Raser Technologies

modeFinance srlVAT number 01168840328

E-mail: [email protected]: www.modefinance.com

Area Science Park, Padriciano 9934149 Trieste, Italy

Tel: +39 040 3755337Fax: +39 040 3756741

modeFinanceEdificio AAREA Science Park, Padriciano 9934149 TriesteITALY

Tel: +39 040 3755337Fax: +39 040 3756741

mail: [email protected]: www.modefinance.com

Creditworthiness scale

Extremely strong(AAA)Very strong(AA)Good(A)Adequate(BBB)Sufficient(BB)Weak(B)High danger(CCC)Pathological(CC)Extremely pathological(C)Non return(D)Not available

RASER TECHNOLOGIES, INC.Fundamental Credit Rating: CC

Company name RASER TECHNOLOGIES, INC.Identification number US870638510Country United States of AmericaZIP code and city 84604 - PROVOAddress Suite 375Phone +1 801 765 1200Web site www.rasertech.comEmail [email protected] form Not availableAccount ConsolidatedIncorporation date 2003NACE 2 Sector 3511 - Production of electricityListed ListedStatus ActivemF Credit limit Not eligible for credit on the base of the available

informations

31/12/2009 31/12/2008 31/12/2007

Turnover (the) 1,523 124 217

Rating CC C BProbability of default 42.00% 57.00% 3.80%Confidence Level 75% 75% 75%

Solvency ratiosLeverage ratio 8.16 28.31 0.22

Total asset/Total liabilties 1.12 1.04 5.49

Capital StructureFixed Assets coverage ratio 0.95 0.66 1.19

Profitability and economic equilibrium ratiosReturn on investement ROI (%) -6.18 -21.06 -66.21

Return on equity ROE (%) -120.05 -724.50 -80.96




Tel: +39 040 3755337Fax: +39 040 3756741

Sector Analysis

Company Healthy Balanced Vulnerable RiskySolvency ratios

Leverage ratio 8.16 0.52 1.97 3.78 -3.29Total asset/Total liabilties 1.12 2.93 1.51 1.21 0.98

Capital StructureFixed Assets coverage ratio 0.95 1.31 1.04 0.93 0.24

Profitability and economic equilibrium ratiosReturn on investement ROI (%) -6.18 15.43 6.18 1.61 -4.81

Return on equity ROE (%) -120.05 16.52 7.99 -2.12 -79.14Cash Conversion Cycle (days)

Days Sales Of Inventory (DIO) 0 11 14 16 27Days Sales Outstanding (DSO) 56 45 45 28 61

Days Payable Outstanding (DPO) 0 19 27 15 52Cash Conversion Cycle (DIO + DSO - DPO) 56 34 30 24 21Numer of analyzed companies - 522 2,060 1,041 152(Average) Rating CC A BB B CC

The sector has been chosen according to:international companies in the sector NACE 2 3511 with financial data of year 2009.

Page | 2




Tel: +39 040 3755337Fax: +39 040 3756741

Sector Analysis - Graphs

Page | 3




Tel: +39 040 3755337Fax: +39 040 3756741

Balance Sheet

BALANCE SHEET (th e) 31/12/2009 31/12/2008 31/12/2007Accounting practice Local GAAP Local GAAP Local GAAPExchange rate USD - EUR 0.69416 0.71855 0.6793Total assets 107,033 132,231 16,157Fixed assets 81,566 127,007 11,115Intangible fixed assets 970 1,140 350Tangible fixed assets 63,258 69,139 872Other fixed assets 17,339 56,728 9,893

Current assets 25,467 5,224 5,042Stocks 0 0 0Debtors 234 104 352Other current assets 25,233 5,120 4,691Cash & cash equivalent 29 1,103 4,016

Shareholders funds 11,686 4,511 13,214Capital 550 456 380Other shareholders funds 11,136 4,055 12,834Total liabilities 95,347 127,718 2,943Non current liabilities 65,422 79,253 58Long term debt 55,375 57,570 0Other non-current liabilities 10,047 21,684 58

