Member Info for dustofnations

HF14 -

Examples:

https://apply-for-innovation-funding.service.gov.uk/competition/1645/overview/3013bb72-ee5b-4fda-9baf-47da3910b144#scope

https://apply-for-innovation-funding.service.gov.uk/competition/1646/overview/be3642c8-80e9-445a-8366-49eae215577d#scope

https://apply-for-innovation-funding.service.gov.uk/competition/1647/overview/8f7f5f02-aae9-4e7d-9ce3-bea08eaeb9e4#scope

Perhaps a productive avenue could be for you to write to your MP and make the argument (politely) that biofuels such as MSAR/bioMSAR should be included in the future fuels schemes.

Say that a British company is a frontrunner that is trying to break through commercially with operators such as MSC, but you are concerned that UK is providing a much less favourable environment than competing jurisdictions like EU and US.

Point out some companies in those other jurisdictions, and note that they are getting green grants and subsidies unavailable here in UK.

I was asked to share this here as it benefit wider shareholder community. Thanks, QED Shareholders' Forums & JPM.

Permission was given by JM to share this.

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Question:

Dear Jason

I have spent considerable time going through the recent IMC and Q&A answers to get a handle on things before deciding whether or not to participate in the open offer.

A huge factor for me is the current situation around the fuel supply for MSC and to be fair you did provide additional info and colour to this subject in your oral and written replies. However, your written answer to Q6 said that selecting a suitable terminal was a “work in progress” while at Q10 you said “There is a lot of associated engineering and permitting work already being carried out in parallel”

These two replies seem somewhat contradictory. In my head, permitting and engineering prep is normally site specific, so how can this work be carried out in parallel if you have not yet selected the terminal?

Can you please give me some clarity on this please as I do think it matters to shareholders. I will of course share any reply you give with other holders if that is your wish.

Best wishes, *

Jason’s reply;

“Hi *

Apologies if the responses below were unclear, we had 102 questions to deal with from the IMC event.

We have a shortlist of terminals located in a particular area, all of which have shared features – hence in areas where there’s commonality the engineering has started. Similarly with regards to permitting, this refers not only to the terminals themselves, but also the fuel and biofuel bunkering permits and accreditation from suppliers and government agencies which are largely independent of the exact terminal location.

I hope that this helps, feel free to share as required.

KR,

Jason”

- QED already secured £1.1M at the placing (mostly to institutional investors).

- Then, QED have an agreement to bring in ~$1.5M from Valkor when they secure the permits to proceed with their project, in addition to various other fees. That is obviously contingent on getting past the DOGM Board and DOGM without further delay, but we should find out what the next steps on that in August.

- What we are providing via the OO:

(i) helps existing shareholders avoid dilution;

(ii) lengthens the runway and capital available for project expenditure without needing to return to the market again;

(iii) puts new shares in hands of people who are less likely to trade and other shenanigans than shorter-term IIs.

Refer to the circular for full information. https://wp-quadrise-fuels-2020.s3.eu-west-2.amazonaws.com/media/2023/07/Circular-to-Shareholders-Placing-Open-Offer-July-2023.pdf

Last bit got chopped off:

> So, overall, there's a lot still to play for. And I feel it is worth making a modest investment to give it a chance to make it over the line, and finally return some value to incredibly patient LHTs.

Thanks for the views, everyone.

After the RNSes, IMC, and Q&A, I've decided I will take up my allowance in this raise. I believe a few key projects are close to execution, and it makes sense to protect the existing (over)investments I've made in Quadrise and see it through.

To put it up front, in my view, the criticisms of the team's poor performance in certain areas is valid (re: strategic customer engagement, negotiations, complex project management, etc), and I hope they have taken that on board and will bring in the required skills as soon as possible. Perhaps that will be on the board of directors, or via full-time employees. There's been too much of a "must be a ChemE" focus at QED, and I believe they've left skills gaps in bizdev areas that are non-technical and don't require deep knowledge of surface chemistry!

I also accept that covid put the brakes on things over the previous couple of years. We shouldn't discount that when thinking about delays.

All things considered, I think the calibre of partners we have is high. Especially for MSC. MSC have purchased and overhauled a ship to undertake the trials, which is a considerable investment. The credibility we can gain by successfully executing those trials and entering into a commercial relationship cannot be overestimated. The economic, market, and regulatory conditions are extremely well-aligned to our product, so this is the best opportunity we'll ever get.

In Morocco, despite our best efforts to shoot ourselves in the foot, things are still on track and this looks like a fantastic opportunity to establish a large commercial contract with scope to expand into additional sites; it also offers the tantalising prospect of re-establishing a relationship with Cepsa for long-term supply in the Med region. Naturally, this could also benefit the marine programme in the long term, but also open up other industrial opportunities in the Med and North Africa.

In Utah, I suspect there's been too much trust of Mr Byle's/Valkor's optimistic timelines, but there's little doubt as to the scale of the opportunity there and that it is an excellent fit for our technology. I am intrigued to see whether Valkor can get these local users using MSAR/bioMSAR, because it will be a while before the railroad is completed, and even longer before the marine programme is mature enough to regularly justify sending vast quantities of MSAR/bioMSAR via rail for bunkering in LA or Houston. It would also be wonderful for us to have some active projects that potential customers could come and visit to see it in action for themselves.

In South America, the projects are interesting, but historically we've had problems converting into commercial because of the complex politics in that region. So that's a "let's wait and see" for me, and I'll be delighted for any of them to progress beyond trials. It seems a good fit given the energy and economic dynamics in the region.

