Meridian Bioenergy iss in the right place

p at the right
r time witth the right ““green” techn
nology.

Meridian is sponsoringg a renewablee energy inveestment oppoortunity. Althhough the com mpany will seeek to
optimize shareholder value
v by exploiting all avaailable governnment incentiives, its businness model is NOT
based on such subsidies – unlike other
o alternattive energy vventures todayy that dependd upon them to be
economiccally viable.

Meridian proposes to raise $18.0 million of eq quity capital with the objbjective to deevelop 3 operating
facilities within 5 yeaars with a po otential enterrprise value tto exceed $5500 million. The venturee will
contributee to the buildiing of a green
ner economy byb utilizing ann abundant, nnearly untapped energy ressource
– food waaste that woulld otherwise beb disposed ofo in landfills,, processed inn wastewater treatment plaants or
used for composting.
c

Through a proven and d advanced foorm of Anaerrobic Digestioon (AD) – a technology thhat has existeed for
more than
n 200 years and
a currently y used extenssively throughhout Europe and Asia – M Meridian prooduces
biogas (m
methane) from m decaying, biodegradab ble organic m matter. This biogas is prrocessed andd sold
commerciially as renew
wable natural gas
g or used too fuel generattors that produuce electricityy.

The Meridian process produces meethane and a marketable oorganic soil cconditioner, w with only CO
O2 and
treated waater created as
a “waste prodducts”. The environmenta
e ally insignificcant levels of CO2 produceed are
released into
i the atmoosphere and the treated water
w can be used as irriggation qualitty “gray wateer” or
discharged into municiipal sewers att acceptable environmentall levels.

Meridian has chosen Houston forr the locatio on of its firsst renewable energy faciility. The plaant is
anticipateed to be commmissioned annd operationaal in the thirrd or fourth qquarter of 20011, with plaans to
produce 2.0
2 million sccf/d (Standard
d Cubic Feet per Day) of pipeline quallity natural gaas. The com mpany
has land sufficient
s to more
m than dou
uble productio
on capacity.

Because of o the gas, altthough identiical in chemiical composition to

o the renewaable energy cllassification of
conventio
onal natural gas,
g the bioggas has “Greeen Attributess” that comm mand a signifficant premiuum to
conventio
onal natural gas
g prices. Th his “green gass” is sold to mmunicipalities, utilities annd other consuumers
and deliveered through contracted caapacity on exiisting natural gas pipeliness.

Meridian Bioenergy, In nc., a Texas “C”

“ Corporattion, has auth orized 1,000,,000 shares of Stock (withh a par
value of $0.001
$ per shhare) consistiing of 600,00
00 of Class A common (ffull voting shhares) and 4000,000
shares of Class B prefferred (limiteed voting shaares). The C Class B preferrred shares shhall have onlly the
limited vooting rights provided
p in th
he shareholdeers’ agreemennt. The propposed offerinng provides fo
for the
company to sell the 40 00,000 sharess of Class B preferred stoock. A $1 mmillion investmment will purrchase
22,222 shhares of Classs B preferred d equating to a 2.222% ow wnership in M
Meridian. Alll 600,000 shaare of
Class A Common
C stocck are owned by the Core Principals off Meridian annd will not be offered for ssale at
this time. Eric Spenceer, a Core Prin ncipal and Meember of the Board of Dirrectors, has puurchased 11,1111 of
Class B prreferred (Non nvoting) sharees.

Although Meridian can’t offer tax advice, the Company

C bellieves that it qualifies as a “Qualified Small
Business”” (a “QSB”) under
u n 1202 of the Internal Reveenue Code. A
Section As a QSB, acccording to Seection
1202 of th
he Internal Reevenue Code,, as modified by certain prrovisions conttained within H.R. 5297 annd the
recently passed
p “Tax Relief,
R Unem
mployment Inssurance Reauuthorization, aand Job Creation Act of 22010”;
gains from
m the sale off stock in Merridian purchaased prior to JJanuary 1, 20012 and held for a minimuum of
five (5) years,
y will not be subject to
t tax under capital gainss or regular fe federal incomme tax or under the

Introd
duction - Pagee 1
federal altternative minimum tax, su
ubject to the liimitations sett forth in the A
Act. Any stocck sold prior to the
minimum m 5 year holdin ng period will be subject to
o the then preevailing capitaal gains rate.

