Confidential INFORMATION DISCLOSURE — For authorized recipients only · Not for public distribution · Carbotura, Inc.
CARBOTURA · Circular Advantage Program · Transaction Proposal

Montgomery County, Maryland
Circular Advantage Proposal

A 30-year Circular Supply Agreement (with perpetual continuation after Year 30 unless Non-Renewal Notice is served) converts 1,800 TPD of manufacturing feedstock into a Circular Royalty™ receipt stream beginning 13 months after corresponding feedstock delivery — reported as a separate transaction from the Beneficiation Fee, at zero County capex, with the Beneficiation Fee at or below the confirmed Fully-Weighted Disposal Cost. A single commercial structure: the Circular Supply Agreement (CSA) — Beneficiation Fee (TMC Fee) + Circular Royalty™ — plus a universal Exogenesis™ Royalty add-on.

Transaction Proposal · 15 min read · DOC 02 OF 06

What this document is

The commercial structure of a 30-year Circular Supply Agreement for Montgomery County — the Beneficiation Fee, the Circular Royalty™, deployment phases, site candidates, risk allocation and timeline.

Three things this document says
  1. One Circular Supply Agreement governs the relationship; the County commits feedstock, not capital, and Carbotura finances the facility at every phase.
  2. The Beneficiation Fee and the Circular Royalty™ are independent transactions, reported separately and never netted against each other.
  3. Authorising the engagement in 2026 is what makes commercial operation possible before the Dickerson contract expires in April 2031.
Looking for something else?
Document: Circular Advantage Proposal Prepared for: Montgomery County, Maryland Date: March 2026 Beneficiation Fee Basis: $100/ton planning floor ESTIMATED Accounting: GASB
This document contains forward-looking statements. All financial projections are based on RevCon™ 3 baseline assumptions. Beneficiation Fee figures are based on the $100/ton Carbotura standard floor pending FWDC confirmation. Actual results may differ materially. Carbotura makes no guarantee of specific financial returns.
Authority Commitment Qualification

Seven Commitments · One Engagement

Four items are required for every engagement and establish the structural commitment between the County and Carbotura. Three optional items signal sovereign offtake election — relevant when the County acts as a sovereign manufacturer or strategic materials buyer.

4 REQUIRED 3 OPTIONAL · 0 ELECTED
01REQUIRED
Commit feedstock
All designated waste streams legally assigned to Carbotura via CSA · liability removed from County balance sheet.
Montgomery County: ~1,800 TPD MSW + commercial mixed stream (Phase Expanded target 2,000 TPD)
02REQUIRED
Commit tax abatements
Local strategic investor instrument · zero corporate income tax for qualifying period · condition precedent to CSA execution.
MD: PILOT / Enterprise Zone designation
03REQUIRED
Receive royalty stream on materials
Circular Royalty™ Stream + Exogenesis™ Royalty Stream · perpetual · paid by Carbotura TO County · never combined.
Reported as separate transactions per the Separate Transaction Principle
04REQUIRED
Exogenesis™ landfill mining
Exogenesis™ Programme · APS · fully electric fleet · $50/tonne royalty TO County · land restored on completion.
Montgomery County: Gude Landfill (Rockville, MD; closed 1982) primary; Oaks Landfill (closed 1997) alternate
05OPTIONAL · NOT ELECTED
Commit offtake for sovereign reserves
Sovereign preferential election right over all RC3–RC5 manufactured output · best efforts · no take-or-pay.
· Sovereign Critical Materials Offtake (KSA construct)
06OPTIONAL · NOT ELECTED
Sovereign preferential pricing on materials
Sovereign preferential rate on -elected RC3–RC5 output · rate set at CSA negotiation · confidential · only meaningful if 06 elected.
· Sovereign Critical Materials Authority pricing
07OPTIONAL · NOT ELECTED
Pre-purchase MAMP payment
County prepays Carbotura under Bay’al-Salam structure · required CP for pricing discount · Carbotura does not deploy capital without receipt.
Sovereign engagements only · not applicable to Public Authority engagements
Sections

What This Means

The Circular Supply Agreement (CSA)
Circular Royalty™
OUTFLOW ↑
Beneficiation Fee: $100/ton → Carbotura
+2.5%/yr · separate transaction
INFLOW ↓
Circular Royalty™: $17.5M/yr (Yr 2)
→ $43.1M/yr (Yr 30)
From Carbotura product revenues · separate transaction · 13-month lag
BBB– credit required · ~$829M 30-yr royalty
Bonus Feature · CSA Add-On
Exogenesis™ Royalty
OUTFLOW
$0 — no incremental fee
INFLOW ↓
Circular Royalty™: $17.5M/yr (Yr 2)
+ Exogenesis™ Royalty: $7.3M/yr (Yr 6+)
Two independent streams · ~$1.04B 30-yr combined (Circular Royalty™ $829M + Exogenesis™ ~$207M)
Legacy mass extracted and beneficiated · land restored on completion

The Circular Supply Agreement (CSA) is Carbotura’s single commercial structure for every engagement.

The Beneficiation Fee (TMC Fee) and all Royalty streams are independent transactions — separate payment obligations under the CSA, never netted against one another. Royalty is paid by Carbotura from operating revenues of Circular Materials sales, independent of any Fee paid by the County. All figures Phase Initial · 400 TPD · 146,000 TPY · ESTIMATED.