Current liabilities 29,925 48,464 2,885Loans 1,345 1,316 0Creditors 0 0 0Other current liabilities 28,581 47,149 2,885

Total shareh. funds & liab. 107,033 132,229 16,157

NET DEBT (th e) 31/12/2009 31/12/2008 31/12/2007Short term debts 1,345 1,316 0Long term debt 55,375 57,570 0Cash & cash equivalent 29 1,103 4,016

Net debt 56,691 57,783 -4,016

31/12/2009 31/12/2008 31/12/2007Working capital - - -Net Current Assets -4,459 -43,241 2,157

31/12/2009 31/12/2008 31/12/2007Days Sales Of Inventory (DIO) 0 0 0Days Sales Outstanding (DSO) 56 308 591Days Payable Outstanding (DPO) 0 0 0Cash Conversion Cycle (DIO + DSO - DPO) 56 308 591

Page | 4




Tel: +39 040 3755337Fax: +39 040 3756741

Income Statement

INCOME STATEMENT (th e) 31/12/2009 31/12/2008 31/12/2007Accounting practice Local GAAP Local GAAP Local GAAPExchange rate USD - EUR 0.69416 0.71855 0.6793Sales 1,523 124 217Revenues growth (%) 1,132.3 -43.1 -

Other revenues +/- variation in inventories andcontract in progress + Fixed assets own constructioncapitalized

0 0 0

Operating revenue / turnover 1,523 124 217Total operating costs 20,658 27,758 11,404Costs growth (%) 6 58 -

Service costs - - -Material costs - - -Costs of employees - - -

EBITDA -17,347 -17,627 -11,001Depreciation 1,789 10,007 185EBIT -19,135 -27,635 -11,187Financial P/L 4,629 -2,518 489Financial revenue 10,542 295 512Financial expenses 5,913 2,813 22Interest paid 7,890 2,298 1

P/L before tax -14,507 -30,152 -10,698Extr. and other P/L 478 -2,530 0Extr. and other revenue - - -Extr. and other expenses - - -

P/L before tax + Extr. and other P/L -14,029 -32,682 -10,698Taxation 0 0 0P/L for period -14,029 -32,682 -10,698

31/12/2009 31/12/2008 31/12/2007Costs of Good Sold 2,706 -165 240Gross Profit -1,183 288 -23Other Operating Expenses 17,952 27,923 11,164

31/12/2009 31/12/2008 31/12/2007Cash flow -12,240 -22,675 -10,512Added value - - -

31/12/2009 31/12/2008 31/12/2007Number of employees 42 57 40

Page | 5




Tel: +39 040 3755337Fax: +39 040 3756741

Evolutions and trends

Page | 6




Tel: +39 040 3755337Fax: +39 040 3756741

Qualitative information

Full overview Raser Technologies Inc, with registered office address in Provo, is a US - based public com-pany engaged in the production of electrical industrial equipments. It started its business in2003. The firm is specialized in the technology licensing and development of quality electricmotor and controller technology for clean renewable power with focus is on improving the ef-ficiency of rotating electromagnetic and heat transfer applications within the transportation,industrial and power generation markets. Its products and services are used in industrial ACinduction motors and drives, automotive alternators, permanent magnet motors, and inte-grated starter alternators and hybrid - electric and electric vehicle propulsion systems. Raserconducts business in two divisions: Transportation and Industrial Technology, and PowerSystems. In the Transportation and Industrial Technology division, the company providesproducts for improving the efficiency and power density of electric motors, generators, andtheir associated power electronic drives and controls. The Power Systems division producesand operates geothermal electric power generating equipments and bottom - cycling oper-ations that gets electric power from the waste heat of existing power plants and industrialfacilities. Some of its products include Symetron motor technology.

History Not available.

Primary business line Technology licensing and development of quality electric motor and controller technology.

Secondary business line Not available.