Two finan ncial models are presented ncial plan secction of this ppackage. Sccenario #1 is based
d in the finan
upon the most likely business
b moddel – without the inclusionn of any ANY Y governmennt subsidies oof any
kind. Sceenario #2 inco orporates all of
o the assump ptions of Scennario #1 in adddition to a revenue stream
m from
a little kn
nown Federal Feedstock In ncentive proggram that waas renewed annd extended tthrough the eend of
2011 in th he recently paassed “Tax Reelief, Unemplloyment Insuurance Reauthhorization, andd Job Creatioon Act
of 2010”. Both Scenaarios assume that t 100% off the capital neeeds for the cconstruction aand commissiioning
of the firsst facility in Houston,
H Texaas are supplied by the $18..0 million in eequity raised through the ssale of
Class B preferred
p stocck, with the funding
f requiired for the eexpansion intto the secondd and third faacility
coming frrom a combin nation of interrnally generatted cash and cconventional debt vehicless. All earninggs are
retained to fund futuree growth and no dividend distributions are anticipateed during thee first five yeears of
operationss.

S
Sensitivity A
Analysis - IRR
R & Investo
or Profit Ana
alysis
Scen
nario #1 - Natural Gas, Electricity & Soil Amen ndment Salees - Without Federal
Feeedstock Inccentive Reveenues - Threee Plant Opeeration
Assume Sale at the
t end of Fiive Years
Value @ Sale
S Based On
O Variablee PE Multiplles

PE Multip
ple - Ongoing Operations
O 20.00 30.00 40.00 50.00
0
PE Multip
ple - Federal Feeedstock Incen
ntive 10.00 15.00 20.00 25.00
0
Net Sales
S Proceeds - Ongoing Operaations 223,8
853,459 342,480
0,716 461,107,9
974 579,735,232
2
Net Sales
S Proceeds - Federal Feedsttock Incentive 0 0 0 0
Plus Deposits & Recceivables 8,6
628,849 8,628
8,849 8,628,8
849 8,628,849
9
Total Net Salees Proceeds 232,4
482,337 351,109
9,610 469,736,8
883 588,364,156
6
Net Investor
I Profit (M
Month 60) 96,5
592,923 144,043
3,826 191,494,7
729 238,945,632
2
Interrnal Rate Of Retturn to Investor 37.60% 44
4.76% 50.10% 54.37%
%
Net Investor
I Profit Per
P $1.0 Million Invested
I 5,3
366,273 8,002
2,435 10,638,5
596 13,274,757
7

S
Sensitivity A
Analysis - IR
RR & Investo
or Profit An
nalysis
Scenariio #2 - Naturral Gas, Eleectricity & Soil
S Amendm ment Sales - Plus Federral Feedstock
Incentiv
ve Revenues - Three Plaant Operatio
on
Assuume Sale at the
t end of Five
F Years
Value @ Sale Based On Variable PE Multip ples

PE Multip
ple - Ongoing Operations
O 20.00 30.00
3 40
0.00 50.0
00
PE Multip
ple - Federal Feeedstock Incen
ntive 10.00 1
15.00 20
0.00 25.0
00
Net Sales Proceeds - Ongoing Operations 242,,633,855 361,26
61,113 479,888,,371 598,515,62
29
Net Sales Proceeds - Federal Feedsttock Incentive 106,,248,279 159,37
72,418 212,496,,557 265,620,69
97
Plus Deposits & Recceivables 8,,628,849 8,62
28,849 8,628,,849 8,628,84
49
Total Net Salees Proceeds 357,,511,013 529,26
62,425 701,013,,837 872,765,24
49
Net Investor
I Profit (Month 60) 146,,604,393 215,30
04,952 284,005,,511 352,706,07
70
Interrnal Rate Of Retturn to Investor 45.09% 5
52.35% 57.75% 62.05
5%
Net Investor
I Profit Per
P $1.0 Million Invested
I 8,,144,689 11,96
61,386 15,778,,084 19,594,78
82

Introd
duction - Pagee 2