THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS

THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS Volume 1: North America, 2000-2005 KLINE & COMPANY, INC. OVERLOOK AT GREAT NOTCH 150 CLOVE ROAD PO BOX 410 LITTLE FALLS, NJ 07424-0410 (973) 435-6262 www.klinegroup.com

THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS Volume 1: North America, 2000-2005 THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS, VOLUME 1: NORTH AMERICA, 2000-2005 is part of a continuing series of reports that completes a realignment of Kline & Company s bellwether studies of the North American and European markets for extender and filler (E&F) minerals. Previous recurring non-paper market surveys of E&F minerals have been consolidated into this new two-volume report that will now encompass such markets as plastics, rubber, construction materials, adhesives and sealants, catalysts, health and personal care, food, and agriculture. North American and European regions are analyzed on alternating years (in Volumes 1 and 2). Asian markets might be added as a third volume, if sufficient interest develops. The first step in this realignment involved the creation of a separate three-volume set of reports on the global markets for extenders and fillers in the paper industry titled THE OUTLOOK FOR EXTENDER AND FILLER MINERALS IN THE GLOBAL PAPER INDUSTRY. Volume 1 of this series was published in 2000 and focused on North America. Volume 2 will focus on Europe and for the first time will include an annual global overview of the paper industry. Volume 3 in this series will cover the Asia-Pacific paper markets. Throughout the 20-year history of Kline s reports on extenders and fillers, the paper market has been analyzed in conjunction with other industrial and consumer markets that are the subject of this new report series. As part of these prior series, markets in plastics, rubber, adhesives and sealants, and paints and coatings have been monitored continuously since 1981. This new report will add coverage for other important markets for performance minerals, including health and personal care, catalysts, food, and agriculture. Like the series on paper applications, THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS will alternately cycle through an analysis of the North American and European market (and eventually, the Asian markets as well) on a continuing basis. The schedule of report releases is provided in Figure 1.

The launching of a global E&F service covering industrial and commercial markets is timely for a number of reasons: Most major E&F mineral companies already have separate business units and marketing staffs to serve either the global paper industry or industrial/commercial markets that are the subject of this series. Each requires dedicated global business planning information to effectively compete in this market The healthcare and other markets not previously covered in North American E&F studies are becoming increasingly important to minerals suppliers Each region has its own set of end-use market dynamics. This affects both the types and volumes of extenders and fillers consumed For example, in the plastics market, the vinyl siding and window casement market is far more developed in North America than it is in Europe. In the rubber market, the use of synthetic silicas has developed faster in Europe than in North America, which still favors kaolin. Additionally, Europe saw the initial development of composite wood-grain flooring, which employs translucent alumina filler. In the paint market, filler markets are tuned to widely different patterns of paint formulations. Some latexes that are popular in Europe are virtually unused in North America. Furthermore, there are important differences in the regulatory climate affecting volatile organic compounds (VOCs), and the attendant effect on the growth rates for water-based paints. The adhesives and sealants markets are similarly affected. For over two decades, Kline & Company s reports on E&F markets have been the leading source of insight on this value-added sector of the industrial minerals industry. This service provides active monitoring of the capability of new and existing suppliers of these minerals to serve the key end-use sectors with their products. In addition, these reports track all major developments in industrial/consumer markets and have proven to be an invaluable resource used by virtually all major E&F mineral suppliers since Kline & Company s first such study was published in 1967. THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS will provide an in-depth analysis of all major performance minerals consumed in the plastics, rubber, construction materials, catalyst, health and personal care, food, and agriculture industries, together with a trend analysis by region and profiles of the major performance minerals suppliers in each region. On a volume basis, various construction-related markets, including paints and coatings and adhesives and sealants, accounted for nearly 50% of the volume of performance minerals in North America in 1999, as shown in Figure 2.

Figure 1 PERFORMANCE MINERALS REPORT SCHEDULING Publication Date 2001 2002 2003 March June Sep March June Sep March June Sep NORTH AMERICA (VOLUME 1) EUROPE (VOLUME 2) ASIA-PACIFIC (tentative) (VOLUME 3) NOTE: The base year for a report is the year previous to publication date. For example, the final report published in September 2001 has a 2000 base year. Figure 2 ESTIMATED NORTH AMERICAN DEMAND FOR PERFORMANCE MINERALS BY MAJOR END-USE SEGMENT, 1999 % Of Of total total volume Construction, 46% Health/ personal care, 1% Food/agriculture, 2% Catalysts, 7% Plastics, 34% Rubber, 10%

