Lignetics Group

CORPORATE BOOK A look at the company and its family of brands

Published by Lignetics Group, LLC 1075 E. South Boulder Rd., Suite 210 Louisville, CO 80027 Agency Iron Ladle Creative Direction Sako Shahinian Lead Designer & Copywriter Lauren E. Drzata Special Thanks to the interviewed Entrepreneurs and Industry Experts: Ken Tucker, Bob Sourek, Lucinda Allen, Luann Lafreniere, Steve Walker, Jerry Natzke, Paul Tlapa, Joy Schmidt, Bruce Lisle, Frank Kvietok, Mike Sale, Charlie Niebling, Ben Madden, Jonah Levine, & Rachel Cornell Samaras Additional Special Thanks to the locals who helped frame the town pieces: Ronda L. Whittaker (Kootenai City Clerk-Treasurer), Sharon Radabaugh (Sand Fork Recorder), Tony Matthews (Kenbridge Town Manager), Tom Cramblett (Mayor of Cascade Locks), S. Scott McDowell (Brownsville City Administrator), Carl Stinchfield (Strong Historical Society), Andrew R. Kurtz (Marathon City Administrator), Lisa Czech (Village of Athens Clerk/Treasurer), Dwight Lenhard (Village of Athens Trustee), Cathi Malke (Mayor of Peshtigo), Jo Anne Carr (Town of Jaffrey Director of Planning and Economic Department), Anthony Lucenti (Town of Schuyler Supervisor), Bryan Moore (Mayor of the Village of Deposit), Lisa Hagberg (Youngsville Borough Manager), Richard Lauger (Supervisor of Brokenstraw Township), and Rhonda Moore (Juniata River Valley Chamber of Commerce)

Copyright © 2021 by Lignetics Group, LLC. All rights reserved. No part of this book may be reproduced in any form or by electronic or mechanical means including information storage and retrieval systems without written permission from Lignetics Group.

TABLE OF CONTENTS

WELCOME TO LIGNETICS GROUP Introduction ......................................................

What is Sawdust?..............................................

The Versatility of Sawdust.............................

Leading With Lignin........................................

The Power to Displace Plastic........................

Uniquely Poised for Success. . .........................

Vision & Mantra ...............................................

Company Mission . . ...........................................

Corporate Company Values ...........................

Internal Cultural Values.. ................................

Commitment to Sustainability.. .....................

The Innovation Lab . . .........................................

Lab Developments . . ...........................................

Corporate Strategy Cycle.. ...............................

Company Architecture....................................

4 5 7 10 12 13 14 15 17 20 21 23 25 27 29

CORPORATE PORTFOLIO Heating Overview. . ...........................................

How to Make a Wood Pellet...........................

Heating Category Highlights.. ........................

Top Heating Brands.. .........................................

Pres-to-Logs History & Acquisition. . ............

Cooking Overview............................................

Cooking Category Highlights.........................

Our Cooking Brand...........................................

Animal Overview.. ............................................

Cat-egory Highlights........................................

Our Litter Brand: Catalyst Pet.......................

Livestock & Pet Brands....................................

Industrial & Other Overview. . .......................

New Creative Uses of Wood...........................

Modern Consumer Roadmap. . ........................

33 35 37 39 41 45 47 49 51 53 55 57 59 61 63

FACILITIES & HISTORY Corporate Acquisitions & Growth . . ..............

North American Presence .............................

Lignetics .............................................................

Lignetics of Idaho..............................................

Lignetics of West Virginia..............................

Lignetics of Virginia.........................................

Bear Mountain...................................................

Bear Mountain Cascade Locks.......................

Bear Mountain Brownsville...........................

Geneva Wood Fuels..........................................

Lignetics of Maine . . ...........................................

Marth Companies. . ............................................

Lignetics of Wisconsin....................................

Marth Manufacturing. . ....................................

Peshtigo Pellet . . ..................................................

New England Wood Pellet..............................

Lignetics of NE - Jaffrey..................................

Lignetics of NE - Schuyler. . .............................

Lignetics of NE - Deposit.................................

Lignetics of NE - Allegheny. . ..........................

Woodpellets.com. . .............................................

Energex................................................................

Lignetics of Lac-Mégantic...............................

Lignetics of Mifflintown.................................

67 69 72 79 81 83 86 91 93 96 103 106 113 115 117 120 127.

129.

131.

133.

136 142 149 151

LEADERSHIP & LOOKING AHEAD Board Members. . ................................................

The Future of Lignetics Group.......................

155 157

WELCOME TO LIGNETICS GROUP

LIG·NET·ICS /lig´nediks/ ORIGIN LATIN lignum of wood

+

GREEK etic relating to or the study of

"Nature is ever at work building and pulling down, creating and destroying, keeping everything whirling and flowing, allowing no rest but in rhythmical motion, chasing everything in endless song out of one beautiful form into another."

- John Muir

WELCOME TO LIGNETICS GROUP

Lignetics Group is an upcycling powerhouse comprised of a robust and diverse family of brands, complemented by an innovative research and development team that is dedicated to producing high-quality, 100% natural products that turn wood and plant waste into a range of premium, eco-friendly consumer products.

With advisors that include fuel pellet industry forefathers and leveraging a manufacturing base that covers the entire contiguous U.S. and part of Canada, the company is uniquely positioned to maximize its know-how and reach new heights through unprecedented growth.

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WELCOME TO LIGNETICS GROUP

WHAT IS SAWDUST? Up until about 40 years ago, most people would have considered sawdust a waste product of the wood industry. A by-product of sawing, milling, cutting, grinding, sanding, and routing wood with machinery, portable power tools, or hand tools, what to do with it after it was created was often seen as a problem. Some landfills even stopped accepting it.

Eventually, great minds figured out that sawdust and other wood waste could be used in many thrilling ways, and could even become high-value products. Some examples:

· Heating Pellets · BBQ Pellets · Cat Litter · Industrial Absorbent · Shavings for Animal Bedding

· Mulch · Fire Starters · Filler Additive · Traction Assistance · Liquid Waste Management

Ever since its potential was unlocked, this former "wood waste" material, along with others such as wood chips and wood flour, has become valuable. In today's world, companies are seeking not only the continued production of tried-and-true products, but looking ahead to see what else sawdust and other natural by-product materials are truly capable of achieving.

WELCOME TO LIGNETICS GROUP

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CORPORATE POSITIONING

THE VERSATILITY OF SAWDUST

One of the Most Useful By-Products on Earth

· There are two types of sawdust: kiln-dried sawdust and green sawdust. Kiln-dried sawdust is sawdust from dry, processed wood. Green sawdust is sawdust from wet, unprocessed wood. · Historically, sawdust has been used for a myriad of applications. From stuffing for mattresses, to punching bags, medicine balls, boxing gloves, and stress balls, the shock absorbency of sawdust has found many uses. · Sawdust was also deemed the best insulation in ice houses, both as stuffing between the double walls and as packing around the ice blocks. It kept ice cream cool during storage and transportation. Untreated sawdust was used as roof insulation too, but nowadays insurance companies require it to be treated for protection against mold, decay, insects, rodents, and fire. · More recently, better control of particle size and moisture content has led to many more uses. Pelletized sawdust provides significantly better heat than traditional burned wood while providing similar ambiance and nearly zero ash or harmful emissions, making it way less impactful to the environment. · Sawdust's absorbent properties make it an economic and hygienic solution for use in livestock barns, arenas, kennels, and pens. It is highly absorbent and a comfortable bedding option for animals, while being 100% natural and conveniently compostable. · Sawdust serves as an ammonia absorber and neutralizer, making it ideal as an odor-controlling cat litter. It is also much more environmentally friendly than traditional clay litters. · ‘Engineered’ sawdust, which has its shape, size, density, and moisture content optimized, outperforms clay-based absorbents. Sawdust can absorb three times its weight in just five minutes. Clay-based absorbents don’t come close to this performance. · The future holds many new applications through further, more refined processing all while maintaining the natural, renewable, biodegradable nature of wood.

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WELCOME TO LIGNETICS GROUP

WELCOME TO LIGNETICS GROUP

LEADING WITH LIGNIN A Sustainable Natural Resource with Huge Potential Fuel pellets are what originally put Lignetics Group on the map, and what continues to represent the lion's share of the company's revenue today. The secret behind dense, durable pellets is a substance called lignin, the second-most abundant naturally occurring biopolymer on earth, behind cellulose. The compound is found in the cell walls of vascular plants (like trees) and functions to add rigidity, conduct water, and prevent rot. Filling up the spaces between other components, it essentially acts as the glue that holds the wood fibers of a tree together.

Throughout the pelletization process, dried wood fibers are subjected to heat and pressure in the machinery. During extrusion, the lignin within the wood fibers is released. As the lignin melts and then cools, the materials are bound together as they are shaped into pellets while being pressed through the small die holes. It is an extremely efficient process that requires no additives, resulting in a cleanburning fuel solution.

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· The quest for using renewable resources in place of fossil carbon sources for chemicals and materials has recently led to an accelerated exploration of lignin (and other biomass sources) in many different applications. The carbon neutral, renewable nature of lignin place it at the top of the list of solutions. · Modified lignins have the potential of contributing the characteristics of lignin in wood to man-made thermoplastic and thermosetting materials, such as bonding, stiffness, fireresistance, biodegradability, and sustainability. · When isolated by separation from woody biomass, lignin performs like a normal polymer in a predictable manner and continues to present the option of re-use in a form it was initially designed for by nature. · A variety of lignin derivatives have been converted into such products as adhesives, coatings, foams, printed circuit boards, melt-blown compostable films, and other thermosetting & injection-molded thermoplastic materials. · Lignin is a natural binder, though the lignin content varies by plant. Sturdier plants, such as trees, generally contain more lignin than those less sturdy, such as grass. · Lignin is a vastly available and well-studied antioxidant.

It works as an antioxidant against the biological, chemical, and mechanical stress on plants. Additionally, lignin has been demonstrated to carry antimicrobial and insecticidal characteristics. · Structure and properties of isolated lignins are subject to wide-ranging changes via chemical modification. Properties can readily be tailored for uses that require special solubility, thermal, and compatibility behaviors.

WELCOME TO LIGNETICS GROUP

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THE POWER TO DISPLACE PLASTIC

An Abundant Biopolymer in Nature

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WELCOME TO LIGNETICS GROUP

LIGNETICS GROUP

Uniquely Poised for Success When it comes to comparing Lignetics Group to other companies in the industry, our value proposition is very clear.

DIFFERENTIATORS: · Acquired businesses include those started by wood pellet industry pioneers, many of whom remain active company advisors today · A rich mill history that gives our numerous facilities and the towns they are in unique pride and character · A focused dedication and commitment to sustainability and the environment through current and future product offerings · Access to a supply of wood residuals on a nationwide scale, and a plant system with specific focuses per location · A research and development arm comprised of a devoted team of specialists that is a always looking three to five years ahead · Unmatched experience in the wood pellet industry through the combined years of the companies under the corporate umbrella · The current company size is ten times that of any other competitor operating in the domestic market · Unparalleled expertise through a manufacturing and distribution network that continues to grow through deliberate and strategic acquisitions

EXPANDING SUSTAINABLE POSSIBILITIES

Our Vision & Mantra

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WELCOME TO LIGNETICS GROUP

COMPANY MISSION

WELCOME TO LIGNETICS GROUP

“

“

Through our unrivaled manufacturing base, we develop wood waste into premium quality, environmentally-friendly products that make it easy for consumers nationwide to choose sustainability.

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WELCOME TO LIGNETICS GROUP

CORPORATE COMPANY VALUES

Informing our Everyday Actions and Decisions

DOING GOOD As a purpose-driven company, we wake up every morning with an Idealistic vision of the world. Optimists at the core, we channel that attitude into everyday problem-solving, challenging our producers to operate within that mindset and ultimately making it easy for our consumers to do good through the purchase of our sustainable products.

INNOVATION Performance-centric efficiency drives everything we do.

We are bringing sophistication to a basic industry, by pioneering quality standards that others aspire to reach. Our knowledgeable approach to operations helps us find ways to cut costs during the manufacturing process so we can pass on that savings to our customers.

WASTE-AVERSE To continuously create sustainable consumer products, we take an unorthodox approach: we look at what other people are wasting and ask ourselves what can we do with it. Our modus operandi is upcycling; making the best products at a low cost that are high in value. We take pride in calling ourselves the "garbage men" of the wood-processing industry.

RESPONSIBLE GROWTH As the largest national supplier, we are bringing professionalism and consistency to a disorganized space. Due to many regional acquisitions, the company is the biggest in the game, but stays true to its roots. Consolidating our regional facilities under one corporate umbrella, this united front brings value and local clout to customers and suppliers.

SAFETY - Highest priority in our business - Everyone goes home safe everyday - Each individual is empowered and responsible for safety

ACCOUNTABILITY - Achieving commitments - Being dependable… being a leader - Doing what we say we are going to do for our customers, employees, and investors

ADAPTABILITY - Open to new ideas - Changing when your environment changes - Creating the future by leading change

INTEGRITY - Doing what’s right, because it is right - When it costs you the most - Having an unwavering ethical compass

RESPECT - Respect isn’t about agreeing, it’s caring enough to disagree - The golden rule… treat people as you want to be treated - Be honest… be constructive

TEAMWORK - Team first perspective - Generous with your time - Boundarylessness

INTERNAL CULTURAL VALUES How We Get Things Done

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WELCOME TO LIGNETICS GROUP

COMMITMENT TO SUSTAINABILITY

Carbon is absorbed in the atmosphere

Wood fuel pellets are burned for heat and energy, releasing the stored carbon

Sawdust and other residuals are manufactured into wood fuel pellets and other upcycled products

T

here is a compelling environmental story underlying the business of the Lignetics Group, informing everything the company does. Upcycling wood waste into valuable products keeps the material out of landfills, an obvious benefit to the environment. A lesserknown advantage is how our products contribute to the recycling of carbon emissions in the atmosphere.

When wood is burned, carbon dioxide is released. Healthy forests remove this carbon dioxide and convert it to new wood as growing trees. Efficient use of pellet fuel turns most of the stored energy in wood into useful heat energy.

If left to rot on the forest floor, wood will release carbon compounds into the atmosphere anyway. The same is not true for fossil heating fuels like oil and gas, which release carbon stored in geologic formations for millions of years instead of continually recycling carbon in growing forests.

For this reason, using pellets as fuel is considered a low carbon alternative to fossil fuels. As long as our forests are managed sustainably, we can continue to use wood as an energy resource with minimal net impact on greenhouse gas emissions like carbon dioxide. For every tree that is burned, other trees take the carbon out of the air. Efficient burns result in the release of carbon, which turns into energy. The process of burning pellets actually releases carbon back into the atmosphere that trees would naturally emit when they die and decompose, so the process is cyclical and in the best interest of the planet.

Carbon is sequestered from the atmosphere into forests

THE CARBON CYCLE

Wood is harvested for various purposes, and wood waste like sawdust is created

Sustainable practices have been embraced by the forest products industry for so long now, they may essentially go unnoticed. If managed wisely, trees are a renewable resource. Forest cover in the U.S. is greater today than it was in 1910, even though population and American use of wood products has nearly tripled during the same period.¹ In reality, there is 2-4 times more wood being grown every year than is being used in the myriad of wood products we depend on every day. Lignetics Group mindfully partners with wood suppliers recognized for responsible timber harvesting and wood sourcing practices. It is important that the market we provide for a wide variety of wood feedstocks fosters and supports the practice of sustainable forestry.

Besides the clear utility of pellets, sustainability is evident in the company's other products as well. Cat litter and stall shavings or pellets can be reused as fertilizer for crops or in compost piles to create more heat and accelerate break-down. Wood flour as an additive for products such as decking materials mean less use of plastics, which we know are bad for the environment.

The future is bright as Lignetics Group continues to push boundaries through the development of new products and processes through its Innovation Lab. The new frontier is full of opportunities for the creative use of wood, and the company intends to be at the forefront, pioneering the new movement with the same vigor and enthusiasm as when fuel pellets first came into the market. ¹ U.S. Forest Resource Facts and Historical Trends.

USDA Forest Service, 2014.

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WELCOME TO LIGNETICS GROUP

THE INNOVATION LAB

And the Main Brain Behind It

O

ne area where Lignetics Group truly stands out is in Research and Development. With a dedicated Innovation Lab at the company's Louisville, Colorado headquarters, the operation is not only able to continuously improve on its current offerings, but be looking ahead at what new cutting-edge products can be made from the same raw materials or other types of biomass.

Led by Director of Innovation Frank Kvietok, the Innovation Lab studies and develops new materials and product opportunities for Lignetics Group. The Lab's efforts are driven by the company's dual motivation to be successful commercially as well as sustainably.

A self-professed "idea hoarder", Frank has a colorful background that lends useful perspectives to his work. He grew up on Long Island, New York, and completed his undergraduate studies at Cornell University. Initially interested in Architecture, he eventually pivoted towards a major in Chemistry. In 1989, after completing a Peace Corps assignment in Nepal, Frank moved to CO to attend the University of Colorado Boulder, where he acquired his Ph.D. in Inorganic Chemistry, and then followed that up with a Post-Doc in Inorganic Chemistry at The Ohio State University.

After completing his schooling, Frank was hired by the well-known multinational consumer goods company, Procter & Gamble. He began there

designing molecules and formulations, and transitioned into becoming a Product Designer and Technologist.

This position required looking at formulations more holistically, and through the lens of product and consumer value propositions.

Frank thrived in this environment, and got the opportunity to work with multiple design firms and world-class facilities and colleagues. He tried out new ideas and contributed work to household brands such as Tide, Febreze, Mr. Clean, and Swiffer. After nine solid years, Frank decided to move on; he liked leaning into different disciplines and was ready for a new challenge. Plus, P&G wanted him to manage instead of research, and turning ideas into products is where his passion was.

