SECTION 1

LIGHTWEIGHT CONCRETE “A SNAPSHOT”

This new innovative technology is a natural industry progression in this country

which integrates seamlessly with cement providers and contractors alike. It is an
extension to the most advanced building technologies but surpasses all others
with its energy efficiency features due to the ingredients that make up its
composition. Like any new product it will not be embraced by all the market in
fact we expect to penetrate only a fraction of the market but in particular those
key developers and contractors who are looking for speed of construction activities
and quality finish. Because of its “Green” qualities we expect strong support from
the media and environmentally conscious market sectors who will understand it’s
environmentally sound and simplistic features and benefits to the end user. This
“Green” aspect of the technology allows those developers and contractors who
embrace it to make bold statements to the market about its environmentally
friendly features aside from all the commercial benefits contractors will reap from
incorporating it in their construction methodology.

SECTION 2

LIGHTWEIGHT CONCRETE – WHAT IS IT?

Lightweight Concrete is as the name suggests “LIGHTWEIGHT CONCRETE”.

The two main reasons why it is so light are because;

(i) It has no aggregate in its mix composition and subsequently in most of its
normal applications (housing construction) it is not as strong as traditional
concrete mix however, in conjunction the Sterling Panel (as we outline
later in this document) lightweight concrete is a market leader with
overall unprecedented technology integrity.

(ii) The main ingredient in lightweight concrete that makes it lighter than
normal mix concrete is what is referred to as a foaming agent. This foaming
agent when mixed with sand, cement and water produces a slurry, the
mixing process incorporates small enclosed AIR BUBBLES within the
mortar thereby making it lighter and having special properties detailed
further herein. There are a number of foaming agents available in the
market that are generally manufactured from palm oil or similar biomass
substance including, protein based foaming agents and synthetic. (Note the
formula of foaming agents is a well guarded secret of the
manufacturer that cannot be acquired). The foaming agent can be

1
purchased from the manufacturers but generally it is part of a package with their
hardware.

When the undiluted foaming agent is mixed with water and processed through a
Foam Generator the end product, the foam, can be best likened to that of most
shaving foams.

SECTION 3

HOW IS LIGHTWEIGHT CONCRETE MANUFACTURED?

With no aggregate the only ingredients that make up lightweight concrete are
cement powder, sand, water and the foaming agent. The strength of lightweight
concrete can be varied significantly by the mix ratio of the ingredients. Once the
Lightweight concrete manufacturer understands the density of the concrete mix
required the composition of each of the ingredients is noted so as to obtain a
consistent concrete strength for the job at hand. Lightweight concrete is mixed in
an agitator in the same common manner as normal concrete. During the mixing
process the foam is pumped into the agitator and the outcome thereafter from the
mixing of sand, cement, water and foam although lightweight concrete is best
described in appearance and density as a slurry.

SECTION 4

FOAM GENERATOR

This essential piece of technology in the production of lightweight concrete is

powered by air. A relatively simple and generally small piece of technology the
Foam Generator can be powered from either an air tank or continuously operating
compressor. Foam generators have a number of control devices that enable the
operator to adjust the foam properties so as to achieve the required density of the
slurry.

SECTION 5

MIXING OF LIGHTWEIGHT CONCRETE

Although we stated earlier herein that lightweight concrete is mixed in the same
common manner as normal concrete, which it is, it is best to use a dedicated mixer
specific to the lightweight concrete as recommended by the foam manufacturer. To
obtain a uniform and smooth slurry it is also important to have the mixer and
2
foam generator in close proximity for speed of operation. The mixing action and
time of mixing is equally as important as mixing to long or short can affect the
integrity of the lightweight concrete mix – “its all about technique and conditions.”

SECTION 6

INSULATION FEATURES OF LIGHTWEIGHT CONCRETE

Due to its very low density and cellular structure lightweight concrete has
unprecedented thermal insulation qualities. Subject to the density of the mix
lightweight concrete can have up to 30% air content lowering its thermal
conductivity thus reducing heat transmission significantly.