Offer: What Carbotura Proposes
A 30-year Build-Own-Operate (BOO) Circular Supply Agreement (CSA). Carbotura finances, builds, and operates an Advanced Circular Manufacturing facility in Montgomery County at zero County capex. The County supplies manufacturing feedstock. Carbotura pays a Beneficiation Fee — a Beneficiation Fee that replaces the County's existing disposal cost.
Commitment: What the County Commits
Delivery of manufacturing feedstock under the CSA. Payment of the Beneficiation Fee per ton delivered — structured to be priced at or below the County's confirmed Fully-Weighted Disposal Cost. No capital contribution. No construction guarantee. No operating liability. The County's maximum annual financial exposure is the Beneficiation Fee obligation on delivered volume.
Return: What the County Receives
Gross cost displacement on every ton converted — the difference between current FWDC and the Beneficiation Fee. Beginning at 13 months after corresponding feedstock delivery after Phase Initial commercial operations, a rolling Circular Royalty™ — structured at 120% of Year 1 Beneficiation Fee per ton and escalating by one percentage point per year. At steady state, the Circular Royalty™ per ton is designed to exceed the Beneficiation Fee per ton. Both are reported as separate transactions per the Separate Transaction Principle.
Key Planning Basis: FWDC Not Yet Confirmed
All Beneficiation Fee and Circular Royalty™ figures in this Proposal use the Carbotura standard floor of $100/ton as the planning basis. The confirmed FWDC — which governs the final Beneficiation Fee — will be established at the Joint Working Group phase. The direction of risk on FWDC confirmation is upward: additional system cost elements beyond the $70/ton gate rate (TS operation, rail, overhead, residue disposal) are not yet fully disclosed. County DEP's own estimate places combined TS+RRF operating cost at approximately $90/ton.
Executive Implications
  • The RFP #1184252 award is the operative decision deadline — not April 2031. Award locks the bridge disposal pathway. The Joint Working Group phase authorization is the decision that keeps the ACM pathway open.
  • Year 1 flows: County pays $14.6M Beneficiation Fee, receives no Circular Royalty™. Year 2: County receives $17.52M Circular Royalty™ (separate transaction) while paying $14.97M Beneficiation Fee. This is the fiscal structure, not a projection of certainty.
  • At steady state (Year 30, Phase Initial), the per-ton Circular Royalty™ rate exceeds the per-ton Beneficiation Fee by design — Fee paid $30.6M, Royalty received $45.3M, reported as separate transactions.
  • The decision to authorize the Joint Working Group phase does not commit the County to the CSA. It confirms the data basis for a final decision.

Commercial Structure & Decision Window

Regulatory Predicate Transition (RPT)

Advanced Circular Manufacturing is a manufacturing process, not a waste-management activity. Microwave Catalytic Reforming operates in an anoxic, oxygen-free, sub-atmospheric environment — mechanistically incompatible with combustion or biological degradation. ACM does not fit within the waste domain and does not operate under waste-domain statutes. The Regulatory Predicate Transition (RPT) — also framed as the dewaste pathway — is the coordinated regulatory shift from legacy disposal-predicate statutes onto manufacturing-predicate classifications. 100% elemental recycling of the municipal material stream requires this transition. Manufacturing NAICS 325180 · 325998 · 327992 · 331110 · 331314 · 331492 (6-code ACM set) plus EPA RCRA §1004(27) / 40 CFR §261.2(e) exclusion pathway in the US; ISIC Rev.4 20-25 + UN CPC 89 internationally. In many jurisdictions the required authorities already exist in latent form within existing statutes; in others the transition requires primary-authority amendments. The Joint Working Group phase includes a regulatory engagement workstream to shepherd the RPT alongside site permitting. Both parties commit to the RPT pathway. Carbotura brings the process-classification evidence, regulatory engagement expertise from prior ACM deployments, and the legal-technical framework. The counterparty brings the standing to engage the local regulator, the political mandate for the transition, and — where applicable — legacy statutory authorities that can be re-instrumented for manufacturing use. The endpoint is categorical: manufacturing classification across all permitting, licensing, and regulatory contexts. Interim bridging authorities may apply during the transition.

Regulatory basis: RCRA §1004(27) · 40 CFR §261.2(e) · 40 CFR §260.43 ·

§ 1.1 — Contract Structure: Circular Supply Agreement

Term: 30 years from commercial operations date (COD)
Structure: Build-Own-Operate — Carbotura finances, constructs, owns, and operates
County obligation: Deliver manufacturing feedstock; pay Beneficiation Fee per ton delivered
Carbotura obligation: Accept all delivered feedstock; pay Circular Royalty™ from 13 months after receipt of the first Beneficiation Fee payment
County capex: Zero
County construction liability: Zero
County operating liability: Zero

§ 1.2 — Decision Window

The hard deadline governing this Proposal is the April 2031 expiry of the RRF service agreement. For Phase Initial ACM operations to be in place at that date, commercial operations date (COD) must be achieved no later than Q4 2028 – Q1 2029 — requiring a Joint Working Group phase authorization no later than Q2–Q3 2026.

The near-term constraint is the pending award of RFP #1184252 (long-haul MSW disposal bridge). Award locks the County's interim disposal pathway and the specific bridge contract term determines when the ACM entry window re-opens. Authorizing the Joint Working Group phase before that award preserves the maximum deployment flexibility window.

Irreversibility Mechanism: Award of RFP #1184252 is the proximate irreversibility event. The bridge contract term — not April 2031 — becomes the binding re-entry constraint once awarded. Authorization of the Joint Working Group phase before award keeps both pathways open simultaneously and does not foreclose the bridge contract. It is the only action that does not reduce future flexibility.

§ 1.5 — Commercial Structure

Carbotura offers a single commercial structure for this and all new engagements: the Circular Supply Agreement (CSA) — Beneficiation Fee (TMC Fee) + Circular Royalty™ — plus a universal Exogenesis™ Royalty add-on.

