Highline Technical Innovations LLC (HLNT-OTCPK)

Alternative Hydrogen Solutions, LLC

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October 8, 2012 Issue

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Alternative Hydrogen Solutions LLC is making Electrolysis good for use in Diesel Engines with their Hy-Impact™ Line of Products

Company Profile:

About Alternative Hydrogen Solutions LLC
The Hy-Impact™ line of products began development in 2005. After 7 years of research, testing and modification, it has emerged as a unique and successful solution to the concerns posed by rising fuel prices and the environmental concerns related to harmful emissions. Alternative Hydrogen Solutions was formed in 2012, when the creators of Arkansas-based Highline Technical Innovations Inc. (HLNT:OTC) joined forces with Alternative Hydrogen Systems Group Sales and Marketing LLC, in order to bring this revolutionary product to market. The products that comprise the Hy-Impact™ line and their corresponding industries include: Hy-Road™ for trucking, Hy-Marine™ for maritime, Hy-Flo™ for oil, Hy-Agra™ for agriculture, Hy-Rail™ for locomotive, and Hy-Drolean™ for municipality.

Chad Coats
Chief Executive Officer

Alternative Hydrogen Solutions since May 2012. His mission is to educate the public on the benefits of hydrogen as an untapped natural resource with the ability to more completely burn fossil fuels in combustion engines. Chad understands the need to reduce dependence on fossil fuel reserves and understands that his mission with hydrogen not only accomplishes this, but it also serves to protect the environment from harmful emissions.

A key player in the quest to bring fuel saving and environmentally responsible technology to full development, Chad also currently serves as CEO of Highline Technical Innovations, the manufacturing and engineering arm of the joint venture since 2010.

His entrepreneurial spirit and multi-faceted interests have led Chad to take ownership roles in several local businesses in addition to his work with HTI.

Chad served in the US army from 1990-1995 in the 25th infantry air assault division and was honorably discharged. He holds a B.A. in Business Administration at John Brown University and prior to joining HTI, worked at two fortune 500 companies based in Northwest Arkansas, his home region.


Highline Technical Innovations LLC

Alternative Hydrogen Solutions, LLC



Interview conducted by: Lynn Fosse, Senior Editor, CEOCFO Magazine, Published – October 8, 2012

Mr. Coats, you are creating the new generation of intelligent hydrogen systems, what are you actually working on specifically?

Mr. Coats: We have a product that is able to help our end users reduce their fuel bill as well as being green at the same time.

CEOCFO: How are you doing that?

Mr. Coats: It is a process of electrolysis. We are taking a water molecule, breaking it into its basic elements of hydrogen and oxygen, and then we are using the hydrogen to help burn the fuel for whatever particular engine is burning rather than trying to burn hydrogen.

CEOCFO: How did the concept come along for you and how does it differ from some other models out there?

Mr. Coats: Actually, it is not new at all, electrolysis has been around for a very long time and it is not patentable. What we do have that is patentable is a process in which we can take electrolysis and make good use of it. We have been working on this for the last seven years and finally got the product to a marketable state in a marketable package.

CEOCFO: How does the process work and what has Alternative Hydrogen Solutions figured out that others have not?

Mr. Coats: How it works is we take the hydrogen and oxygen and inject into the combustion chamber of a combustion engine. We specialize in the diesel applications right now. Without getting into a huge science lesson, when fuel is injected into combustion chambers and is atomized, it is like a mist that is made of diesel, then oxygen is brought into the mix to help combust the fuel. What hydrogen does when it is injected into the combustion chamber with diesel is it actually helps the diesel burn more completely, which is the reason why we have emission now days in applications or any vehicle. What is coming out the tail pipe is what is left over from the diesel burning, so if we can help the diesel burn more completely, there is less of it coming out of the tail pipe.

CEOCFO: Why do you use diesel first; is that an easier process?

Mr. Coats: It is that we specialize and are marketing toward commercial groups. We have several verticals in marine, agricultural, and transportation, which we are talking about today. In general, diesel engines have always been more efficient engines therefore they are more utilized in their commercial applications. They are also bigger and we do like bigger engines, we find them more effective, and we are talking about 350-1000 horsepower range. We focused specifically on the diesel engines simply because there are more of them.

CEOCFO: What was the biggest challenge in putting this together?

Mr. Coats: We are in our ninth generation of the product. The jump from number eight to nine was incredibly significant because generation eight just was not marketable esthetic, yes it worked fantastic, but the problem was you put it on the end user and use it like a major fleet, so they will look at it and say they do not know if it will be good on their truck. With generation nine, even the manufacturing itself is cutting-edge, it is state-of-the-art, and it is a product that we can present to particular fleet manager and they can start to buying into it then. The biggest challenge was taking our eighth generation, which looked more like something made in a garage, to where it is mass productive. The whole production process is automated by machines and not many hands touch it.

CEOCFO: Would you tell us about your arrangement with Velociti?

Mr. Coats: Velociti specializes in technology deployment. One of the biggest issues many of the new technologies have is that you may have a great idea, but if you cannot make them fast enough, that is a problem. Where Velociti comes in, you need to get them installed. With most of these larger commercial entities, it is not their core competency to put things on their truck, or boat, or generator, so the core competency of Velociti is to take this technology, implement it and deploy it, which they are paid to do. The standpoint for us is we have a great product, however, if it is not installed properly and correctly, it will not work effectively. The fact that Velociti can come in, train them one time, and they filtrate it down through their entire system, it gains traction across the country. We have people in place to install them on site.

