INFORMATION MEMORADUM

A Revolutionary
Fuel Additive

S&A Química Information Memorandum 1


Passionate
about what we do, we
strive to positively
impact the world.
Join us on this journey, and
let's work together to crea-
te a sustainable future for
generations to come.
S&A Química
S&A Profile
S&A Indústria Química LTDA
is a revolutionary player
in the manufacturing of additives for
combustion engines. Our high-tech
products not only enhance engine per-
formance and lifespan but also signifi-
cantly reduce harmful emissions into
the environment.
As a Brazilian private company, we
were founded by two visionary part-
ners, Sérgio da Rosa and Anderson
Aléssio, both with extensive experien-
ce and education in the chemical sec-
tor. We specialize in the commerciali-
zation, production, and most importan-
tly, research and development of inno-
vative chemical processes and pro-
ducts.
Our mission is to revolutionize the fuel
industry by providing environmentally-
friendly solutions that allow people to
live in perfect harmony with nature. We
understand that reducing costs, impro-
ving performance, and conforming to
ESG standards are key drivers for insti-
tutional customers. That's why our
products offer superior quality and
provide a significant competitive edge
to our clients.
By reducing fuel consumption, increa-
sing performance and efficiency, and
considerably decreasing emissions of
pollutants, we help our clients meet
their sustainability goals.
We take pride in offering a low-cost
solution to environmental issues rela-
ted to fuel combustion. Our cutting-
edge products are not only a game-
changer in the fuel industry but also
serve as an alternative means of parti-
cipating in the decarbonization credit
market (CBios).
Information Memorandum 2
 Our Team
Since 2016, S&A Química has been dedicated to developing, producing, and commerciali-
zing a cutting-edge "additive" designed to enhance the energy efficiency of both fuels
and biofuels used in combustion engines.

Guided by the principles of sustainability, the company holds a prestigious green patent
for its products, reflecting its commitment to reducing emissions of pollutants while pro-
viding cost-saving benefits to its clients.

With a clear focus on the future of energy transition, S&A Química is poised to play a sig-
nificant role in the decarbonization of the air. The company is dedicated to leveraging the
latest sustainable technologies to help create a cleaner and greener future for us all.

S&A Química's administrative headquarters are located in Criciúma, SC, with its producti-
on facilities located in nearby Tubarão, SC.

The company is led by a talented and experienced team

- Sérgio da Rosa (Co-founder, Industrial Chemist, and R&D/Industrial Director),
- Anderson Aléssio (Co-founder, Chemical Engineer, and Executive Director),
- Mauricio Mafra (Chemical Engineer and National Commercial Manager).

With their combined expertise, S&A Química is well-positioned to continue driving inno-
vation and growth in the energy sector.

Sérgio da Rosa Anderson Aléssio Maurício Mafra

S&A Química Information Memorandum 3

 A Historic Discovery
That Reinvents Fuel To Make Our Planet Cleaner

S&A is proud to present our revolutionary, proprietary fuel additive that has been
developed to meet the growing demand for an environmentally friendly, highly
versatile, and cost-effective solution to traditional fuel.

Our state-of-the-art fuel additive has been designed to enhance the performan-
ce of gasoline, diesel, and biofuel for all modes of transport and electricity gene-
ration. With just 1 liter, our additive can treat up to 1,000 liters of fuel, providing
an incredibly powerful solution that delivers exceptional value for money.

Our fuel additive offers numerous benefits to our clients, including a 9% reduction
in fuel consumption, improved lubrication of the engine and its components, and
a remarkable reduction of greenhouse gases and dangerous emissions by up to
49.5%. These advantages make S&A the most powerful and affordable fuel ad-
ditive available, providing our clients with a profound, immediate, yet lasting
competitive advantage.

It can be easily used by gas station operators, refineries, and anyone who opera-
tes any mode of transport at a cost-saving. This feature positions S&A as the
partner of choice for clients looking to increase their competitive edge in an ever-
changing market. We believe this will help us secure long-term partnerships as it
provides clients with a profound, immediate, yet lasting competitive advantage.

It is essential to realize that fuel is expected to remain the primary power

source for nearly 60% of all vehicles by 2050. However, as the market demands
cleaner, safer, and more efficient solutions, S&A's fuel additive is positioned to
fulfill this need and keep our clients at the forefront of innovation. Our product
offers unparalleled benefits, providing a sustainable competitive advantage that
will enable our clients to meet the growing demand for environmentally friendly
and cost-effective fuel solutions.