Next, Frank moved back to Colorado with his wife, Lisa, and three kids. He got a job as a New Product Explorer at Orange Glo International. It was in this position where he learned a lot about the direct-to-consumer model. The company manufactured and marketed a variety of household cleaning products, such as OxiClean and Kaboom, designed with natural, environmentally safe ingredients. Built from the ground up by a husband and wife team, the company initially grew through trade shows, word-of-mouth, direct mail, and networking. Later, the company found success through grocery store distribution, a feature on the Home Shopping network, and with catchy infomercials.

Frank Kvietok, Director of Innovation

Orange Glo International was bought

by Church and Dwight (of Arm & Hammer fame) in 2006. In early 2007, Frank teamed up with the former president of the company and together they began an incubator enterprise called Launch Pad, working on a wide variety of products ranging from educational, to dietary supplements, to scooters, and more.

This venture gave Frank opportunity to really hone his entrepreneurial skills. They launched products in a variety of ways to screen and refine concepts. For instance, Home Shows and County Fairs brought in a wealth of real-world consumer information, as simple changes in a pitch could illustrate what worked vs. what didn't.

After a few years, Frank's boss wanted to focus on two products that were doing well, but again he was ready for change, as the excitement existed in starting things - getting products to market and then seeing if they take off.

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In 2010, Brett Jordan, CEO of American Recreation Products, was searching for someone to take the lead on Research and Development for new materials.

As a company that designed and manufactured outdoor products like tents, sleeping bags, and backpacks, there was a need for new technologies and new functions for products that would stand out in the market.

Beginning as a consultant and then coming on full-time as the Director for Advanced Development, Frank set up a prototyping operation and worked closely with various brands under ARP's corporate umbrella.

American Recreation Products was acquired in 2015, and from there Frank moved on to work in the green energy space. As the Director of Application Development at Tersus Solutions, he was again able to advance his passion for learning a new industry, this time with a sustainability story. The company had invented a waterless, closed-loop cleaning system that utilizes recycled liquid CO2 to penetrate deep into fabrics. The system sanitized and deodorized fabrics with the goal of drastically extending the life of textiles across several key industries.

Throughout his career, Frank also maintained a consulting business.

Fatefully, one of his clients ended up being Lignetics Group. Brett Jordan from ARP was now the CEO there, and he approached Frank with a project proposition: put together a collection of higher value products that could be developed from the company's vast access to wood residuals.

Frank looked at possible applications and compiled a portfolio of opportunities that were extensions of and improvements to products, as well as new ideas and technologies. Some of these had already been researched a bit, but never fully developed. It was all Brett Jordan needed to see in order to bring Frank on full-time as the inaugural member of the new Product Development Department, known as the Innovation Lab today.

As Director of Innovation, Frank now works with Product & Brand Managers Ben Madden and Jonah Levine, the Operations team, and a steady stream of enthusiastic interns. The team is always working three to five years ahead on new products and ideas, while also diving into near-term opportunities for the brands under the Lignetics Group umbrella. As it is not realistic to revolutionize a product line or market every single year, the focus with each brand is on a steady stream of incremental improvements as well as big ideas that they can plan to execute.

Besides still participating in the excitement of the research process, Frank also approaches projects with the business mind he has honed throughout his career. He looks at the portfolio of opportunities not just as new products, but through the lens of the potential revenue per ton. The new product Smoke ‘Ems ™ is a great example: A 20lb bag of BBQ pellets produced for pellet grills can become a completely different, high-value product if sold in small 6oz flavor

packets that can be conveniently tossed onto any grill. Giving consumers an easy way to enjoy wood smoke flavor, especially for those new to smoking, creates a newsworthy buzz that is just as valuable as traditional marketing. It might also get the folks buying Smoke ‘Ems ™ to consider buying a pellet grill in the future.

Frank strongly believes in the "openinnovation" of ideas over the cliché mad scientist alone in a lab. The team uses their vast collective knowledge, but are humble enough to seek out relationships that may lead to shared technologies that can be expanded upon. Collaborations so far have included outside suppliers, universities, and other labs, which have resulted in beneficial partnerships and even funding from government grants.

Some of the most exciting projects that the Innovation Lab has been working on are mentioned in detail on the following pages, and serve to keep Lignetics Group at the forefront of the push towards doing even more with wood waste:

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WELCOME TO LIGNETICS GROUP

LAB DEVELOPMENTS

A Snapshot of Projects and Possibilities CAT LITTER

GRILLING OPPORTUNITIES

WOOD FLOUR

Armed with the knowledge of other competitive products in the market, the Innovation Lab knew sawdustbased litter could be a disruptor. After vigorous testing to determine the best wood species, particle size, and clumping agents, Catalyst Pet cat litter was born.

The company's Bear Mountain brand is doing great, and the current products are viewed as a jumping off point into a world of new flavors. Thanks to the development of the new Smoke ‘Ems™ product, Lignetics Group is able to deliver a pantry-full of natural flavors that go beyond traditional wood.

This rising product line is naturally absorbent and odor-neutralizing, clumps well, and has the reputation for great "cat acceptance". The team insisted on creating a formulation that would not compromise its performance despite also being sustainable. Proudly balancing the best of both worlds, new variations are in the works as well, such as a low-traction version that would be ideal for cats with extra long or fine hair.

Imagine not only having wonderful wood flavor in your grilled food but also some garlic or herb flavor. The possibilities exist to suit every person's taste buds as new flavor combinations are developed. The company also has its sights set on the charcoal market with a wood-based plus lignin product that burns cleanly and consistently while delivering the flavor of real wood.

Wood flour consists of pulverized particles of wood that can be used as an additive, or "natural filler" in a variety of products. It has been produced commercially since 1906 in and for many products such as soil amendments, extenders for glues, and absorbents for explosives. Lignetics Group currently sells wood flour into the wood plastics composite market where it is commonly used as a functional filler in polyethylene or polypropylene decking, making it less expensive and lighter. Higherend, more performance-oriented applications are on the horizon too. The Lab is experimenting with different particle shapes, smaller sizes, thermally-modified, and coated flour that could add performance advantages such as increased strength, waterresistance, and temperature stability.

WELCOME TO LIGNETICS GROUP

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PELLET ADDITIVES & PROCESSES

BIOPOLYMER COMPOSITES

A NEW KIND OF LIGNIN

As much as has been done in the world of pellet-making, there are still vast opportunities to make betterperforming pellets more efficiently.

For instance, coffee grounds are another natural substance that have long been considered a waste product.

The Innovation Lab discovered that the residual fatty acid in the grounds are similarly extracted during the pelletization process like lignin due to the temperature and pressure. The grounds act as a lubricant as they move through the die, so output is improved on the manufacturing side.

And as an additive to wood pellets, the result is an even hotter burning pellet with even more efficiency and less emissions.

Biopolymers are polymers that are produced from sustainable sources and are biodegradable. Also referred to as bioplastics, these systems benefit from the use of a fiber or filler in the same way that traditional fossil-fuelbased plastics do. The Innovation Lab is working with a number of companies who have developed biopolymers to partner in creating bio-composites for applications as diverse as straws and 3D printing filament. Wood flour is an obvious choice in maintaining the material’s sustainability profile and has been proven to actually enhance biodegradation. This work is also allowing the company to pursue compounding, the process of mixing polymers with fillers, as a possible new business model.

The power of lignin has already been proven as a natural binder during the pelletization process. It can be melted and solidified, so combining it with other materials could yield products that are not only strong, but sustainable. Traditionally, lignin generated from the papermaking industry was too varied in its physical properties to be useful beyond as a combustion fuel. The Innovation Lab has partnered with a company that has developed a unique form of lignin that has very consistent physical properties.

Similarly, the Innovation Lab is asking some really basic questions about the best way to remove water. Simple as it sounds, the energy to remove water is often the most expensive aspect of the business and it turns out that not all water is the same. In partnership with the Idaho National Laboratory, the Lab is conducting experiments that use the heat naturally generated during pelletizing to do the majority of moisture removal. This so-called ‘wet pelleting’ process holds the promise of reducing production energy costs and emissions by over 40%.

Material property tests will determine the most viable applications, but there has been early success combining lignin with wood flour to get a material that looks like onyx, and by adding other polymers to change its characteristics. Lots of possibilities exist, but the system has another huge advantage versus other biopolymers: cost. While the leading biopolymers like PLA are considerably more expensive than fossil-fuel based conventional, this unique form of lignin will actually cost considerably less, allowing for broad, high-volume usage.

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WELCOME TO LIGNETICS GROUP

CORPORATE STRATEGY CYCLE

VIRTUOUS

- Reach more people that can make the right choice for our planet - Grow sales of our products - Utilize Operational Excellence to optimize profits - Invest profits in manufacturing capacity, new products - Create more renewable, sustainable, products

STRATEGIC - Grow capacity through strategic acquisitions - Optimize Profits through operational excellence - Invest in product diversification into high growth categories and markets - Build consumer product brands to deliver long-term value - Build a performance culture for sustainable results

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WELCOME TO LIGNETICS GROUP

COMPANY ARCHITECTURE: A HOUSE OF BRANDS The brands under Lignetics Group stand by themselves.

Company architecture refers to the hierarchy of brands within a single company. It is the interrelationship of the parent company, subsidiary companies, products, and services, and should mirror the marketing strategy. This architecture is important to bringing consistency and order throughout all elements to help the company grow and market more effectively.

WELCOME TO LIGNETICS GROUP

LIGNETICS GROUP The company architecture is structured as a House of Brands system, which is characterized by a series of well-known consumer brands. The corporate entity may either be invisible or inconsequential to the consumer, and is known primarily by the industry in which it operates. The parent company, Lignetics Group, offers a stage on which its brands confidently shine, while benefiting from shared corporate resources.

HEATING

COOKING

ANIMAL

INDUSTRIAL

GREEN SUPREME

BEAR MOUNTAIN

CATALYST PET

RAW MATERIALS

GOLDEN FIRE

EZ- EQUINE

MARTH

COZY DEN

NEW ENGLAND WP

DRY DEN

ENERGEX

MARTH

CLEANFIRE

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CORPORATE PORTFOLIO Lignetics Group is proud to showcase the primary brands and products that drive the company's profitability. The company's portfolio focuses on four main categories: Heating, Cooking, Animal, and Industrial & Other. The following pages will introduce each category, present some highlights, and spotlight the main brands playing in each market sector.

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CORPORATE PORTFOLIO

HEATING OVERVIEW

All-Natural, Sustainable, and Economical

CORPORATE PORTFOLIO

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Our commitment to creating premium-grade heating products is central to everything we do. It all starts with the wood fiber. We hand-select and lab-test every batch of wood fiber to ensure we start with only the cleanest raw materials. We handle it with care throughout the transportation and manufacturing process and complete finishing lab tests to confirm that our high-quality standards are met. We continuously invest in technological advancements and quality control measures that allow us to manufacture only the best, most reliable wood pellets, disks, logs, and bricks on the market. The result is a series of modern, cost-effective, renewable heating alternatives that are ideal for people, animals, and the planet. From residential pellet stoves to industrial boilers, we've got the heating solution that is better for the environment as well as your piggy bank.

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CORPORATE PORTFOLIO

HOW TO MAKE A WOOD PELLET 1. Residuals are sourced from a local supplier (lumber mill, hardwood flooring manufacturer, etc.).

2. Residuals are dumped into an outdoor pile/indoor storage area or retained in trailers.

3. Residuals can be in the form of chips, sawdust, or shavings.

4. Material is dried from “green” state (~40% moisture) to desired moisture content.

CORPORATE PORTFOLIO

5. Material is hammermilled to desired particle size distribution.

6. Sized and dried material is processed through a pelletizer using rotating rolls and dies to form the pellet.

A

B

7. Pellets are bagged in an automated form, fill, and seal machine into 20 or 40lb bags.

8. Bags are automatically palletized (robot or dedicated palletizer).

C

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CORPORATE PORTFOLIO

CATEGORY HIGHLIGHTS

10x the Production Capacity of the #2 Residential Heating Pellet Manufacturer

#1

BRAND IN RETAIL (GREEN SUPREME)

#1

BRAND ONLINE (CLEANFIRE)

Lignetics Group employs a talented team of folks that bring skills and experience from all different backgrounds, like forestry, pulp & paper, biomass, and other related fields and industries, who are drawn to the company due to its rich mill history, environmental purpose, and size. The scale of the company's operation puts it far ahead of all other domestic residential competitors. The system of plants has only become more efficient with every passing year, as the company adopts the best practices from each entity that is acquires and rolls them out across its entire network. More acquisitions are in the works, which will mean further boosts of overall production capacity and more reach across the contiguous United States.

There are a multitude of heating pellet brands under the corporate umbrella. These include various brands that came with the companies that have been acquired, as well as one that bears the company's namesake, Lignetics. As Lignetics Group moves forward with the goal of streamlining, the focus of resources and investments will be on the brands that have proven themselves the most valuable in the marketplace through sales and consumer loyalty. Green Supreme and CleanFire are great brands that have always outshined the competition, time and time again. A spotlight on successful regional brands is important to the company too, as different areas of the country have expressed their preferences for brands they have known and trusted for generations, like Marth, New England Wood Pellet, and others.

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OUR TOP HEATING BRANDS Residential Heating Solutions GREEN SUPREME

GOLDEN FIRE

MARTH

PREMIUM PERFORMANCE (NATIONAL BRAND)

VALUE-DRIVEN PERFORMANCE (REGIONAL BRAND)

FIBER IN MOTION, SINCE 1958 (REGIONAL BRAND)

Our Green Supreme Wood Premium Wood Pellets are high-quality, PFI Certified premium-grade fuel made from a proprietary blend of wood species. Our premium wood pellets are made from 100% natural, recycled, renewable sawmill residues, and manufactured at the highest quality control levels, resulting in premiumgrade fuel pellets. Green Supreme pellets yield a consistent, high BTU output and produce less than one percent ash. This translates to a hotter, more efficient burn and less waste to clean up. Though a national brand, all of our pellets are made from locally sourced materials from local mills.

For over 25 years, Golden Fire has set the industry’s Gold Standard of wood pellet fuel. Manufactured in Oregon using 100% Douglas Fir, our time-tested production methods ensure that every bag brings consistently high heat and low ash. Kiln-dried to perfection, our pellets contain the lowest moisture rating in the industry. With an ultra-low average of 1.9% moisture, the heat produced by these pellets is intense and long-lasting, resulting in an efficient and rewarding burn experience every time. This means less fuel needed to burn away excess moisture, and more fuel in each bag to heat your home.

Founded in the heart of Wisconsin, we began manufacturing pure, all-natural animal bedding from recycled wood waste in 1958. In the decades since, our innovative approach to creating value from wood residuals has led to the development of our popular heating pellets. Marth Fuel Pellets are made of 100% pure renewable and sustainable wood fiber and produced using the latest technology in the industry.

These super-efficient wood pellets are made by compressing wood particles.

The result is a cost-effective way to heat your home or commercial building that's highly efficient, environmentally friendly, and convenient.

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NEW ENGLAND WP

ENERGEX

CLEANFIRE

MODERN WOOD HEAT PIONEERS (REGIONAL BRAND)

THE ENERGEX STANDARD (REGIONAL BRAND)

DELIVERING QUALITY (INTERNET BRAND)

As the oldest and largest pellet brand in the Northeastern United States, we take a great deal of pride in the quality and craftsmanship that we put in to making our premium-grade pellets. We have earned a reputation for providing consumers with a consistently performing, high-quality product. Our stringent quality standards apply to every pellet in every bag and exceed industry standards. A primary goal has been to constantly improve upon and evolve our premium wood pellets, and one thing has never changed: our dedication to making not just the best performing wood pellets in America, but the most trusted, too.

When you buy PFI Certified wood pellets, you guarantee yourself a quality product. However, what if you want not only good wood pellets, but the best wood pellets? A product needs even more than PFI standards to become the best of the best. It needs to follow the Energex Standard. Our quality assurance and quality control programs go above and beyond PFI’s standards to create wood pellets like no other. We have developed the industry’s most advanced quality control system to track and ensure product quality. We take every step of the process seriously — it’s the Energex Standard.

Woodpellets.com's private label with a loyal following, CleanFire wood pellets are quality-guaranteed and rigorously lab-tested to ensure industry standards are not just met but exceeded. Not only are these pellets tested at dozens of mills across North America to confirm super-low ash and high BTUs, but they’re also certified through independent third-party labs to ensure the highest quality available.

In addition to award-winning customer service and convenient home delivery, the exceptional quality of the CleanFire brand brings customers back to Woodpellets.com year after year for their home heating needs.

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A WOOD FUEL BRAND SINCE THE 1930s

History & Acquisition

P

res-to-Logs is a trademarked name that has permeated the industry so much, nowadays it might refer to any brand of densified wood logs. The origin of the brand itself, however, goes back nearly 100 years and is an important, historic part of the utilization of wood waste.

Pres-to-Logs are a type of wood briquette, a term which includes any of the small logs or blocks produced by the compression of wood waste and used for fuel. The wood waste is typically in the form of sawdust and wood shavings or their ground up remains.

Briquette manufacturing had taken place in Europe during the early 1900s, but binding agents were always mixed with the wood waste to hold the resulting log together. In 1929, Robert T. Bowling, an engineer with Wood Briquettes, Incorporated, somewhat revolutionized the industry through the invention of the Presto-Logs machine. His new process relied on high pressures to make the briquette self-binding rather than using a mechanical or chemical binder.