Reports. A single volume typically runs 350 to 400 pages in length. A general outline for each volume of THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS is detailed in Table 1. Consulting. Each subscription will include one day of consultation time. This time can be used to explore specific issues related to this industry with a key member of the project team within the Minerals Practice of Kline & Company or a representative in one of our regional offices. Kick-off meetings. Kick-off meetings will be conducted with all subscribers to the service. The meetings will take place in the first quarter of each year and will focus on understanding issues that are considered important to subscribers before the research begins. These meetings will provide a forum to understand subscribers needs and to ensure that questionnaires, contact lists, and other research tools focus on meeting those needs. The kick-off meetings will be conducted by Kline at the subscribers offices to the extent possible. Electronic media. THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS is also available to subscribers through our Web-based delivery service. This option allows clients to purchase a site license from Kline & Company, in addition to receiving one hard copy of the report. The site license will allow unlimited access for the subscriber s company. Individual users can access the report from anywhere in the world via the World Wide Web. THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS will include both textual and tabular data and will have searching and export capabilities, enabling users to search for specific companies and brands. Most importantly, subscribers will have access to multiple years of data. Benefits of our Web-based product include ease of accessibility; unlimited user access; increased timeliness; the ability to search, cut, and paste; and access to historical data. Interview reports. Nonconfidential interview reports will be available in our offices for subscribers to review. NOTE: All E&F minerals supplier interviews and other related supplier interviews are confidential.

Table 1 THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS TENTATIVE OUTLINE 1. EXECUTIVE SUMMARY 2. INTRODUCTION PRODUCT CHAPTERS For each major product covered each year, the following will be provided: Overview Grades and prices Applications New and competitive products Consumption by industry and end product Major consumers by market Suppliers by market Historical trends Market developments Outlook and opportunities 3. ALUMINA TRIHYDRATE 4. CALCIUM CARBONATE (Overview) 4A. GROUND CALCIUM CARBONATE 4B. PRECIPITATED CALCIUM CARBONATE 5. KAOLIN (Overview) 5A. HYDROUS KAOLIN 5B. CALCINED KAOLIN 5C. AIR-FLOATED KAOLIN 6. MICA 7. TALC 8. TITANIUM DIOXIDE 9. OTHER MINERALS AND PIGMENTS Attapulgite Barytes Bentonite (organoclays) Diatomite Ground silica Wollastonite Others to be added depending on specific subscriber interest REGIONAL END-USE INDUSTRY CHAPTER For each volume, the following end-use industries will be analyzed for the region under review: Plastics Segmented by at least seven types of plastics (PVC, polyester, polypropylene, polyethylene, epoxy, phenolics and nylon) Rubber Manufactured rubber goods Tires Construction materials Architectural paints OEM and specialty coatings Adhesives Sealants and joint compounds Health and personal care Cosmetics Pharmaceuticals Food Agriculture Catalysts Industrial Automotive For each of these industries, the following details will be covered: End products Performance minerals Functions Levels of use Consumption Major consumers Major suppliers Channels of distribution Market developments Outlook and opportunities 10A. NORTH AMERICA (2000) 10B. EUROPE (2001) 10C. ASIA-PACIFIC (tentative, 2002) APPENDIX: LIST OF ORGANIZATIONS INTERVIEWED

The reports The overall survey and analysis will be completed in two separate volumes on a twoyear recurring basis. A third volume covering Asian markets might be added in the future, in which case the volumes would be presented on a three-year cycle. Each of the major global regions will be analyzed in detail once during the cycle; however, all regional segments will be monitored continuously. The two main volumes in the continuing service THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS will be structured in a concise and consistent format. Each volume will typically have eight separate major product chapters, plus one summary chapter of all the end-use industries covered, as discussed below: Products. In each volume of THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS, the major mineral products used in the various market segments featured in that volume will be analyzed in detail. This approach will provide subscribers with an in-depth view of specific products, as well as a macro view of the entire performance minerals business for industrial/consumer applications. Consumption patterns in each region, similar to what is provided in Figure 3 for the plastics market in North America and Europe, will be detailed for each product covered in terms of market tonnage and value. Specific products detailed in each volume of THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS are provided in Table 1. The benefits Current subscribers to THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS service cite many benefits derived from this type of continuing service. The most common benefit reported is that the service provides an independent and objective source of market insights and information. Several other specific benefits frequently mentioned by subscribers are outlined below: Detailed information on E&F mineral consumption and trends in specific end-use applications helps subscribers target profitable markets during their annual business planning process Analysis of individual supplier market shares and market and product mix enables subscribers to make accurate competitive assessments for product groups and enduse markets Five-year forecasts for all product categories and end-use markets provide subscribers with data necessary for completing long-range strategic plans End-user interviews and comments are used in product development activities by major suppliers that are insulated from the marketplace by a network of distributors