Main activity Services; Manufacturing.

Secondary activity Not available.

Main products and services Not available.

Size estimate Not available.

Strategy, organization andpolicy

Not available.

Strategic alliances Not available.

Membership of a network Not available.

Main brand names Symetron.

Main domestic country United States Of America.

Page | 7




Tel: +39 040 3755337Fax: +39 040 3756741

Main foreign countries orregions

Not available.

Main production sites Provo.

Main distribution sites Not available.

Main sales representationsites

Not available.

Main customers Not available.

Auditor/Advisor/Banktype

HEIN & ASSOCIATES Auditor

Boardfunction date of birth nationality

Mr Nicholas Goodman Chairman of the Board, Chief Executive Officer(Finance & Administration)

- United States

Mr Barry G Markowitz Director - -Mr James A Herickhoff Director - -Mr Reynold Roeder Director - -Mr Scott E Doughman Director - -

Sharehoders (the first twenty shareholders ordered by Direct %)

LINDEN ADVISORS LP via its fundsRating: -

Country ISO code US Operating revenue (MIL $) 1NACE Rev. 2, Core code - Total Assets (MIL $) -Direct % - Number of Employees 15Total % 1.42 Information date 2010/12

Page | 8




Tel: +39 040 3755337Fax: +39 040 3756741

FLETCHER INTERNATIONAL LTD.Rating: -

Country ISO code US Operating revenue (MIL $) -NACE Rev. 2, Core code - Total Assets (MIL $) -Direct % 1.25 Number of Employees -Total % - Information date 2010/02

VANGUARD GROUP, INC. THE via its fundsRating: -

Country ISO code US Operating revenue (MIL $) 2,018NACE Rev. 2, Core code - Total Assets (MIL $) 1,830Direct % - Number of Employees 9,500Total % 1.08 Information date 2010/09

CITIGROUP INC via its fundsRating: -

Country ISO code US Operating revenue (MIL $) 87,047NACE Rev. 2, Core code - Total Assets (MIL $) 1,913,902Direct % - Number of Employees 260,000Total % 1.07 Information date 2010/09

OCH - ZIFF CAPITAL MANAGEMENT GROUP LLC via its fundsRating: D

Country ISO code US Operating revenue (MIL $) 925NACE Rev. 2, Core code - Total Assets (MIL $) 2,094Direct % - Number of Employees 405Total % 0.78 Information date 2010/09

STATE OF NEW JERSEY via its fundsRating: -

Country ISO code US Operating revenue (MIL $) -NACE Rev. 2, Core code - Total Assets (MIL $) -Direct % - Number of Employees -Total % 0.47 Information date 2010/06

DIMENSIONAL FUND ADVISORS LP via its fundsRating: A


MORGAN STANLEY SMITH BARNEY LLC via its fundsRating: -


Page | 9




Tel: +39 040 3755337Fax: +39 040 3756741

POWER FINANCIAL CORP via its fundsRating: B

Country ISO code CA Operating revenue (MIL $) 22,977NACE Rev. 2, Core code - Total Assets (MIL $) 143,126Direct % - Number of Employees -Total % 0.20 Information date 2010/11

DEUTSCHE BANK AG via its fundsRating: -

Country ISO code DE Operating revenue (MIL $) 40,849NACE Rev. 2, Core code - Total Assets (MIL $) 2,546,303Direct % - Number of Employees -Total % 0.16 Information date 2010/09

GOLDMAN SACHS GROUP, INC via its fundsRating: -

Country ISO code US Operating revenue (MIL $) 39,161NACE Rev. 2, Core code - Total Assets (MIL $) 911,332Direct % - Number of Employees 35,700Total % 0.16 Information date 2010/09

NOMURA HOLDINGS INC via its fundsRating: -

Country ISO code JP Operating revenue (MIL $) 11,016NACE Rev. 2, Core code - Total Assets (MIL $) 345,634Direct % - Number of Employees -Total % 0.15 Information date 2010/12