Bowling continued to invent new parts to perfect the machine, which were developed between 1929 and 1933.

Later improvements were also made, in order to make a mechanically stronger briquette and to increase production, as in the case of adding a conveyor belt.

In 1934, F. W. Bender, superintendent of Pacific Lumber Company at Scotia, CA, conducted some experiments with

machinery, as well as market the logs.

By 1941, there were 39 of the machines operating within the United States, with others in South Africa, Peru, and Yugoslavia. Expansion continued for years afterward.

A worker needed to transfer Pres-to-Logs to a hand cart before a conveyor belt was added to the machine

redwood waste. He brought a carload of sawdust and shavings to Lewiston, Idaho, where he experimented with the Pres-to-Logs machine in full cooperation with Wood Briquettes, Inc. Bender dried the shavings to below ten percent moisture content, and then ground them into uniformly-sized particles with a hammer-mill grinder.

Once this material was processed through the Pres-to-Logs machine, it was discovered that the resulting briquettes burned longer and hotter than any other kind of compressed sawdust (except cedar).

Pres-to-Logs were born, and from then on the trade name was associated with any briquettes produced by the Pres-to-Logs machines (regardless of the wood species). Wood Briquettes, Inc., a wholly owned subsidiary of the Potlach Corporation, continued to manufacture and lease the Pres-to-Logs

Pres-to-Logs required one-quarter of the space of the original wood, and gained a great reputation due to their performance and ability to provide constant, uniform heat. Markets were wide open for convenience and efficiency, and the uniformly-shaped logs earned the title “modern” for eliminating tedious trips for firewood.

Lumber companies and fuel service stations began selling small lots and bundles to appeal to the everyday consumer.

Housewives soon learned the exact part of a Pres-to-Log necessary to cook a particular meal. While Depressionera housewives popped the little logs into their wood cook stoves, others burned them in room heaters, hot water heaters, and bake ovens. Besides being used as fuel for domestic and commercial buildings, the logs soon became used in the dining cars of Union Pacific Streamliners, as fuel in the rolling field kitchens of the U.S. Army, as galley fuel on intercoastal vessels, and as fuel in Civilian Conservation Corp camps.

The logs were used during recreational activities as well, such as fishing, camping, and picnicking. Up through the late 1950s, Pres-to-Logs saw a lot of success. Around this time

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methods for operating appliances as compared to electric, the apex of modern living.

A 1930s advertising poster for Pres-to-logs

however, various initiatives, including the construction of dams, caused the business to decline. Electricity became cheap, and “Gold Medallion Electric Heated Homes” became all the rage. Electric utility companies and electricity manufacturers joined forces and launched a successful marketing campaign called “Live Better Electrically” to increase profits and meet the demand for electricity in postwar America. The campaign initially sent a 70+ page brochure to homeowners which told them how their lives could be enriched by the use of electricity and the purchase of electric appliances.

Another challenge at the time was the competition for raw materials.

Particle board and paper-making companies had also innovated ways to use sawdust and other wood waste; raw materials had gone from being free and widely accessible to being pretty expensive and hard to come by as multiple companies vied for them.

The patent for the Pres-to-Log machine expired in 1960, and none were built after that time. Wood Briquettes, Inc. lost control over the machines and producers and in 1984 the directors consented to dissolve the company. All assets were transferred to the parent company, Potlatch Corporation. By the end of 1985, the company sold the remaining machinery.

Various companies that had licensed the machines were still producing logs during the 1960s and early 70s, but not in the same capacity as during their heyday. The great energy crash of 1973 renewed interest in the logs however, and production again ramped up. The brand’s legacy by this point had become embedded in pop culture. In 1990, Pres-to-Logs even got mentioned in the popular film Back to the Future, Part III, as the colored logs that powered Doc and Marty MyFly’s locomotive.

Pres-to-Logs live on today thanks to the Lignetics Group purchasing the historic brand. The beloved logs continue to be sold in various channels as 3-packs, 6-packs, and as full pallets of the product, used and appreciated by new generations.

In October of 1957, the “Medallion Homes” campaign was launched to further the LBE program, which sought to initially sell 20,000 all-electric homes nationwide within a year. A house would be marked with a 3” brass plaque, advertising its medallion status once the home was solely sourced with electricity for heat, light, and power.

The “Medallion Homes” campaign was a huge achievement for the electric industry, and positioned natural gas and wood burning as old-fashioned

A 1958 advertisement for Gold Medallion homes

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Pressing sawdust into Pres-to-Logs, log by log, box by box - The Tuttle Collection, Humb. Co. Public Works

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Sectional drawing showing complete details of a wood-briquetting machine

Pres-to-Logs Plant at Pacific Lumber Company in Scotia, CA

"Robert T. "Bob" Bowling", Potlatch Lumber Company Photograph Collection, Digital Initiatives, University of Idaho Library

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Pres-to-Logs for sale at a service station

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Tugboat on Lolo Creek in Idaho using Pres-to-Logs for heating fuel

"Operating Pres-to-Log machine", Potlatch Lumber Company Photograph Collection, Digital Initiatives, University of Idaho Library

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COOKING OVERVIEW

All-Natural Wood Flavors

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Perfect for all brands of BBQ pellet grills and smokers, our BBQ pellets and Smoke 'Ems™ deliver unforgettable mouth-watering, wood-fired flavor. Our all-natural wood pellets do not use any fillers, binders, additives, or bark, so our premium all-natural products deliver a perfect, clean smoke. After combining a variety of choice hardwoods, we've also crafted optimal flavors with the perfect blends. We’ve refined the pellet-making process, creating a solid pellet structure with only 5% moisture. This means our pellets create the ideal smoke to infuse flavor, while leaving little ash behind. So if you’re looking for the big, bold taste of BBQ, all you need is smoke, created by our premium, 100% natural BBQ Wood Pellets and Smoke 'Ems™. Simply add wood pellets to your grill or smoker, and your meal will be taken to a completely new level of delicious.

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CATEGORY HIGHLIGHTS

The Market Leader and Innovator in Smoke Flavor

#1

IN OVERALL BBQ PELLET PRODUCTION

300K TONS OF BBQ PELLET CAPACITY PER YEAR

With six separate plants producing BBQ grilling pellets in the key states of Oregon, Wisconsin, West Virginia, New York, and Pennsylvania, the ability to reach consumers in every corner of the U.S. is possible through the scale of Lignetics Group. Four new distribution sites are in the works across the country to enhance this reach even more, and will provide services of convenience, like customized mixed pallet orders to get vendors exactly the flavors they want.

Bear Mountain Craft Blends are our most popular products, expertly concocted to satisfy any and all taste buds. Our Bourbon BBQ Blend infuses the unmistakably smooth flavors of real bourbon barrel wood chips with rich, all-natural wood smoke. The Texas-inspired Bold BBQ Blend serves up big flavor that is smoky, earthy, and rich. The Sweet BBQ Blend is fruit-forward, bringing out finger-lickin' sweetness to anything tossed on the grill. And those are only a few highlights.

Bear Mountain Smoke 'Ems are our answer to those consumers who only have access to or prefer propane, electric, or charcoal grilling. Great for on-the-go activities like tailgating and camping trips, we've taken four of our delectable Craft Blends flavors and put them into powerful packets that can deliver 45 minutes of natural hardwood smoke to any grill. Who knows, maybe next we will develop a product that works to deliver smoke flavor right in the kitchen!

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OUR COOKING BRAND Bear Mountain: Founded on Flavor At Bear Mountain BBQ, we strive to serve up a smoking foundation that delivers infinite flavor possibilities for quality meals and good times with friends and family.

R

ooted in the Pacific Northwest where the first pellet grill was invented in 1990, we’ve spent the past 30 years crafting premium quality wood pellets for those that are passionate about BBQ. But at Bear Mountain, we don’t just care deeply about the way our grilled food tastes; we also care a whole lot about the earth. So we decided to bring these two passions together.

As the original grilling pellet brand, we’ve always been driven to put the environment first. Our 100% sustainable BBQ wood pellets are made from virgin material that's sourced locally across the United States. We hand-select the best, most flavorful hardwoods to naturally produce a range of BBQ grilling and smoking woods that exceed industry standards.

We know wood smoke adds a depth of flavor you can’t get any other way.

So, we experimented. After combining lots of different choice hardwoods, we learned a thing or two and have crafted delicious flavors with the perfect wood Craft Blends. The results are rich, smoky flavor profiles simply added to food through tasty, clean smoke.

We’ve also got a full range of speciesspecific grilling and smoking pellets that pair perfectly with a whole lot of incredible meats and vegetables that boost flavor to crowd-pleasing levels.

Hickory that adds richness to steaks.

Apple to bring out the sweetness in pork. Cherry for taking chicken beyond delicious. Alder for the perfect salmon.

Our newest addition, Smoke 'Ems™ pack a whole lot of rich smoky flavor in one small convenient packet to amplify the flavors of any meal, on any grill, anywhere. The best part of all is that none of our products use

any fillers, additives, or binders — just pure, all-natural hardwood for mouthwatering smoke flavor.

So now that you know our story, we invite you to try our BBQ products the next time you fire up your grill.

We’re pretty sure you’ll experience an authentic BBQ taste you could never imagine (or find using anything else).

And get ready... friends and family will start to gather and good times will arise, guaranteed. We know this as fellow BBQ lovers here at Bear Mountain BBQ, who believe that BBQ should taste delicious.

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100% Natural Hardwood Craft Blends

100% Natural Hardwood Species Flavors

Smoke 'Ems™ Flavor Packets

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ANIMAL OVERVIEW

Cat Litter, Hygienic Stall Bedding, & Shavings

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Keeping large and small animals healthy, happy and comfortable is our top priority. Our newest offering, Catalyst Pet cat litter, is a groundbreaking product that is the only cat litter engineered from upcycled soft wood fiber to offer performance and peace of mind. It leads in Superior Odor Control, Unrivaled Cat Acceptance, Great Clumping, Low Dust, and Light Weight, as well as being Sustainable, Renewable, and Responsible. Our all-natural animal bedding is made from 100% pure wood, acquired as a by-product of the lumber industry. It is cleaned, kiln-dried, and processed into shavings and pellets to enhance animal comfort and keep your stalls and other enclosures feeling and smelling fresh and clean. Our animal bedding products begin composting immediately upon contact with urine and can be integrated into compost to create nutrient-rich soil for gardening.

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CAT-EGORY HIGHLIGHTS

The Highest Performing All-Natural Upcycled Cat Litter on the Planet!

1/2 THE WEIGHT OF CLAY

2X

THE ABSORPTION OF CLAY

4X

MORE EFFECTIVE THAN CLAY

Catalyst Pet cat litter is worthy of special mention for Lignetics Group. While the product shares the same raw materials as most of our other products, that is where the similarities stop. Catalyst is vying for shelf space against litter industry behemoths, where the market share is dominated by clay-based litters. Essentially operating as a startup, the brand uses eye-catching graphics and its special story of sustainability in both ecology and economy to attract new consumers.

It starts with being better (in every way) than clay. As with all mining operations, the mining of clay for litter produces a negative environmental impact. Mining it is only economical when the clay is close to the surface. In strip mining, the top layer of soil is removed and then the clay is taken out, leaving a depression or pit that must be reclaimed (which does not necessarily restore the land to its prior state). There are also often watershed impacts as the result of disturbing the layers of sediment. Once mined, the clay must be transported to a facility for drying (usually with heat generated from petroleum-based products) and processing, and then again to its destination as finished product. From there is it used and disposed of, ending up in landfills where it does not naturally break down.

With 10lbs of all natural, renewable Catalyst product doing the same job as 40lbs of traditional clay product, the environmental benefits are clear. From the sustainable nature of biomass to requiring less trucks and overall transportation to move a product that outperforms clay, the message of choosing an upcycled product that is better to the world and better for their cat is increasingly well-received by the conscientious consumer.

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OUR LITTER BRAND: CATALYST PET A Healthier, Natural Alternative to Clay Litter Our motto around here is right on every package: "Love Your Pet, Change Your Planet."

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e're on a mission to overthrow the litter aisle.

We're sick and tired of environmentally damaging products that also don't live up to the standards we should expect. Whether it be re-using an old door or experimenting with an upcycled ingredient, we're continuously living our commitment to create better products for our pets, our homes and the planet.

Our primary ingredient in all three varieties is clean, upcycled pine softwood. This material is sourced from, regional sawmills converting what would have been waste into upcycled litter. No contamination is allowed in the wood: no paint, no stain, or any previously used wood.

The wood is captured straight off of a mill making Catalyst litter healthy and clean and the litter and sawmill very efficient and environmentally friendly.

Healthy Cat and Multi-Cat formulas, in addition to the pine wood, include a biobased oil, a natural clumping agent, zeolite and a mild natural scent. The Unscented formula only includes a biobased oil and a natural clumping agent with the pine wood.

Most cat lovers are not aware that traditional clay litters are usually made of sodium bentonite, a mineral that is strip-mined and not biodegradable.

A 2017 report reveals that more than five billion pounds of it is mined each year just for cat litter, with the vast majority ending up in landfills—more than 125,000 truckloads each year.

Catalyst solves this problem because it is biodegradable and does not require precious resources for its manufacture.

In fact, the upcycled soft wood fiber used to make the litter is collected from wood processing facilities that would otherwise send it to a landfill. Because one pound of Catalyst does the work of three pounds of clumping clay litter, it also reduces pollution and carbon emissions that result from production and transportation.

Taking it even further, we carefully considered different materials for our bags and settled on the #4 LDPE bag. This type of bag is durable and protects from weather damages during delivery, giving customers the best possible experience. We also chose this bag because LDPE #4 plastic bags are 100% recyclable in numerous recycling facilities nationwide.

We are constantly working on new innovations to further reduce our environmental impact. Currently, we are collaborating with a plastic neutral non-governmental organization (NGO) and formulating a way to add a biobased polymer into our production.

Every Catalyst Pet purchase online is now certified Plastic Neutral. By partnering with rePurpose Global, Catalyst Pet is donating a percentage of every product purchase to collect and reuse one ocean-bound plastic pouch for every one it sells online. By funding cutting-edge recycling technologies and supporting ethical wages for marginalized waste workers in India, the company is enabling rePurpose Global to tackle harmful plastic waste streams otherwise destined for landfills and waterways worldwide.

By taking this bold commitment, every Catalyst Pet purchase online will now carry a net zero plastic footprint.

We know sustainability is a path, and not a point in time. Partnering with rePurpose global on Plastic Neutral is an opportunity to live our values, pushing our packaging sustainability to the next level.

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100% Upcycled Softwood Cat Litter in Multi-Cat, Healthy Cat, and Unscented formulas

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OUR LIVESTOCK & PET BRANDS Only the Best Hygienic Bedding EZ EQUINE

MARTH

DRY DEN

EZ Equine premium pelletized animal bedding is from 100% biodegradable raw, white, soft pine that is kilndried and pure of any additives, binders or chemicals. Our kiln-drying process eliminates all insects, mold and bacteria, to create a pure, and extremely sanitary product. Each pellet contains less then 5% moisture content, and acts as a mini sponge in your stall, absorbing four times it's weight in liquid.

Founded in the heart of Wisconsin, we began manufacturing pure, all-natural animal bedding from recycled wood waste in 1958. The benefits to animal health of such high quality bedding may seem obvious in hindsight, but at the time it was a real innovation.

In the decades since, our innovative approach to creating value from wood residuals has led to the development of an expanded variety of animal bedding for your horses, kennels, and cages

The pine pellets bond with ammonia to immediately destroy odors naturally by neutralizing on contact, greatly reducing respiratory complaints and pesky insects, creating a nice, freshsmelling stable. Screened and aspirated to remove harmful dust particles, this advanced pelletized bedding eliminates respiratory problems in all animals.

By creating and using secondary products made from renewable resources, we help to reduce the carbon footprint of every industry, company, and individual that purchases and uses these products. This effort is building the momentum we need to regenerate and balance the ecosystem in which we all live.

When developing Dry Den Animal Bedding, we wanted to create a product that would absorb more moisture, and increase overall animal health by eliminating respiratory illness and hoof infections; two of the leading illnesses that occur within stalled animals. Zeolites combined with pelletizing the bedding works to solve all these problems. Zeolites contain a honeycomb structure that naturally absorbs over 70% of it's weight, and works immediately to neutralize ammonia and toxic gases released by decomposing manure. Animals will be more comfortable in a drier, cleaner, more pure stall.

With pellets, stalls can be spot-cleaned, taking about 5min/day. The soiled bedding creates a compost base and begins to decompose immediately.

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COZY DEN

Originating in Oregon, we specialize in recycling wood remnants from the lumber industry into high-quality animal bedding. We process pure softwoods like Pine and Cedar into shavings, then kiln-dry them so they are sanitary and extra absorbent. Our shavings are ideal for horse stalls, but can be used for any animal, big or small, making kennels and cages comfortable for all.

Our Cozy Den shavings are kiln-dried to 8-10% moisture content, resulting in a clean, highly absorbent, light weight, extra fluffy environment for your animals. They are also double-screened to remove sawdust and large chunks for ultimate comfort. Our shavings neutralize urine on contact, keeping your stalls odor-free and clear of any bacteria or insects.

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INDUSTRIAL & OTHER OVERVIEW

Spillage Solutions, Polymers, & Niche Products

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Beyond our Consumer Packaged Goods story, Lignetics Group supplies raw materials and new technologies that add value to the world around us and highlight more possibilities for wood waste.

Wood chipping utilizes low-value wood material as biomass energy and a whole host of other things. Sawdust has long been used as a spillage solution for oil and water solidification. And wood flour is used as the chief base ingredient for composite materials in things like toilet seats, decking, automotive components, and marina products, even adding characteristics like weatherproofness and other further benefits. It is also a natural alternative to synthetic fillers in things like animal feed and plastics. As described in our Innovation Lab section, new technologies are on the horizon too, that will be tangible proof of our "Expanding Sustainable Possibilities" vision.