So, overall, there's a lot still

It's in the RNS, see the table: https://www.lse.co.uk/rns/QED/placing-results-open-offer-posting-of-circular-13gt0wap07uns9f.html

Andy has dramatically increased his holding.

JM is taking up approximately his allowance in OO (touch less, not material).

Laurie, Phil S, and David are applying in excess of their allowances.

Phil H acquired his first tranche of shares.

You can do whatever you like, of course, and nobody would begrudge you that.

But, the idea is that you are acting to protect your investment instead of guaranteeing a loss.

Hi All,

I've made a cleaned audio-only version of the IMC. I have also slowed down the audio by a tiny fraction, as it makes Jason easier to understand.

I found it useful to listen again, as there are quite a lot of details I missed first time.

https://quorumzine.gitlab.io/quorum/audio/12-july-qed-imc-cleaned.opus

@Wazaaa: circular page 6. Your broker will usually have narrower windows by a day or two; they'll advise you very shortly, no doubt.

"1 Open Offer Share for every 8 Existing Ordinary Shares held on the Record Date"

Record Date was 6th July 2023 @ 18:00.

However many shares you had at the date and time above, 1/8th of that amount should be the entitlement (guaranteed number of shares you can acquire if you wish).

You can still always apply for excess if you wish.

Check out the circular: https://wp-quadrise-fuels-2020.s3.eu-west-2.amazonaws.com/media/2023/07/Circular-to-Shareholders-Placing-Open-Offer-July-2023.pdf

Kolonic - a quick scan of the application scope page for that project answers your question.

# Projects we will not fund:

We are not funding projects that are:

* focusing on non-methanol biofuels

For whatever reason UK are the outlier on this topic, wanting to only fund hydrogen, methanol, and ammonia. They have decided they do not like biofuels for some reason.

EU, US, and JP are extensively funding sustainable biofuel projects, but we're not in the EU any more, obviously.

In the future this may be a good reason to expand our presence directly into an EU country, perhaps via acquisition, so we can qualify for these kinds of projects.

CFP — start of the fuel supply negotiations started approximately 1 year ago with the signing of the "Framework Agreement with MSC Shipmanagement" once the nature of the trials had been thrashed out. That still isn't very impressive in terms of speed, but very different to 3 years.

If you listen to the interview carefully there is no one supplier for the marine fuels trial. Quadrise are having to piece together an alliance of companies themselves:

- multiple glycerol suppliers;

- HFO supplier (seems they will use HFO as a stand-in for residue that would come in a full commercial installation);

- marine terminal with appropriate permitting for biofuel storage and blending;

- bunkering with permitting for this kind of activity.

I'm not going to defend the remuneration numbers, they are self-evidently excessive.

However I think there is some very important context: the fully loaded cost to a company of an employee vs their salary are two very different things. People are conflating them together here.

The number you see in the annual report includes: salary + employer pension + employer national insurance contributions + cash value of any employee benefits.

(Fully loaded costs would also technically include stuff like office and admin costs, etc, but that's not relevant for this discussion).

So, from the 2022 annual report as an example:

Short-term benefits (salary + other similar elements): 251k

Social security (NI taxes, etc): 34k

Post-employment benefits (pension, etc): 10k

Other benefits (would be stuff like health insurance I guess): 6k

No idea where £400k people are floating around is coming from. It's already a large enough amount without the ever-increasing grapevine numbers!

Hi Haggis/StockCheque/EarEyeAm/Brian/etc, why not just use one account here instead of multiple? We all know it's you, there's no need to astroturf the board to make your points.

I don't really see the benefit of this ongoing charade to the company or shareholders? We're all adults here and people can see through it; it's just causing unnecessary friction and distraction with fellow holders.

Thanks 🙏.

What is an open offer: https://www.investopedia.com/terms/o/openoffer.asp

You are allowed to purchase new shares issued by the company at a set price (1.25p per share). You are guaranteed to be allowed to purchase up to 1/8th of the shares you own, and you can apply for excess if you wish which will only be fulfilled if other people do not take up their allowances.

Let's say you have 8000 shares, then you would be entitled to 1,000 shares in the open offer, and anything you applied for over that would come out of the excess facility.

You are not obliged to participate.

Your broker will contact you for the procedure, as the specifics of how to take up your allowance varies broker to broker. But, essentially: make sure you have cash available in your account; take up the number of shares you want; this money will then go to the company.

That's it.

Participating in the open offer @ 1.25p provides money to the company to ensures it continues running. That is more valuable to self interest and collective interest than trading on the secondary market.

Official circular out, has more detail on than the RNS. Make sure you read all the way down as there are some interesting details on various agreements/contracts:

https://wp-quadrise-fuels-2020.s3.eu-west-2.amazonaws.com/media/2023/07/Circular-to-Shareholders-Placing-Open-Offer-July-2023.pdf

12th is when the placing ends, which most retail investors will not have been directly involved in (institutions).

In theory:

Open offer is for a longer period and according to the schedule deposit of your OO entitlements is "as soon as practicable after 8.00 a.m. on 11 July 2023" and then latest time for taking up entitlement is "3.00 p.m. on 20 July 2023".

Check the RNS https://www.lse.co.uk/rns/QED/placing-results-open-offer-posting-of-circular-13gt0wap07uns9f.html and the section titled "EXPECTED TIMETABLE OF PRINCIPAL EVENTS"

In practice:

Your broker will send you a notification with their own time window that is likely slightly narrower than the one specified in the open offer literature to ensure their own systems have time to act.

I've found the start period can be delayed a bit because of manual setup needed on the broker's side.