S&A Química Information Memorandum 4

 DESCARBONIZATION

S&A Química Information Memorandum 5

 The Fossil Fuel Vehicles
The automotive sector is one of the major contributors to air pollution and global
warming due to carbon residue and smoke opacity emission. Today, the trend of
decreasing sources of petroleum fuel has led to the innovation of other resources
such as alternative fuels and fuel additives.

All kinds of internal combustion engines i.e. Spark Ignition (SI) and Compression
Ignition (CI) are equally responsible for the emission of gaseous such as nitrogen
oxide (NOx), carbon monoxide (CO), carbon dioxide (CO2), hydrocarbon (HC) and
smoke opacity.

Some of the gaseous emitted would have a direct hazardous effect. They are also
polluting the surrounding atmosphere and cause acid rain, global warming, gree-
nhouse effect, and other hazardous effects.

On the other hand, only about 12%–30% of the energy from the fuel you put in a
conventional vehicle is used to move it down the road, depending on the drive
cycle. The rest of the energy is lost to engine and driveline inefficiencies or used
to power accessories. Therefore, the potential to improve fuel efficiency with ad-
vanced technologies is enormous.

S&A Química Information Memorandum 6

 By 2050, there will be about 3 billion light-duty vehicles on the road worldwide,
up from 1 billion now. At least half of them will be powered by internal combusti-
on engines (ICE), using petroleum-based fuels.

The chart above is based on the assumptions of The International Energy Agency (IEA)’s growth
scenario, which is a highly optimistic roadmap. This scenario assumes government incentives
for EVs will continue. It also foresees that fast charging or battery-swapping technology will
proliferate by 2030 and it predicts that by 2040, new batteries that “significantly outperform”
lithium-ion batteries at similar costs will be available.

S&A Química Information Memorandum 7

 OUR PRODUCTS

S&A Química Information Memorandum 8

 S&A Additives
S&A's additive is a game-changer in the fuel additive industry. Our proprietary
method of production sets us apart from the competition, allowing us to produce
advanced materials that outperform almost every other existing additive in
terms of both price and performance.

Our cutting-edge technology ensures that our additive not only meets but exce-
eds industry standards, providing our customers with the most efficient and
cost-effective solution on the market.

Our versatile additives are suitable
for use in a wide range of combusti-
on engines, including power genera-
tors, trains, and various types of wa-
tercraft. With our additives, custo-
mers can expect improved engine
performance, increased fuel effici-
ency, and reduced emissions, all of
which can lead to significant cost sa-
vings and environmental benefits. By
incorporating our additives into their
operations, businesses can not only
improve their bottom line, but also
demonstrate a commitment to sus-
tainability and responsible environ-
mental governance.

The superior performance of our additive is due to its ability to facilitate the
scission of hydrocarbon chains and enhance oxygen adsorption onto fuel surfa-
ces, resulting in more extensive fuel oxidation and improved combustion effici-
ency.

S&A Química Information Memorandum 9

 The agglomeration of hydrocarbons in fuel can cause mass transfer limitations,
leading to incomplete combustion due to restricted oxygen diffusion.

Incomplete combustion

However, the use of POWER BOOST SA10, SA20, and SA30 additives promotes
molecular catalysis, allowing for the scission of hydrocarbon chains and enhan-
cing oxygen adsorption onto fuel surfaces. This increases the mass transport
rate of oxygen and promotes more extensive fuel oxidation, resulting in improved
combustion efficiency, better engine performance, increased fuel economy, and
lower emissions of harmful exhaust gases such as CO, NOx, THC, and SOx.

Complete combustion

S&A Química Information Memorandum 10

 As an example, let's consider a diesel tank with a capacity of 15,000 liters. To this
tank, 15 liters of POWER BOOST (SA10, SA20, or SA30) would be added, which
is equivalent to 0.1% of the nominal capacity of the fuel tank.

The POWER BOOST additive comes in packaging sizes of 5, 20, 50, and 200 li-
ters. The application is intended for use in the diesel fuel of a 15,000-liter tank.

S&A Química Information Memorandum 11

 OUR BUSINESS

S&A Química Information Memorandum 12

 Our Business
As a chemical company, we are committed to transforming the fuel industry by
integrating cutting-edge technology and pioneering advancements to create a
powerful, user-friendly, and game-changing product that can greatly enhance
fuel efficiency and drastically reduce pollution.

Our team of scientists has dedicated over five years to the research, design, tes-
ting, and refinement of our product and production methods, leveraging their ex-
tensive scientific knowledge and expertise.