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NEW CREATIVE USES OF WOOD

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“

As the smallest, underrepresented part of the company, Industrial & Other offers the largest potential to our business and to the environment. We believe it is the true embodiment of our Vision Statement, as the sky is the limit with where we can go.

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“

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MODERN CUSTOMER ROADMAP Lignetics Group is creating awareness, engagement, and exceptional experience between consumers and our brands. The below channels and methods of engagement enable consumers to purchase our brands and products where ever they like to shop.

HIGHLIGHTED SALES CHANNELS

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CREATIVE IDEAS

EMAIL MARKETING

WEB SITE

REVIEWS

PRESS / PR

SOCIAL MEDIA

MASS MERCHANTS

SOCIAL MEDIA

ADVERTISEMENT

PAY PER CLICK

FARM AND FEED

ANALYTICS

MEDIA CONTENT

COMMUNITY FORUMS

HARDWARE

RE-TARGETING

WORD OF MOUTH

NEAR ME "GPS"

GROCERY

DIGITAL ADVOCACY

1

2

3

4

BRAND

PRODUCT

POINT OF

POST

AWARENESS

FIND-ABILITY

PURCHASE

PURCHASE

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HISTORY & FACILITIES Lignetics Group is a pivotal part of the wood processing industry and always has been. From heating pellets to BBQ pellets, to animal bedding, and more, the company's history is intertwined with major figures in the business, and its more recent acquisition strategy honors other companies who had their own products and accomplishments in the early days. The company is a sum of its parts, and each component has a unique story that contributes to what Lignetics Group can offer to its customers today.

"In a forest of a hundred thousand trees, no two leaves are alike.

And no two journeys along the same path are alike."

- Paulo Coelho

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HISTORY & FACILITIES

CORPORATE ACQUISITIONS & GROWTH Prior to its expansion via acquisitions, Lignetics Group could output about 323,000 tons of heating pellets per year (combined) out of its 3 original plants in Idaho, West Virginia, and Virginia. This graph shows the increase in tons of capacity that came with each acquisition as the company nears the impressive benchmark of 2 million tons of production capability per year. The three acquisitions occurring in 2021 are brand new and might output even more than shown here after streamlining efforts unify them completely into the company.

GENEVA WOOD FUELS 93,000 TONS (1 PLANT)

BEAR MOUNTAIN

MARTH

NEW ENGLAND WOOD PELLET

173,000 TONS (2 PLANTS)

119,000 TONS (2 PLANTS)

394,000 TONS (4 PLANTS)

2017

2018

2015

HISTORY & FACILITIES

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2M

1.8M

1.6M

1.4M FOREST ENERGY CORPORATION 120,000 TONS (3 PLANTS)

1.2M

1M

GREAT LAKES RENEWABLE ENERGY 40,000 TONS (1 PLANT)

800K

600K

400K WOODPELLETS .COM

ENERGEX

TRAE-FUELS

INTERNET ONLY (NO PLANTS)

264,000 TONS (2 PLANTS)

100,000 TONS (1 PLANT)

2019

2020

2021

200K

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HISTORY & FACILITIES

5. KOOTENAI, ID 3. COLUMBIA CITY, OR 4. CASCADE LOCKS, OR 2. BROWNSVILLE, OR

7. LOUISVILLE, CO 1. CALPELLA, CA

6. SHOW LOW, AZ

NORTH AMERICAN PRESENCE

HISTORY & FACILITIES

8. HAYWARD, WI

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22. LAC-MÉGANTIC, QC

11. PESHTIGO, WI 9. ATHENS, WI 10. MARATHON, WI

23. STRONG, ME 18. SCHUYLER, NY

20. JAFFREY, NH 21. BEDFORD, NH 19. JAFFREY, NH

13. ALLEGHENY, PA

17. DEPOSIT, NY 16. MIFFLINTOWN, PA

12. SAND FORK, WV 15. BUMPASS, VA 14. KENBRIDGE, VA

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

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17.

18.

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23.

Forest Energy Corporation California Plant Bear Mountain Brownsville Plant Forest Energy Corporation Oregon Plant Bear Mountain Cascade Locks Plant Lignetics Of Idaho Plant Forest Energy Corporation Arizona Plant Lignetics Corporate Headquarters Great Lakes Renewable Energy Wisconsin Plant Marth Manufacturing Plant Lignetics Of Wisconsin - Marth Companies Peshtigo Pellet Plant Lignetics Of West Virginia Plant Lignetics Of New England - Allegheny Plant Lignetics Of Virginia Plant Trae-Fuels Virginia Plant Lignetics Of Mifflintown Plant Lignetics Of New England - Deposit Plant Lignetics Of New England - Schuyler Plant Lignetics Of New England Fabrication Facility Lignetics Of New England - Jaffrey Plant Woodpellets.com Field Office Lignetics Of Lac-Mégantic Plant (Canada) Lignetics Of Maine Plant

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HISTORY & FACILITIES

1929

1978

Pres-to-Logs machine is invented

Ken Tucker & Jason Day build pellet plant in Idaho under Day Resource and Development Company

1934

1979

Production of commercial Pres-to-Logs begins

Tucker and Day’s first pellet plant goes online

1973

Oil Embargo causes fuel shortage and drives interest in alternative fuels

1977

Rudolph Gunnerman patents Woodex process for manufacturing wood fuel pellets

1984

Jerry Whitfield debuts first fuel pellet stove at trade show in Reno, NV

1985

Lignetics prints its first branded bags

1981

1992

Day steps away from the company, the bank now owns it and has Tucker manage

Company builds plant in Doniphan, MO, its first expansion

1983

1993

Lignetics is born

1994

Dr. William Pickering begins investing in the pellet industry and partners with Tucker’s company -

Doniphan, MO plant comes online

Lignetics begins production under Pres-to-Logs brand after purchase of trademark and logo the year before

HISTORY & FACILITIES

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LIGNETICS

1996

2007

Lignetics of West Virginia plant comes online

Lignetics buys Royal Oak facility in Kenbridge, VA

1998

2009

Dr. Pickering retires - Ken Tucker becomes CEO and moves company headquarters from Pasadena, CA to Sandpoint, (Kootenai) ID

2000

Company liquidates MO plant

2004 Dr. Pickering passes away, still on the Board

Lignetics of Virginia plant comes online

2014 Lignetics is bought by Taglich

2015

CEO Brett Jordan forms Innovation Lab with Frank Kvietok at the helm

2017

Company headquarters moves to Louisville, CO

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HISTORY & FACILITIES

AN IDEA SPARKS A

The Beginnings of Lignetics

T

he story of Lignetics began in Idaho. It was the early 1970s, and Ken Tucker was a young man with an associate’s degree, fresh out of the army. He found himself living in Boise, and in search of part-time work.

He eventually interviewed and found employment with Jason Seymour Day, Jr. who was involved in various pursuits through his business, Day Resource and Development Company.

One of these pursuits was buying, restoring, and reselling military equipment. Tucker was initially hired to assist with this, due to his prior experience in the military.

Around this same time, initial interest in heating fuel pellets began to grow, mostly due to the Oil Embargo of 1973-74. Sawmills around the western United States (and Oregon in particular), were unable to get heating oil to run dry kilns because of the nationwide shortage, which in turn made it difficult to stay in business in traditional markets. The mills were swimming in sawdust and wood shavings however, and wondered if there could be a way to make use of this excess material. Storing the shavings and sawdust was also a challenge due to the space it required, so it would be ideal to condense them for use at a later time. If sawmills could figure out a way to make their own energy from these waste materials, a huge problem would be solved.

People began to experiment with different processes of pelletizing the sawdust and wood shavings, often combining equipment parts from both the particle board industry and the alfalfa dehydration pellet industry in their trials. (The pelletizing of alfalfa had been done since the 1940s for use as animal feedstock, and served as early inspiration for the process of densifying wood.)

Around 1977, Jason Day was looking into buying a sawmill near the Caribou-Targhee National Forest, in eastern Idaho. Another one of his company’s ventures at the time was building and selling recreational log cabins, and he was in search of a good supply of timber for posts and poles.

The Targhee Forest happened to have a lot of beetle-killed trees that needed to be cleared to eliminate the risk of forest fires in the area. By now, Tucker was working for Day full time as his General Manager of Operations, and he had also acquired his pilot’s license. He began flying Mr. Day around the country for business trips and meetings, and accompanied him out to Portland, Oregon to discuss the purchase of the sawmill.

While meeting with an attorney about the sawmill, the attorney pointed out an article in the newspaper about a man named Rudolph Gunnerman, who had allegedly created a patented process for manufacturing wood pellets, made from the very sawdust that mills had come to regard as waste.

The attorney tracked down a phone number for Gunnerman and passed it on to the men. Day and Tucker met with Rudolph Gunnerman shortly thereafter, as the man framed what would become Woodex fuel pellets as the energy of the future.

Gunnerman took them out to his converted particle board plant in Brownsville, OR, and gave them a tour.

The ability to create a clean burning replacement for coal from any wood or fibrous agricultural waste product was intriguing to Day and Tucker, and they intently listened to Gunnerman’s aspirations of franchising the Woodex process. An appealing bonus was that the fuel pellet manufacturing facilities could be built and put into operation in just a few short months.

A publication from 1953 that discusses the uses for and process of making dehydrated alfalfa pellets

A portrait of Rudolph Gunnerman

HISTORY & FACILITIES

74

NEW INDUSTRY Day decided to buy a territory that covered eastern Oregon, northern Idaho, and eastern Washington. Tucker was tasked with finding a market for the fuel pellets as well as a place to build a plant. As part of the deal, Gunnerman would get paid a royalty amount per ton of pellets produced.

Prospective customer Atlantic Richfield Company (ARCO) agreed to buy everything that Day and Tucker could make, which they would use as a heat source and energy source for their silver refining operation. ARCO was known as a petroleum corporation, and in 1977 attempted to diversify its holdings through the addition of metals, coal-mining assets, and solar panel manufacturing efforts. A letter of intent was inked, and banks loaned Day’s company the funds to build the needed plant.

Ken Tucker was able to find an ideal site for the plant in the town of Kootenai, a former lumber town and part of Sandpoint, Idaho. The brand new facility was built in 1978, and was online by the end of 1979, in order to take advantage of the tax credits it would be allowed due to the Oil Embargo of 1973-1974. Thanks to its location, the plant had excellent access to an abundance of raw materials and produced its very first fuel pellets in May of 1980.

An unforeseen circumstance was that ARCO had decided to reverse course on its diversification efforts. Just like that, Day and Tucker were without a customer. With the plant in place and fully operational, the next challenge was growing the market for their product.

In the early 1980s, not much of a market for fuel pellets existed. While there were clear benefits to doing so, such as an overall competitive

energy price and process efficiency, it was a challenge to get people to quit coal. Tucker set out to change minds by educating existing industrial businesses on doing just that. Places like veterans hospitals and prisons that ran their boilers year round for laundry and hot water needs (plus heating in the winter) were the kind of institutions that stood to benefit the most. Plus, increased environmental regulations in the northwest put great pressure on these places at the time to find alternative energy sources, especially in areas that did not have access to natural gas. Clean burning wood pellets were suddenly getting attention, and Ken Tucker’s accounts began to grow. Schools, greenhouses, and nursing homes were quick to join the fold.

In 1981, Jason Day decided to move on from Day Resource and Development Company. The bank took it over, and asked Ken Tucker to run the business until they could find a buyer. Tucker continued to produce fuel pellets using the Woodex manufacturing process to meet the bulk demands of his hardearned customers.

In 1983, Tucker’s plant attracted the attention of a gentleman named Dr. William Pickering, the retired Director of the Jet Propulsion Laboratory (JPL) in Pasadena, CA. Dr. Pickering had developed a vested interest in all forms of renewable energy - wind, hydro, solar cells, etc. He became aware of the enormous amount of wood waste that sawmills were dealing with, and was inspired to patent his own manufacturing process of turning such wood waste into fuel pellets. Pickering traveled to Boise to talk to the National Forest Service about the material available in the Targhee Forest, and the rangers there told him about Tucker and his plant up in Kootenai.

Serendipitously, Pickering had been looking for a plant on which to put the name of his company, Lignetics, Inc. And Tucker and the bank were still in search of an investor. Pickering’s group entered into a deal with Tucker, who adopted the new Lignetics pellet manufacturing process and company name. Together, with the plant in Idaho and the company's corporate headquarters staying in Pasadena, the entrepreneurs looked ahead to advance what they believed to be an up-andcoming, lucrative industry, which also would help the environment.

It is important to note that a challenge during this time was the overall logistics of a distribution network; fuel pellets were shipped in bulk via 25-30 ton truckloads (that’s a lot of pellets).

The cost of freight, coupled with where to put it once it arrived, seemed prohibitive to many folks in the early days of the industry, which was a concern for growth, especially beyond the industrial and bulk-market sector.

Then came the mid-80s, which proved to be groundbreaking years for the pellet industry for a couple of reasons: the introduction of the first commercially viable wood pellet stove and the very first bagged pellets.

The pellet stove arose out of the need, specifically in the northwest, to combat the noxious wood-stove emissions that were a problem in many mountain communities. Wood stoves were a popular alternative heating source at the time, but the air quality in some areas got so bad that certain communities began banning wood stoves altogether or fining households that disregarded the state’s antipollution initiatives.

Enter Jerry Whitfield, a former Boeing Company fuel efficiency engineer, who had been tasked with developing

75

HISTORY & FACILITIES

alternative fuels for the industry during the fuel crisis of 1973. If other fuels were available, then more of the scarce petroleum-based fuel could be reserved for the airline industry.

Whitfield initially learned about fuel pellet technology in Europe and started working on his first project, a wood pellet boiler, in his garage. He even paid a local university to test it.

The tests were successful and gave Whitfield a new direction, which was also inspired by Whitfield’s awareness of Ken Tucker, who had been working on perfecting the Lignetics fuel pellets.

Whitfield was impressed with Tucker’s work and quickly realized that the heating potential of pellet fuel extended well beyond industrial applications. Whitfield applied his knowledge of forced-air furnace technology to smaller-scale residential heating systems, and by 1983, he had developed the first forced-air pellet stoves.

Whitfield’s stove looked like a typical wood stove on the outside, but inside it was state-of-the-art. With an auger feeding in specific amounts of pelletized low-moisture fuel, and adding combustion air at just the right level, a clean, consistent, and controllable burn was established. By blowing the heat off of the stove, the

A photo of Dr. William Pickering

safety and efficiency was raised, and the back side of combustion air made chimneys obsolete. With these new pellet stoves, emissions were only 0.7 grams of particulate emissions per hour, as compared to wood stoves at 50-100 grams per hour.

The price point for the stoves began at about $1200, but were cheaper to install than wood stoves since no chimney or triple-wall pipe was needed because they burned so cleanly. This made them an attractive and viable alternative for the mass market consumer.

It is worthwhile to mention that other inventors were attempting to solve the wood stove problems during this time, but their solutions were modifications to existing wood stoves rather than an all-new apparatus. One example is the “Collins Hopper”, invented by Loren Collins, which was an add-on device for wood stoves consisting of a bin for pellets, an electric auger, and a blower that mounted on the stove’s side. This device was an economical solution for folks that were not yet ready to part with the wood stove that they owned.

Whitfield had linked up with Ken Tucker to procure the wood pellets for his original pellet stove prototypes, and the relationship continued as he introduced his invention to the public. The pellet stoves were shown for the first time at a regional trade show in Eugene, Oregon, in 1984.

In preparation for the show, Ken Tucker bagged Lignetics fuel pellets for Whitfield’s use in demos, and to accompany the resulting sales of Whitfield’s pellet stoves. Though the bags were technically “off the shelf” and unprinted, this marked the first time that wood pellets were bagged for residential use.

The success of the trade show in Eugene gave Whitfield the confidence and momentum that he needed to finally quit Boeing and devote himself fully to making stoves. Whitfield debuted his pellet stoves on the national level at the Wood Heating Alliance show in Reno, NV in 1984.

At the end of the four day show he had orders for 1,000 stoves, a true accomplishment.

As a result of Whitfield’s stove sales (and eventual competing models), bagged pellets were in increased demand, and by 1985, Lignetics was selling enough volume to justify printing their first branded bags. The timing of this coincided with a decline for bulk demand, as natural gas pricing had gotten considerably lower and large businesses were moving to the cheaper fuel. Lignetics was now able to focus on residential product output rather than industrial bulk customers.

In these early years when pellet stoves were just gaining popularity, competition began to spring up. There were other plants outside of Idaho producing pellets in states such as Minnesota, Wisconsin, Montana, Oregon, Florida, Tennessee, North Carolina, Washington, and Quebec, Canada. Most of these plants however were just trying to produce pellets the

Early articles discussing the new Whitfield stove

HISTORY & FACILITIES

easiest way possible; quality control was not too tight when the goal was merely competing with coal. Plus, commercial appliances in those days had a much greater tolerance for lesser-grade fuel.

When the residential market opened up, high-quality fuel was of utmost importance, and Lignetics tightened up their proprietary manufacturing process to work well in residential applications. The pellet process includes many variables such as the feedstock, the moisture of the pellet, and the particle size of the material.

With Pickering and the Lignetics group still based in Pasadena but advising on the process, Ken Tucker was on the ground every day in the plant, using trial and error until the optimum heating fuel pellets were achieved.

Additionally, Lignetics of Idaho began producing wood briquettes as a way to offer products besides pellets that were made from the same raw materials.