WS CAPITAL LLC via its fundsRating: -


COMMERZBANK AG via its fundsRating: -

Country ISO code DE Operating revenue (MIL $) 17,836NACE Rev. 2, Core code - Total Assets (MIL $) 1,007,894Direct % - Number of Employees 57,676Total % 0.13 Information date 2010/09

D. E. SHAW & CO., L.P. via its fundsRating: -


Page | 10




Tel: +39 040 3755337Fax: +39 040 3756741

MCADAMS WRIGHT RAGEN INC via its fundsRating: -

Country ISO code US Operating revenue (MIL $) -NACE Rev. 2, Core code - Total Assets (MIL $) -Direct % - Number of Employees 50Total % 0.10 Information date 2010/09

HEARTLAND ADVISORS, INC.Rating: -

Country ISO code US Operating revenue (MIL $) 5NACE Rev. 2, Core code - Total Assets (MIL $) -Direct % - Number of Employees 35Total % - Information date 2007/04

Subsidiaries (the first twenty subsidiaries ordered by Direct %)

Not available.

Page | 11




Tel: +39 040 3755337Fax: +39 040 3756741

MORE rating guide

General vision

A credit rating is an opinion of the general creditworthiness of an obligor (issuer rating), or the creditworthiness of an obligor inrespect of a specific debt security, or other financial obligation (issue rating), based on relevant risk factors.

The Multi Objective Rating Evaluation (MORE) model is essentially used to assess the level of distress of industrial companies byusing data included in financial statements.

The basic idea of the model is to analyze a set of financial and economic ratios in a predictive corporate bankruptcy model withthe purpose of creating a fundamental credit rating model for each industrial sector. Results of the model are obtained by applyingnewly developed numerical methodologies, drawing together financial theory, data mining and engineering design methodologies.The heart of MORE is a multi dimensional and multi objective algorithm that produces a classification of each company, by takinginto account any attributes (such as sector and country) characterizing a firm.

The model gives the opportunity to assign a rating to a company even without considering a complete data analysis and allows toprocess quality information. It induces a better understanding of a company s strength and weakness thanks to sophisticated datamining tools and taking into account the analysts knowledge.

The MORE rating vision is to look at the fundamental economics of the company. The main idea is to evaluate the rating observingevery aspect of the economical and financial behavior of the company: better is the equilibrium between the different aspects, betterwill be the final rating.

This is done studying, evaluating and aggregating the most important sections of the financial and economic behavior of a companyas: profitability, liquidity, solvency, interest coverage and efficiency.

Page | 12




Tel: +39 040 3755337Fax: +39 040 3756741

Rating scale

Rating class Rating Macro class Assessment

Healthy

The company’s capacity to meet its financial commitments is extremely strong. Thecompany shows an excellent economic and financial flow and fund equilibrium.AAA

The company has very strong creditworthiness. It also has a good capital structureand economic and financial equilibrium. Difference from ’AAA’ is slight.AA

The company has a high solvency. The company is however more susceptible to theadverse effects of changes in circumstances and economic conditions than companiesin higher rated categories.

A

Balanced

Capital structure and economic equilibrium are considered adequate. The company’scapacity to meet its financial commitments could be affected by serious unfavourableevents.

BBB

A company rated ’BB’ is more vulnerable than companies rated ’BBB’. Further-more the company faces major ongoing uncertainties or exposure to adverse business,financial, or economic conditions.

BB

Vulnerable

The company presents vulnerable signals with regard to its fundamentals. Adversebusiness, financial, or economic conditions will be likely to impair the company’scapacity or willingness to meet its financial commitments.

B

A company rated ’CCC’ has a dangerous disequilibrium on the capital structure andon its economic and financial fundamentals. Adverse market events and an inadequatemanagement could affect with high probability the company’s solvency.