Our technology is proprietary and protected by patents (green patent - through

the use of more than 80% of green raw materials), but we have also optimized
our production process and materials to achieve cost-effectiveness, ensuring
that we can easily scale up to meet high demand.

We are proud to count some of the world's largest corporations among our pros-
pective customers. These companies generate billions of dollars in revenue and
recognize the transformative potential of our technology.

To demonstrate the efficacy and practicality of our product, we have established

Memorandums of Understanding with a range of partners, including gas station
operators, oil and gas companies, and multinational automotive manufacturers.

With our passion for innovation and commitment to environmental sustainabi-

lity, we are confident that our groundbreaking product will revolutionize the fuel
industry and pave the way for a cleaner, more efficient, and more sustainable
future.

S&A Química Information Memorandum 13

Market The worldwide fuel market is $3.5 trillion.

Size Global oil markets

Crude oil prices: The Brent crude oil
spot price averaged $82 per barrel (b)
in January, about $2/b higher than
the average in December 2022.

Source: U.S. Energy Information Administration

Business We have developed a unique business model that allows it to sell its products
through three different sales channels. These channels are designed to reach a

Model wide range of customers, from individual consumers to large industrial clients.

The first sales channel is direct to the consumer. This channel is focused on indi-
vidual consumers who want to improve the performance of their vehicles or re-
duce their fuel consumption. Customers can purchase these products online or
through a network of authorized dealers.

The second sales channel is institutional sales, which includes sales to distribu-
tors, refineries, industry, freight transport, and public transport. This channel is
focused on businesses and organizations that use large quantities of fuel on a
regular basis. Bulk orders of fuel additives can be used to improve the perfor-
mance of large fleets of vehicles or industrial equipment. These products can
help businesses reduce their fuel consumption, improve their environmental per-
formance, and reduce their overall operating costs.

The third sales channel is in-house plants. This channel is focused on selling fuel
additives to industrial plants that produce their own fuel. The manufacturer of-
fers a range of specialized additives that can be added to different types of fuel,
such as diesel or gasoline, to improve their performance and reduce emissions.
These products can help industrial plants improve the quality of their fuel and
meet regulatory requirements.

S&A Química Information Memorandum 14

 Why invest in
S&A Química?

S&A Química Information Memorandum 15

 Why invest in
S&A Química?
Profitable The company currently generates a steady monthly recurring revenue while con-
tinuing to produce its products in outsourced facilities. With ambitious plans for
Investment organic growth over the next five years, the company is targeting a growth rate
(CARG) 42.75%. Despite these impressive growth targets, the company's EBITDA
margin is already exceeding 40% relative to its net revenue.

Investing in this company presents an excellent opportunity, as it has already

achieved a steady stream of recurring revenue and has ambitious plans for orga-
nic growth in the future. With a current EBITDA margin, this company has a
strong financial foundation to build upon, which bodes well for investors seeking
a profitable and stable investment opportunity.

Disrupting Investing in his company also presents an incredible opportunity to help disrupt
the fuel market. The company's fuel additives are known for their effectiveness
and reliability, and their use can help reduce the dependency on traditional fossil
fuels.

Safer In addition, investing in S&A Química can also make a positive impact on the en-
vironment, as the company's fuel additives contribute to a cleaner and safer fu-

Future ture for everyone. Investors can play a role in promoting sustainability and redu-
cing carbon emissions, which can help to mitigate the effects of climate change.

Furthermore, the use of S&A Química's fuel additives can save lives by reducing
harmful emissions that can cause respiratory illnesses and other health pro-
blems.

S&A Química Information Memorandum 16

 FINANCIAL
DATA

S&A Química Information Memorandum 17

 Financial Projections
Premisses - In 2022, in the second semester of the year, the company had a gross revenue
equivalent to R$ 1.2 million, which annualized would be equivalent to R$ 2.4 mil-
lion.
- In 2023, our company will be expanding its product offerings to include two ad-
ditional sales channels. This is a result of our sales department's hard work and
dedication to achieving their goals, as well as successful negotiations with our
partners.
- Starting in 2024, our company will be operating in brand new, state-of-the-art
facilities, which will not only improve the overall efficiency of our operations but
also boost our profitability margins. With our facilities, we will have greater con-
trol over our processes, allowing us to optimize our resources and provide even
better value to our customers.
- The CAGR of the company's revenue for the 5-year projection period will be
42.75%.