In addition lightweight concrete is basically an inert non-combustible material

unlike many other types of insulation which may degrade over time or give off
toxic fumes when combusted. One of the key features of lightweight concrete that
we broached on earlier herein in the Sterling section was that due to its high flow
characteristics it requires no compaction and by nature it is self levelling.

When used as a stand alone product, that being when it is not being used as an
infill into Sterling Panel for example as a roofing surface it can also be mixed with
suitable waterproofing agents to make it impervious. In addition and for further
protection a layer waterproof membrane in the form of a polymer modified mortar
can be applied on the finished lightweight concrete surface as further protection
Lightweight concrete can also be used to replace concrete applications which
incorporate polystyrene as lightweight concrete is recognised as one of the leading
thermal insulators in the construction industry.

General thermal conductivity of cellular concrete compared to normal

concrete

Bulk density (kg/m3) Thermal conductivity (W/m deg C)

1,000 0.30
1,100 0.34
1,200 0.38
2,400 (normal concrete) 1.83

The table above shows that thermal conductivity of cellular concrete at 1,000kg/m3
is only 18% that of normal concrete.

3
SECTION 7

FIRE RATING OF FOAMED CONCRETE

Attached is the “indicative” fire rating in hrs for concrete of various densities.
“As a cement bonded material lightweight concrete is incombustible. In the event
of fire to a building, it has been found that lightweight concrete dos not
disintegrate or explode.”

Table showing thickness of lightweight concrete (mm) for fire resistance

at various densities.

Fire resistance ( hrs )

Density (kg/m3) 2 3 4 5
400 - 480 55.0 - 70.0 70.0 - 82.5 82.5 - 95.0 95.0 - 105
800 - 960 70.0 - 77.5 82.5 - 87.5 97.5 - 102.5 110.0 - 115
1120 - 1280 77.5 – 85.0 87.5 - 105.0 110.0 – 120.0 122.5 - 133
1600 100 125 145 -

SECTION 8

SOUND INSULATION OF LIGHTWEIGHT CONCRETE

Lightweight Concrete provides better (or equivalent) sound insulation transmitted

by air (airborne sound) than other solid building materials such as cement bricks
or clay bricks under comparable conditions.

The insulation of solid one leaf homogenous walls is dependent on the weight per
unit area i.e. surface related mass.

Using the Mass Action Law (Berger’s Law) for solid walls;

Rs = 14.5 log (m) + 10 dB

Where; m is the mass of the wall element in kg/m2 (inclusive of plaster and any
surface finish)

Rs is the sound reduction index (dB) for average range of 100 to 3150 Hz

Below are typical values of sound reduction index for various densities of
lightweight concrete compared to brickwork.

4
 Density of lightweight Rs (sound reduction
Thickness (mm) concrete (kg/m3) index) dB
150 1250 44.45
150 1200 44.25
100 2000 (cement brick) 44.70
100 1850 (clay brick) 44.39

 It is assumed that walls are plastered on both sides with cement based
plaster of minimum thickness of 12mm.

 Due to the high bending stiffness and low dry density of lightweight
concrete walls, the values above may increase by more than 10 percent.
(The chart does not take into account the Sterling Panel we will use
in all our construction activities). Typical formulas for Lightweight
Concrete given in ISO/171(1982); ”Method for rating the airborne sound
insulation of buildings and of interior building elements” results in sound
reduction index of 54 dB for 1250 kg/m3 which is higher than the values
given in the table above and exceeds the values for brick walls.

 Be mindful that as the Sterling panel makes up the interior/exterior walls

of our construction activities and being only 5mm thickness the sound
reduction index above will obviously change slightly.

5
SECTION 9

LIGHTWEIGHT CONCRETE TECHNOLOGY – SEE’S INVOLVEMENT

South Eastern Equities (“SEE”) have been researching innovative construction

technologies to be used in construction activities in the Philippines for in excess of
ten (10) years. During this time SEE introduced and had accredited by the
National Housing Authority (“NHA”) a “Sandwich Panel” building technology that
suited a multitude of building application but particularly those of the Philippine
Housing Industry. Unfortunately this technology as we were to later discover did
not pass the “knock test” of consumers and as a result of several years of work and
a lot of cost the technology was abandoned.