CCC

Risky

The company shows signals of high vulnerability. In the event of adverse market andeconomic conditions, the company’s strong disequilibrium could increase.CC

The company shows considerable pathological situations. The company’s capacity tomeet its financial commitments is very low.C

The company has not any longer the capacity to meet its financial commitments.D

Page | 13




Tel: +39 040 3755337Fax: +39 040 3756741

Fundamental Credit Rating Ratios

Solvency ratiosLeverage ratio Measures the level of total liabilities of the company in comparison with equity.Assets to debt Indicates company s solvency. The company shows a level of deficit when the value

of this ratio is under one unit.Financial ratiosFixed Assets coverage ratio Only for holdings. It measures the capital structure i.e. whether a company covers

the fixed assets with long term capital.Liquidity ratios

Current ratio The current ratio measures whether a company has sufficient short-term assets tocover its short-term liabilities.

Quick ratio The quick ratio compares current liabilities only to those assets that can be readilyturned into cash.

Profitability and economic ratiosReturn on Investement(ROI) It measures the profitability of company investments without regard to the way the

investment is financed.Return on Equity(ROE) It measures the profitability of the equity.

Asset turnover It indicates the investments turnover with regard to sales. The level assumed fromthe ratio depends on the sector in which the company operates.

Profit margin It indicates the profitability of the sales.Interest coverage ratio

Interest Paid coverage Indicate the ability of the company to cover interest expenses through the economicmargins (Gross profit and EBIT) and through the cash flow from operating activities.

Page | 14




Tel: +39 040 3755337Fax: +39 040 3756741

mF Credit Limit

mF Credit limit is the estimation of the amount of maximum credit that is possible to assign on a commercial relationship with theanalyzed company with an outlook of one year.modeFinance used the following values associated with the company analyzed while computing the credit limit:

• Size;

• Years in Business;

• Average number of suppliers;

• Liquidity of the company and the comparison with its sector;;

• The funds dedicated to be paid to suppliers;

• The likelihood that a company may pay its debts in the next 12 months (MORE Ratings).

The credit limit in this report is merely a suggested value of commercial credit limit calculated on the basis of annual public data.This value should be reviewed by paying attention at the Confidence Level value and by using other information such as otherbusiness information, news... etc; and private information such as the relationship with client, history of payments, guarantees andthe knowledge of the sector.

Probability of default and Confidence Level

In addition to the MORE rating, modeFinance also estimates the probability of default and provides a level of confidence. Theprobability of default is the degree of certainty (in quantitative terms) that the company will go into default.As the probability of default is strongly affected by the economic climate the company is operating in, companies in the same MOREclass will not necessarily have the same probability of default.The MORE model can produce a MORE rating even if there is missing data by using an associated confidence level:

Confidence =∑Available Information∑Total Information

The level of confidence does not indicate financial confidence in the company. It is a reflection of the variations in availability offinancial data across Europe due to filing regulations and suggests the degree of financial detail the MORE rating is able to takeinto account for each company.For companies with fully populated records a confidence level of 100% would be applied: companies where no financial data isprovided, 0%. This puts the MORE rating in a context for the user and aids interpretation.

Page | 15




Tel: +39 040 3755337Fax: +39 040 3756741

NOTES

The present analysis was based on the company available financial statements as provided by Bureau Van Dijk Electronic Publishing- ORBIS database (lack of both Notes to financial statements and Report on operations).

DISCLAIMER

All Rights Reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by anymeans, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher modeFinance.The facts of this report are believed to be correct at the time of publication but cannot be guaranteed. Please note that the findings,conclusions and recommendations that modeFinance delivers will be based on information gathered in good faith from both primaryand secondary sources, whose accuracy we are not always in a position to guarantee. As such modeFinance can accept no liabilitywhatever for actions taken based on any information that may subsequently prove to be incorrect.

ContactsCompany modeFinanceProducts MORE ratingWhere AREA Science Park

34149 Trieste, via Padriciano 99 - ITALYInfo [email protected] www.modefinance.comPhone +39 040 3755337

Page | 16

Documents

Raser Technologies