Joint Venture to Convert Biomass to Ethanol

DDS Technologies USA signed a joint venture arrangement with Xethanol Corporation in the emerging biomass-to-ethanol industry.

Boca Raton, Florida, July 23, 2003 [] “Our joint venture with Xethanol represents a significant opportunity for DDS to capitalize on the growing market for ethanol as a clean alternative fuel source,” said Ben Marcovitch, Chairman and CEO of DDS Technologies. “We are confident in our ability to establish additional revenue generating agreements with leading companies within the agricultural and other industries as we continue to implement our strategic growth plan and expand the company. We look forward to working with Xethanol in a mutually beneficial relationship.” Under the terms of the ten-year renewable joint venture arrangement, DDS will utilize its proprietary technology process to convert municipal solid waste and other organic waste matters into starch and other consumable nutrients. The starch will be converted into fermentable sugar and used in the process of making ethanol. Ethanol is a federally mandated, clean burning and renewable fuel used as an oxygenate in 10 percent gasoline blends under the Clean Air Act and an octane enhancer to improve vehicle performance. It is the closest proxy for gasoline as a gas-extender (gasohol) with nationwide distribution in place. “The rationale supporting the DDS-Xethanol alliance is compelling. Prior to DDS, there were no viable low operating cost recovery technologies for the sugars trapped within waste concentrations,” said Chris d’Arnaud-Taylor, President of Xethanol. “The DDS-Xethanol alliance will provide a seamless technology and project development platform for processing multiple waste streams into ethanol and other valuable bi-products. After the initial phase, we expect to increase our volume capacity production requiring additional DDS units as we penetrate the market for processing additional waste streams including municipal solid waste.” The initial phase of the joint venture calls for the processing of approximately 40 tons of biomass waste per day, per machine. Based on this capacity, DDS anticipates that a minimum of four machines will be required initially. DDS estimates to generate gross revenues of approximately US$5 million annually from the sale of ethanol and the other consumable nutrients. The memorandum of understanding is subject to executing a final definitive joint venture agreement within approximately 60 days.

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