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Excavation Alert Systems, LLC.

Excavation Alert Systems, LLC. Damage Prevention Systems for Buried Infrastructure. Ryan Dunn 660 Hunters Place, STE 102 Charlottesville, VA 22911 ryan.c.dunn@gmail.com 518.312.2443. 3,000 Pipeline Companies: 500,000 mi. Transmission & 2,100,000 mi. Distribution. Growth (Shale):

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Excavation Alert Systems, LLC.

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  1. Excavation Alert Systems, LLC. Damage Prevention Systems for Buried Infrastructure Ryan Dunn 660 Hunters Place, STE 102 Charlottesville, VA 22911 ryan.c.dunn@gmail.com 518.312.2443

  2. 3,000 Pipeline Companies: • 500,000 mi. Transmission & 2,100,000 mi. Distribution • Growth (Shale): • $187B in new pipelines. • 24,400 mi/year transmission. • 50,000 mi/year distribution. • High Consequence Areas (HCAs): • 35,000 miles transmission (7%). • 2,100,000 miles distribution (100%).

  3. PROBLEM: Excavation Damage • Leading cause of significant pipeline incidents. • 2007-2011: 318 incidents • 27 fatalities. • 114 serious injuries. • Cost: $1.9B. • 57% of excavation incidents caused by: • Failure to call a locating service (32%). • Failure to correctly mark utility (25%).

  4. Protocols & Proactive Devices: Passive Visual Indicators: Monitoring and Sensor Systems:

  5. ExcAlertTM SOLUTION: • Directly warns excavation crew, PREVENTING accidents. • Visual (colored smoke). • Sound. • No proactivity required. • New and retrofit installations. • Inexpensive: ~1% of pipeline cost. • Safe for use near natural gas pipelines. • Long life, no maintenance, weatherproof.

  6. Product Details: Sound Producing Diaphragm • PVC Pipe with designed breakpoints. • High longitudinal strength for installation. • Easily broken with excavator shear force. • Clear path to surface for signal when broken. • Small hole diameter required for retrofit. • High effective area when installed at angle. • Easily produced in varying lengths for pipelines at different depths. • Multiple configurations in pending patents: PCT/US2012/071096 Smoke Generator Retrofit Installation Vehicle GPR Image

  7. Innovative Business Model: • How to create a pull in a regulation driven industry? • Create a 5-10 year ROI for pipeline companies. • Strategic relationships with leading pipeline insurance companies to offer reduced premiums on ExcAlertTM protected pipelines. • Utility companies can pass system cost through to rate payers. • Improves “Triple Bottom Line” initiatives: Safety, Health & Environment.

  8. CEO, ElectraWatch, Inc. • Successful product commercialization. • Electrical Engineering & Engineering Management, Dartmouth College. RYAN DUNN FOUNDER & CEO • VA Bar & TX Bar Oil and Gas section. • “Super Lawyer” for IP law, VA Super Lawyers magazine. AV Rated. BRYAN WRIGHT J.D. IP & INDUSTRY EXPERT • 30 years experience in operation and management of IP based companies. • Resident Advisor & Entrepreneurial Mentor, Darden / Batten Institute. • Financial Expert. ROBERT TOBEY C.P.A. OPERATIONS & CFO • Strategic first hire. • Significant experience at major pipeline company. • Leverage experience and connections for business development. MAJOR PIPELINE EMPLOYEE BUSINESS DEVELOPMENT ? INVESTORS & ADVISORS: LEN WOLOWIEC President, Universal Steel America Pipeline Connections in Houston, TX. GEORGE PHILLIPS Senior Vice President, Rutherfoord Pipeline Insurance Industry Expert

  9. Company Information: • Virginia LLC. headquartered in Charlottesville, VA. • $65k in seed funding from founders. • Functional Prototype Stage. • Strong IP (PCT/US2012/071096 - pending). • Initial strategic relationships. Series A - $1.6MM of $3MM Raised: $1.6MM $3MM • Awarded $1.5MM in VA tobacco commission funding on 9/16/13. • Equity capital at significantly below market rates. • Requires $1.5MM in matching funding and manufacturing in VA tobacco region. • $100k Charlottesville based Angel. • Funding Use: • Strategic hires from pipeline industry: Business Development & Sales. • Design improvements: improved performance, mass manufacturing. • Statistical Testing: soil types, freeze thaw cycles, longevity, large test bed. • Working Capital.

  10. BACKUP SLIDES

  11. Commercialization Timeline: VOLUME MANUFACTURING $3MM INVESTMENT SALE OF COMPANY: MONITORING SYSTEM COMPANIES OIL & NATURAL GAS COMPANIES PIPELINE INSTALLATION COMPANIES PIPE PRODUCERS RETROFIT INSTALLATION VEHICLE FINAL DESIGN COMPLETE BUILD TEAM 2013 2014 2015 2016 2017 PHMSA DEMO FORM COMPANY PIPELINE INSTALLATIONS INSURANCE ACCEPTANCE FILE PATENT

  12. Proforma: Projections: Revenue & COGS: • Revenue: • Devices: $30k/mi • Installation: $20k/mi with vehicle • $50k/mi = ~1% of $4MM/mi pipeline cost • COGS: • Devices: $7,450/mi • Installation: $6,786/mi with vehicle • Gross Margins = 72% Sales Example: • 40 mile ExcAlert Installation: • Revenue: $50k/mi * 40mi = $2MM • COGS: $14k/mi * 40mi = $560k • Gross Margin: $1.44MM (72%)

  13. United States Pipeline Market: • 3,000 Pipeline companies. • 2010: $9.7B profit on $31B in revenues. • $930MM annually on preventative technologies. • 500,000 miles of transmission pipelines. • 2,100,000 miles of distribution pipelines. • Target Market: Pipelines in High Consequence Areas (HCAs): • 35,000 miles transmission pipeline (7%). • 2,100,000 miles distribution pipeline (100%). • Target Market Growth (Shale): • $187B investment next 25 years ($7.5B/year). • 24,400 mi/year trans. (1,709 HCA mi/year). • 50,000 mi/year dist. (50,000 HCA mi/year). • Secondary Markets: • 35MM mi of buried infrastructure in U.S. • Power transmission & fiber optic backbone lines. * Use of potential customers trademarks does not indicate a relationship with or sponsorship by the potential customer.

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