Slide 1: November 2020 Investor Presentation
November 2020 Investor Presentation
Slide 2: Disclaimer
2 Disclaimer This presentation (this “Presentation”) is provided for information purposes only and has been prepared to assist interested parties in making their own evaluation with respect to a potential business combination between Roth CH Acquisition I Co . (“ROCH”) and PureCycle Technologies (“P
Slide 3: Disclaimer (Cont.)
3 Disclaimer (Cont.) Financial Information ; Non - GAAP Financial Measures The financial information and data contained in this Presentation is unaudited and does not conform to Regulation S - X . Accordingly, such information and data may not be included in, may be adjusted in or may be presented d
Slide 4: Proposed Transaction Summary
4 Proposed Transaction Summary ▪ PureCycle Technologies LLC (“ PureCycle ” or “PCT”) and Roth CH Acquisition I Co. (“ROCH”) executed a merger agreement to enter into a business combination ▪ Target merger close by Q1 2021 ▪ Post - close, a parent company of PureCycle (“PureCycle Parent”) will be a p
Slide 5: Introducing The Presenters
5 Introducing The Presenters PureCycle Technologies, LLC MICHAEL DEE CHIEF FINANCIAL OFFICER ▪ 23+ years of experience leading and scaling early - stage companies ▪ Seasoned entrepreneur with proven track record of founding, capitalizing start - ups ▪ 10+ years of experience leading transformational
Slide 6: Introducing PureCycle Technologies
Introducing PureCycle Technologies
Slide 7: Seven years of R&D and $100M invested to date
7 Seven years of R&D and $100M invested to date – on track to begin commercial sales in Q4 2022, 10 years after technology development Significant amount of capital raised to fund future plant construction – $250M municipal bond offering, $90 million in equity private placements, and up to $60M conv
Slide 8: History and Background
8 2014 History and Background 2015 2016 2017 2018 2019 Initial P&G development of a unique supercritical fluid extraction process to purify waste PP Koch Modular Process Systems (KMPS) engaged to begin Plant 1 design / engineering Due to strong demand, PureCycle increased planned Plant 1 capacity an
Slide 9: The Current Challenges with Polypropylene (PP)
9 The Current Challenges with Polypropylene (“PP”) 1 OECD May 2018, Improving Markets for Recycled Plastics: Trends, Prospects and Policy Responses (Policy Highlights) Polypropylene doesn’t break down C an remain in our food chain, and in our water streams <1% recycling rate L ess than 1% of PP is c
Slide 10: Less Than 1% of Polypropylene is Recycled
10 155 162 167 173 180 188 196 204 212 221 228 2017A 2018A 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E Despite Representing 28% of the World’s Polymer Demand, Less Than 1% of Polypropylene is Recycled Polypropylene is the Largest Global Market 1 (lbs in bn) Global Polypropylene Demand is G
Slide 11: Global Regulation Against Single-Use Plastics
11 US ▪ California becomes the first U.S. state to implement a partial ban on plastic straws ▪ Seattle becomes the first U.S. city to ban plastic straws and utensils ▪ New York bans all single - use, plastic carryout bags at any point of sale in the state India ▪ Pledge to eliminate all single - use
Slide 12: PureCycle Provides a Solution to a Massive Plastic Waste Problem
12 PureCycle Provides a Solution to a Massive Plastic Waste Problem PureCycle’s Recycling Process Produces Virgin - Quality Resin That is Suitable for High - Value, Food Grade Consumer Products 1 Traditional, Mechanical Recycling Process Virgin Quality Clear Color Near Odorless Food Grade Limited Us
Slide 13: Market Size and Resin Quality