The “knock test” is a simple credibility test used by Filipino’s to hear and feel the
integrity of construction materials adopted in the construction of any building. It
is particularly important for home owners. The short thud noise that resonates
when a wall is thumped on with the palm of a clenched fist comforts the owner of
the house that the integrity of the construction material(s) are either solid and
secure or otherwise. Quite simply, like most countries Filipinos want to know that
their home is constructed of concrete or a concrete based materials and that it is
secure. Given the climatic conditions of the Philippines it is ironic that self
comfort is a distant consideration to security. Bearing this in mind South Eastern
Equities three (3) years ago began to research all concrete building technologies
and it wasn’t long before we realised that lightweight concrete was the way of the
building industry in the future. Lightweight concrete is not a new technology to
the building industry but generally most of the preparation and application
processes we have seen are archaic to say the least; hence the use of lightweight
concrete has been limited. Aside from spraying lightweight concrete the most
frequent way it is being used at this time in construction activities is as a filling in
in-situ formwork. However, adopting lightweight concrete in in-situ applications
has many downsides as the formwork is expensive and time consuming to
construct and dismantle. Furthermore, most of the in-situ formworks have limited
uses due to the erosive effects cement has on the surface of the formwork over a
period of time. Despite how well it is cleaned after each application the formwork
ultimately decays, which result in an expensive exercise to replace. Having
sourced a number of lightweight concrete products within the region we were of
the opinion that our future construction technology issue had been solved.
However, there were still a number of hurdles to overcome before the regular use
of lightweight concrete would be viable for us, the biggest problem was the
sourcing of a suitable formwork that was practical and commercially viable.

6
SECTION 10

STERLING CONSTRUCTION & DEVELOPMENT CORPORATION

(“STERLING”)

Approximately 12 months ago we were introduced to Sterling who had patented

an in-situ building technology that was fabricated from the regular James Hardie
panel manufactured in the Philippines. The Sterling technology is best described
as a permanent in-situ building technology and has been embraced by
construction companies in the local and international markets. On a commercial
basis the technology is on parity with traditional building methods i.e., concrete
hollow blocks (“CHB”) but the Sterling panel is many times faster in construction
and has a far superior finish.

In all the time that Sterling have been providing their technology to the market
the only way of “filling up” the cavity in their panel with concrete is by pouring
traditional concrete mix from a bucket or similar carrying apparatus directly into
it. In its natural state of readiness for accepting traditional concrete fill the
Sterling panel is not robust enough to accept concrete fill from a pump. The filling
of the cavity by using a concrete pump would result in a “blow out” at the panel
seams due to the shear weight and pressure of the concrete. The current system of
filling the cavity with buckets of traditional concrete mix is also floored with
technical issues not to mention the time it takes to bucket fill the cavity or the
manpower required. At the forefront of these issues is when the concrete mix is
poured into the cavity out of buckets it leaves air pockets around the plastic
“recycled” panel spacers that hold the two (2) sides of the Sterling panel together.
The only way around this problem is to compress the concrete fill with what is
commonly known as a concrete vibrator. However, once again the use of a vibrator
would result in “fracturing” of the Sterling panel.

Whilst Sterling have a technically sound in-situ construction technology it has

some flaws as detailed above which can only be overcome by the filling of the
in-situ wall cavity with a very liquid self levelling concrete – “lightweight
concrete”.

7
SECTION 11

SEE’S PUMP AND MIXER TECHNOLOGY

Being technically satisfied with the Sterling panel and likewise with several of the
suppliers of lightweight concrete product (foaming agent) was comforting but
South Eastern Equities was still not satisfied with the hardware solutions it had
been offered during its hardware sourcing exercise. Quite simply we wanted a
combined mixer and pump that would transfer the lightweight concrete directly
into the cavity of the Sterling Panel and we were not about to compromise.

