much safer and more cost effective for pipe connections than using a hand-held grinder. The Bevel-Sert product cost is considerably less—approximately 75% less—than utilizing the hand-held grinder and saves substantial time in the installation.

Potential Revenue-Generating Clients
Every municipality, city, town, private water or sewer company in North America is a potential customer of the Bevel-Sert, as well as private contractors, the US Army Corps of Engineers, and main- tenancy providers for water and sewage piping. Expansion of US patents internationally will open global markets.

Sales and Marketing
We plan to build awareness and demand for the Bevel-Sert through articles in trade publications, white papers, online mar- keting, direct mail, trade shows/conferences, and thru Govern- ment agencies. Our target market includes:
• 18,443 cities, towns, villages and other such governing bodies.
• 25 regional and national construction supply companies.
• 5 major ductile iron pipe manufacturers.

Competition
The current competition is the traditional method of bevelling in the industry, i.e., the use of the gas powered cut off saw (used to cut pipe) in an unsafe and now OSHA prohibited method of bevelling the pipe ends. There is an approved grinder which could be utilized for the necessary bevelling but is not currently used due to the cost and time required for the process.

Competitive Advantage
Infra-Tect, with its existing patents and patent-pending appli- cations for the Bevel-Sert, will effectively inhibit competitors from entering this market with any low-cost competitive product which specifically solves all the major industry issues of corrosion mitigation, leakage reduction, safety, and ease of installation.

The practice of grinding a bevel onto a cut piece of pipe with a cut off saw was prohibited by OSHA. The Bevel-Sert is an HDPE bevelled edge that eliminates corrosion and adheres to OSHA standards.

Financial Projections ——— Snapshot
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5
REVENUE $3,469,620 $11,272,800 $25,686,320 $51,372,640 $102,745,280
EXPENSES $3,235,815 $8,535,468 $19,705,350 $36,250,021 $63,766,309
PROFIT $193,464 $2,691,730 $5,895,792 $15,169,372 $39,130,300

EXECUTIVE TEAM
• Steve Wolff: Founder and in- ventor, with 30+ years of ex- perience as a business owner and in construction project management.
• Mike Neill: Successful business owner and thought leader with connections across the Valley.
ADVISORY BOARD
Andy Germer Gerry Craft Geoff Tanham
Kasten Spethmann

STRATEGIC PARTNERS
AWWA
Beltsville Supply NUCA/ AZ-NUCA Tools West Molding

TARGETED PARTNERS
ACIPCO
City of Phoenix
Eugene Water & Electric Board
McWane Pipe
US Pipe
WSSC

FINANCING SOUGHT
$1.5 million in convertible debt

EXIT STRATEGY
Acquisition at appropriate valuation in 7 to10 years.

CONTACT
Mike Neill on Merar for more information. Business plan is available for download by registered investors.

As of this time, there is no direct competing product to the Bevel‐Sert. While the rubber gaskets currently being utilized have the potential to offer the benefit of discontinuity, preventing the ductile iron pipes from touching or preventing the ductile iron pipe from making contact with the metal joint,
(known as “bottoming out”), is extremely difficult to accomplish and contractors don’t even attempt to address this issue during the installation process.

See attached Business Plan for more details and further analysis.

After identifying and analysing the Bevel‐Sert market, determining the amount of capital necessary to effectively pursue this market, and projecting the potential revenue stream that Infra‐Tect could capture by capitalizing on its current competitive advantage and aggressively pursuing the existing market, Infra‐Tect believes that utilizing outside capital is the financially prudent path to pursue, and is the path which will offer greatest financial return to both the Company and a debt or equity investor.

Infra‐Tect is seeking an outside capital in the amount of $1.5 million. Ideally, this capital would be in the form of a convertible debenture, with the term, interest rate and conversion feature open for discussion.

See attached Business Plan for more details and "Use of Funds" breakdown.

See attached Business Plan for the "Opportunity For the Investor" information. Proforma's are available on Demand.