13 Market Size ($B) CAGR (‘18E – ‘22E) PureCycle UPRP Resin Traditional Packaging & Consumer $19 6.6% Electronics & Appliances $10 6.1% Automotive $14 7.1% Building & Construction $9 5.9% Agriculture $2 5.9% PureCycle UPRP is Interchangeable with Virgin Polypropylene Key Polypropylene Resin End Mark
Slide 14: Established and Growing Roster of Global, Blue-Chip Customers
14 Established and Growing Roster of Global, Blue - Chip Customers ▪ Polypropylene is used by industries including consumer packaged goods, electronics, automotive, building & construction and a gri culture ▪ Recycling goals and growing awareness of environmental sustainability require new and innov
Slide 15: Plant Production, License Agreement and Economics Overview
Plant Production, License Agreement and Economics Overview
Slide 16: PureCycle's Process Produces Virgin-Quality PP With Minimal Scaling Risk
16 x All unit operations are well - known and commercially available at scales much larger than required by PureCycle x Physical separation/ specialized solvent - based purification process (no chemical reactions are involved) x Process operating conditions comparable to current polyolefin (PP and P
Slide 17: Global License Agreement in Place with P&G
17 Global License Agreement in Place with P&G ▪ P&G has granted PureCycle a global royalty - bearing license to utilize P&G’s intellectual property ▪ PureCycle has granted P&G a license back to the P&G technology, with a right to sublicense (subject to volume and geographic restrictions) ▪ PureCycle
Slide 18: PureCycle Satisfied Bond Investor Due Diligence
18 Technology Requirements x Technology Validation x Scaling Risk Quantification x Infrastructure Evaluation Commercial Requirements x Proof of Scale Up x 20+ year Feedstock Agreements x 20+ year Offtake Agreements x Independent Evaluation of technology (90+ page public report) Bond Financing Requir
Slide 19: Ironton, Ohio Plant Highlights
19 Ironton, Ohio Plant Highlights ▪ FEU Operational: July 2019 ▪ Phase II Construction Start: October 2020 ▪ First Commercial Sale: 2H 2022 ▪ Site Size: 26 acres ▪ Annual Production: 107M lbs ▪ Purification Process Contractor: Ironton, Ohio Facility (Plant 1) Progress C Feedstock Evaluation Unit A E
Slide 20: Strong Industry Recognition and Strategic Partnerships
20 145 feedstocks evaluated 100 non - solicited online feedstock leads 5 supplier agreements 26 LOIs signed 200 non - solicited online offtake leads 6 long term contracts Our Strong Industry Recognition and Flagship Strategic Partnerships D rive Additional Offtake and Feedstock Opportunities PureCyc
Slide 21: Building a Feedstock Supply Network
21 PureCycle is Building a Feedstock Supply Network, Leveraging the 170B+ Pound Annual PP Global Market Traditional Post Consumer Grassroot Campaigns Existing Plant Contracts Post Industrial Waste ▪ PureCycle’s pre - processing is designed to provide maximum flexibility on feedstock selection and op
Slide 22: Offtake Production Volume Secured for Nearly 2x Plant 1 Output
22 Volume (in Millions of Pounds) Company Min Max (at PCT Option) Initial Term 20 60 7 Years 15 40 3 years; automatic renewal at buyer option for 10 years 28 28 4 years or 8 years at buyer's option 15 15 Perpetual 5 5 20 years 15 15 10 years Total Volume (M) 98 163 Additional Offtake LOIs (M) 99 250
Slide 23: Offtake Pricing De-Linked from Commodity Pricing
23 Offtake Pricing is Increasingly De - Linked to Commodity Pricing, Eliminating the Risk of Potential Volatility in Oil Markets Over Time // // // // PureCycle has been receiving increased interest from customers for its UPRP at a significant premium price to commodity polypropylene pricing 1 Prici
Slide 24: Multiple Contingencies to De-Risk Construction and Operations
24 Multiple Contingencies in Place to De - Risk Construction and Operations Plant 1’s construction, permits, feedstock contracts and offtake agreements are secured De - Risked by PureCycle Technologies Through… Plant 1 Future Plants Financing Secured x Completed municipal debt financing; phase 2 con