Ken Tucker convinced Dr. Pickering that they needed to produce logs after touring a Shell Oil-owned plant in Ontario, Canada. The company acquired two machines from Basel, Switzerland in 1992. Each machine could process 900 pounds of material an hour at the Idaho facility.

The company began manufacturing logs under the Lignetics brand, and then in 1993 when the opportunity presented itself, bought the Pres-toLogs trademark and logo from the Small Business Administration. The following year, the logs were rebranded with the household name and achieved a permanent place on the product roster.

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most wood stoves were located in the country. Most of these wood stoves would have been bought during the Oil Embargo in the 1970s, and they would eventually rust out or burn out, requiring a replacement. A large concentration of these stoves were identified as being within 400 miles of St. Louis, Missouri.

The state of Missouri was also looking for ways to utilize wood waste. At the time, there were no uses for the raw materials, and an environmental hazard began taking shape, as sawdust piled up at the sawmills and created leaching issues in the aquifer. This environmental concern, coupled with the problem of increased pollution from wood stove emissions, led the state to explore viable solutions.

Missouri began offering great incentives to get its residents to buy pellet stoves, such as a $500 discount towards the purchase of a new one.

The state also tightened regulations on wood smoke pollution, and sought to entice businesses that produced wood pellets to set up shop within state lines.

Knowing that it was possible for consumers to learn that wood pellets were economical and offered the same ambiance, warmth, and radiance as wood, Ken Tucker and Dr. Pickering set their sights on MO. They had assumed that the industry would start in the west (where they already were), and naturally move eastward, so it seemed like a sure bet. With help from the state and after a good deal of research, Lignetics broke ground for a new plant in Doniphan, a town in southeastern Missouri.

As the years went on, Lignetics was ready to grow. By 1992 the Idaho plant had been in operation for nine years, with a great deal of success. Residential heating was still a hot market as pellet stoves and the pellets that fueled them continued to appeal to new customers, driving sales. The company decided to look into expanding.

The MO plant was considered a “greenfield operation”, and was fully built from the ground up, just like the plant in Idaho. It proudly came online in 1993, and produced heating fuel pellets (and dabbled in producing BBQ pellets) for a good 7 years. During that time however, the feasibility of continuing its operation gradually declined, due to the plant’s remote location.

Dr. Pickering had been doing his due diligence, anticipating where the next wave of demand would occur for heating pellets. He looked at where the

The demand for heating pellets in the area also proved to be a bit more complicated than originally anticipated. While there was certainly

The Collins Hopper attached to a classic wood stove

interest in heating pellets and stoves, the socioeconomic aspects of the area did not easily lend to people making the switch. Why would folks invest in buying a new stove and fuel pellets, when they could simply go out back and cut as much wood as they needed for free?

It became obvious that a plant was needed in an area that had access to more affluent communities, as well as easy proximity to a national transportation corridor. Doniphan was located 200 miles south of St. Louis, 140 miles east Springfield, 140 miles north Little Rock, and 200 miles from Memphis... but not near a major interstate. And as far south as they were, there was not much of a market there. The actual demand turned out to be 700 miles even further to the east, in the states of Massachusetts, Delaware, Eastern New York, and Connecticut.

This led to an exploration of additional sites in other states that would allow for successful reach to the northeast.

The goal was to be within a 300-400 mile trucking range of the target market, due to the expense of moving the freight to customers. Lignetics began listening to where the pellet

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HISTORY & FACILITIES

stove manufacturers were telling them to go. Incentives were offered by states as it became known that the company was looking to expand yet again.

The best offer came from West Virginia. The state actually proposed to make them a custom 8-acre site, carved out of a hillside, at no cost to the company. Negotiations followed to ensure reasonable electrical and natural gas rates for plant operation.

A deal was signed, and 250,000 cubic yards of dirt was moved. A new plant rose up from a plot of mud that was 35ft deep, uncovering natural spring water along the way (which is still being siphoned off to this day).

In 1996, the Sand Fork, West Virginia, plant came online. The new plant had abundant access to raw materials and excellent proximity to the freeway, located a mere 6 miles from Interstate 79. Interstate 95 was now within reach too, and therefore the coveted northeast region.

In 2000, Lignetics liquidated its MO assets and sold the original second plant, choosing to keep its focus on the west and northeast. Demand for fuel pellets continued to outpace supply, especially along the east coast. A new search for an additional plant site with access to raw materials and a convenient distance from an interstate began in earnest between 2006 and 2007. All of the company’s plants were greenfield operations thus far, and there was no reason to think that the next expansion plant would be any different.

The front-runners in the bid to get the next Lignetics plant were Virginia and Kentucky. Both states put forward attractive incentives and had the desired location logistics. Virginia in particular was extremely helpful and accommodating, as there was an urgency to bring new businesses into the state to fill the void of the exiting tobacco industry.

The deciding factor ended up being a coincidental car ride. A task force in Virginia had arranged a tour for Ken Tucker (who was CEO by now) through various towns so he could meet with local Rotary Clubs, attend chamber

of Commerce meetings, and talk to sawmill owners. One of Governor Tim Kaine’s people was driving Tucker up from South Hill, VA, when they passed a group of buildings in a semiremote area. Tucker inquired about the property and was informed that it was a defunct Royal Oak charcoal plant that had been shut down for about 10 years. Royal Oak had faced fines from the government due to the plant violating limits on visible and particulate emissions from 1994 through 1998. The company had shut down the charcoal kilns in May 1999, and the plant never reopened.

Ken Tucker went and looked at the shuttered plant, and saw great potential in the infrastructure.

With 133,000 square feet of covered buildings that already had water and power set up, the convenience of not having to build from the ground up for the first time was crystal clear.

Lignetics bought the facility in 2007, and invested $5.35 million to get it ready for operation as a pellet plant.

All of the Royal Oak equipment was moved out or sold, and modifications were made so the necessary pelletizing equipment could be moved in. A covered area for raw materials was also added at the site, and by December 2009, the plant was fully operational, with 35 new jobs created.

A warm welcome from local sawmill operators, who provided the raw materials, the ease of transporting the finished products to the customer base (especially in the northern market), and the tremendous support from the community made the plant purchase an excellent decision for the company.

Despite being only 200 miles from the West Virginia facility, the two plants did not compete with each other. With the Blue Ridge Mountains in between them, the plants were able to focus on two different markets, with West Virginia honing in on the north with its hardwood pellets, and Virginia servicing the Virginia and Maryland market, as well as the northeast seaboard with mixed wood and softwood offerings.

Now with a trio of efficient plants, Lignetics continued its focus on

distribution and being the brand that customers wanted, the best pellets on the shelf. New product diversification efforts soon followed as well due to opportunity and ingenuity.

There were gas fields north of the West Virginia plant where there was a substantial amount of drilling for natural gas. Industrial absorption pellets were created at Lignetics of West Virginia and were easily sold into that market to combat spills. The guy they were selling to in West Virginia suggested trying to sell to the oil fields in North Dakota, and Lignetics of Idaho began producing the absorption pellets as well for use in the Bakken oil fields.

Ken Tucker had also heard that there were some people using wood pellets for animal bedding, which piqued his curiosity. The traditional animal bedding material was straw, which was not available in some areas. Where is was available, it was not easy to dispose of. Stalls needed to be mucked daily, and oftentimes the clean and soiled straw couldn't be told apart.

This resulted in the whole area being constantly changed out for fresh straw.

Waste management charged a lot to remove it, and it was a large hassle for animal owners. The straw would pile up, blow around, and make a general mess of the place.

Tucker looked into making special pellets for use in stalls and pens, and even had a local vet in Sandpoint, ID look at them from a health perspective.

Different wood species were tested, and ultimately pine was decided on.

Pine absorbs particularly well, and animals were not allergic to it in any way. To make sure animals didn't slip on the pellets, they were made softer and would easily crush if stepped on.

They absorbed wetness quickly and it was clear to see where the affected areas were, making cleanup easier and resulting in less waste. Plus, unlike straw which doesn’t break down, soiled pellets would break down back into sawdust and could be used as fertilizer or soil amendment, or could be added to a compost pile to generate heat that aided in the composting process. EZ Equine was the resulting brand that sprang from the experimentation, and it officially came to market in 2010.

HISTORY & FACILITIES

The Lignetics company continued to grow and prosper. It attracted the interest of Taglich Private Equity, a New York-based, value-oriented financial sponsor with an interest in investments in manufacturing, business services, and consumer products companies throughout the United States. In 2014, Taglich acquired Lignetics from Gladstone Capital Corp, providing opportunity for Lignetics to expand its reach through robust financial backing.

Taglich wanted the company to add additional facilities and assets, and was there to assist with the heavy lifting and logistics. In 2015, Lignetics completed a merger with Bear Mountain Forest Products, based out of Oregon, and then an acquisition of Geneva Wood Fuels of Maine, adding a total of three new plants to its arsenal and expanding production capacity to about 600,000 tons of pellets a year.

Two years later in 2017, Lignetics acquired Marth Companies, adding another 3 plants, and then New England Wood Pellet in 2018, which brought 4 more facilities and enabled production capacity to over 1 million tons of pellets per year.

Another portfolio addition in 2018 was Woodpellets.com, which gave Lignetics a large foothold in the e-commerce space with the business's unique distribution model. Finally, the most recent acquisition of Energex Corporation in early 2020 added another 2 plants to the portfolio, bringing the new total to 15. The future is bright, and further acquisitions are always being explored.

So what happened to the founders of Lignetics and the industry? Well, Jerry Whitfield, the inventor of the original pellet stove, continued to sell various models of his stove over the years, improving the design and making aesthetic changes, and cementing the Whitfield stove’s legacy as the first and best-in-class. His company, Pyro Industries, was eventually sold to Lennox International in 1999, which was later reorganized into Lennox Hearth Products. The company sold Whitfield’s stoves for many years before finally discontinuing the legacy name in 2014.

Dr. Pickering, whose team gave Lignetics its name and was the driving force behind its early success, decided to retire as CEO in 1998, paving the way for Ken Tucker to become CEO (and later President and Chairman of the Board). The company headquarters moved to Sandpoint, ID that same year, where Tucker and most of the team was already located. Dr. Pickering remained on the Board until his death in 2004. Without a doubt, he would be proud of what the company has achieved and become.

When Taglich Private Equity bought the company in 2014, Ken Tucker decided it was time to step back and retire after a long career in the industry. He did however stay involved for an extra two years after the acquisition. Tucker remains on the Board at Lignetics, and has maintained a friendship with Jerry Whitfield since their start as industry pioneers. These days, Whitfield has been working on a design for a commercial coffee

78

roaster. Tucker has been enjoying his retirement years and spending time with his grandkids, and graciously allowed himself to be interviewed for this piece.

In 2015, new CEO Brett Jordan spearheaded forward-thinking initiatives to continue propelling the company forward. He moved the company headquarters to Louisville, CO, a central location in the country where a large pool of talent was available. He also pushed for new products, and robust research and development, ultimately hiring Frank Kvietok to lead the new Innovation Lab that would be the driving force behind these efforts.

The Lab and its team continues to push boundaries in product development and to open doors for the company.

From one brand and 200 tons of bagged pellets in 1984 to various brands and products and well over a million tons bagged in 2020, it is clear to see how far Lignetics Group has come. A spark of an idea has become a successful conflagration, dominating the pellet industry and continuing to fan the flames of sustainable products and progress in multiple markets.

A recent photo of a truck loaded up with pellets at Lignetics of Idaho

ORIGINAL BRANDS IN THE COMPANY

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HISTORY & FACILITIES

LIGNETICS OF IDAHO

The Original Plant West

Kootenai, ID

31756 HWY 200 E KOOTENAI, ID 83840

Fuel Pellets

Softwood

Animal Bedding Pellets

Softwood

Animal Bedding Shavings

Softwood

Heating Logs

Softwood

Firestarter Disks

Softwood

Map data: Google © 2020

Located along picturesque Lake Ponderay in proximity to various commercial and residential neighbors, the flagship plant in Idaho is still going strong today. The company's northernmost plant, it employs one of the highest employee headcounts in the Lignetics Group system. Idaho is the only plant using CPM brand pellet mills. Boasting the second-most complex product mix, the plant runs 24/7 and has the ability to output 87,000 tons of pellets a year. Products produced here include softwood fuel pellets (including Green Supreme), softwood animal bedding pellets under the EZ Equine brand, softwood cedar shavings, softwood heating logs under the Pres-to-Logs brand (made on the same machines originally purchased by Ken Tucker from Switzerland), and Firestarter disks.

Distribution from this location reaches the Western and Mountain regions of the United States, which include the states of Montana, Colorado, and Wyoming.

A

ccording to the City of Kootenai’s website, the city’s history is built around the lumber industry. In 1899 the Ellersick family sold their sawmill business in Minnesota and built a single-band sawmill at the Greenough’s (railroad) Spur. They named their mill the Kootenai Bay Lumber Company (KBLC), and the community that grew up around the sawmill and adjoining company store adapted the name.

platted with 80-foot-wide streets and commercial lots reserved for a school, public park, and church.

The location of the mill was ideal for the KBLC, as it was by the lake, where they could float and store logs, and next to the railroad, where they could ship lumber to distant markets.

Other lumber companies established operations nearby as well, including the Humbird Lumber Company in 1900, which acquired the Sandpoint Lumber Company and other timber properties that year.

In June 1930, after weathering the first two of the depression years, Humbird ceased operations as a lumber firm. All of its timber, holding, mill, machinery shops, and miscellaneous items were sold to the Weyerhauser Lumber Company. The new firm owned sawmills in many places and had no further need for the SandpointKootenai mills. Mill workers scattered and stump ranches were sold for a pittance. HLC moved to Canada.

Following the premature death of Henry Ellersick, the family sold the KBLC to HLC. Nearly 1000 men were employed in the Humbird mills and yards. Within a short time the combined HLC sawmill operations in Sandpoint and Kootenai became one of the largest in the northwest. The storage yard at Kootenai had over 19 miles of railroad track and used three locomotives to move logs and lumber.

When the Northern Pacific railroad decided on a stop in Kootenai, HLC owned the town site land, which was a dense forest of pine, fir, tamarack, and cedar. Within two months, an army of men had cleared the town site of trees and stumps. The town was then

By December 1908 Kootenai was emerging as the largest community in the area with a bustling business district. There was even an ice house filled in the winter with ice from Lake Pend Oreille. On June 30, 1910, Kootenai became an incorporated village.

The Kootenai Mill closed down on August 23rd, 1931 and did not operate further. All logging was closed down in August, 1931. The business district died out with the closing of the mill.

Many buildings burned down in a fire in the 30’s. In 1967 Kootenai became an incorporated city to conform with Idaho law, and in 1968 officially was renamed to the City of Kootenai.

When Lignetics came on the scene in 1978, the town gained a new plant that not only brought back jobs, but jobs that harked back to the city’s history as one literally built by the lumber industry.

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HISTORY & FACILITIES

LIGNETICS OF WEST VIRGINIA

The Strategic Expansion Plant Mid-Atlantic

Sand Fork, WV

228 INDUSTRIAL PARK ROAD, SAND FORK, WV 26384

Fuel Pellets

Hardwood

BBQ Pellets

Hardwood

Industrial Absorption Pellets

Mixed

Map data: Google © 2020

Located in a very rural setting, the plant in Sand Fork is the company's highest producing plant for BBQ pellets. Like Idaho, this plant employs one of the highest employee headcounts in the Lignetics Group system. It can output a total capacity of 126,000 tons of pellets per year. It is one of only two plants that has log chipping capability (through contract), and uses natural gas instead of wood fiber to fire the burner. The facility has hosted on-site job fairs in support of the local community, and is the pilot plant for the Coffee Additive project being spearheaded by the Innovation Lab. The products coming out of this plant include both hardwood heating fuel pellets and hardwood BBQ pellets, as well as industrial absorption pellets of mixed wood origins. The BBQ product is freighted to many states in the eastern parts of the Midwest and as far south as Texas, and the heating pellets are focused into the Midwest and Central United States.

WEST VIRGINIA

L

ocated in Gilmer County, West Virginia, the town of Sand Fork is a small and rural one, with a total area of 0.35 miles and a population of about 90 current residents. It was originally incorporated as Layopolis, after Eureka Pipe Line Company employee William R. Lay. The post office in the town was always known as Sand Fork, however, and the name was officially changed after an election in 1983.

Lifelong Sand Fork resident Sharon Radabaugh went to college at Glenville State, returning to the town to teach and later substitute teach in the old elementary school for over three decades. For the past 7 years, she has maintained the position of Town Recorder. In her words, "The best part of the town is the people". In this closeknit community, everyone knows each other and feels safe, while still having plenty of space to spread out.

A coal town at one time, oil and gas later became the prominent industries once coal slowly phased out. The town today has several interesting features.

An early historic general store, several churches, and a number of businesses operate within its boundaries. Until a few years ago, a community school was a center point as well, as a source of various events and activities.

Recreational areas are plentiful in the region, with Cedar Creek State Park a convenient drive away. Folks participate in many outdoor activities such as fishing, camping, deer & squirrel hunting, and more. There is also a trailhead located near Sand Fork with an extensive set of unnamed offroad vehicle (ORV) trails. These trails are located on private land but access is unrestricted.

Sand Fork is in close proximity to Glenville State College, West Virginia's only centrally located public college.

The college was founded in 1872 to provide instruction and practice for common school teachers, and has evolved to prepare students for careers in teaching, business, land resources, music, the liberal arts, the sciences, criminal justice, and human services. The college acts as a major employer in the area (as does the oil and gas industry and some timbering projects), and is the site of the West Virginia State Folk Festival, an annual event the third Saturday in June that celebrates the remnants of pioneer life and culture of West Virginia in music, entertainment, education, and social & economic activities.

