BLUGLASS LIMITED — Investor Presentation 2012

Jul 1, 2012

BLUGLASS PRESENTATION – JULY 2012 WWW.BLUGLASS.COM.AU

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DISCLAIMER
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• This document has been prepared by BluGlass Limited to provide existing and prospective investors in BluGlass Limited with a summary of progress to date.

• Any statements, opinions, or other material contained in this document do not constitute any commitments, representations or warranties by BluGlass Limited or/and associated entities or its directors, agents and employees. Except as required by law, and only to the extent so required, directors, agents and employees of BluGlass Limited shall in no way be liable to any person or body for any loss, claim, demand, damages, costs or expenses of whatsoever nature arising in any way out of, or in connection with, the information contained in this document.

• This document includes certain information which reflects various assumptions. The assumptions may or may not prove to be correct. Recipients of the document must make their own independent investigations, consideration and evaluations prior to making any decisions to invest in the Company.

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EXECUTIVE SUMMARY
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• BluGlass has patented processes for exploiting Remote Plasma

• Breakthrough Chemical Vapour Deposition (RPCVD)

• ✓ Technology  Applicable to several large end markets

• Superior performance potential for LED and PV devices enabled

• Performance and through BluGlass’ unique lower temperature process

• ✓ Cost Advantages  Cost and scalability benefits

• LED market grew from $11.3B in 2010 to $12.5B in 2011. Demand

• Rapidly Growing for LEDs in lighting market grew 44% to $1.8B in 2011[1.] 

• ✓ End Markets Concentrated Photovoltaic (CPV) solar cell market expanding to 1.5GW by 2015[2. ]

• JV with SPTS Technologies (global semiconductor equipment

• Key Partnerships provider)

• ✓  Significant Australian Government grants

• RPCVD technology approaches commercialisation

• Progressing Next steps for the company: -

• towards Produce commercial quality material

• ✓ - Produce market leading material

• commercialisation - Customer site for demonstration and testing

• Source: Strategies Unlimited March 2012 2.Source: 2010-2015 CPV Consortium 2010 Report

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RECENT ANNOUNCEMENTS
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TEM IMAGE AT INTERMEDIATE MAGNIFICATION

RPCVD GaN layer

 BluGlass produces high quality crystalline GaN films using low temperature RPCVD

Independent Expert verification of film quality

MOCVD GaN layer

As shown in the transmission electron microscopy (TEM) image, both the MOCVD and low temperature RPCVD GaN layers (dark grey layers) are of equal quality, i.e. both have a low defect density and good crystalline quality

 The achievement of high quality crystalline GaN films grown at low temperature on commercial MOCVD GaN templates is the result of a significant reduction of the ‘defect density’ in RPCVD GaN material

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LOW DEFECT DENSITY RPCVD GAN
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BluGlass has made inroads towards proving the commercial potential of RPCVD

• Significant progress towards minimising impurities to within industry acceptable ranges

• The crystal quality is a dramatic improvement for RPCVD; and is largely due to the reduction of impurities incorporated into the GaN layer during growth

TEM IMAGE AT LOW MAGNIFICATION Cap layer RPCVD GaN Interface MOCVD GaN template

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CONTENTS
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• BLUGLASS OVERVIEW  Fast Facts

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• Virtual Tour

• A Platform Technology

• THE LED OPPORTUNTITY 10

• A Low Temperature Process

• Target Market Features

• Equipment Market

• THE SOLAR OPPORTUNITY  What is CPV

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• Why InGaN CPV

• Why RPCVD for InGaN CPV

• Target Market Features

• ROADMAP and HIGHLIGHTS

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• Roadmap to Market

• Investment Highlights

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VIRTUAL TOUR
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FAST FACTS
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A PLATFORM TECHNOLOGY
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RPCVD TOOL

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LED OPPORTUNITY

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POTENTIAL VALUE PROPOSITION
OF A LOW TEMPERATURE PROCESS
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Low temperature process ✓

✓

Potential performance advantages

✓

Low cost inputs

✓

Substrate flexibility High potential for scalability

✓

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PERFORMANCE
ADVANTAGES FOR LED
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A low temperature growth system such as RPCVD offers LED manufacturers compelling performance advantages at several stages of device growth

LED STRUCTURE GROWN USING MOCVD

BENEFITS OF RPCVD GROWTH

p-GaN grown at high temperature

Multi-Quantum-Well InGaN layer, the ACTIVE REGION of an LED - grown at lower temperature

n-GaN grown at high temperature

The higher temperature growth of the p-GaN top layer can cause some of Indium to diffuse out of the active MQW layer and reduce the LEDs light performance. MOCVD cannot effectively grow quality p-GaN at lower temperatures RPCVD has great potential to improve device performance simply by growing a low temperature p-GaN layer which in turn improves the stability of the InGaN layer during fabrication

