Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Quality

Environmental Achievements

• Facilities recertified to ISO 14001:2000

Social Achievements

• Achieved 100% customer service levels with zero customer complaints for the fifth consecutive year

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Dependence on a small number of customers for a high percentage of sales
• History of losses
• Long adoption cycles for products
• Rapid changes in technology
• Intense competition
• Need to raise additional capital
• Potential product liability risks
• Governmental regulations
• Stock price volatility

Mitigation Strategies

• Expanding marketing and business development efforts
• Improving production efficiency
• Developing new customers
• Investing in research and development
• Maintaining insurance coverage
• Implementing Lean Six Sigma discipline
• Securing equity funding and loans

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: ISO 14001:2000, ISO 9001:2000, cGMP

Certifications: ISO 14001:2000, ISO 9001:2000

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Facilities and processes were re-certified to ISO14001:2004, the international environmental management standard.

Social Achievements

• Reached a new safety record with 850,000 continuous working hours without a lost time accident.
• Achieved 99.1% customer satisfaction levels on product shipments and had no customer quality returns.

Governance Achievements

• Facilities and processes were re-certified to ISO9001:2000, the internationally recognized standard of manufacturing and quality excellence.

Climate Goals & Targets

Environmental Challenges

• Dependence on a small number of customers for a high percentage of sales.
• Long adoption cycles for products.
• Rapid changes in technology.
• Intense competition in the advanced materials industry.
• Potential product liability risks.
• Governmental regulations.
• Commodity metal price increases.

Mitigation Strategies

• Consistently expanding marketing and business development efforts and production efficiency.
• Pursuing strategic relationships with customers.
• Committing substantial resources to develop technologies and product applications.
• Maintaining insurance coverage for product liability claims.
• Implementing appropriate procedures and processes to have its facilities certified to ISO 14001.
• Passing through commodity price increases to customers where possible.
• Maintaining sufficient cash balances.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ISO 9001, ISO 14001

Environmental Metrics

ESG Focus Areas

• Environmental Health and Safety (EH&S)

Environmental Achievements

• Facilities certified to ISO 14001:2004 (international standard for environmental management); processes generate very low levels of waste and emissions.

Social Achievements

• Not disclosed

Governance Achievements

• Established Audit and Finance Committee, Compensation and Governance Committee, and Nominating Committee, each comprised entirely of independent directors.

Climate Goals & Targets

Environmental Challenges

• Decreased sales to largest customers due to aggressive inventory reduction programs and focus on cheaper products; global recession impacted consumer products and exterior coatings markets.

Mitigation Strategies

• Broadening market reach by addressing several market segments with targeted solutions; implemented cost savings initiative, including workforce reduction, to improve margins; aggressively pursuing new customers.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: ISO 9001, ISO 14001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• NanoUltra™ line of architectural window cleaning and restoration products.

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Environmental Management
• Safety
• Governance

Environmental Achievements

• Facilities certified to ISO 14001:2004 (international standard for environmental management)
• Processes generate very low levels of waste and emissions

Social Achievements

• Exemplary safety record
• Strong relationship with employees

Governance Achievements

• Established Audit and Finance Committee, Compensation Committee, and Nominating and Corporate Governance Committee
• Board of Directors reviews risk at entity and strategic levels

Climate Goals & Targets

Environmental Challenges

• Dependence on a few major customers
• Long adoption cycles for nanomaterials
• Potential supply chain disruptions due to reliance on Rare Earth elements (cerium oxide) from China
• Intense competition in the advanced materials industry
• History of losses

Mitigation Strategies

• Aggressive pursuit of new customers through a customer-direct business model
• Focus on reducing controllable variable product manufacturing costs
• Efforts to expand production capabilities
• Continued research and development to improve technologies and reduce costs
• Strategic relationships with customers to develop new applications

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ISO 9001, ISO 14001, cGMP

Certifications: ISO 9001:2008, ISO 14001:2004

Environmental Metrics

ESG Focus Areas

• Environmental Management
• Safety

Environmental Achievements

• Facilities and operations are certified to ISO 14001, American National Standard, Environmental Management System Requirements.
• Processes generate very low levels of waste and emissions.

Social Achievements

• Company has an exemplary safety record.
• Strong relationship with employees.

Governance Achievements

• Board of Directors has established an Audit and Finance Committee, Compensation Committee and Nominating and Corporate Governance Committee.
• All compensation paid to the executive officers is intended to be tax deductible to the Company pursuant to Section 162(m) of the Internal Revenue Code.

Climate Goals & Targets

Environmental Challenges

• Dependence on a few major customers for a high percentage of sales.
• Long adoption cycles for products.
• Potential product liability risks.
• Rapid changes in technology.
• Intense competition in the advanced materials industry.
• Need to raise additional capital in the future.
• Potential for mandatory license of technology and/or sale of production equipment to BASF under certain circumstances.

Mitigation Strategies

• Expanding marketing and business development efforts and production efficiency.
• Focusing on key markets and applications to gain a depth of knowledge.
• Maintaining insurance for product liability claims.
• Committing substantial resources to develop technologies and product applications.
• Aggressively pursuing new customers through a customer direct business model.
• Exploring public or private financing and contracts with governmental entities or other companies.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ISO 9001, ISO 14001, cGMP

Certifications: ISO 9001, ISO 14001