Lignetics of West Virginia is actually located in a small area about 4 miles outside of the town's boundaries, in a small community called Stout's Mills.

Sand Fork, being the closest town with a post office, was the best address to claim and only a short drive away. The plant is located in the Gilmer County Industrial Park, alongside a few other businesses, including one that builds rafters and other wood products. The plant employs quite a few people from the county, enabling families in the area to continue to make a decent living in this rural community.

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HISTORY & FACILITIES

LIGNETICS OF VIRGINIA

The First Transformed Plant Mid-Atlantic

Kenbridge, VA

11068 SOUTH HILL RD, KENBRIDGE, VA 23944

Fuel Pellets

Mixed

Animal Bedding Pellets

Softwood

Cat Litter

Softwood

Map data: Google © 2020

The Virginia facility is located below the Mason-Dixon Line, on the edge of the town of Kenbridge.

It is one of three plants with a lake on the property. The plant employs around 28 people and can output 110,000 tons of pellets a year if running at capacity. It was the first plant to begin tracking man/machine/material issues as it relates to Overall Equipment Effectiveness at the pellet mills.

This important process has become a standard operating procedure across all facilities to inform output capacity and reveal where improvements can be made. This plant has the second most finished goods covered warehouse storage space in the plant system, and is also special for being the pilot facility for the emerging brand Catalyst Pet cat litter (which is shipped nationwide). Besides litter, Kenbridge makes hardwood and softwood fuel pellets, which are distributed across the mid-Atlantic region, and softwood EZ-Equine and private label animal bedding pellets for the midAtlantic region as well as parts of the Central U.S.

T

he town of Kenbridge, VA, is a small one, covering a total of about two square miles and populated by just over 1200 citizens in a county of 12,000. It is a tucked away, rural community, separated enough from major highways to achieve quietude, while still being close enough to them for convenience. Surrounded by farmland, rolling hills, and lush valleys populated by the southern pine tree and other hardwoods, the area is picturesque and quaint. As proclaimed on the official town website, Kenbridge is "A special place where charm still exists, and prosperity is right around the bend..."

According to Town Manager Tony Matthews who grew up in the county, folks in the town are neighborly and always looking out for one another. Mom-and-pop stores and small privately-owned businesses are favored here over corporations. The community is united by faith through church services and functions and is supportive of events such as various youth sports games and the annual July Jubilee, which occurs around Independence Day each year. The camaraderie that the townspeople experience is palpable in this place.

Kenbridge was settled in the late nineteenth century as a farming community. It was originally named Tinkling, after a post office that was established there in 1890. The Virginia Railway laid track through the community in 1907. The town was incorporated in 1908 and took its name from combining the last names of two of its local citizens, William

F. Kennedy and Lewis Bridgeforth.

In 1909 a telegraph station was established in the town, and by 1910 the first tobacco warehouses had been constructed. These, coupled with the railroad, led to Kenbridge becoming a very important market for the tobacco industry and a business center for the region. Manufacturing and the logging industry provided livelihoods for families in the area as well.

As the years passed however, the tobacco industry dwindled, and most manufacturing moved overseas. The railroad tracks were covered over.

These days, Kenbridge is known as a point along the Tobacco Heritage Trail, an off-road trail system that makes use of abandoned railroad property into an outdoor recreation destination for cyclists and hikers. The town also features a beautiful town park, playgrounds, and a town gym, which is the only non-school affiliated gym in seven counties.

The Lignetics of Virginia plant is located on the outskirts of town, in a fairly remote area. The company has always felt welcomed by the tight-knit community, and is regarded fondly as a business that employs a fair amount of people from the town, adding to its legacy and continuing its prosperity.

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HISTORY & FACILITIES

1984

1990

Bob begins building a new plant in Cascade Locks

1995

Forester and entrepreneur Bob Sourek establishes firewood business

1987

1991

1997

Bob sees pellet stove in Portland and begins learning the pellet-making process - friends help him to build a plant

1988

Bob begins making BBQ pellets for Traeger

begins production in Hood River, OR

1989

1993

Bob hires his first employee and sells his first truckload of pellets

Bear Mountain Forest Products produces chips and chunks for Luhr Jensen

1992

Production begins around-the-clock in Cascade Locks, and the company hits $1M in sales

Bob establishes Bear Mountain Forest Products and

Bear Mountain Forest Products sells BBQ nuggets to Japan

Bob moves BMFP corporate office to Cascade Locks and begins production of new product ideas

1998

The Dry Den and Bear Mountain Shavings products are introduced

2000

Bob begins making Wax Fire Starter and Gelled Alcohol Fire Starter

HISTORY & FACILITIES

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BEAR MOUNTAIN

2001

The CEO of Advanced Wood Resources in Brownsville approaches Bob about purchasing the plant

2002 Bob acquires the Golden Fire plant and brand

2005

Bear Mountain Forest Products begins production of Bear Bricks

2006

Bear Mountain Forest Products introduces America's Best brand to mass merchants

2013

Bear Mountain Forest Products celebrates 25 years in business

2015

Bear Mountain Forest Products merges with Lignetics

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HISTORY & FACILITIES

A MERGER THAT...

Bear Mountain Forest Products Enters the Fold

I

n 2015, momentous news ricocheted across the industry, as the two longest-running wood pellet manufacturing companies in the United States joined forces. The merger of Lignetics and Bear Mountain Forest Products meant that the newly combined company would be the only residential wood pellet manufacturing enterprise with plants on both the East and West Coasts, capable of producing approximately 500,000 tons of wood pellets per year. It was a significant venture that continues to pay off today.

But before we take a look at the plants that the unification brought into the company fold, it is important to understand the history of Bear Mountain Forest Products.

It began with a young upstart named Bob Sourek. Bob was born and raised in Cleveland, Ohio. His father was very resourceful, and ethics in the family included wasting as little as possible and valuing what was available. After high school, Bob headed out to the University of Montana for college, and fell in love with the splendor of the outdoors.

After completing his studies in 1979, Bob relocated to Carson, Washington, and began working for the U.S. Forest Service. As a forester he became enamored with the region, and decided that the Pacific Northwest was where he would build his life. He later found employment at a sawmill, where he learned the ins and outs of the forest industry, and then took another job back with the Forest Service.

His career path gave him a wide variety of experiences and a vast knowledge of forest management.

Along the way, Bob took an interest in forest industry by-products such as sawdust, wood shavings, logging debris, and small-diameter trees,

which were considered residual waste.

He thought it would be fantastic if something useful could be done with these materials.

Bob’s game-plan was always to grow up, get a job in the forest, and live a happy life. He had achieved the first two, but an entrepreneurial yearning kept him from being completely content. Since the age of twelve, Bob had worked for himself on various business pursuits. In 1984, Bob decided to start a firewood business as a side hustle while working at the sawmill.

He now had a wife, one child, and another one on the way, but couldn’t help feeling like it was finally time to strike out on his own. Lacking in startup capital and business experience however, he wasn’t able to make much headway with this venture.

Everything changed in 1987 when Bob was in his 20s and building a house for his family. He attended a Home Show in Portland, and it was there that he encountered his very first pellet stove, and Bob thought it was awesome.

A home heating stove that could feed itself, emit nearly zero ash and emissions, and produce the same heat and ambiance as a traditional wood stove? The potential was obvious and exciting. Plus, Bob knew he wanted to continue working with wood, so the idea had seemed like a good one and right up his alley.

A local sawmill in Hood River called Krieg Millwork & Building Supply was having difficulty getting rid of its residual wood chips and shavings, which meant a costly disposal problem.

Bob had worked with the company on his house construction project, and approached the owners with an offer to take away all of their waste for free, in exchange for space to erect a building, some equipment, and steam from the

existing dry kiln. The owners accepted the deal, with an agreement that if things didn’t work out in 5 years, the sawmill would buy the building and they could part ways.

Bob Sourek (right) on site with sawmill owners Carl and Ron Krieg, shortly before he incorporated Bear Mountain Forest Products

With the space secured, Bob formally established Bear Mountain Forest Products on March 14th, 1988, taking the name from Bear Creek Road where he lived, as well as Bear Mountain, a popular name for peaks in nearly every region of the country. To learn the craft of pellet-making, Bob reached out to some friends he had met back when he worked at the sawmill between his Forest Service jobs. They had recently put together a small pellet plant and were in the business of making alder pellets as bedding for lab rats. They taught him the basics and their specific techniques, and agreed to build Bob a plant for a mere $60,000.

So Bob began making pellets, and brought in $12,750 in his first year of business. Bob's friends had used density, oil, and steel dies to make their pellets, but the material would often have sticking issues. Bob discovered that oil wasn’t needed if high-chrome dies were used, and learned that the balance between heat and pressure

HISTORY & FACILITIES

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MOVED MOUNTAINS varied by wood species. After about 2 years of trial and error, he developed a pelletizing process that was successful, and pellets that were becoming known as consistent, reliable, and high-quality.

Once the product was made, Bob had no problem moving it; he would make 5 tons of heating fuel pellets in the morning, and sell them that same afternoon. He slowly built up his one-man show and began seeing the fruits of his labor. In Bob's second year of business, he brought in just over $78,000 and was able to hire his first employee. Since the only expenses were bag cost, labor, and electricity, the operation was very economical.

For 3 years, Bob’s plant ran two shifts. As the location was in a “light industrial zone”, they were not able to run production overnight. With a growing business and the 5-year term agreement with the sawmill owner

approaching maturity, Bob decided to find a new location where he could run shifts for 24 hours a day. The location that would become the Bear Mountain Cascade Locks plant was previously a sawmill that was part of the historic Cascade Locks Lumber Company.

Starting with one 150HP pellet machine and no dryer, the operation would add a dryer, another two pellet machines, and a small fleet of trucks to keep up with the demand, as Bob’s business continued to thrive.

In 1990, Bob attended an event on pellets at Joe Traeger's house in Mt. Angel, OR. Traeger is credited as the inventor of the pellet grill, which enabled folks to add the taste of their favorite wood smoke to BBQ. Traeger's son made some delicious BBQ, and Bob was inspired to bring a pellet grill back home. He soon began making his own BBQ pellets, under the American Heritage label, and was later The original Bear Mountain Forest Products logo

approached by Joe Traeger to produce BBQ pellets under the Traeger brand as well for a time.

The year 1992 marked the official start of production in the Cascade Locks location. It was also the year that the company made its first million dollars. In 1993, the company moved its headquarters to the new facility, continuing to run the Hood River plant concurrently until 1994, at which point the original plant was decommissioned (and the equipment sold off in 1996 to Pennwood Products in Pennsylvania).

The Cascade Locks Lumber Company site in the 1970s. Bear Mountain is currently located where the three buildings in the upper right are shown in the photo.

Then came the “Timber Wars” of the 1990s, which affected the timber industry for years. Logging operations were slowed and sawmills shut down in the Pacific Northwest, making raw materials hard to come by as the Forest

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HISTORY & FACILITIES

Service and logging industry went head-to-head with conservationists looking to preserve old-growth trees and the northern spotted owl that called such forests their habitat.

Between 1993-1999, Bob scrambled for his share of the dwindling Douglas fir raw materials supply, and attempted a variety of new initiatives to stay in business. He tried to become a vertical operation through selling solid wood products such as finger-joint trim ends. He started producing chips and chunks for a company out of Hood River called Luhr Jensen that made smokers. He began selling BBQ pellets and fuel pellets overseas to Japan, New Zealand, and Australia, and even created a specialty product for Japan called BBQ Nuggets, promoting them at trade shows there. And Bob also looked into diversifying his product offerings in the United States. Some of these products didn't stick, such as a product called Cedar Landscaping chips. Others would do extremely well and go on to become new staples of the business.

During this time, Bob's daughter had a horse and was experiencing difficulty getting the shavings she needed for stall bedding. Bob realized that pine and white fir pellets performed well as animal bedding (and made excellent composting material and fertilizer after use), so he began selling this product as

well. He was later inspired by a product called Sweet PDZ, which marketed the mineral zeolite as a powder that would refresh and deodorize stalls by neutralizing odors. In order to differentiate his animal bedding pellets from others on the market, Bob began adding zeolite as an additive, and Dry Den was added to the product line in 1998 (and patented in 2002).

Baled cedar and pine shavings, which naturally kept bugs away, joined the mix as well as Bear Mountain Shavings that year (which were re-branded Cozy Den later in 2005).

The company continued to diversify in the early 2000s. Gelled and cedar waxed Firestarter products were made and sold. After seeing a Pres-to-Log from North Idaho Energy Logs, Bob bought some and invested in a Presto-Logs machine in 2001 to produce his own densified firewood. In 2005, Bob swapped out the Pres-to-Logs machine in favor of a wood fuel brick machine, and Bear Bricks were born.

Just as he had done with his heating pellets, Bob spent time discovering the right configurations of ingredients and processes for perfecting these new products, and his company’s reputation grew. Between 1998 and 2002, 50% of Bear Mountain Forest Products’ revenue was from heating pellets, and the other 50% came from his product extensions.

Imagery and ad for Bear Bricks in 2005

In 2002, Bob was approached by the CEO of Advanced Wood Resources in Brownsville, Oregon, who asked him to purchase their business. Bob had a relationship with the plant already, as he had been purchasing bulk pellets from them since 1999. Already set up as a heating pellet plant, the facility was producing a brand of pellets called Golden Fire. This 100% Douglas fir pellet was considered a premium offering, with low moisture content and excellent heat output. The offer was too good to pass up. Bob acquired the Golden Fire plant, and his business tripled in size, with Bear Mountain Forest Products continuing its upward trajectory within the industry.

Despite both plants being in Oregon, they did not compete with each other.

Cascade Locks made lots of different types of products and had access to various species of wood. Brownsville solely made heating pellets. As the seasonality and access to raw materials made it a fluctuating business, the two plants would feed off of each other and even out the cash flow.

Bob showing his wares at a trade show in Tokyo, Japan in 1996

Throughout the next decade, Bob focused on profitability and improving the company. He re-branded Bear Mountain with a new, more aggressive logo. He oversaw equipment upgrades such as new pellet machines and a dryer system at the Brownsville plant.

He weathered the 2008 recession and in 2013, finally purchased the site

HISTORY & FACILITIES

An ad commemorating 25 years in business

of the Brownsville plant, while also celebrating his 25th year in business.

In 2014, Ken Tucker of Lignetics approached Bob about merging their companies together. Tucker’s company, Lignetics, was recently purchased by Taglich Private Equity, who considered wood pellet manufacturing to be a growth business. Lignetics was ready to expand, and Bear Mountain Forest Products was an impressive enterprise that had a very diverse product line, was profitable in all areas, and had a highly desirable premium fuel pellet product through its Golden Fire brand.

Bob and Ken had known each other since the late 80s, when they were both attending pellet trade shows as up-and-comers in the industry. Their relationship over the years wasn’t always a close or cordial one; they

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headed different companies in the same business after all, but there was always an element of respect there.

They both had gained positions on the Pellet Fuel Institute Board and by 2014, the men had mellowed out and were open to conversing.

After negotiating a fair price, securing a seat on the new Board, and keeping a good investment, Bob Sourek agreed to the merger in 2015. He stayed on as a manager for three years, and then stepped back, remaining an active Board member and investor.

It turned out the timing was good. Bob had enjoyed his career in the pellet industry very much, but the idea of having less of a day-to-day role was now appealing. He knew that very much like Bear Mountain, Lignetics was a family-oriented company that placed value on its workers and their happiness. Both companies had family picnics and generous time-off policies.

Both also dominated their regions. By combining forces, they could dominate the entire marketplace.

In his words, Bob considers Lignetics Group "Unique in the opportunity to be new and exciting and doing what no one can match, while honoring the rich history of individual entrepreneurs that put together the wood pellet industry." The merger with his company set the momentum for additional acquisitions yet to come, and Bear Mountain BBQ grilling pellets remain a rising star as they continue to outperform expectations in the market today.

A modern-day view of the Cascade Locks plant

ORIGINAL BRANDS IN THE COMPANY

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HISTORY & FACILITIES

BEAR MOUNTAIN CASCADE LOCKS

The First Presence in the West WEST

Cascade Locks, OR

5 NE CRAMBLETT WAY, CASCADE LOCKS, OR 97014

Fuel Pellets

Softwood

BBQ Pellets

Hardwood

Animal Bedding Pellets

Softwood

Animal Bedding Shavings

Softwood

Heating Bricks

Mixed

Map data: Google © 2020

Located in a beautiful natural setting where Oregon meets Washington state, this plant outputs hardwood BBQ pellets, softwood fuel pellets (including under the Bear Mountain brand), softwood animal bedding pellets, softwood animal bedding shavings, and Bear Bricks, which are made from mixed softwood and hardwood raw materials. It is one of two plants that have a Wet Electrostatic Precipitator, and uses wood fiber as well as propane in the burner and drying process. This plant employs around 20 people, and has the ability to output 34,000 tons of pellets per year. Notably, the first Safety Concern Form for Lignetics Group was created here, a foundational process that enables employees to identify, risk rank, and address safety hazards. This system has now been rolled out to all plants. The distribution footprint for heating pellets primarily includes the Western U.S. including Washington, some of Idaho, and the northern parts of Oregon. The BBQ product made here ships primarily to the West, Mountain, and Southwest regions of the U.S.

C

ascade Locks, Oregon, is a small city in the heart of the Columbia River Gorge, surrounded by rising mountains, silver waterfalls, and the iconic river. It is also a mere 44 miles away from Portland and is considered one of the top ten places in the world for small boat sailing due to its reputation for high winds.

