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Rotapower - The engine of the future

Investment opportunities

Key Financial Information

2 scenarios

  • In house production & distribution
  • External production & distribution

In House production & distribution

The following projection takes no account of income from:

    • Joint ventures
    • Sub-licenses
    • External manufacture and ditribution of engines

7 August 09 - Update from Freedom Motors Freedom Motor's business plan projects that it will generate a revenue of $385 million in the fourth year of production (0.25% penetration of the world engine market). The company has received letters of intent to purchase and conditional orders for over 900,000 engines ($1 billion) from a number of original equipment manufacturers. To provide selected OEMs with production ready beta engines will require approximately $5 million in funding to re-tool two displacements (150cc and 450cc) for volume production and produce a few hundred engines. Delivery contracts are expected to help fund the full scale volume production ($15 to $20 million).

Following a one year start-up, the Company projects $23.2 million revenue in the first full year of production based on converting a few letters of intent to firm orders and establishing a market presence that will facilitate very modest penetration of the recreational, industrial and hybrid vehicle markets.

    1. 0.25% penetration of the worldwide annual engine sales 
    2. 14% net profit on sales
    3. $385 million in sales (does not address revenue from potential sub-licensees, which would increase figures dramatically)

     

Rate of Return Summary

The financial analysis shows a 60% annual compound rate of return* through the 4th year of production, assuming that the required funds are obtained in return for the purchase of the Company’s common stock. This return is based on the audit share price ($10 per share) assigned to Freedom Motors shares when it became independent of Moller International in 2002.  It is anticipated that investors who provide bridge funding will acquire their shares at a discount from this price, while subsequent investors will acquire their shares at a modest increase from this price.
* Based on a J.P. Morgan estimate that evaluation could be projected using the average of 8.5 times cash flow, 20 times earnings, which is conservative for a company undergoing rapid growth in a very large potential market.

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External production & distribution

To be Advised

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How will funding be used?

Production Phase 1   $5m            Preparation of 60hp+ engine for pilot production. Part of this funding can be in the form of an interim loan for which the company can provide security via a large volume of shares, quoted or unquoted. The loan can be converted into shares once the investor’s due diligence is complete. Any investor coming forward with such a loan can expect an advantageous position in negotiating ongoing share acquisitions.

Production Phase 2   $20 - $30m  Commence modest engine production and prepare other Rotapower engine versions also for production. The strategy is for Freedom Motors themselves to manufacture engines for high-performance high-value niche markets.

Production Phase 3   $100m         Expand the models in production, lower production costs, prepare for world markets and increase the global hybrid car market. All other markets and engine production are likely to be exploited under license, region-by-region or via JV partners.





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