ParameterThe CSA — Beneficiation Fee (TMC Fee) + Circular Royalty™
County OutflowBeneficiation Fee (TMC Fee): $100/ton baseline, 2.5%/yr escalation. County's sole recurring financial obligation.
County InflowCircular Royalty™: 120% × current-Year Beneficiation Fee/ton from 13 months after corresponding feedstock delivery. +1pp/yr multiplier.
Year 2 per-ton flowsFee −$102.50/ton; Royalty +$120.00/ton (separate transactions, never netted)
30-Year Total Royalty~$829M (400 TPD basis) · ~$1.04B combined with the Exogenesis™ Royalty add-on, if activated
Credit RequirementBBB– / Baa3 or equivalent at execution
Site / LandCounty retains land. Carbotura acquires or leases site separately.
Tax AbatementRequired — a commercial condition to capital deployment (PILOT or equivalent). Not tied to classification.
Recommended for Montgomery County✓ Standard — available to all Montgomery County engagements; see the Exogenesis™ Royalty add-on below (Gude/Oaks Landfill legacy-mass economics)

Indicative economics based on 400 TPD / 146,000 TPY. Terms fixed at CSA execution, not at Term Sheet. All figures illustrative. Source: Carbotura CSA Engagement Document Suite v2026.7.

EXOGENESIS™ ROYALTY — CSA ADD-ON

Gude Landfill (Rockville, MD; closed 1982) and Oaks Landfill (closed 1997) are qualifying assets for the Exogenesis™ Royalty, which runs concurrently with the Circular Royalty™. Where a qualifying closed, closing, or operating landfill site exists, Carbotura commits to deploy Exogenesis™ (legacy landfill mining) within 3–7 years post-COD, alongside the primary Regenesis™ facility. This creates a second concurrent royalty stream.

Royalty StreamRateEscalationTriggerIndicative Year 2 (400 TPD ea.)
Circular Royalty™ (current feedstock stream)120% × Beneficiation Fee/ton+1pp/yr multiplier13 months after corresponding feedstock delivery, rolling~$17.5M
Exogenesis™ Royalty (legacy mass)$50/ton extracted1.0%/yr13 months after first extraction~$7.3M
Combined (once Exogenesis™ operational, Year 6+)—~$24.8M/yr

Carbotura provides Environmental Impairment Liability and Pollution Legal Liability cover for its own Exogenesis™ extraction operations.

Exogenesis™ activation is confirmed at CSA execution. Phase II ESA and Waste Characterization Study conducted during Joint Working Group phase (costs shared equally). All figures illustrative · Source: CSA v2026.7 §4B.2A, §4B.12, §4B.13


Deployment Architecture

§ 2.1 — Phase Configuration

PhaseDeployed TPDModules (100 TPD each)Annual Feedstock (tpy)% of MSW StreamCOD (est.)CapExStatus
Initial4004146,00022%Q4 2028 – Q1 2029$262.5MCarbotura standard parameters
Medium1,00010365,00056%Q2 2030 – Q3 2030$627.5M cumulativeCarbotura standard parameters
Expanded2,00020730,000111%*Q2 2031 – Q3 2031$1,232.5M cumulativeCarbotura standard parameters

*Phase Expanded exceeds MSW stream — incorporates CONDITIONAL and ACCESSIBLE streams. Module math: ceil(TPD / 100). COD dates based on Carbotura standard deployment schedule — project-specific T0 confirmed at CFS. CapEx: $75M first module; $57.5M each additional.

Deployment Phase Configuration — Annual Feedstock by Phase
Phase Initial (400 TPD) addresses 22% of the MSW stream using only IMMEDIATE feedstock — zero third-party negotiation required.
Source: Registry Phase Configuration · CapEx per Carbotura standard parameters ($75M first module; $57.5M incremental) · COD per Carbotura standard deployment schedule

§ 2.2 — BOO Capital Structure

Zero County Capex — Confirmed
Carbotura finances, builds, and owns the ACM facility under the BOO structure. The County's total financial obligation is limited to the Beneficiation Fee per ton of manufacturing feedstock delivered. The County makes no equity contribution, no construction payment, and no debt guarantee. The facility appears on Carbotura's balance sheet — not the County's.

§ 2.3 — Feedstock Stream Coverage by Phase

StreamPhase InitialPhase MediumPhase ExpandedAccess Status
MSW Residual (1,800 TPD)✓ Primary✓ Continued✓ ContinuedIMMEDIATE
Dual-Stream Recyclables (480 TPD)—✓ Added✓ ContinuedCONDITIONAL
Yard Trim (320 TPD)—✓ Added✓ ContinuedCONDITIONAL
Organics / Food Scraps (180 TPD)—✓ Added✓ ContinuedCONDITIONAL
Biosolids — MC Share (145 TPD)—Partial✓ FullCONDITIONAL
C&D Debris (220 TPD)——✓ AddedACCESSIBLE
Special Waste / HHW (75 TPD)——✓ AddedACCESSIBLE

Access Classification = IMMEDIATE / CONDITIONAL / ACCESSIBLE — reflects access constraints, never ACM capability limits.

§ 2.4 — Site Candidate Analysis

Three priority candidate zones identified from industrial land inventory, zoning analysis, and feedstock infrastructure proximity. Research: places_search + M-NCPPC zoning records + Montgomery County DEP · March 2026

Site candidate research — Montgomery County, Maryland · March 2026 · Sources: M-NCPPC Shady Grove Sector Plan (P1); Montgomery Planning (P2); Montgomery County Zoning (mcatlas.org); Carbotura site analysis. Driving distances per Rome2Rio / direct measurement. Zoning per Montgomery County Digital Zoning Map.
PriorityZoneAcreageZoningLand AuthorityCo-location AdvantageKey Consideration
P1Shady Grove Industrial Corridor, Derwood15–20 acI-2 IndustrialMontgomery County / Private0.3 mi from Shady Grove TS; existing CSX rail; MRF co-locatedLand acquisition / parcel availability at Phase Expanded scale
P2Germantown Technology Corridor20–30 acI-2/I-3 IndustrialPrivate / M-NCPPCI-270 logistics; larger parcels; tech park permitting precedent9-mile dedicated feedstock haul adds transport cost vs. P1
P3Dickerson Energy Park50+ acRural IndustrialMontgomery County / PrivateAdjacent to existing RRF; large footprint; existing rail20 mi from primary feedstock source; rural road constraints
Priority 1 Finding — Shady Grove Industrial Corridor
The Priority 1 candidate site is the Shady Grove Industrial Corridor, Derwood, MD — immediately adjacent (0.3 miles) to the Shady Grove Transfer Station and MRF, the single convergence point for 1,800 TPD of Montgomery County's manufacturing feedstock. Co-location at this site eliminates the existing 20-mile rail haul to Dickerson entirely for converted volumes, removes the CSX rail dependency for ACM-processed feedstock, and positions the facility at the existing logistics hub. The existing industrial zoning (I-2) and M-NCPPC planning framework support manufacturing use. Site confirmation and land availability are deliverables of the Joint Working Group phase.