The city is just upstream from the Bridge of the Gods, a toll bridge that is the only bridge across the Columbia River between Portland and Hood River. It is also known as the lowest point and largest city directly on the Pacific Crest Trail.

The identity of Cascade Locks has traditionally been one of a timber town. The Cascade Locks Lumber Company operated there between the 1940s and 1980s, and cut logs rafted in by the river were a common sight.

Average production was 150,000200,000 feet of lumber per shift, which was moved by rail across the country.

When the mill closed in the 80s, the town struggled. As the town's main employer, the loss had immediate effects such as the closure of the high school. Teachers and their spouses moved away, and the events that had driven the whole town were no more.

The town was established as a portage community amongst a robust system of rapids that runs for about 5 miles.

These rapids were difficult to navigate, and provided protection from invasion in the town's early days. History highlights include sea routes for Native American trading, a stop by Lewis and Clark, and as part of the first great migration of Oregon pioneers. Later in the 1850s, steamboats came along, followed by the Northern Pacific Railroad in the 1880s. The town was considered a major transportation corridor for the entire northwest, as freight and passengers moved through it to get above and below the rapids.

Mayor Tom Cramblett's family had resided in Cascade Locks since the late 1800s, originally following the timber industry there. Bear Mountain is located on Cramblett Way, named for Tom's father, Harry Cramblett, who was on the Port Commission for over 30 years and contributed to the economic development in the town.

Mayor Cramblett credits the arrival of BMFP with getting the town back on its feet when there was no real industry there anymore. Tom worked at the CLLC back in the 1970s, and knew firsthand what the mill had meant to the town. Bear Mountain created new jobs that reinvigorated the town spirit and allowed it to rebuild.

Locks are devices used for raising and lowering boats, ships, and other watercraft between stretches of water of different levels on river and canal waterways. The city of Cascade Locks took its name from a set of locks built to improve the navigation past the Cascades Rapids of the Columbia River.

People and things continue to come through this hourglass area of the Columbia River. The city thrives, not just from the current business diversity that attracts people to set up shop, but also from folks wanting to witness the beauty that 100-plus inches of rainfall a year can create in nature.

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HISTORY & FACILITIES

BEAR MOUNTAIN BROWNSVILLE

The Premium Product Plant West

Brownsville, OR

34363 LAKE CREEK DR, BROWNSVILLE, OR 97327

Fuel Pellets

Softwood

Map data: Google © 2020

The attentive reader will remember Brownsville as where Ken Tucker and Jason Day met with Rudolph Gunnerman to tour his converted particle board plant. This location was originally Woodex International’s first North American manufacturing plant. By 2001, it was owned by Jeld-Wen under the name Advanced Wood Resources and was manufacturing premium Douglas fir heating fuel pellets under the Golden Fire brand. That year, the company’s CEO approached Bob Sourek and asked him to purchase the plant. Now part of Lignetics Group, the plant employs around 31 people and can output 139,000 tons of pellets per year, one of the best outputs in the system. It has one of the largest site footprints, and has a Wet Electrostatic Precipitator. It uses natural gas and wood fiber in the burner & drying process and produces the driest heating pellet in the plant system, and possibly the U.S. The softwood fuel pellets made here go to Washington and southern Oregon, plus Southwest states like Utah and Nevada, and sometimes Montana, Wyoming, and Idaho.

L

ocated in the foothills of the Cascades in the Willamette River Valley, Brownsville is a small and close-knit town that almost feels lost in time. Peppered with classic houses, picket fences, old-fashioned front porches, and a lazy river that winds through the city park, it is a picturesque community of about 1800 people that looks almost exactly the same as it did when featured in the 1986 Rob Reiner film, Stand by Me. The town was named in honor of Hugh L. Brown, who settled there in 1846 and opened the very first store. The town is an easy drive from the hubs of Portland, Eugene, Albany, Salem, and Corvallis, Oregon. It is also in close range of Oregon State University and embraces all of the sports fans and commuters who have chosen to call it their home.

The close-knit community is powered by a strong volunteer spirit, civic pride, and engagement. Neighbors know each other and do things collectively.

An involved Chamber of Commerce supports and promotes local business and initiatives, and the Linn County Pioneer Association is headquartered in Brownsville, which hosts the annual Linn County Pioneer Picnic, Oregon's oldest, annual, continuously held event. Additionally, the town hosts a yearly celebration called Carriage Me Back, which celebrates the history of a particular year in Brownsville.

Actors dress in period costumes and re-enact selected bits of town history, and visitors get to ride in a horsedrawn carriage from the Linn County Historical Museum.

The town’s claim to fame stems from it being used as the setting for Castle Rock, Oregon, the fictional town in Stand by Me. July 23rd is the official Stand by Me Day in town, when people from all over the world come and pay homage to the film through visiting various scene locations and attending a festival with 1950s-themed activities, sometimes with surprise attendance from members of the film's cast.

Brownsville is also known as the home of one of the first woolen mills for the Pendleton company.

Bear Mountain is thought of fondly in the town, and City Administrator S. Scott McDowell credits the plant with providing integral jobs, as well helping to put the city on the map through name recognition. The plant has also contributed to town events over the years. For the annual Linn County Pioneer Picnic, Bear Mountain supplies mulch for the Penny Scramble, a popular event for kids in which coins are hidden within the mulch for them to discover as quickly as possible.

Bear Mountain BBQ pellets are very much embraced in the town, where they are carried by multiple shops. In fact, one of the City Council members is known for using them in a Traeger grill every 4th of July during the local music festival. Fans and artists alike look forward to gathering around for Councilor Mike Neddeau's delicious BBQ and chicken.

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HISTORY & FACILITIES

1850

Bostonian Charles Forster encounters nativemade toothpicks in Brazil and sends some back to the United States, where interest builds at hotels

1861

Forster acquires the patent for a shoe pegging machine that would be modified to create modern-day toothpicks

1887

Forster moves his toothpick operation to Strong, Maine, at a former starch mill location

1980

A power plant is added at the facility

1992

A private investor company from Boston buys Forster's

2002

After over 100 years in business, Forster’s Manufacturing Company was decommissioned

HISTORY & FACILITIES

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GENEVA WOOD FUELS

2003

Electricians Jeff and Lucinda Allen purchase the old mill to run it as a power plant

2008

Business partners Steven Chute and Jonathan Kahn purchase the plant with the intention of converting it for fuel pellet production

2009

Geneva Wood Fuels plant goes online and launches the Maine's Choice pellet brand

2010

The plant goes online for the second time with new equipment, after suffering an explosion the year before

2011 The Geneva pellet brand is launched

2015

Lignetics Group acquires Geneva Wood Fuels

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HISTORY & FACILITIES

THE MAINE EVENT

Geneva Wood Fuels Explodes Onto the Scene

T

he town of Strong, Maine, is probably best known for being the Toothpick Capital of the World. At its peak in the years directly after WWII, 75 billion toothpicks a year were produced in the area. In fact, 95% of all wooden toothpicks made in the U.S. came from Strong at one point.

This interesting part of the town’s history began with a Bostonian named Charles Forster. Forster was born in Charlestown, MA, in 1826. While in his 20s, he worked for his uncle, who ran an import-export business. Young Charles was sent to Brazil in 1850, and during his time there observed the natives using handmade toothpicks, which resulted in excellent dental hygiene and their beautiful teeth.

Back in the states, the tradition was to whittle a toothpick as needed after meals, or to use large goose-quills that could easily break in a person’s teeth. Forster sent a box of the locals’ toothpicks back to his wife in the U.S. as a curiosity, and she helped to get them in the hands of a hotel. The hotel liked them and ordered more, and soon other establishments followed suit, requesting the handmade toothpicks.

Forster had the natives continue to produce toothpicks to send back to the States, and saw a hole in the market.

There was the potential to make a great fortune if the little wooden tools could be mass produced by machinery back home in consistent shape and quality.

To further his aspiration to make a machine-made wooden toothpick, Forster looked to the world of shoe pegging. Before stitching or glues were used, shoes at the time had their uppers attached to the soles by thin wooden pegs that were driven in by hand. The quest to find pegs of uniform quality was extremely challenging, however.

Along came an inventor named Benjamin Franklin Sturtevant, who has been credited with inventing a shoe pegging machine that could peel logs into narrow strips of veneer from which uniform pegs could then be stamped out. Forster saw that toothpicks could be produced in much the same way, and he and his wife acquired the patent from Sturtevant in 1861, with the intention of modifying the parts. Teaming up with a shoe pegging mechanic named Charles Freeman, the men converted a shoe pegging machine so it would produce toothpicks.

Their first toothpicks were flat, but this form was later refined to be round with a tapered point. The design was simple but perfect, and solidified into what we are familiar with today.

The two men also tested different wood species that could be used in production, and discovered that white birch was perfect for their purposes.

The wood was soft and pliable, while also retaining a faintly sweet odor.

The desirable white birch tree grew in abundance up in Maine, and in 1887 Forster moved his operations to Strong, where his first toothpick mill was opened in what was a former starch mill. This new mill was capable of producing millions of toothpicks a day.

With the technical aspects now figured out, the new challenge for Forster was creating demand for his product. What he did next in and of itself is the stuff of a marketing genius. Forster hired good-looking young people to go into shops and request wooden toothpicks.

Once the shopkeepers revealed they did not have the coveted wares and lost a potential sale, Forster had no problem showing up a short time later and selling the “in-demand” items into those shops.

A similar strategy was employed to introduce toothpicks into restaurants.

Forster hired Harvard men to ask for wooden toothpicks at the end of their meals. When told there were none on the premises, the men would get angry

Forster Manufacturing Co., Strong, Maine, circa 1939 - Collections of Strong Historical Society

HISTORY & FACILITIES

and loud, promising to never return to a dining establishment that didn’t provide wooden toothpicks. When Forster later showed up selling those very items, the restaurants not only stocked up, but began providing them to every table.

main station was just across the road and a set of tracks went up through the warehouse in the back of the main mill. There were wooden numbered placards up on the beams to denote where the train would be able to stop for easy loading.

Once they became a staple for the wealthy, it was only a matter of time before the masses wanted in on the tiny teeth-cleaning sticks as well.

Toothpicks became all the rage, and it was not uncommon at all to see young people, and even women, with them dangling from their mouths in front of restaurants and on the street.

Besides the obvious benefits that the toothpick industry brought to the town, Forster's was a fixture in Strong for other reasons as well. There had been a power plant installed in Forster’s back in 1980, and at the time it had provided steam heat to houses on the entire street, as well as all of the homes on the right side of bustling Main Street. There was also a system of pipes that ran for 3-4 miles, delivering water throughout the town.

Demand continued to outstrip supply, and Forster expanded to 5 mills. Toothpick usage evolved beyond simply picking food out of one's teeth to other purposes, such as presenting cocktail garnishes, keeping hors d’oeuvres together, as a food sampling tool, and even as an indicator for checking baking completion.

Eventually competitors sprang up around Maine too, hoping to cash in on the new trends. But through it all the Forster facility in Strong had the prestige of being the original mill of the toothpick movement, and a driving force behind the economy of the town.

The mill later diversified its offerings, producing ice cream sticks, clothespins, coffee stirrers, and even yo-yos.

Forster’s Manufacturing Company in Strong was comprised of various buildings over its history that were all owned by the plant. Some of these included a creamery, where local farmers would bring and make milk, a corn shop, where corn was husked in a long building, and a garage. The complex was located between railroad tracks at a grand central turnaround, where tracks could switch and enable service to various destinations. The

Company letterhead and detail from 1944

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The original Geneva Wood Fuels logo

As the years continued to pass, new challenges faced the toothpick industry, punctuated by cheap imitation imports from Asia and the advent of nylon floss. Plus, the opinion of picking one’s teeth in public had shifted from being a status symbol to being viewed as uncouth. In 1992, a private investor company from Boston purchased Forster’s. Almost a decade later, profit margins were not improving, and toothpick mills continued to shut down. Forster’s downsized from its 5 plants down to the lone Strong location, and was approaching bankruptcy. The mill was finally decommissioned for good in the year 2002.

After sitting idle for about a year, Jeff Allen, a Strong native and former worker at Forster’s, along with his wife Lucinda, purchased the mill to run it for power generation. Lucinda had grown up working for a competing mill that her family had operated and owned, called Strong Wood Products.

Both Jeff and Lucinda Allen had backgrounds as electricians when they made the purchase, and were thrilled to breathe new life into such a historic location once again. In fact, the couple was able to make use of some of the original materials at the site over the years. When an adjoining barn was

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HISTORY & FACILITIES

torn down in the mid 1980s, they used the metal roofing and wood beams in the building of their house.

After the purchase, the Allens offloaded all of the buildings except for the main mill structure. For five years, Jeff and Lucinda generated power at the plant, made wood chips, and also sold firewood for a time. The venture was lucrative until a contract with the power company changed things, and the prices of chips went up as well. The couple decided it was probably a good time to shut down the plant and look to sell.

In 2008, a lawyer out of Portland, Maine showed up and wanted to look at the facility. His name was Steven Chute, and he had an uncle named Byron and a businessman named Jonathan Kahn that he wanted to partner with for the purchase. Kahn was an investor out of Chicago who saw the value in energy commodities, and the Strong plant as a great opportunity. The men had a vision of entering the fuel pellet market, and so the Allens sold the mill, staying on as plant managers. Their son, Nathan Allen, came on to work at the plant as well as a crane operator between 2008-2014.

Loading in the new Earthcare dryer in 2008

Governor Paul LePage, Lucinda Allen, Jeff Allen, Jonathan Kahn, and a representative from the state after the new ownership deal was inked

The dryer in place above the 3 Andritz Sprout Pelletizers

Kahn had a business plan ready to go, and invested about $13 million into the old factory to turn it into a state-of-the-art pellet mill. The plant officially went online in March 2009.

The historic exterior facade looked the same, but on the inside three Andritz Sprout pelletizers, an Earthcare dryer, an Andritz Sprout stationary hammermill, banks of electronics,

and advanced computer monitoring systems would now work together to convert wood chips into pellets.

A massive chip storage building was constructed as well, standing right where the train used to pass through the old Forster warehouse. The new plant would be known as Geneva Wood Fuels, named after a street in Chicago where Kahn grew up.

Logistically, there were lots of moving parts in getting the new business up and running. Kahn tapped the Massachusetts company International Forest Products for initial help in sales and to get the brand "out there" for wood pellets with design, quality, and public broadcast. IFP is owned by Bob Craft (also the owner of Gillette Stadium and the New England Patriot's

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100

Construction of the new chip storage building underway in early 2009

The original build crew responsible for the plant renovations in 2008-2009

Machinery in place and covered in snow in January, 2009

Jonathan Kahn getting in on the action with a sawzall

football team) and is a global leader and North America's largest trader of forest products commodities. Their assistance was pivotal at the time to grow Geneva Wood Fuels outside of Strong. Steve Maneiri with IFP worked very closely with Kahn and the Allens from the reconstruction of the old mill into a pellet plant right out through all of their initial pellet sales. The company was also involved in the design of the new loading docks, and it was they who designed the first Maine's Choice pellet bag in 2009.

Maine’s Choice became the core pellet offering, and later on in 2011 an orange bag emblazoned with “Geneva” would be introduced to step up sales and give people a choice for a better quality

pellet. The brands were primarily sold in Massachusetts, New York, Rhode Island, and Connecticut.

One thing that made Geneva Wood Fuels different from other fuel pellet producers at the time was the operation's reliance on wood chips rather than sawdust. Paper mills in the area depended on sawdust for their products, so it was already heavily spoken for. Kahn hired a company called Timber Resource Group to procure the roundwood that was used instead for production. TRG had to find the right amount of the right type of wood, build the contracts with the lumberman, and keep the yard full at all times. It was a very competitive and difficult task to obtain logs at a

sustainable cost as the wood pellet margins were so tight at the time.

Once logs arrived at the plant, they were debarked, and then converted into chips. A very specific chip was needed however, of precise size and style, so the wood fibers were not compromised and the dryers could process the material correctly. Kahn discovered a unique machine at a trade show and purchased it after doing some research. The result was a quality pellet that delivered the best efficiency and throughput from the mill.

Once created, the pellets were sent to an automated assembly line where they were packaged into 40lb bags, stacked on pallets and taken to the

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HISTORY & FACILITIES

Aftermath of the 2009 explosion showing the burner upside down

Origin of the explosion in the dryer

loading dock via forklift. Crews would load as many as 10 to 12 trucks each day, shipping pellets to customers throughout the New England area.

At 1:20am on August 8th, 2009, five months after beginning pellet production, an explosion occurred at the plant that could be felt 10 miles away. The entire building was rocked (and remains structurally tipped to this day). Beams were completely dismounted from their positions, the burner flipped upside down, and the power plant imploded. Emergency crews rushed to the scene, and miraculously, the 4 people on the premises at the time were unharmed.

It was ultimately determined that dust had built up in the dryer passages, amassing great pressure that resulted in the massive explosion.

While definitely a setback, this blow wasn't the end of the story.

Jonathan Kahn and his investors doubled down on Strong and chose to rebuild, outfitting the plant with a new high- efficiency TSI dryer and putting new safety precautions in place that Lignetics would later adopt. The plant went online for the second time in the spring of 2010 and resumed operations. The two bagged pellet brands continued to do well, and the plant acquired bulk accounts too, selling pellets by the truckload to several school districts and the Jackson

A view of the plant in operation in early 2009

Laboratory. Business began to boom, and a new metal silo was constructed on the property that could hold 300 tons of wood pellets.

In 2015, Lignetics expressed interest in buying the plant off of Jonathan Kahn.

For Kahn, his patience and investment paid off, as his hope had always been to build up and sell the business.

With support from Taglich Private Equity, Lignetics was able to secure the acquisition and extend its footprint into Maine and upper New England,

expanding its production capacity to almost 600,000 tons per year.

