What this document is
A single-page action instrument: what Nucor/DJJ commit, what they receive, and the one authorisation to give.
- ASR disposal is estimated at $75/ton today, and an RCRA Subtitle C reclassification would move it to $150–250/ton.
- One CSA: a $150/ton Beneficiation Fee, and a Circular Royalty™ of $180/ton from Month 13 — $6.57M in Year 2 at Phase Initial, ~$328M gross over 30 years.
- One action: execute an LOI/MOU and authorise Term Sheet phase verification, which starts the 24-month build clock.
Why this matters — what Carbotura is offering Nucor and DJJ
Phase Initial reaches commercial operation 24 months after T0. Term Sheet phase verification completes at T0 + 3 months and is a prerequisite for financing close, which itself carries a 6–9 month lead time; the ADEM manufacturing permit runs an estimated 12–18 months alongside it. Each quarter of delay in LOI/MOU execution moves COD by the same quarter.
Carbotura converts Automotive Shredder Residue — the fraction that remains after metals recovery — into manufactured Circular Materials by primary elemental dissociation in an oxygen-free process. Not landfill, not incineration, not waste-to-energy: manufacturing, in the North Alabama industrial corridor.
ASR disposal is estimated at $75/ton across the Southeast, and an RCRA Subtitle C reclassification would move that to $150–250/ton. The Beneficiation Fee is $150/ton, escalating 2.5%/yr; at Phase Initial (100 TPD, 36,500 TPY) that is $5.47M in Year 1. Carbotura finances the $75M Phase Initial build and the $247.5M full deployment — Nucor/DJJ commit feedstock, not capital.
Beginning 13 months after the first Beneficiation Fee payment, Nucor/DJJ receive a rolling monthly Circular Royalty™ at $180/ton — $6.57M in Year 2 at Phase Initial, 120% of that year’s fee, adding a percentage point every year. Over the 30-year term that is approximately $328M gross at Phase Initial and $1.31B at 400 TPD. The fee and the royalty are two transactions and are shown separately throughout.
Why this fits
ASR disposed today at an estimated $75/ton would cost $150–250/ton under a Subtitle C reclassification. Delivering the stream as manufacturing feedstock removes the disposal predicate the reclassification would apply to.
It is a Southeast regional blended average, ESTIMATED. Disclosure of the current DJJ/Nucor disposal contracts is the first Term Sheet phase verification deliverable, alongside shredder throughput data for the 100/200/400 TPD volumes.
From Month 13 the royalty is $180/ton — 120% of that year’s Beneficiation Fee, adding a percentage point every year. It is not a discount on the fee and is never netted against it.
Carbotura finances, constructs, owns and operates the facility — $75M at Phase Initial rising to $247.5M at full deployment. Nucor/DJJ carry no construction or operating exposure.
ADEM issues a manufacturing facility permit on an estimated 12–18 month timeline. Morgan County’s Industrial Development Board has a positive record with Nucor, including the $125M Towers & Structures investment in 2023.
The structure, stated once
The Beneficiation Fee and the Circular Royalty™ are independent gross transactions with different payers. They are reported separately and never netted against one another.
The same physical mass is counted once in each of three dimensions — asset, revenue, attributes — and never summed as three independent masses.
Build-Own-Operate. Carbotura funds 100% of capital at every phase. The counterparty commits feedstock, not money.
One Circular Supply Agreement
+ Circular Royalty™
- Beneficiation Fee: $100–150/tonne · set at Term Sheet against the verified FWDC · 2.5%/yr escalator
- Circular Royalty™: 120% of the current-year Beneficiation Fee in Year 1 ($120–180/tonne), +1pp/yr, uncapped
- Royalty commencement: 13 months after the first Beneficiation Fee payment, rolling monthly on delivered tonnage
- Perpetual CSA, 30-year minimum term · Build-Own-Operate · zero counterparty capital
- Feedstock transfers under the CSA — ownership and liability pass at collection or delivery
- Accounting basis: US GAAP (corporate counterparty reporting basis)
Key figures at a glance
SE regional blended average
120% of current-year fee
192 at Phase Expanded
Circular Royalty™ projections by phase
Beneficiation Fee and Circular Royalty™ shown independently per the Separate Transaction Principle. No figure on this page nets one against the other.
| Capacity | Annual TPY | Beneficiation Fee · Year 1 | Circular Royalty™ · Year 1 basis | 30-Year Gross Royalty | Direct FTE |
|---|---|---|---|---|---|
| 100 TPD ← Phase Initial | 36,500 | $5.47M | $6.57M | ~$328M ESTIMATED | — |
| 200 TPD · Phase Medium | 73,000 | $10.95M | $13.14M | ~$655M ESTIMATED | — |
| 400 TPD · Phase Expanded | 146,000 | $21.90M | $26.28M | ~$1.31B ESTIMATED | — |
FWDC $75/ton ESTIMATED. Beneficiation Fee $150/ton. Circular Royalty™ (Year n) = (120% + (n−1)pp) × that year’s Beneficiation Fee; payments commence 13 months after the first fee payment and roll monthly. 30-Year Gross Royalty is gross royalty over 30 payments, ESTIMATED. The Beneficiation Fee and the Circular Royalty™ are independent gross transactions and are not netted or combined anywhere in this package.