From international inquiries we were able to locate several lightweight concrete

manufacturers who had the pump technology that allowed end user to pump
lightweight concrete directly into in-situ formwork. Those involved in housing
construction activities who use in-situ building systems all have residual concrete
markings and scoring when the formwork is removed. These marks and scoring
are created by the panel joints in particular the general uneven nature of in-situ
formwork. To remove these visible markings which crisscross internal/external
walls they have to be cement rendered but this a time consuming and expensive
exercise and more importantly the walls rarely have an even finish appearance.
With the Sterling product this is not necessary as the formwork, that is the in-situ
bonded James Hardie panels are never removed they make up the internal and
external walls. Several months ago South Eastern Equities on a back to back
formal arrangement with Bubble Double (a BVI company) entered into a
commercial arrangement with an organization who has successfully developed
and tested a lightweight concrete mixer and pump. The mixer/pump chemical
additive injector including the diesel motor and hydraulic pump which operates all
the function of the technology are full encased and integrated on a mobile trailer.

To the best of our knowledge and research the technology we will be offering to the
Philippine construction industry in association with Sterling is a world first and
South Eastern Equities have secured the exclusive rights thereto.

8
SECTION 12

THE SEE TECHNOLOGY

(i) THE HARDWARE

During our hardware sourcing exercise we noticed that all the lightweight
concrete suppliers we met or spoke to all had similar hardware components.
Each had a Foam Generator, Mixer, and where we did locate it a pump.
These were all separate units and on several occasions also included a
generator that was required to power the hardware as most of it was
electrical. It is not hard to understand that with all these separate pieces of
hardware connected by pipes, cables, etc. and all having their own specific
task in the manufacture of lightweight concrete that life is more than just a
little bit hectic for the operators. Worst still there is no uniformity in the
process as the operators are moving from hardware to hardware and then
transfer the end product (“lightweight concrete”) from one machine to
another. This process is just to complex, messy and unproductive given the
loss in time in managing all the various pieces of hardware. With one of the
manufacturers of hardware and foaming agent in Asia we spent several
months sourcing components so that they could develop a fully integrated
system for us but this also became too hard. On several occasions we were
told by other operators that an integrated system would simply just not
work. After months and months of international enquiries we located an
American engineering corporation who had just developed what we were
looking for. Now referred to by us as the “Air Crete Junior” this piece of
Technology has all the components integrated and mounted on a trailer
that can be towed by the average sized household car. It is in fact so
compact that the operators have no reason to be distracted by peripheral
hardware activities.

This Technology includes the mixer, pump, foam generator, diesel operating
motor, hydraulic systems, air compressor and air holding tank all in the one
compact unit. The unit is compact and mobile but has great performance
output to meet the demands of the most discerning contractors when
engaged in general housing activities. Due to its compact size and the fact
that it is mounted on a trailer the unit can be crane lifted allowing it to be
used in high rise development activities. SEE have secured the exclusive
rights to this Technology for the Philippines and we expect to expand these
rights to the other countries where Sterling supply their panel to i.e. Middle
East, South Africa, India to name a few and there are more countries on the
enquiry list.

9
(ii) FOAMING AGENT

Foaming Agents are in most instances the intellectual property of

manufacturers of Lightweight concrete Technologies and are mostly sold
to end users on a package basis. That being the end user generally
acquires the hardware of the foaming agent manufacturer on the basis that
it has been specifically set up (“so they say”) for their foaming agent.

With the exemption of one (1) all the foaming agents we have knowledge
of all work on the same basic dilution formula of around 40 to 1. This
means one litre of foaming agent plus 39 litres of water produces 40
litres of foaming solutions. However, 40 litres of foam mix (i.e. foaming
agent and water) expand to around 500 litres of foam.

(iii) BUBBLE DOUBLE FOAMING AGENT

The foaming agent we have procured the licensing rights to is simply

known as “Bubble Double Foaming Agent” which works and looks different
to all other foam concentrates. More importantly it complies with all the
American Standards (ASTM-C869 Standard Specifications) and (ASTMC-
796 test procedures) which is a stability during “pumping” test. Lightweight
concrete is tested during mixing and pumping and the loss of air content is
not allowed under the test conditions to exceed 45.5% of air mass.

The dilution rate of Bubble Double exceeds 1.300 this being seven to eight
(7-8) times the dilution ratio of other brands of other liquid foam
concentrates which their manufacturers promote as 1.40 dilution ratio. Not
only can Bubble Double be diluted seven to eight (7-8) times more than any
other brands of foam concentrate on the market but it is also formulated to
allow a wide range of adjustment in dilution ratios and yields.