Figure 3 ESTIMATED PERFORMANCE MINERAL CONSUMPTION IN PLASTICS IN NORTH AMERICA, 1999 % Of Of total total volume volume Calcium carbonate, 57% Other-a, 3% Wollastonite, 2% Barytes, 4% Titanium dioxide, 12% Alumina hydrate, 11% Talc, 7% a- Includes diatomite, ground silica, and mica. Kaolin, 4% The leading use for Kline s EXTENDER AND FILLER MINERALS studies is reported to be in the area of market development. This includes growing existing businesses by better understanding market needs, as well as expanding existing product lines into new applications. These reports have also provided clients with the fundamental information and insights required to pursue product development activities. In addition, the continuing service is frequently cited by subscribers as an excellent resource for competitive intelligence. This issue is particularly important in benchmarking, staffing, and planning activities. This applies not only to producers of these performance minerals but also to other participants along the supply chain, including companies that supply such raw materials as lime. All subscribers to past EXTENDER AND FILLER MINERALS studies also note that the reports are excellent training tools. Methodology The overall survey and analysis will be completed by a team of experienced Kline professionals in our regional offices, along with associates retained for this project. While members of the team will draw heavily on their backgrounds and prior experience in the performance minerals business, major emphasis will be placed on primary data gathered through telephone and personal interviews.

An estimated 280 in-depth interviews will be conducted to complete the first two volumes of THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS during the base years of 2000 to 2001. An approximate distribution of interviews for each volume is shown in Figure 4. The interviews will focus on the end users of E&F minerals (your customers) and key suppliers (your competitors). In addition to developing information on consumption, these interviews yield valuable insights into market developments, unmet needs, purchasing practices, trends, and other key issues. In addition, we will interview other intermediaries in the supply chain, including distributors, original equipment manufacturers (OEMs), trade associations, and others who are knowledgeable in the E&F minerals business. Although primary research is by far the leading source of information provided in THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS, the analysis is supplemented by secondary research. This secondary research includes: 1) a review of suppliers product literature; 2) a search of recent trade and technical literature; and 3) an analysis of statistical data from the United States Geologic Service and other government, industry, and trade associations and agencies. Figure 4 TENTATIVE NUMBER OF INTERVIEWS TO COMPLETE EACH VOLUME OF THE PERFORMANCE MINERALS STUDY 70 60 Number of interviews 50 40 30 20 10 0 Construction Plastics/rubber Food Health/personal care Agriculture Catalyst Mineral suppliers North America Europe

Kline & Company s credentials Kline & Company is a leading business consultancy serving the minerals industry worldwide. The firm was established in 1959 and is headquartered in Little Falls, New Jersey. It also maintains a global network of offices in Australia, Belgium, Brazil, Japan, Mexico, and Singapore. Kline is organized into separate industry business practices. Our Minerals Practice has extensive experience in assisting major corporations with business planning, raw material requirements, technology commercialization, project feasibility studies, diversification, strategy development, acquisition identification, screening and due diligence, and other business consulting services. Our assignments have been significantly augmented by our strong and unique capabilities in understanding the underlying forces driving these businesses and the technology issues that will affect future demand. Performance Mineral Expertise. Kline & Company s extensive experience in performance minerals dates back to the founding of the company in 1959. In the 1960s and 1970s, the company published the KLINE GUIDE TO THE PAINT INDUSTRY, an annual digest of market facts useful to suppliers. In 1967, Kline published its first major mineral study, EXTENDER AND FILLER PIGMENTS UNITED STATES 1967. We repeated this major analysis again in 1973 and 1978. In 1981, Kline converted the program into a yearly analysis covering North America. Companion European studies were released in 1973, 1984, 1988, and 1996. In addition to this continuing series of studies, Kline has researched opportunities for fillers and coating pigments, synthetic latexes, numerous types of filled and composite resins, and specialty chemicals in a variety of other syndicated reports, as shown in Table 2. The company has also conducted hundreds of proprietary assignments investigating the market opportunities for filler minerals. These studies have ranged from quantifying existing markets for fillers to investigating the opportunities for new filler products with unique performance capabilities. How to subscribe THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS is available by subscription only at $13,500 (U.S. funds) a year for hard-copy version only (five copies in total provided), or $14,500 for a single hard copy plus the Web-based access to the report and database, until February 28, 2001. After this date, the price of the report will increase to $15,000 and $16,000 per year for the report or Web service, respectively. Each subscription includes one day of consultation per year. To subscribe, please complete the subscription agreement for THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS in this prospectus and return it to Kline & Company s North American or European offices.