§ 2.5 — Phase Initial Feedstock Sufficiency

Finding — Phase Initial is Fully Supportable Without Third-Party Negotiation
Phase Initial (400 TPD) draws exclusively from the MSW Residual stream — 1,800 TPD of IMMEDIATE-classified feedstock with no contract barrier at RRF expiry. Phase Initial represents 22% of the available IMMEDIATE stream. No recycling contract renegotiation, no WSSC Water engagement, and no C&D program development is required to support Phase Initial commercial operations.
📍 Interactive site map requires Google Maps API key in config.js All zone detail visible in the panel →
ACM Candidate Zones — 3 identified
P1 — Priority 1 Shady Grove Industrial Corridor
LocationDerwood, MD 20855
Acreage15–20 acres available
ZoningI-2 Industrial
AuthorityMontgomery County / Private
Advantage0.3 mi from Shady Grove TS — zero incremental transport; existing CSX rail on-site
→ Shady Grove TS: 0.3 mi (adjacent) · Dickerson RRF: 20 mi (rail)
ConstraintLand acquisition / lease; parcel availability at Phase Expanded scale
P2 — Priority 2 Germantown Technology Corridor
LocationGermantown / Clarksburg, MD
Acreage20–30 acres available
ZoningI-2 / I-3 Industrial; M-NCPPC planning zone
AuthorityPrivate / M-NCPPC
AdvantageI-270 logistics corridor; larger parcels; tech park permitting precedent
→ Shady Grove TS: ~9 mi (via I-270) · Dickerson RRF: ~25 mi
Constraint9-mile dedicated feedstock haul from Shady Grove TS; added transport cost vs. P1
P3 — Priority 3 Dickerson Energy Park
LocationDickerson / Poolesville, MD
Acreage50+ acres available
ZoningRural Industrial / Energy Park overlay
AuthorityMontgomery County / Private
AdvantageAdjacent to existing RRF; existing rail infrastructure; large footprint for Phase Expanded
→ Shady Grove TS: 20 mi (via rail/road) · Dickerson RRF: 0 mi (adjacent)
ConstraintRural road constraints reduce Phase Initial attractiveness; 20 mi from primary feedstock source
P1 Emerald
P2 Blue
P3 Mustard
Feedstock ref

Economic Structure — Beneficiation Fee

Planning Basis — FWDC Not Yet Confirmed
All Beneficiation Fee calculations use the Carbotura standard planning floor of $100/ton. The confirmed FWDC — the governing variable — will be established at the Joint Working Group phase. Montgomery County DEP estimates combined TS+RRF operating cost at approximately $90/ton (DEP council briefing, January 2025 — ESTIMATED). The $100/ton planning floor is used as a conservative ceiling that does not exceed the implied per-household cost-derived rate of $108.57/ton.

§ 3.1 — Beneficiation Fee Formula

// Beneficiation Fee — Contractual Formula (Carbotura standard)
TMC_Fee = MAX($100, MIN($150, FWDC − $5))

// Montgomery County planning basis
FWDC = ~$90/ton (ESTIMATED — DEP estimate)
TMC_Fee_Planning_Basis = $100/ton (floor applied) Carbotura standard parameters
TMC_Fee_Annual_Escalator = 2.5%/year Carbotura standard parameters

§ 3.2 — Annual Beneficiation Fee Obligation by Phase

PhaseAnnual Feedstock (tpy)Year 1 Beneficiation Fee/tonYear 1 Annual ObligationYear 10 (escalated)Year 30 (escalated)
Initial (400 TPD)146,000$100/ton$14,600,000$18,533,000$30,612,000
Medium (1,000 TPD)365,000$100/ton$36,500,000$46,331,000$76,530,000
Expanded (2,000 TPD)730,000$100/ton$73,000,000$92,662,000$153,060,000

All figures at $100/ton planning basis · 2.5% annual escalator · Carbotura standard parameters ESTIMATED


Royalty Structure

§ 4.0 — The CSA: Beneficiation Fee (TMC Fee) + Circular Royalty™

Montgomery County pays Beneficiation Fee each month; receives Circular Royalty™ 13 months later. From Year 2 onward the per-ton royalty rate exceeds the per-ton Beneficiation Fee — both are reported as separate transactions, never netted.