As an environmentally friendly product it is not aggressive, will not chap

your hands not cause problems with surfaces that it touches. Unlike other
foaming agent products it does not decompose in an opened container and
the shelf like is for years.

In its natural state or when mixed into slurry there is no odour and with a
very attractive strawberry colour, texture and no odour it is a very simple
product to work with.

Similar to the “Aircrete Junior” hardware SEE have procured the licensing
rights to the Bubble Double Foaming Agent both which work perfectly in
harmony.
10
In summary, SEE have spent an enormous amount of money, time, and
effort in researching this rapidly emerging technology, Lightweight
Concrete. From such research we are of the opinion that what we have the
marketing and distribution rights to is the most technologically advanced
hardware and foaming agent available in the world today. We are
comfortable from test results that the Technology produces a constant
integrity of Lightweight Concrete in accordance with specification pre-
determined to the batch mix of the ingredients. As an environmentally
friendly technology what they, that is the hardware and foaming agent
collectively are able to produce is unprecedented in the construction
industry in the Philippines. The end development in particular housing
constructed from Lightweight concrete will provide a huge range of benefits,
pleasure, and uninterrupted living comfort due to its thermal and acoustic
properties.

Working in co-operation with Sterling the combined Technologies will be

difficult to surpass both as a packaged building technology or as a
commercially prudent business opportunity. Collectively they will establish
a new benchmark for all construction activities in the country that others
will aspire to, “or quite simply be forced to join”.

This is a very exciting opportunity for any bank or Investment

Corporation to be involved with particularly organisations who support
clean energy efficient construction processes that can be replicated on a
global basis at an affordable cost to the end user.

11
SECTION 13

COMPETITION

In the Philippines we were only able to locate two (2) suppliers of what their
manufacturers label as lightweight concrete technologies but each are vastly
different and inferior in their applications to the SEE technology, they are;

(i) SPEEDPANEL – An Australian technology only recently introduced to the

Philippines manufactured from galvanised steel with a lightweight
concrete infill. This technology is geared for commercial application.
Whilst it has excellent acoustic and thermal qualities it is expensive
and being manufactured offsite there will always be carriage/storage
issues to be dealt with but it is well suited for a number of specialized
commercial applications.

(ii) BOX SYSTEM CONSTRUCTION – A USA patented product promoted

locally by Northcon Construction & Management Group (“Northcon”).
It is a pre-cast in-situ panel system that is produced from a normal
concrete mix blended with polystyrene beads, Portland cement and
chemical admixtures.

It is said to be a cost effective building system comparable with concrete hollow

blocks but much faster. As an in-situ building product the finish should be of high
quality and we are informed it has very good Acoustic and Thermal qualities.
Once again being manufactured off site it has the same carriage/storage issues as
Speedpanel above. Due to its finish most of the clients of Northcon are reported to
be foreigners which is testament to the finish of the product.

We believe that Northcon may also manufacture concrete hollow blocks but the
information available suggests they are more expensive that traditional CHB
which restricts their market opportunities immediately.

Other than these two products we are not aware of any other competition in the
Philippines to that of our lightweight construction technology.

In Malaysia, Thailand, Indonesia and other Asian countries there are a number of
lightweight concrete fabricators using various configurations of preparation and
delivery of lightweight concrete. However, our research indicates that most of the
manufacturers are focused on pre-cast moulding of hollow and solid blocks
including wall panels. Another common use is the pre-casting of decorative wall,
ceiling and garden features.

12
There are a few manufacturers of lightweight concrete in Asia who use in-situ
building systems but their formwork is expensive and time consuming to construct
and dismantle. Generally there are quality finish issues with using in-situ
formwork building systems that become evident after the formwork has been
removed.

