“three-track financing plan” ----- as M presented to Mr.

Berick

Mr. Berick,

I understand there is a question concerning how to fund with each of three tracks. Please kindly
allow me to explain:

How do we fund with CREBs?

If you recall you mentioned a Goldman Sachs concept in a prior e-mail. CREBs are a stop-gap for
investors seeking motivation to risk debt or equity capital. The New CREBs offer AMT relief
period (as far as all investors are concerned). They may or may not be awarded so this is a really
“iffy” way to secure project finance. Our MOU anticipates the "squishiness" and prepares more
sure routes as follows:

How do we fund with the for sure method: SBLC finance option?

The USDA RUS or the federal agency FFB (federal financing bank) issues an SBLC (standby letter
of credit) for the interim phase construction of the 17+ plants (that LC spells out in the fine print
no program funds) against the Debt Investor’s collateral (this is a “credit enhancement” for
funds currently on deposit at NYFRB) and commercial banker(s) monetizes that SBLC with actual
dollars to build plant. We have the banker on hold.

When the plant is built and running, after 6 months the FFB/Jefferies/USDA RUS acquires our
WEANS (wholesale electrical anticipation notes) which would be issued under FERC Form 523
authority since public/private business combination is a EWG (exempt wholesale generator)
with MBRA (market based rate authority) that we have certified now from FERC (pool authority
to issue any class of securities). All investors of every class prefer tax exempt cash flow from
investment opportunity.

We are expecting the funding bank’s SBLC draft instrument soon, we will forward it to both
Senators to the USDA RUS (Elgohary and Schultz) and to the FFB (awaiting contact if need be)
and expect your joint involvement to assure one and all that NO PROGRAM FUNDS are required
for pool or project. Under ARRA09, ~USDA RUS can issue an SBLC or the FFB can issue the SBLC,
we have no preference. Which will follow our finance model so that bankers will continue to
fund our pool?

How do we fund our Pooled Financing option?

Bank will repeat our cookie-cutter finance model as proposed involving my debt investor’s
public/private enterprises, so now I anticipate that in order to empower my ability to finance
such with Troutdale and not give up revenue to my debt investor we need a convertible BTU
“depletion allowance” type of security in lieu of investor’s collateral. We can mix CREBs and/or
1603 grants funds and allow FFB or USDA RUS to earn back stimulus money under dNPV model
(Tri-Stone Survey examples) or you can submit any other proposal that makes sense. Your part
in this is to endorse our equal treatment of BTUs as “depletion allowance” eligible (note we are
an extractive industry extracting landfill deposits) and then you have empowered Troutdale and
myself to achieve financing independent of all investors (we pledge forward or future electricity
sales, just as the fossils do now). All investors want AMT tax relief and/or tax exempt income as
inducements to invest in projects or pools. States create pools, such as the one in NY, which
want to capture some spread from the accretion of wholesale to retail pricing (ARC or
aggregator of retail customers ~ dNPV spread). Fossils and timber have had this tax favored
attributes since 1918 (read link below).

Troutdale and the Developer (whose revenue-fates are linked) need the ability to finance
without equity investors. Both are grateful to the Stand-By Debt Investors, but we want what’s
best for our interests, which are the greatest revenue streams possible.

Senator Wyden already supports BTU-parity and has a bill to push through in the last two
months of this year. A simple tweak would cause it to address more than PTC limitations and
the basis of the discrimination against renewable projects, as discussed in this link:

http://www.britannica.com/EBchecked/topic/158261/depletion-allowance

This is available to all coal companies, timber companies and oil companies large to small,
majors or independents. Our public/private venture is the equivalent of an independent energy
concern which needs to motivate debt investors to put up their funds in a pool which “faces the
following obstacles” as the link says:

• Federal tax relief

• State tax relief

• Regional and local tax relief

A triple tax-exempt Oregonian Renewable Developer pool asking you to do right by our
public/private enterprise, which means that renewable projects like ours won’t hop over the
border to Idaho or Canada to chase favorable tax treatment where we are treated better and as
a consequence invest that money over there and hire over there. Your endorsement at
FFB/USDA RUS and down the line will help bring this economic stimulus to Oregon. Troutdale
has to have a TEDA (Troutdale Economic Development Authority) with open access to capital in
order to attract investors, to be competitive with these other better more capable jurisdictions.
Troutdale will have an edge with ZESC technology backed up by a debt investor and that can’t
be wasted.

Jobs for plant workers and jobs for profit center workers are in the lurch:

*greenest brick technology (samples to be provided)

*foamed cellular concrete (video available)

*ceramic tiles (mature industry future development)

On the ensuing letter, please signify funding up to $90 Million/plant. The Treasury knows that
we put in a range for estimated costs of local EPA testing and certification of emissions and final
product streams beyond the initial sales of wholesale electricity (TEDA to expand ARC and build
up local economy).

Thanks for asking for this clarification.