Royalty(m+13) = BeneficiationFee(m) × Royalty_Rate(m)
m = month of Beneficiation Fee payment   ← rolling monthly basis
Royalty_Rate(Year 1) = 120%  ← base multiplier
Royalty_Rate(Year n) = (119+n)%  ← +1 percentage point per year, no cap
ParameterValueBasis
Base Royalty Rate (Year 1)120% of Year 1 Beneficiation Fee per tonCarbotura standard
Royalty Multiplier Escalator+1 percentage point per year (Year 2: 120%; Year 30: 148%)Carbotura standard
Beneficiation Fee Escalator+2.5% per yearCarbotura standard
Effective Royalty Growth~3.3%/yr average over 30 yearsDerived
Payment Lag13 months after corresponding Beneficiation Fee paymentFixed
Counterparty CreditBBB– / Baa3 required at execution and throughout TermCSA §4A.5
PeriodTimingCounty OutflowCounty Inflow
Pre-RoyaltyMonths 1–12 after first deliveryBeneficiation Fee ($100.00/ton)$0 royalty
Royalty Ramp13 months after corresponding feedstock delivery → Month 24 (approx.)~$102.50/ton (escalated)Circular Royalty™ at $120.00/ton
Steady StateYear 2 onward+2.5%/yr escalating+~3.3%/yr effective (multiplier mechanic)
PRE-ROYALTY PERIOD — MONTHS 1–12

Montgomery County pays the Beneficiation Fee and receives zero Circular Royalty™ during the first 12 months following Phase Initial COD (est. Q2 2028 – Q2 2029). First Circular Royalty™ payment: Q3 2029. This is a planned structural feature of the 13-month lag, not a performance shortfall. The Exogenesis™ Royalty (bonus) is additive, never an outflow, and follows its own independent schedule.

YearAvoided Disposal/tonBeneficiation Fee/ton → CarboturaAnnual Fee PaidRoyalty/ton → CountyAnnual Royalty Received
1$95.00$100.00$14,600,000$0$0
2$97.37$102.50$14,965,000$120.00$17,520,000
5$104.86$110.38$16,115,668$132.46$19,338,802
10$118.64$124.89$18,233,399$155.96$22,769,513
20$151.87$159.87$23,340,293$215.23$31,424,004
30$194.41$204.64$29,877,548$295.48$43,140,264

Phase Initial 400 TPD / 146,000 TPY. Year 5 royalty = 123% × $107.69 = $132.46/ton. All ESTIMATED. US GAAP.

CSA — Gross Fiscal Position, Years 1–20
Three gross items, not pre-netted. Circular Royalty™ (emerald) exceeds Beneficiation Fee (red) from Year 2. Avoided disposal cost (brown) present from Year 1.
Phase Initial · 400 TPD · 146,000 TPY
Avoided disposal cost Beneficiation Fee paid Circular Royalty™ received
$95/ton
Avoided disposal · Year 1
$100/ton
Beneficiation Fee · Year 1
$120/ton
Circular Royalty™ · Year 2
Registry values · Phase Initial 400 TPD / 146,000 TPY · All ESTIMATED.
The CSA — Phase Expanded Full Build-Out (2,000 TPD / 730,000 TPY)
YearBeneficiation Fee/ton → CarboturaAnnual Fee PaidRoyalty/ton → CountyAnnual Royalty Received
1$100.00$73,000,000$0$0
2$102.50$74,825,000$120.00$87,600,000
10$124.89$91,166,997$155.96$113,847,567
30$204.64$149,387,740$295.48$215,701,322

Phase Expanded: 2,000 TPD × 365 = 730,000 TPY. All ESTIMATED. US GAAP.

Gross cost displacement is quantified separately from Circular Royalty™ cash flow. Both are independent financial effects of the CSA.
At steady state, the Circular Royalty™ is designed to exceed the Beneficiation Fee on a per-ton basis.
Circular Royalty™ payments begin 13 months after corresponding Beneficiation Fee payments and ramp to full run-rate on a rolling basis.

§ 4.2 — Exogenesis™ Royalty (Bonus Feature · CSA Add-On)

The Exogenesis™ Royalty is a bonus feature available as a CSA add-on, concurrent with the Circular Royalty™. Carbotura extracts and beneficiates legacy mass from the qualifying landfill — in Montgomery County's case, Gude Landfill (Rockville, MD; closed 1982) as primary candidate, with Oaks Landfill (closed 1997) as alternate target — and pays $50/ton extracted royalty, +1.0%/yr compound, beginning 13 months after first Exogenesis™ extraction. The figures below illustrate the combined position alongside the Circular Royalty™.

Royalty StreamRateEscalationTriggerBasis
Circular Royalty™ (current feedstock stream)120% × Beneficiation Fee/ton, +1pp/yr multiplier+2.5%/yr Beneficiation Fee escalator13 months after corresponding feedstock deliveryCSA §4A.7
Exogenesis™ Royalty$50/ton extracted (Exogenesis™)+1.0%/yr from Year 2 of extraction13 months after first Exogenesis™ extractionCSA §4B.2A
Legacy Royalty CERCLA floor / step-up$25/ton floor if CERCLA contamination discovered; $75/ton if 7-yr long-stop missed—Per Waste Characterization Study findingsCSA §4B.2A
PeriodTimingCounty OutflowCounty Inflow
Pre-RoyaltyMonths 1–12Beneficiation Fee ($100.00/ton)$0
Circular Royalty™ OnlyYear 2 → Year 5Beneficiation Fee (escalating 2.5%/yr)Circular Royalty™ from 13 months after corresponding feedstock delivery
Dual StreamYear 6 onward (Exogenesis™ online + 13m)Beneficiation Fee (escalating 2.5%/yr)Circular Royalty™ + Exogenesis™ Royalty
YearAvoided Disposal/tonCircular Royalty™/tonLegacy Royalty/tonTwo-Stream Total/tonAnnual Two-Stream
1$95.00$0$0$0$0
2$97.37$120.00$0$120.00$17,520,000
5$104.86$132.46$0$132.46$19,338,802
6 ★$107.48$136.87$50.00$186.87$27,283,020
10$118.64$155.96$52.03$207.99$30,365,893
20$151.87$215.23$57.47$272.70$39,814,624
30$194.41$295.48$63.49$358.97$52,409,804

★ Year 6 = first Exogenesis™ Royalty year (Exogenesis™ target COD Year 5 + 13-month trigger). Legacy Royalty Year n = $50 × 1.01n−6/ton (n≥6). Circular Royalty™ per §4.0 formula. Phase Initial 400 TPD / 146,000 TPY. All ESTIMATED. US GAAP.

