Notes from Natcore AGM

Great summary of the AGM that Natcore from a respected IH poster, JB3729..


Notes from Natcore's AGM Natcore was represented by Chuck Provini(CEO), Brien Lundin(Chairman), and Tom Scarpa(IR).

We were shown a new slide show and there was a lengthy q&a session. Brien was very active in the discussions. I came away feeling that he is a hands on chairman, board member, and founder. Natcore has 11 patents and 17 patents pending. Most of the patents pending are duplicate patents filed in China. Natcore/China met with the head of the Chinese patent office and were assured that all patents will be honored, provided they are filed by Chinese companies. Natcore/China qualifies as a Chinese company. Provini stated that Natcore will have to have a Chinese partner for their Chinese thin film roll to roll business in order to have patent protection in China.

A US based thin film roll to roll partner is preferred for Natcore's worldwide thin film roll to roll business. At the present time, Natcore has no plans to manufacture the thin film roll to roll or tandem cell panels themselves. Brien Lunden stated that Natcore prefers to have manufacturing experts handle the manufacturing.

Funding ...

Grants from US, state, and local governments are still a possibility. Natcore will not accept low interest loans, as they have no interest in taking on debt. Seed money from Malasyia has already been offered. Chuck and Brien didn't elaborate on this. This may not be a preffered option. Phono Solar has offered to fund all of Natcore's needs. A ballpark offer of $15 - $30 million offered was mentioned. Phono Solar currently has a silicon solar capacity of 500 MW. They plan to double that capacity. Phono Solar is a division of Sumec Group, which is a division of Sinomach, the largest Chinese overseas power plant contractor with sales of $15 billion last year.

The Kodak situation is still unclear. Chuck and Brien wouldn't speculate. However, they do feel that Natcore and Kodak share a very good relationship. Dennis Flood (CTO) told me last week that he thinks Kodak prefers to only commit to the recently announced agreement with Natcore for now. He stated that they are under a great deal of scutiny from institutional investors and aren't in ideal shape financially. It's my opinion that Kodak would prefer to commit closer to the commercial launch of thin film roll to roll. Chuck deferred my future private placement question to Brien. Brien stated that while a future pp can not be entirely ruled out, it's his belief that we have seen the last one. He said if the right investor came along, and the price was right, it would have to be considered. Natcore has the cash from the recent pp, the May warrant conversions, and will recieve more cash from the upcoming September warrant conversions. Money from Natcore's Chinese partners will start flowing in shortly. Provini estimates Natcore's cash burn rate at $125,000 per month including the new lab. Chuck stated that the Kodak agreement saved Natcore millions of dollars in equipment purchases necessary to develop the thin film roll to roll technology. Technology

Update ...

Black silicon passavation and AR coating coming soon. Test results should be in hand in 2-3 months with sales after that. Natcore plans to distribute 1000's of samples to solar manufacturers. Natcore expects solar manufacturers to switch from convential flat wafers to the textured black silicon wafers. Natcore expects output from the black silicon panels to be 20-30% greater than fixed in place convential panels. The output gains come from greater sunlight absorbtion, from different sunlight angles, due to the textured surface. Currently there are 3 potential buyers for the Intelligent LPD Process machines. No elaboration beyond TLNZ Solar. Natcore expects more buyers after the coated black silicon samples go out. It sounded like Natcore thinks they have a big winner here with the passavation and AR coating of black silicon. Natcore's scientists believe that the nanostructured flexible thin film can have a tandem coating eventually. They say this will halve the cost and double the output. Natcore and Kodak are scheduled to start development of the thin film roll to roll in late July.

Chuck stated that Natcore recieves 4-5 calls a week from current and former Kodak engineers that are familiar with Natcore's potential. Some are looking for work, others with ideas regarding applications for Natcore's technology. Natcore is looking to hire a few downsized Kodak employees for their lab. Things should start moving more quickly now with the tandem cell technology. Due to monetary and lab restrictions, only one graduate student at Rice U, under the direction of Dr. Barron, has been actively involved (per Dr. Flood last week). Chuck stated that we should see a proof of concept tandem device in a matter of months. Brien talked about tandem cell commercialization in 20-40 months. Last week, Dr. Flood estimated 24-30 months. Phono Solar and TLNZ Solar are chomping at the bit for tandem cells. Natcore is monitoring the sample Nanoshades in CT. With all else going on, it sounded like NanoShades has been shelved for the time being. Chuck stated that it will be a great product due to its ability to cool (shade) and generate electricity at the same time. Natcore met with MicroTech last week in NJ. Brien stated that the talks were very exciting.

MicroTech stated to Brien and Chuck that even they may not know what they have regarding the potential of the LPD process and the Intelligent LPD Processing machine. One of the slides presented showed the machine. It looked pretty impressive. The machine incorporates devices and procedures that only MicroTech can provide. It has an exclusive lazor device for measuring the thickness of the coating while the wafers are submerged. It has an exclusive powder drying componant (the silicon industry currently uses air drying which steaks the surface). The machine can also determine if particles are growing on each other away from the wafers. When particle growth away from the intended growth on wafers occurs at a predetermined magnitude, it is time to change out the chemical solution. Brien stated that it was decided that MicoTech is going to hold on to the machine for a couple of weeks in order to show it to their clients. MicroTech believes the machines will be a huge seller. Also, Brien stated that MicroTech wants to work as closely with Natcore as Natcore will allow.

Closing remarks ...

The management team stated that they know of no competing technology when I asked them to assess risks. They said that a new, supposedly exciting, technology comes out of universities every week, but none of them are commercially viable. They feel the number one risk to the business is giving away too much in return for backing. They stated that they are working with 800 pound gorillas. The other risk they pointed out was losing focus and drifting into too many projects too soon. Brien stated that eventually there will be so many developed applications and businesses that it will be difficult to manage properly. To avoid this, Natcore plans to spin off businesses to it's shareholders as things progress. JB