13
SECTION 14

TARGET MARKETS

Our target market is just a fraction of those highly rated contractors licensed with
the Philippine Contractors Accreditation Board (“PCAB”). For the records and to
appreciate the size of the Philippine market as of September 2009 PCAB had
issued a total of 3,698 contractor licenses for 2009/2010. Of this number 97.1%
were license renewals and the remaining 2.9% were new entrants. Important to
qualify for our target market is the large contractors “AAA” and “AA” account for
only 6.3% of the issued licenses. The medium sized contractors “A” and “B”
composed of 36.2% while small contractors still remained the majority of PCAB
licenses at 57.5%. However, more comforting for our entry into the Technology
side of the construction industry is the surprising increase in the trade figure
related to the construction industry referred to as construction investments.
Amidst the global economic crisis, soaring oil, gold, and food prices and general
economic uncertainty during the first semester of 2009 the Philippine economy
managed to grow by 3.8%. Whilst there was mixed earnings recorded by all
market sectors there was a staggering 15.8% growth in the construction industry.
In the first six (6) months of 2009 construction investments, as measured by the
gross value in construction (“GVC”) reached Php66.2 billion representing a 9.7%
increase in the same period in 2008. Generally market optimum is high and we
have not seen or heard anything to the contrary that the industry has slowed
down in 2010.

Having regards to the financial stability of the construction industry we are of the
opinion that we could not have forecast a better time for the introduction of the
lightweight concrete technology into this market. Our general sentiments are that
it will obtain huge recognition and acclaim from all areas of the construction and
development industry once they become aware of it. The applications for its use
are wide and varied but our immediate focus will be directed towards existing
clients of Sterling and thereafter potential clients of Sterling.

The reciprocal benefits to both Sterling and SEE working in a collaborative

relationship should become apparent almost immediately and will also allow
Sterling the opportunity to re-visit customers that they may previously were
unable to close due to mixed reasons associated with their technology.

The technology in time will have impact, but little, on the concrete hollow block
(“CHB”) industry as there will always be users of this type of technology as it has
applications that we would could not even consider. It’s just a matter of time as to
how we penetrate this market with our lightweight concrete technology but a
Lightweight concrete hollow block at the same price as the traditionally made
14
concrete hollow block would be our objective. As the business matures there will
be a requirement for technology diversification that being larger and smaller
models of the technology to accommodate large commercial developments and
similarly to support the small provincial developers and manufacturers of cement
based building products. These opportunities will be addressed as they come to
hand.

The market penetration for this type of technology is controlled by capital costs
and our forecast of twenty (20) machines in year one (1) to well rated contractors
of the Philippines Contractors Accreditation Board is in our opinion very
conservative.

15
SECTION 15

CARBON CREDITS

This commercial area of the technology has not been researched at this time as it
would be premature until such time as production of Lightweight concrete
commences (October 2010). However, given its green qualities we see no reason as
to why it would not qualify for Carbon Credits. In the immediate future we will
schedule meetings with; key advocacy groups the likes of Philippine Green
Building Council (“PHILGBC”) and LEED to discuss the innovative and
environmentally friendly features of lightweight concrete.

We are of the opinion that we would obtain immediate status as one of the leading
technologies within the Building for Ecologically Responsive Design Excellence
(“BERDE”) programme being developed by PHILGBC.

SECTION 16

HOW WILL CONTRACTORS/DEVELOPERS GET TO USE THE

TECHNOLOGY?

The Technology will not be for sale to any party, the ownership of the hardware
will always remain the property of South Eastern Equities.

We will however rent the hardware and sell the foaming agent to customers on a
package basis. A draft of the Double Bubble Services and Rental Agreement is
attached at the rear of this section which outlines the terms and condition for the
commercial arrangement proposed.

To the benefit of the end user under the proposed commercial arrangement they
have no capital outlay and will still enjoy the benefits of the product delivered by
specifically trained operators in the use and application of the Technology. The
pricing of the daily rental has been structured in such a manner that the
technology and services provided thereafter including the supply of the foaming
agent should not cost the end user anymore, or very little, if any, than the cost of
using the Sterling Panel adopting traditional concrete mix infill. Quite simply
what we have structured the Rental Agreement results in nothing less than a
commercial “WIN WIN” for SEE, Sterling and the beneficiary (Contractor/
Developer) of the Technology and Services thereto.

16