Circular Royalty™ + Exogenesis™ Royalty — Phase Expanded Full Build-Out (2,000 TPD / 730,000 TPY)
YearCircular Royalty™/tonLegacy Royalty/tonTwo-Stream Total/tonAnnual Two-Stream
1$0$0$0$0
2$120.00$0$120.00$87,600,000
6 ★$136.87$50.00$186.87$136,415,100
10$155.96$52.03$207.99$151,832,700
30$295.48$63.49$358.97$262,048,100

★ Year 6 = first full Exogenesis™ Royalty year. Beneficiation Fee outflow continues on its own schedule at all phases (see §3.2) — not netted against Circular Royalty™ or Exogenesis™ Royalty receipts. All ESTIMATED. US GAAP.

LEGACY LANDFILL CANDIDATES — MONTGOMERY COUNTY

Primary candidate — Gude Landfill (Rockville, MD; closed 1982): older closure with larger documented buried tonnage and clean access; preferred Phase 1 Exogenesis™ target. Alternate — Oaks Landfill (closed 1997): smaller, later-closure profile; available as secondary or contingent target depending on Waste Characterization Study findings. Final selection at CSA execution.


Risk Register

RiskKey DriverWho Bears ItMitigationResidual Exposure
FWDC verification — true cost exceeds or is below $90/tonIncomplete County cost disclosureBoth partiesCFS confirms FWDC; Beneficiation Fee re-anchored to confirmed figureIf FWDC below $100, floor applies; County not over-charged
Technology performance — ACM output yield below RevCon™ 3Feedstock composition variabilityCarboturaRevCon™ 3 conservative baseline; performance warranty in CSACounty Beneficiation Fee obligation unchanged; Carbotura revenue risk only
Timeline slippage — Phase Initial COD delayed past Q1 2029Permitting; site acquisition; constructionCarboturaPriority 1 site pre-positioned; construction schedule locked at CFSCounty may require bridge disposal coverage for delay period
Third-party contract constraints — CONDITIONAL streamsMRF contract terms; WSSC Water bilateralBoth partiesPhase Initial designed for IMMEDIATE streams only; CONDITIONAL streams are Phase Medium+Phase Initial unaffected; Phase Medium requires bilateral engagement
Competitive procurement — RFP #1184252 award forecloses entryBridge contract locks interim pathwayBoth partiesAuthorize CFS before award; CFS does not foreclose bridge contractBridge contract term determines re-entry window if award precedes CFS
Residual stream — ACM outputs require marketCircular Materials offtake and pricingCarboturaCircular Materials revenue confirmed at CFS; multiple product markets targetedCounty Beneficiation Fee obligation not contingent on Circular Materials revenue
PFAS regulatory — feedstock PFAS contentEvolving PFAS regulation in MSWCarbotura advantageACM designed for complete PFAS elimination through elemental dissociation at 1,200°C+; eliminates PFAS from output streamsACM eliminates, not introduces, PFAS regulatory risk vs. current system

Deployment Timeline

MilestoneEstimated DateDescriptionDecision Window
RFP #1184252 AwardQ1–Q2 2026Long-haul bridge disposal contractor selected — locks interim pathwayNow — active. Engage before award.
LOI/MOU ExecutionQ2–Q3 2026County authorizes Joint Working Group phase — confirms FWDC, site, ACM parametersRequired before this date for Phase Initial COD before April 2031
Joint Working Group phase CompleteQ4 2026FWDC confirmed, site selected, Circular Materials baseline confirmed, Beneficiation Fee finalizedCSA execution gate
CSA ExecutionQ1 202730-year Circular Supply Agreement signedTriggers Phase Initial detailed design
Phase Initial Detailed Design & PermittingQ1–Q3 2027Confirms four-module configuration, site plan, environmental permitsConstruction mobilization gate
Phase Initial ConstructionQ4 2027 – Q3 2028ACM facility construction — 400 TPD, 4 modules, Shady Grove Industrial Corridor (P1)—
Phase Initial CODQ4 2028 – Q1 2029Commercial operations date — feedstock delivery begins; Beneficiation Fee obligations commence—
First Circular Royalty™ PaymentQ1–Q2 203013-month lag after Phase Initial COD — rolling royalty payments beginCounty fiscal Year 2 — royalty stream commences (separate from Fee obligation)
RRF Contract ExpiryApril 2031NMWDA service agreement terminates — hard deadlinePhase Initial must be operational by this date

Community Value Stack

§ 7.1 — County Fiscal Effects

Fiscal EffectPhase Initial BasisStatus
Gross cost displacement — Beneficiation Fee vs. FWDC$0–$14.6M/year depending on FWDC confirmation at $100/ton floorESTIMATED
Pre-Royalty Period (Year 1)County pays $14.6M Beneficiation Fee; receives zero royaltyCarbotura standard parameters
Year 2 Beneficiation Fee paid$14,970,000ESTIMATED
Year 2 Circular Royalty™ received$17,520,000 (separate transaction)ESTIMATED
30-year cumulative Circular Royalty™ (Phase Initial, gross)~$1,050,000,000ESTIMATED
Year 30 Beneficiation Fee paid$30,600,000ESTIMATED
Year 30 Circular Royalty™ received$45,300,000 (separate transaction)ESTIMATED
County capex obligationZeroCONFIRMED
Lifetime royalty — Phase Expanded~$735,000,000 (estimated)ESTIMATED

§ 7.2 — Regional Economic Effects

EffectPhase InitialBasis
Direct employment (FTE)100 FTECarbotura standard parameters — designed for 400 TPD Carbotura standard parameters
Indirect and induced employment~300 jobsCarbotura standard parameters Carbotura standard parameters
Annual economic impact$32M+/yearCarbotura standard parameters — subject to site confirmation Carbotura standard parameters
Carbon impact−1,522 to −1,566 tons CO₂e/dayDesigned for 400 TPD at RevCon™ 3 baseline Carbotura standard parameters
PFAS eliminationComplete elimination through elemental dissociation at 1,200°C+Per ACM Regenesis™ Protocol design specifications
Ash residue stream eliminatedVolume converted at ACM — no landfill residue from converted portionEliminates Brunswick, VA EJ exposure for converted volumes