Slide 25: Financial Overview
Financial Overview
Slide 26: Global Rollout Strategy: First Wave and Beyond
26 Target Plant 1 Completion Global Rollout Strategy: First Wave and Beyond x 50 - plant total, most of which will follow the cluster strategy x Replicable technology, production process, and construction provides scalable plant rollout Global Rollout Strategy 2020 2021 2022 2023 2030 2035 2019 Init
Slide 27: Plant Construction Rollout
27 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2019 2020 2021 2022 2023 2024 Ironton, OH Annual Plant Capacity: 107M lbs Pre-Planning & Design Work, Infrastructure Europe Annual Plant Capacity: 107M lbs Pre-Planning & Design Work, Infrastructure Cluster 1 (Five Plants) Annua
Slide 28: Process Enables Highly Attractive Economics
28 Plants 1 (107M LBS) 1 Plant 2 (107M LBS) 1 Future 5 Plant Clusters (165 LBS *5 = 825M LBS) 1 Process Enables Highly Attractive Economics PureCycle expects consistent, replicable economics that are more profitable than commodity virgin polypropylene, resulting fr om lower feedstock than traditiona
Slide 29: Financial Projections
29 Financial Projections ($ in millions, except net revenue / lb) FY 2020P FY 2021P FY 2022P FY 2023P FY 2024P FY 2025P FY 2026P FY 2027P Operational Plants - - 1 5 7 10 14 18 Installed Capacity (mm lbs) - - 119 853 1,219 1,769 2,503 3,236 Effective Utilization (at 90% uptime) - - 10% 33% 86% 69% 75
Slide 30: Transaction Overview
Transaction Overview
Slide 31: Sources & Uses and Pro Forma Equity Ownership
31 Shares % ROCH Sponsor 2.2 1.8% SPAC IPO Investors 7.7 6.5% PIPE Investors 25.0 21.1% PureCycle 83.5 70.6% Total 118.3 100.0% Warrants Outstanding Shares Strike ROCH Sponsor 0.2 $11.50 SPAC IPO Investors 5.7 $11.50 Total 5.9 Sources & Uses and Pro Forma Equity Ownership 1 ($ in millions, except SP
Slide 32: Operational and Valuation Benchmarking
32 8.8x 12.5x 12.8x 18.0x 19.1x 18.8x 35.2x 27.3x 13.0x NM NM 55% 29% 29% 31% 22% 26% 48% 30% 22% NM NM 119% 8% 5% 7% 8% 7% 30% 14% 8% 48% 14% Operational and Valuation Benchmarking EBITDA Margin EV / EBITDA Multiple Revenue CAGR % 2023E - 2025E for PureCycle; 2020E - 2022E Median for Peers 2024E fo
Slide 33: Transaction Priced at a Discount to Peer Multiples
33 $7,201 $2,650 $826 $9,002 $3,660 Implied Future Enterprise Value Implied Discounted Enterprise Value Post-Money Enterprise Value Transaction Priced at a Discount to Peer Multiples 8.8x 2024E EBITDA Implied EV Based on Comparable Companies’ Current Trading Valuation Transaction Value Summary of Ap
Slide 34: Sources and Uses of Investment Proceeds
34 Sources and Uses of Investment Proceeds SOURCES AMOUNT Senior Debt $220 Subordinated Debt $30 Convertible Notes $60 Strategic Investments (PCO) $35 Private Placement $60 Total Sources $405 ($ in millions) USES AMOUNT Plant 1 Development $248 Capitalized Interest $55 Debt Service Reserve Fund $21
Slide 35: Significant EBITDA and Highly Attractive Economics
35 Significant EBITDA and Highly Attractive Economics ▪ Expected EBITDA of $450M by 2024 – Going public at a significant valuation discount to Environmental Services and Process Technologies peers Blue Chip Customers, Partners and Strategic Investors ▪ Strong continued interest and broad global awar
Slide 36: Appendix
Appendix
Slide 37: Future Plant Economics
37 Plant 1 (Ironton, Ohio) First European Plant Representative Cluster Plant Five Plant Cluster Production Volume (M lbs) 107 107 165 825 Gross Revenue $97 $107 $165 $825 Average Selling Price ($/lb) $0.90 $1.00 $1.00 $1.00 EBITDA $48 $59 $96 $479 EBITDA/lb $0.45 $0.55 $0.58 $0.58 EBITDA Margin % 50
Slide 38: Universe of Comparable Companies