GaN grown at high temperature

Substrate

A second potential for RPCVD is the growth of high quality InGaN MQW layers at lower temperatures than MOCVD The RPCVD process could enable Indium rich MQW layers necessary for green LEDs and also for PV devices

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TARGET MARKET FEATURES
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• BluGlass is targeting the high value / high margin LED equipment market

MOCVD UNITS SHIPPED

• US$6.1Billion opportunity through to the end of the decade[1 ]

• Veeco estimates ~400-800 machines shipped annually for LEDs to 2016[2 ]

• Two global (NASDAQ) MOCVD companies hold +95% of the market

• Veeco (US) (market cap US$1.32B[3] )

• Aixtron (Germany) (market cap US$1.48B[3] )

• High gross margins with tools selling ~US$2M system purchase price

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e e
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• This market is driven by the rapidly expanding LED lighting market

Notes: 1). Yolé Developpement III-V Epitaxy Equipment and Application Market Report 2012 2). Veeco Investor Presentation June 2012 3). As at 13 June 2012 ; Chart Source: B Riley and Co 2012

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EQUIPMENT MARKET SHARE
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The MOCVD market is highly concentrated and is currently dominated by two key players: Aixtron of Germany and Veeco of the USA

EQUIPMENT MARKET SHARE

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Source: IMS Research Quarterly GaN LED Supply and Demand Report March 2012

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MARKET DRIVER
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“With the LED TV backlight market slowing, and the general lighting market yet to take off, LED makers are looking to all sorts of innovative ways to improve cost and performance to drive adoption — from disruptive new technologies to incremental improvements to manufacturing yield” - Paula Doe, SEMI Emerging Markets 2012

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• LED sales for lighting jumped 44% in 2011

• This helped push LED sales up 10% to $12.5B in 2011

• The demand for LEDs for general illumination will continue to expand driving 13% CAGR for lighting applications from $1.8B in 2011 - $3.3B in 2016

Chart and Data Source: Strategies Unlimited March 2012

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SOLAR OPPORTUNITY

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WHAT IS CONCENTRATED
PHOTOVOLTAICS?
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• Concentrated

Photovoltaics (CPV) is currently the most effective way to capture and convert large amounts of solar energy

 It works by focusing the suns rays onto a small area of high efficiency solar cell material. The power generated is far greater than an ordinary solar cell

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WHY InGaN FOR CPV?
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RPCVD has great potential to grow high indium content InGaN when compared to MOCVD due

to its low temperature process

✓

High efficiency

→ Efficiencies over 50% possible

✓

BluGlass technology could be ideal for InGaN manufacture

→ → Low temperature High Indium% → possible Scalable process

Single material solution

✓

→ Simpler manufacture when compared to conventional multi-material solar cells

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WHY RPCVD FOR InGaN CPV?
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BLUGLASS TECHNOLOGY

✓

Low temperature process

✓

Performance advantages

✓

Low cost inputs

✓

Substrate flexibility

An InGaN solar cell can be tuned to absorb multiple wave lengths into the cell

InGaN is a single material solution with the potential to be tuned to capture a large spectrum of the solar radiation into a solar cell to achieve better than 50% solar energy conversion

✓

High potential for scalability

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CPV MARKET FORECAST 2010-2015
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Sources: 2007-2009 EPRI; 2010-2015 CPV Consortium 2010 Report

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ROADMAP AND HIGHLIGHTS

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ROADMAP TO MARKET
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INVESTMENT HIGHLIGHTS
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• RPCVD developed in Australia from $35m research investment

• Breakthrough  Significant government support through major grants and tax

• ✓ Technology credits  Superior performance potential for LED and PV devices

• Significant  Enabled through BluGlass’ unique low temperature technology

• ✓ Advantages  Environmental and cost benefits  LED market grew from $11.3B in 2010 to $12.5B in 2011.

• Rapidly Growing End Demand for LEDs in lighting market grew 44% to $1.8B in 2011

• ✓ Markets  Concentrated PV market expected to reach 1.5GW by 2015

• BluGlass formed a JV with SPTS Technologies, a leading

• Key Strategic manufacturer of plasma etch and deposition and thermal

• ✓ Industry Alliance processing equipment for the semiconductor industry

• Achieved high quality crystalline GaN using low temperature

• Demonstrated RPCVD on commercial GaN templates

• ✓ Progress  Substantial reduction of chemical impurities

• Enhanced market access and de-risked technology

• Approaching  Recent technology achievements provide basis for commercial

• ✓ Commercialisation discussions

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BLUGLASS PRESENTATION – JULY 2012