CEOCFO: What is the ROI?

Mr. Coats: It depends on the vertical. From what I understand, for transportation general acceptable, it is anywhere from nine to twelve months, and our pricing is in accordance with the return on investment for that particular customer and their vertical. Marine is approximately the same, but the pricing is not because we have a different unit for each vertical which has a different pricing structure.

CEOCFO: What is the company going to be doing for the next six months to a year?

Mr. Coats: Highline Technical Innovations is the manufacturer with exclusive manufacturing rights and I am the CEO of that. Our problem has been finding a way to implement a plan to get into these different spaces. You can have a great product, but if you do not have entry points into it, you just cannot get anywhere, so that was a big problem for one or two years there. Mr. Cunetta and crew came in and that is their specialty. He brought in people like Susan Fall with LaunchIt Public Relations, a firm that specializes in the commercial vehicle sector and Velociti. These are strategic partners that can implement a marketing plan and strategy to get our unique cutting-edge technology into the transportation field is and example. The Alternative Hydrogen Solutions plan is to take an angle to eventually get to the end user or even the OEM down the road with our technology to where it is part of the manufacturing process, and that is a long-term goal of ours.

CEOCFO: How do you capture interest with so many new products and ideas in the indudstry?

Mr. Coats: We are advertising, and you are saving 6% to 18% on your fuel and in any particular vertical that is going to have to get some attention, which means that with every dollar you spend, you can save $0.06 to $0.18. The other factors that are put into the equation are not only fuel reduction but emissions reduction, longer life for your engine, and running at cooler temperatures. Much of the EPA emission standards are governing not just transportation, but other verticals, and they are requiring systems like diesel exhaust filters on transportation. There are so many pieces where we are able to help a custom get value.

CEOCFO: When you are talking to the right people, do they understand the concept quickly or do they need further explanation?

Mr. Coats: You get the CFOs attention by the dollar signs that are attached to the savings and the ROI. It has to start at the top and work its way down. One of the lessons we learned in the past is when started from the shop and tried to work our way up, people in the office did not know what is going on out in the field. Therefore, you have to sell the idea to the executive, and they need to see the dollars, then you can implement a plan to get the value out of it. When they see the value and we can get their attention virtually with dollar signs, the rest is fairly easy.

CEOCFO: Development is always expensive as is commercialization, is Alternative Hydrogen Solutions sufficiently funded to do the rollout?

Mr. Coats: That is always a work in process. I take any dollars out there at any time. We are sufficiently funded, but there are so many dreams that we have around the shop. For our purposes and what we are trying to accomplish right now, yes, we do have the funding. We have the manufacturing in place that was critical. Funding is important, but if you do not have the right partners in place, let’s say we had a $5000 order in and let’s hope it takes less than a year to get those units out there. Manufacturing partners and our vendors are critical pieces of that equation for our success.

CEOCFO: Have you been or will you be speaking with OEMs as well?

Mr. Coats: It is in the plan, which is down the road. There have been many different companies and people who had and are trying what we are doing now. Eventually, somebody has to get it right and we believe we have done that. As far as our competition and who we face out there, it comes down to the trade secrets that make our unit different. Most units out there use anywhere between fifty to sixty amps, but we use two to two point five, so much less power is needed. We are not trying to burn hydrogen, we are trying to use hydrogen, and there is a huge difference. With most applications, people are in the phase of trying to figure out this technology because they are just flooding the engines with hydrogen and hoping to burn it and create more power, but the reality is that hydrogen does not contain enough energy to move a vehicle. It is the diesel in the engine that is the energy that drives an engine, and by using hydrogen rather as a catalyst as opposed to a fuel itself, that is where we are different and that is the reason why we figured it out. We got the process in place and now we can make any application for any vertical based on that process.

CEOCFO: Are you able to work with any of the environmental groups?

Mr. Coats: We have already implemented steps such as EPA verification for diesel technologies back in December. It is government, you have to fill out paperwork, it is not a matter of them listening to you, it is a matter of you filling out the right documents and for them to look at it and talk about proving it. They set the rules that everybody has to abide by, so we are going through the processes of that. It just takes time, and by the third or fourth quarter, we hope to be well into the process, but realistically it could take all the way through 2012 to do so.

CEOCFO: Why should investors pay attention to Alternative Hydrogen Solutions today?

Mr. Coats: We are going to make a difference. We have a very unique product that not only can help the end user but the environment as well. As a business, we plan do very well with it. For the public investor, this is an IPO, so anything an investor puts money into on the stock market is pretty much stocked, and it is coming from somebody else, out of somebody else’s portfolio. What makes us attractive is merely our stock price in the particular tier that we are in as we are growing and becoming more credible in the investment community, moving from speculating stock to investment opportunity. That is why we have that amount of volume on our equity end. Our security and the stock price itself is an attractive feature if you can believe what I say, and that is precisely what we are trying to do. Not only do we have the product, but we have the ability to educate the investment community, and more importantly, we have all of our partners educate the actual public and the end user of what our product does. Every company will experience this. Stock price will always follow revenues, it happens every time. That is who we are aiming at primarily right now. As far as the stock opportunity, it would be more of a long-term approach and outlook.


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Actually, it is not new at all, electrolysis has been around for a very long time and it is not patentable. What we do have that is patentable is a process in which we can take electrolysis and make good use of it. - Chad Coats


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