38 Universe of Comparable Companies Environmental Services x High Barriers to Entry x Stable Growth Rates x Strong Cash Flow Generation Limited Recycling / ESG Traditional, Commoditized Process and Services (~10x – 18x+) Process Technologies x Unique Process, High Barriers x High Value - Added S
Slide 39: Bond Summary – Key Takeaways
39 Bond Summary – Key Takeaways ▪ $250M (Bonds) - PureCycle raised a total of $250M of debt proceeds to support the development of its first plant in Ohio ▪ $153M (Equity) - $53M in Project Contribution; $60M in fresh equity on October 7; $40M in additional equity by January 31, 2021 ▪ Significant i
Slide 40: Traditional Polypropylene Recycling Processes are Challenging
40 Traditional Polypropylene Recycling Processes are Challenging and Have Limited Applications Favorable Characteristics Compared to Traditional Polypropylene Recycling PureCycle UPRP Process Benefits x Physical extraction and purification process uses supercritical fluids and solvents to extract im
Slide 41: Modular Design for Rapid, Efficient Global Deployment and Scaling
41 Modular Design for Rapid, Efficient Global Deployment and Scaling Scalable Modular Development from Feedstock Procurement to Plant Construction Key Global Scaling Criteria PureCycle to capture global market with scalable business model and modular plant infrastructure Plant Design & Construction
Slide 42: PureCycle's Process Independently Validated
42 • Phasex engaged to continue process design • Conducted 100+ process tests to support applications for nine total patents, five of which are granted and four of which are pending • Conducted 300+ optimization tests to form the basis for production plant and FEU design • PureCycle tested and verif
Slide 43: Longstanding Partnership with Procter & Gamble
43 PureCycle’s Longstanding Partnership with Procter & Gamble In August 2017, P&G announced a breakthrough recycling technology that will revolutionize the plastics and recycling industri es Press Release Highlights 1 The Science and Inspiration Behind the Breakthrough Technology 2 1 P&G press relea
Slide 44: Plant Financing Strategy
44 Plant Financing Strategy Future Plant Financing Strategy Illustrative Source of Funds (Assuming 80% Debt / 20% Equity) 1 Cumulative Development Funding (80% Debt / 20% Equity) 3 1 Total Uses excludes $50M of SPAC proceeds for liquidity reserve, and assumes no current ROCH stockholders exercise re
Slide 45: Billions of Pounds of Polypropylene Feedstock Exist in the Market
45 Billions of Pounds of Polypropylene Feedstock Exist in the Market Today Polypropylene feedstock is widely available across industries; most of these feedstocks are untapped by traditional recyclers Flexible and Rigid Packaging Sports and Fashion Medical Applications Consumer Products Automotive &
Slide 46: Plant Construction Team
46 Plant 1 Construction Team Highly credible construction managers led by Mortenson, Koch, and Denham Blythe Owner / Developer Program Manager PROJECT MANAGEMENT OVERSIGHT Independent Engineer PROJECT ANALYSIS CONSTRUCTION MONITORING Inside Battery Limit (ISBL) Outside Battery Limit (OSBL) Owner Sup
Slide 47: The PureCycle Team
47 The PureCycle Team PureCycle Management team has broad experience across plastics manufacturing, plant development, technology, R&D, sales, marketing, accounting and finance MIKE OTWORTH CHIEF EXECUTIVE OFFICER Green Ocean Innovation CHRIS TALAREK SENIOR DIRECTOR, OPERATIONS SCOTT BROWN SENIOR PR
Slide 48: Reconciliation of Non-GAAP Financials
48 Reconciliation of Non - GAAP Financials ($ in millions) FY 2020P FY 2021P FY 2022P FY 2023P FY 2024P FY 2025P FY 2026P FY 2027P Operating Income ($3) ($10) ($15) $69 $375 $505 $801 $1,187 (+) Depreciation & Amortization - - 3 31 75 96 142 192 EBITDA ($3) ($10) ($12) $100 $450 $601 $943 $1,380 (-)