Toll Compounding

1. Toll Compounding A Vital Link In The Raw Material Supply Chain

2. The Plastics Industry----Dynamic and Ever Changing

3. The Plastics Industry----Dynamic and Ever Changing • Resin suppliers are going back to their core competencies

4. The Plastics Industry----Dynamic and Ever Changing • Resin suppliers are going back to their core competencies • Fewer and fewer end use materials can be engineered in the reactor

5. The Plastics Industry----Dynamic and Ever Changing • Resin suppliers have been, and continue to, go back to their core competencies • Fewer and fewer materials can be engineered in the reactor • The marketplace continues to demand an increasing number of unique materials

6. The Plastics Industry----Dynamic and Ever Changing • Resin suppliers have been, and continue to, go back to their core competencies • Fewer and fewer materials can be engineered in the reactor • The marketplace continues to demand an increasing number of unique materials • The market is growing!

7. Let’s Understand The Magnitude Of The Market(s) We Play In

8. Let’s Understand The Magnitude Of The Market(s) We Play In • In 1999 overall thermoplastic demand was in excess of 77 Billion pounds

9. The Overall Market Demand (billion pounds) Material1994199920042009 Eng. Plastics 2.1 3.4 4.3 5.5 HDPE 10.7 13.8 16.8 20.0 LDPE 12.3 14.6 17.2 20.0 Polypro 8.9 13.0 16.5 20.7 Polystyrene 5.6 6.3 7.1 8.0 PVC 10.0 13.0 15.5 18.3 TPE’s .8 1.1 1.5 2.0 Others 9.1 12.2 14.2 16.2 Total Demand 59.5 77.4 93.2 110.7

10. Let’s Understand The Magnitude Of The Market(s) We Play In • In 1999 overall thermoplastic demand was in excess of 77 Billion pounds • Independent compounders provided over 6 Billion of those pounds (8%)

11. Demand Supplied ByIndependent Compounders (million pounds) Material1994199920042009 Eng. Plastics 930 1305 1645 2050 Polyethylene 825 1050 1270 1500 Polypropylene 715 970 1225 1510 Polystyrene 351 395 450 510 PVC 1365 1785 2155 2570 TPE’s 405 600 835 1160 Total Demand 4591 6105 7580 9300

12. Let’s Understand The Magnitude Of The Market(s) We Play In • In 1999 overall thermoplastic demand was in excess of 77 Billion pounds • Independent compounders provided over 6 Billion of those pounds (8%) • Growth for independent compounders between 1994 and 1999 was about 5.9% • Growth between 1999 and 2004 is forecasted to be 4.4% • Engineered thermoplastics are forecasted to grow at 4.7%

13. Growth Rates:Independent Compounders (million pounds) Mat’l199419992004200999/9404/99 ETP’s 930 1305 1645 2050 7.0% 4.7% PE 825 1050 1270 1500 4.9% 3.9% PVC 1365 1785 2155 2570 5.5% 3.8% Others 1471 1965 2510 3180 6.0% 5.0% Total 4591 6105 7580 9300 5.9% 4.4% GDP 7338 8848 10030 11430 3.8% 2.5% (bill $)

14. Material/Product Needs Of The Market Are Being Filled By:

15. Material/Product Needs Of The Market Are Being Filled By: Captive Compounding Operations

16. Material/Product Needs Of The Market Are Being Filled By: Captive Compounding Operations Custom Compounders

17. Material/Product Needs Of The Market Are Being Filled By: Captive Compounding Operations Custom Compounders Processor Owned Compounders

18. Material/Product Needs Of The Market Are Being Filled By: Captive Compounding Operations Custom Compounders Processor Owned Compounders Toll Compounders

19. The Role Each Plays In The Supply Chain Captive Compounder Resin Manufacturer Toll Compounder Concentrate Supplier Additive Supplier Custom Compounder Processor Processor Owned Cmpd.

20. Focus On Toll Compounding Concerns, Issues, Myths—Are they valid? Is there a stigma attached to what we do?

21. Focus On Toll Compounding Concerns, Issues, Myths—Are they valid? There are small tollers and there are large tollers Barriers to entry are minimal Some are professional----some are “garage shops”

22. Are Toll Compounders “Poor Cousins?” • Safety • Quality • Technology • Confidentiality/Integrity • Logistical Support • Environment

23. The Fact Is………. • These are the very issues we focus on every day to be the best we can be. • Today, more than ever before, we are • a vital link in the supply chain between • the prime resin supplier and the • market place.

24. The Role We Play In The Supply Chain Resin Manufacturer Toll Compounder Concentrate Supplier Additive Supplier Processor

25. What Makes For A Successful Toll Compounder In Our Industry? What is the Technology we bring? What are the Services we provide? What is the Role we play?

26. Yes, We Bring Conversion Capacity And Services • Compounding • Blending • Drying • Crystallization • Grinding • Packaging • Testing • Warehousing

27. But We Bring More……… First, and foremost, we are a Solution Provider We bring value through assisting our customers solve their customers’ problems. Their customers are our first priority.

28. And More………….. We provide on going, consistent, high quality products and services With an eye towards continual Improvement.

29. And More………… • A Commitment To HSE: • To the health and safety of • our Associates • To care for the environment

30. Market Survey: Customers’ Expectations Of Their Toll Compounders Proactive & Honest Communications Strict Customer Confidentiality Logistical Capabilities Consistent Quality What Customers Want On-Time Delivery High Yields Materials Management Production Capacity Trust-Centered Relationships e-Commerce; Ease of Doing Business

31. Our Business Model: Maximizing Your Business By Design Partnership Maximization Shared Vision High Performance Assurance Open Communications Customer Visits Clear Expectations Quality Audits Performance Maximization Process Maximization Continuous Improvement Quality Plan Collaborative Solutions

32. In Summary

33. In Summary We build a long term strategic relationship. We provide more than just a tactical solution to a short term problem.

34. In Summary We manage our customers logistics to make the Partnership “hassle free.”

35. In Summary • Professionalism • Competency • Safety of our Associates • Care for the environment • Confidentiality