Why This Works in Montgomery County

1. Volume Alignment: The County's 1,800 TPD MSW Residual stream supports four 100 TPD Phase Initial modules immediately. No volume shortfall. No blended feedstock sourcing required. Phase Initial operates at 22% of available IMMEDIATE feedstock — well within confirmed available supply.
2. Infrastructure Alignment: The Priority 1 candidate site (Shady Grove Industrial Corridor) is 0.3 miles from the Shady Grove Transfer Station — the County's existing feedstock convergence point. Co-location eliminates the 20-mile rail haul to Dickerson for converted volumes, removes CSX rail dependency, and positions the ACM facility within the existing logistics system. No new feedstock infrastructure is required for Phase Initial.
3. Contract Timing Alignment: The April 2031 RRF contract expiry aligns precisely with the Carbotura standard deployment schedule's Phase Initial COD window (Q4 2028 – Q1 2029), providing 27–30 months of overlap and transition period. The CFS-to-COD timeline is 24 months — confirming the Q2–Q3 2026 CFS authorization as the binding scheduling constraint.
4. Policy Alignment: Montgomery County DEP's Aiming for Zero Waste program explicitly references continued exploration of advanced processing technologies concurrent with the bridge procurement process. The County's Comprehensive Solid Waste Management Plan 2025–2034 (adopted April 2025) establishes ACM as an eligible "alternative technology" within the county's 10-year solid waste framework.
5. Environmental Driver: The County's own environmental justice analysis documented the Brunswick, Virginia ash residue disposal as an EJ concern. ACM eliminates the ash residue stream entirely for converted volumes — directly resolving the documented EJ exposure without regulatory mandate. The County's Zero Waste goals are structurally aligned with ACM's near-zero landfill output design.
6. Economics Specificity: The $100/ton Beneficiation Fee planning floor is below the County's own estimate of $90/ton combined TS+RRF operating cost — and well below the $130/ton bridge long-haul alternative. Even on the conservative planning basis, the gross cost displacement position is favorable. On FWDC confirmation above $100/ton, the cost advantage widens. On FWDC below $100, the Beneficiation Fee floor applies, capping the County's maximum obligation at $100/ton.

All values in this block are the authoritative State B inputs for the EIR delta model. Source types propagated exactly. No independent derivation in EIR — all State B values sourced here only.

ParameterValueSource Type
Phase Initial deployed capacity400 TPD / 4 modules / 146,000 tpyCarbotura standard parameters
Phase Initial project CapEx$262,500,000 total ($75M first + $57.5M × 3)Carbotura standard parameters
Phase Initial CODQ4 2028 – Q1 2029 (Carbotura standard schedule)Carbotura standard parameters
Beneficiation Fee — planning basis$100/ton (floor; FWDC confirmed at CFS)ESTIMATED
Beneficiation Fee annual escalator2.5%/yearCarbotura standard parameters
Circular Royalty™ base rate (Year 1)120% of Year 1 Beneficiation Fee per ton = $120/tonCarbotura standard parameters
Circular Royalty™ escalator+1 percentage point per yearCarbotura standard parameters
Payment lag13 months after corresponding Beneficiation Fee paymentCarbotura standard parameters
State B Year 1 Beneficiation Fee paid−$14,600,000 (pre-royalty)ESTIMATED
State B Year 1 Circular Royalty™ received$0 (pre-royalty)ESTIMATED
State B Year 2 Beneficiation Fee paid−$14,970,000ESTIMATED
State B Year 2 Circular Royalty™ received+$17,520,000 (separate transaction)ESTIMATED
State B Year 30 Beneficiation Fee paid−$30,600,000ESTIMATED
State B Year 30 Circular Royalty™ received+$45,300,000 (separate transaction)ESTIMATED
30-year cumulative Circular Royalty™ (Phase Initial, gross)~$1,050,000,000ESTIMATED
Priority 1 site candidateShady Grove Industrial Corridor, Derwood, MD — 0.3 mi from Shady Grove TSESTIMATED — CFS confirmation
State A FWDC (planning basis)~$90/ton (DEP estimate January 2025)ESTIMATED
ACM County capexZeroCONFIRMED
Site candidate coordinatesP1: 39.145, −77.134 (Shady Grove Industrial Corridor)ESTIMATED — CFS site confirmation
Appendix A
Data Basis
Appendix B
Selective Glossary
Beneficiation Fee (Total Material Conversion Fee)
The Beneficiation Fee paid by the county per ton of manufacturing feedstock delivered to the ACM facility. Replaces the tipping fee. Structured as MAX($100, MIN($150, FWDC − $5)). Annual escalator: 2.5%. The County's maximum financial obligation under the CSA is the Beneficiation Fee per ton delivered.
Circular Royalty™ (Conversion Royalty)
Rolling monthly payment from Carbotura to the County. Base rate: 120% of Year 1 Beneficiation Fee per ton. Escalates by +1 percentage point per year. Payment lag: 13 months after corresponding Beneficiation Fee payment. At steady state: Circular Royalty™ per ton exceeds Beneficiation Fee per ton by design. Reported as a separate transaction from the Beneficiation Fee per the Separate Transaction Principle (MR §4.8) — never netted in tables, charts, or sentences.
Circular Supply Agreement (CSA)
The 30-year Build-Own-Operate contract governing the ACM engagement. Carbotura finances, builds, and operates the facility. County supplies feedstock and pays Beneficiation Fee. Circular Royalty™ commences 13 months after corresponding feedstock delivery. Zero county capex, construction contribution, or operating liability.
Fully-Weighted Disposal Cost (FWDC)
The all-in per-ton cost of the County's current manufacturing feedstock system. Includes collector-facing gate rate, TS operation, transport, processing, residue disposal, and County overhead. Confirmed at the Joint Working Group phase. Currently ESTIMATED at ~$90/ton based on DEP council briefing (January 2025). The Beneficiation Fee is structured at or below the confirmed FWDC.
Gross Cost Displacement
The per-ton difference between the current FWDC and the Beneficiation Fee. If FWDC is confirmed at $90/ton and Beneficiation Fee is $100/ton floor, gross displacement is $0 (floor applies). If FWDC is confirmed above $100/ton, gross displacement = FWDC − $100. This is quantified separately from the Circular Royalty™ cash flow.
Per-Ton Fiscal Flows
The County's Beneficiation Fee obligation and Circular Royalty™ receipts are reported as independent transactions per the Separate Transaction Principle (MR §4.8) — never netted in any table column, chart dataset, or prose sentence. Year 1: Fee −$14.6M; Royalty $0 (pre-royalty). Year 2: Fee −$14.97M; Royalty +$17.52M. Steady-state (Year 30): Fee −$30.6M; Royalty +$45.3M. 30-year cumulative Circular Royalty™ (Phase Initial, gross): ~$1.05B.
Pre-Royalty Period
Months 1–12 of ACM commercial operations. County pays Beneficiation Fee; no Circular Royalty™ received. Duration: 12 months (royalty payment lag is 13 months — first payment arrives in 13 months after corresponding feedstock delivery). The pre-royalty period is a structural feature of the rolling payment model, not a commercial concession.
Build-Own-Operate (BOO)
The ACM facility ownership and operations model. Carbotura finances construction, owns the facility, and operates it for the full 30-year CSA term. The County does not acquire any ownership interest in the facility. Carbotura bears all construction risk, technology performance risk, and Circular Materials revenue risk. The County's risk is limited to the Beneficiation Fee obligation on delivered feedstock volume.