Table 2 PARTIAL LISTING OF SYNDICATED STUDIES COMPLETED BY KLINE ON INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS EXTENDER & FILLER MINERALS NORTH AMERICA and WESTERN EUROPE Plastics and Rubber Industry volume Paints, Coatings, Adhesives and Sealants Industry volume SPECIALTY BIOCIDES series: United States and Western European editions Paints, Adhesives and Sealants sections SPECIALTY SILICAS GLOBAL COMPETITIVE ANALYSIS Sections on Plastics, Rubber, Healthcare, and Agriculture SYNTHETIC LATEX POLYMERS Sections on Adhesives, Carpet, Caulks and Sealants, Paints and Coatings FUNCTIONAL FOODS: A COMPETITIVE LANDSCAPE COSMETICS AND TOILETRIES USA - Continuing Industry Analysis COLORS IN PLASTICS COMPETITIVE COATINGS TECHNOLOGIES FOR VOC COMPLIANCE IN THE 1990s INORGANIC, SYNTHETIC, AND NATURAL THICKENERS USA KLINE INVESTMENT AND DIVERSIFICATION OPPORTUNITIES PROGRAM: U.S. Specialty Chemicals Series (Paint Additives Section) SPECIALTY ADHESIVES AND COATINGS FOR POLYMER COMPOSITES SPECIALTY EXCIPIENTS USA PAINT AND COATINGS 2000: REVIEW AND FORECAST (First, Second, and Third Edition)

THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS, 2000-2005 2005 (A Continuing Business Analysis) Please enter our subscription to your comprehensive survey THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS, 2000-2005 2005. We understand this subscription includes up to five copies of each volume in this two-year series of annual reports, one day of professional consultation each year with a member of the survey team (within six months of receipt of the report), and access to all non-confidential source data used for each report. A Web-based delivery option is also available at an extra charge. To protect our investment in this report and that of other subscribers, we agree that, for three years after its final date of issue, we will (1) refrain from reproducing or copying this report in whole or in part by any means, (2) restrict its circulation to our own employees, and (3) use all reasonable precautions to prevent the disclosure of its contents to any other persons or organizations. However, we may make this report available to any subsidiary company in which we hold more than a half interest or to any parent company that holds more than a half interest in our firm. We may also use or disclose any information in this report that is public knowledge, that was already in our possession before receipt of the report, or that comes to us from third parties independently of this report. Kline & Company similarly agrees that it will use all reasonable precautions to prevent the disclosure of the contents of this report to any persons or organizations other than subscribers for three years after its date of issue of the report. We understand that each two-volume set in this two-year series of reports, THE OUTLOOK FOR INDUSTRIAL AND CONSUMER MARKETS FOR PERFORMANCE MINERALS, 2000-2005 2005 is available only by subscription. Additional copies of each volume are available for $500 each. Subscription prices do not include sales tax. (NJ add 6% sales tax.) You will invoice us for the full amount for Volume 1 upon receipt of this subscription agreement and an equal installment for Volume 2 early in the first quarter of 2002. We will pay these invoices within 15 days after receipt. We have indicated the desired delivery option by selecting from the following:! We would like five hard copies of the report. The price is $13,500 per year if we order by February 28, 2001, and $15,000 per year thereafter. or! We would like the ONLINE version of the report (unlimited access), which also includes one hard copy. The price is $14,500 per year if we order by February 28, 2001, and $16,000 per r year thereafter.! In addition to the copies provided with our subscription, we would like to order (please indicate amount) extra hard copies at $500 each. We have completed and signed this subscription agreement. Please indicate your acceptance of this subscription by countersigning g and returning one copy for our files. ACCEPTED KLINE KLINE & COMPANY, & COMPANY, INC. INC. COMPANY ACCEPTED COMPANY SIGNATURE SIGNATURE SIGNATURE SIGNATURE NAME DATE DATE NAME NAME DATE DATE E-MAIL E-MAIL PHONE SHIP TO: SEND PHONE INVOICES TO: NAME SHIP TO: NAME ADDRESS NAME SEND INVOICES TO: NAME ADDRESS ADDRESS ADDRESS X64T X64T