Financial Projections
2022(12M) 2023 2024 2025 2026 2027
Liters b2c 1.000 1.500 1.950 2.438 2.925
Price liter B2C 72,85 72,85 72,85 72,85 72,85
Liters b2b 70.000 140.000 210.000 273.000 341.250 409.500
Price liter b2b 35,77 35,77 35,77 35,77 35,77 35,77
Liters In-House 6.000 10.500 13.650 17.063 20.475
Price In-house 30,00 30,00 30,00 30,00 30,00

Gross revenue 2.448.707 5.830.650 8.933.475 11.613.518 14.516.897 17.420.276

(-) Deductions (428.524) (874.598) (1.340.021) (1.742.028) (2.177.535) (2.613.041)
Net Revenue 2.020.183 4.956.053 7.593.454 9.871.490 12.339.362 14.807.235
Cost of products/services sold (588.730) (2.502.148) (3.044.899) (3.958.369) (4.947.961) (5.937.554)
Gross margin 1.431.453 2.453.904 4.548.554 5.913.121 7.391.401 8.869.681
Operational expenses (607.476) (789.719) (987.149) (1.184.579)
Ebitda 1.431.453 2.453.904 3.941.078 5.123.402 6.404.252 7.685.102
Depreciation and amortization
EBIT 1.431.453 2.453.904 3.941.078 5.123.402 6.404.252 7.685.102

Incom Tax Experiences (139.936) (214.403) (278.724) (348.406) (418.087)

Income tax (97.955) (150.082) (195.107) (243.884) (292.661)
Social contribution (41.981) (64.321) (83.617) (104.522) (125.426)

Net Income 1.431.453 2.313.969 3.726.675 4.844.677 6.055.846 7.267.016

Var. Rob %a.a.a. 138,1% 53,2% 30,0% 25,0% 48,5%

Deductions % ROB 17,5% 15,0% 15,0% 15,0% 15,0% 15,5%
Gross margin % ROL 70,9% 49,5% 59,9% 59,9% 59,9% 59,9%
Ebitda Margin % ROL 70,9% 49,5% 51,9% 51,9% 51,9% 51,9%
Ebit margin % ROL 70,9% 49,5% 51,9% 51,9% 51,9% 51,9%
Effective tax rates % EBT 0,0% 5,7% 5,4% 5,4% 5,4% 5,4%
Net margin % ROL 58,5% 39,7% 41,7% 41,7% 41,7% 41,7%

S&A Química Information Memorandum 18

FCFF FCFF
(=) Operational Result (EBIT)
2023
2.453.904
2024
4.548.554
2025
5.913.121
2026
7.391.401
2027
8.869.681
Operational Result (EBITDA) 2.453.904 4.548.554 5.913.121 7.391.401 8.869.681
( -) Income Taxes (139.936) (214.403) (278.724) (348.406) (418.087)
(=) Noplat 2.313.969 4.334.151 5.634.396 7.042.995 8.451.594
( -) Working capital (69.245) (237.559) (308.826) (386.033) (463.240)
( -) Capex (71.550) (520.000) (520.000) (520.000) (520.000)
(=) Free Cash Flow to the Firm 2.173.174 3.576.592 4.805.570 6.136.962 7.468.355

VALUATION We are conducting an estimation exercise that takes into consideration the suc-
cess of our strategic planning, our sales budget, and our ability to secure the ne-
cessary financial resources. By carefully considering these factors, we aim to cre-
ate a realistic projection of our future performance and identify any potential
challenges that we may face. We are committed to achieving our goals and are
confident that this exercise will help us stay on track toward a successful future.

VALUATION
WACC
Perpetuity 12,28% 13,28% 14,28% 15,28% 16,28%
1,50% 49.446.061 47.532.822 45.713.798 43.983.509 42.336.840
2,00% 50.969.388 48.990.090 47.108.414 45.318.678 43.615.577
3,00% 54.421.128 52.292.143 50.268.503 48.344.065 46.513.094
4,00% 58.544.312 56.236.524 54.043.305 51.957.961 49.974.246
5,00% 63.555.966 61.030.845 58.631.506 56.350.585 54.181.211

S&A Química Information Memorandum 19

 Disclaimer
This publication has been carefully prepared, but it has been written in ge-
neral terms and should be considered as containing only general state-
ments.

This publication should not be used to cover specific situations, and you
should not act, or refrain from acting, based on the information contained
in this publication without obtaining specific professional advice.

Any use of this publication or reliance on it for any purpose or in any con-
text is therefore at your own risk, without any right of recourse against the
analyst or any of their partners.

S&A Química Information Memorandum 20

 Site: www.saaditivos.com.br
email: comercial@saquimica.com
Tel:. +55 (48) 9.9176- 4795

S&A Química Information Memorandum 21