Standard Counterparty Requirements

Basis of Presentation

Basis of Presentation — Assumptions & Confidence

Source-of-truth references for the key figures cited throughout this document. Full Assumption Registry available on request from the Montgomery County engagement team.

FieldValueConfidenceSource
Beneficiation Fee (TMC Fee) — Year 1 $100/ton at floor LOCKED Carbotura CSA v2026.7 §4.2 — standard floor rate
Beneficiation Fee escalator +2.5%/yr compounded LOCKED Carbotura CSA v2026.7 §4.2
Circular Royalty™ — Year 2 rate $120/ton (120% of Year 1 Beneficiation Fee) LOCKED Carbotura CSA v2026.7 §4.7
Circular Royalty™ — Year 30 rate ~$295/ton LOCKED Carbotura canonical royalty projection — MR §4.13
Royalty payment lag 13 months after corresponding Beneficiation Fee payment (rolling monthly) LOCKED Carbotura CSA v2026.7 §4.7
CSA term 30-year minimum + perpetual continuation unless Non-Renewal Notice served (Year 28+) LOCKED Carbotura CSA v2026.7 §6.1
Counterparty credit floor BBB–/Baa3 minimum — CSA LOCKED Portfolio compliance pass 2026-05-15
Tax abatement NAICS 31–33 manufacturing Regulatory Predicate Transition (RPT); PILOT or equivalent (Maryland Enterprise Zone or equivalent) LOCKED Portfolio compliance pass 2026-05-15
FWDC (Fully Weighted Disposal Cost) ESTIMATED — Montgomery County RRF tipping rates and landfill gate rates not publicly disclosed at planning stage; estimated in line with Maryland Mid-Atlantic regional disposal costs ($90–120/ton all-in). Contract audit required at Joint Working Group phase. ESTIMATED Carbotura engagement planning basis — no verified published rate; Maryland DEP regional data; to be confirmed at Joint Working Group phase
Phase Initial capacity 400 TPD — 4 modules (initial addressable from immediate MSW stream) ESTIMATED Montgomery County municipal waste generation — ESTIMATED from 2024 population of ~1.07M at regional per-capita generation; Assumption Registry §B (community-meta.json lock)
Phase Expanded capacity 3,220 TPD — 32 modules ESTIMATED Full Montgomery County addressable feedstock including MSW, biosolids, and commercial streams · community-meta.json
Direct employment (Phase Initial) ~100 direct FTE ESTIMATED Carbotura standard 400 TPD baseline (100 direct FTE)
Indirect employment (Phase Initial) ~300 indirect jobs ESTIMATED 3:1 indirect multiplier
Annual economic impact (Phase Initial) ~$32M/yr ESTIMATED Carbotura standard 400 TPD economic impact baseline
RRF contract exposure ⚠ Existing Montgomery County RRF contract expires April 2031. RFP #1184252 remains unadjudicated — Council vs. County Executive standoff has stalled procurement. No contracted alternative in place. ESTIMATED Montgomery County procurement records; public reporting on RFP #1184252 status — verify current status at Joint Working Group phase
Zero Waste commitment Montgomery County Climate Action Plan + Zero Waste 2030 plan set binding diversion targets incompatible with current landfill trajectory VERIFIED Montgomery County Climate Action Plan (public); Zero Waste Plan (public)

Confidence flags follow Carbotura RevCon™ classification: VERIFIED (contracted or audited) · MODELED (calculated from documented inputs) · ESTIMATED (best-available, locked at Term Sheet phase).

Canonical Principles
  1. Carbotura is a manufacturer, not a waste manager. Advanced Circular Manufacturing converts delivered feedstock into products; it does not manage or dispose of waste.
  2. The Beneficiation Fee and the Circular Royalty™ are independent transactions. They are reported separately and in full, and are never netted against each other.
  3. Hydrogen powers the facility internally — it is generated and consumed on site to run the process, and is not sold as offtake.