While Lignetics switched from using roundwood to processing sawdust at the plant in 2017 for efficiency, many other things remain the same. The old Forster's building continues to be a source of pride and jobs for the town of Strong, having survived closures and the changes of the times, and rising like a phoenix from the literal flames of the 2009 explosion. The future is bright, and wood products are still the star.

HISTORY & FACILITIES

Another side of the building shown in early 2009

Nathan Allen operating a crane as part of the debarking process, alongside an industrial wood chipper making quick work of the logs

Stacks of logs near the scale house

Self-feeder full of wood chips ready for processing

ORIGINAL BRANDS IN THE COMPANY

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LIGNETICS OF MAINE

The Historic Plant Northeast

Strong, ME

30 NORTON HILL RD, STRONG, ME 04983

Fuel Pellets

Hardwood/Softwood

Animal Bedding Pellets

Softwood

Map data: Google © 2020

The Easternmost plant in the system, this former toothpick mill is located near commercial and residential neighbors. This plant has demonstrated the best practice for production meeting format, and this format will be modeled and rolled out to all other plants. It is the only plant in the system with steam turbines/generators on site from its days as a power plant, and the only plant that uses Andritz 36" diameter pellet mills. The plant no longer relies on log chipping as in the days of Geneva Wood Fuels ownership. To maximize space and efficiency, the plant now uses sawdust as the main raw material like the rest of the Lignetics Group plants. The facility has a great deal of raw material inventory and the fourth highest finished goods inventory on site. The plant employs around 31 people and has the ability to output 93,000 tons of pellets a year. The products made here include hardwood and softwood fuel pellets, as well as softwood animal bedding pellets. These products are shipped primarily to Maine, and also parts of New Hampshire and Vermont.

STRONG MAINE THE

TOOTHPICK CAPITAL OF THE WORLD

B

efore gaining notoriety for toothpicks, Strong, Maine had been known as various other names. Pierpole, a Native American living in the area when the white settlers arrived, referred to it as “middle town” on the Mussul Unsquit, his name for the Sandy River. The 1790 census record lists “Sandy River, Middle Twp.” Soon after that it became known as Readstown, after the settlement proprietor, William Read from Nobleboro. Incorporated as a town on January 31, 1801, it was permanently named Strong, for Gov. Caleb Strong of Massachusetts.

The official website for Strong describes it as being set on a hilly intervale above a big bend in the Sandy River. The fertile soil presented ideal conditions for agriculture, and farmers grew hay, wheat, corn, oats, and potatoes. The northeast branch of the Sandy River provided water power for mills, which helped to make Strong prosperous and continue to grow. By 1859, when the population was 1,008, the town had sawmills, a gristmill, a fulling mill, a carding machine, a starch factory, and a tannery. Two years later, Forster would begin making his toothpicks.

The narrow gauge Sandy River Railroad connected the towns of Farmington and Phillips in 1879. By 1886, town industries included a boot & shoe factory, machine shops, Maine’s first cheese factory, a clothespin manufacturer, a maker of cane seat chair bottoms, and an excelsior factory.

At the time it was named as “one of the prettiest villages in the county.”

Strong became known as the “Toothpick Capital of the World” due to the productivity of the Strong Wood Products Inc. plant, which once manufactured 20 million toothpicks per day, and of course because of Forster's Manufacturing Company.

Much of the original business district burned to the ground in a fire in 1969, and these days not much industry remains. The bedroom community in Strong today is supported by a few commercial businesses in the service industry, oil, lumber, and logging.

Folks living in Strong today enjoy the quiet, small-town atmosphere and appreciate the town for its history. Carl Stinchfield, who operates the Strong Historical Society, was born and raised in the same house he lives in now, and raised his family there, too. With a population of about 1,200 today, the town is mostly free from crime and other concerns that come with larger communities. Stinchfield expressed that Lignetics, located opposite a popular general store called the White Elephant, is a very welcome employer in the town, keeping Strong on the map as a wood products producer.

Strong is home to the annual Sandy River Festival, as well as "Pierpole Day" on the weekend closest to the 4th of July every year. It is said that Pierpole (a shortened and condensed version of his real name, Pierre Paul) moved to the area in 1780 from Canada, with his wife, Hannah, and their six children.

They stayed and helped the settlers.

The celebration is marked with a parade and festival, and the event also honors the town’s war veterans.

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1958

Milton & Geraldine Marth start Marth Wood Shavings Supply in Marathon County, WI

1971

Milton Marth secures a wood hauling permit securing him sole authority to haul wood waste in the area

1972

Paulette & Kenneth Natzke relocate to Marathon and join the family business

1981 Trucking is de-regulated in Wisconsin

1984

Marth Transportation, Inc. is founded as a whollyowned subsidiary of Marth Wood Shavings Supply

1989

Jerry Natzke begins building the first pellet mill east of the Mississippi River at the Marathon facility

1985

A semi-automated packaging line is installed at the Marathon facility

1987

A rotary dryer is purchased for the facility to enable procurement of additional wet sawdust raw material

1991

Marth begins operating a wood pellet stove retail segment out of the Marathon facility

1995

The plant begins working with pioneers in the Wood Composite Decking field

HISTORY & FACILITIES

106

MARTH COMPANIES

2000

Marth Manufacturing is established in Athens, WI to produce wood flour

2006

The Marth Peshtigo Pellet Plant location is added in Peshtigo, WI

2004

2008

A second pellet mill is added to the Marathon location

Marth is recognized at one of the fastest growing companies in the U.S. by Inc. 5000

2005

2010

Paulette & Kenneth Natzke retire, giving the company reigns over to their son, Jerry

A chip plant and drier facility is added to the Marathon facility, as well as a Forestry segment

2015

The Marathon facility installs a complete robotic and automated packaging line

2017

Lignetics Group acquires Marth Companies

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HISTORY & FACILITIES

A TURKEY FARM TO

Marth Builds an Empire in Wisconsin

B

ack in 1956, Milton and Geraldine Marth were in the business of growing turkeys for Jerome Foods in Barron, WI. They needed bedding for their 40-acre turkey farm, located in Hamburg, a township in Marathon County, WI. The Marths began purchasing wood shavings for bedding that was delivered from across state lines in Minnesota. Milton was amazed at the cost of the shavings, and began looking to a local waste product for a better solution. This innovative thinking led to a series of corporations in the state of Wisconsin that would bear the Marth surname and carry on a legacy for years to come.

The waste product in question was sawdust. Milton Marth knew people that owned sawmills and was aware of available wood waste at their mills, right there in Central Wisconsin. After trying some of the local material and finding it workable, he purchased a truck and contracted with a mill 20 miles away to take all

An aerial view of the original Marth turkey farm

of their by-product shavings for use as a substrate in his animal pens. He also collected wood shavings from window companies to use as well.

With assurance of consistent removal of sawdust and shavings, the mill was able to concentrate on their profit centers and production.

As the original contracted mill increased its sales, the amount of byproduct increased there as well. Milton and Geraldine Marth soon found themselves with more bedding than they needed for their turkey farm. In 1958, they began selling the excess to friends in the poultry and livestock industry, and Marth Wood Shavings Supply was born.

Turkeys on a typical farm

The company would grow quickly as word of the new operation spread.

With the personal service provided, other mills soon sought out Marth to remove their by-products. As things grew, Milton Marth decided to apply to the Wisconsin Public Service

Commission for a permit to haul wood shavings and sawdust at a cost of $25.

When Mr. Marth arrived at the permit hearing, he was told by the examiner that sawdust and shavings were considered garbage and there was no authority needed to haul the product.

Milton Marth asked that they give him authority anyway, seeing that he had already paid the fee and taken the time to appear at the hearing. Authority was granted on August 17, 1971, and that protected Marth with a unique, sole authority to haul wood by-products in Wisconsin until deregulation occurred in 1981.

In 1972 Milton and Geraldine's daughter, Paulette, and son in law, Kenneth Natzke, relocated to Marathon from Cedarburg, WI and joined the family business. Milton and Kenneth handled the dispatching of trucks, as well as the maintenance of the trucks and equipment. Paulette took over the legal and daily operations of the office. She would also go on to establish

HISTORY & FACILITIES

108

STABLE STAPLES

A family business for three generations. From left to right: Milton & Geraldine Marth, Paulette (Marth) Natzke & Kenneth Natzke, and Michelle & Jerry Naztke

Marth Foundation LTD, in 1982. This foundation was dear to Paulette, and provided a $1000 scholarship towards a college education for the children of Marth employees for 8 semesters, provided that they maintained a C-average. This ensured that a good amount of the workers' kids became eligible to receive the scholarships.

During the 60-year stretch from 1935 through 1995 when trucking was regulated, it meant that the federal government and states could impose rules around pricing and territory, effectively controlling who could carry what where. These rules were often considered restrictive, complicated, and inefficient, but they were originally designed to limit trucking's ability to out-compete the railroads, an important part of the American freight industry.

The Motor Carrier Act of 1980 slowly began to unravel the federal trucking regulations, and further measures to clean up and decontrol the industry passed in 1995. Trucking

laws within state borders were also amended in the 1980s and 1990s due to pressure from shippers. In Wisconsin, trucking was deregulated in 1981.

Deregulation allowed manufacturers to reduce inventories, to move their products more quickly, and to be more responsive to customers.

Between 1971 and 1981, Marth's growth exploded into new mills, manufacturers, and farm accounts.

Trucks, trailers, and drivers were added to meet the demand. Postderegulation, it was projected that there was enough long-term potential for trucking growth to explore starting a separate, profitable company. Marth Transportation, Inc. was founded in 1984 as a wholly-owned subsidiary of Marth Wood Supply Inc. The new entity was quickly able to grow into a common and contract carrier hauling for many large customers beyond Wisconsin to the Southeastern/ Southern United States. The large fleet of trailers could handle almost any need and included flatbeds and walking floors.

Milton and Geraldine Marth decided to retire in 1984, but stayed close by to watch the business grow. Their grandson, Jerry Natzke, began working for the company in 1980. As Jerry was still in high school, his initial tasks consisted of unloading shavings and working on the trucks. He went on to attend Northcentral Technical College from 1986-87 to pursue an Associate Degree in Marketing. He worked in various positions for the Marth company after his time at the college, as is common in a family business.

The company continued to evolve as the years passed. In 1985, a semiautomated packaging machine was installed, the first step in efficiency to help broaden the product offering.

This move brought production up to 70,000 bags per year. A rotary dryer was introduced in 1987 to enable procurement of an additional 40,000 ton supply of wet sawdust raw materials. The dryer would convert it into dry product for industrial applications for accounts such as Weyerhaeuser Company,

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HISTORY & FACILITIES

known as the world's largest private owner of timber and as the world's largest pulp and paper company, and Rodman Industries, a particle board manufacturing business.

In 1989, the wood pellet industry was still in its early years. Jerry Natzke began researching wood pellets and saw them as a way to expand into another product category. He started building the very first pellet plant east of the Mississippi River and collaborated with well-known industry entrepreneurs who were developing wood pellet burning appliances like stoves. These manufactures are known today as original industry leaders with the names of Lennox, Breckwell, Traeger, and Whitfield.

1991 marked the start of six years of operating a wood pellet stove retail segment out of the Marathon facility, and becoming one of Breckwell's top retailers and distributors for stoves in the Midwest in the process. Natzke served on the Breckwell advisory board during this time, helping to guide the company in consumer affairs and pellets combustion research and technology. (This portion of the company was sold off in 1997 as it was not the core focus of the overall business plan.)

Uphill growth continued throughout the 1990s. Wood shavings mills were installed in the Marathon location in 1993 to convert logs directly into shavings to help penetrate broader

markets for animal bedding. The demand already existed and this was a new way to increase production.

Furthermore, the company's trucking power and industry knowledge led to partnering for raw materials and other opportunities. In 1995, the plant began to work with pioneers in the Wood Composite Decking field such as Certainteed, Universal Forest Products, Greentree Composites, and Timber Tech. This collaboration led to the development of a cellulose fiber that could be used as a base filler in the extrusion process to manufacture composite decking products. This "wood flour" product was created from pulverizing dried wood into fine particles, which is a natural alternative to synthetic fillers.

A Marth display trailer used to promote the company's products(with original logos) and Breckwell stoves

The display trailer with doors open, showcasing the Breckwell stoves inside

An old Breckwell/Marth brochure ad

HISTORY & FACILITIES

110

The turn of the century ushered in new momentum as the company expanded its physical footprint. A third corporation, Marth Manufacturing, Inc. was designed and constructed in the year 2000. The new state-of-theart wood flour manufacturing facility in Athens, WI could produce 38,000 tons of material per year with only two people per shift.

The new plant was built to fill the needs of the composite decking industry, as well as to supply materials to companies such as Bemis and Olsenite. The final wood flour product could be prepared as a custom blend of materials and particle distribution to satisfy each customer's individual specifications. The Athens plant has been a leader in the industry for manufacturing excellence supplying the cellulose fiber to industrial customers who produce toilet seats, explosives, car parts, composite decking & components, and other household products.

The Marth Peshtigo Pellet location shortly after being built in 2007

Improvements to the Marathon, WI facility came in 2004 when a second pellet mill was added. A fully automated packaging line for wood pellets was introduced around the same time as well. This increased production to 36,000 tons of product per year (1600 truckloads per year).

Paulette and Kenneth Natzke retired from the business in 2005, giving complete control to their son Jerry, who had been active and involved with the growth of the corporations throughout the years.

In 2006, a third facility was added, known as Marth Peshtigo Pellets. This plant was built at a strategic location to continue to supply the growing residential need for the wood pellet fuel heating product. The streamlined plant only needed 4 people on staff to operate it. All raw materials came from relationships with local suppliers, who delivered 8-10 loads of sawdust a day.

The sawdust would come in dry and then be efficiently processed.

The addition of the Peshtigo location increased pellet production to 72,000 tons per year, which translated into 3.6 million bags, or 3200 truckloads of product. The Marth Peshtigo

Wet sawdust entering the rotary dryer for processing at the Marathon facility

Pellets facility is incredibly efficient today as the level of automation has continuously been updated. At the time it came online, Marth had aggressive market penetration as its products were offered in Big Box Retailers such as Mills Fleet Farm, Menards, Ace Hardware, and Lowes, along with other mid-level retailers who grew with the company from the beginning.

By 2008, Marth was recognized by Inc. 5000 as one of the fastest growing companies in the United States.

The Marathon, WI facility was always the center of the Marth universe, where each project would start and then move if needed. Further evolution at this special location came in 2010 with a complete Chip Plant and Dryer facility to continue to meet the needs of a growing customer base in the industrial and residential categories. In a business known to be vulnerable to material shortages, the company was able to get crafty with the chipper stay competitive. They would occasionally

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HISTORY & FACILITIES

Jerry Natzke's grandfather, Milton Marth, passed away in 2010. He was remembered as an avid churchgoer who enjoyed snowmobiling and woodworking, and of course, as the entrepreneur who with his wife would put Wisconsin on the map for the wood waste industry. Connected to the end, Geraldine passed away a week later, at almost exactly the same hour as her beloved husband and business partner.

Three generations of the family continued to grow the business that they founded at that original Marathon County location, where the main office and plant remains today. And there is no doubt that Milton and Geraldine would be very proud of what Marth Companies has become and achieved since 1958.

A modern-day view of the Marathon plant

find low-grade wood that could be chipped to keep supply up, keeping them as the #1 supplier in the area.

A unique forestry arm was also added at the Marathon site. Two foresters procured stumpage with two harvesting crews and serviced the needs of landowners during the procurement of the wood. This procurement of purchased stumpage decreased wood cost by 20-25% over gatewood, which was delivered from outside producers.

A complete robotic and automated packaging line was installed in Marathon in 2015 as a more recent upgrade. This line increased production, reduced workman's comp exposure, and lowered packaging costs while utilizing the same man hours to produce 60% more finished product.

By 2017, production on this line was up to 1.2 million bags, or 1300 truckloads per year.

After being solicited by Taglich Private Equity in 2016 and giving it careful consideration, Jerry Natzke officially completed the sale of Marth Companies to Lignetics Group in 2017. Lignetics ended up adopting many of the safety practices, manufacturing operating models, and various other industry-

leading technologies that Marth Companies had developed throughout its many years in business. The acquisition upped production capacity of Lignetics Group to approximately 700,000 tons of wood pellets per year and made it the only wood pellet manufacturing company that had plants in the East, Central, and West, with nine plant locations that included facilities in the states of Maine, Oregon, Idaho, West Virginia, Virginia, and now Wisconsin.

At the time of the acquisition by Lignetics Group, Marth Companies consisted of Marth Wood Shavings Supply, Marth Transportation, Marth Manufacturing, Marth Peshtigo Pellets, Marth Foundation, and Marth Properties, a holding company. Marth Transportation had grown to include 28 company-owned tractors, 4-6 owner operators, and 300-plus trailers in its fleet. Along with its own fleet, there was a brokerage department to manage the more than 10,000 loads per year that were moved. Altogether, the company consisted of 105 employees and earned over $30 million dollars of revenue per year. The Peshtigo location remains exemplary as the lowest cost producing pellet plant in the Lignetics portfolio of operating pellet plants, with the other two not far behind.

Milton Marth in a company ad for heating pellets

HISTORY & FACILITIES

A young Milton and Geraldine Marth accepting an award for their turkeys in 1956

The Natzkes' house in the foreground, the Marathon plant in the background

112

Bagged fuel pellets ready to go to customers

A photo in a brochure advertising Marth animal bedding shavings, around 1995

Paulette Natzke at work in her office at the Marathon location

ORIGINAL BRANDS IN THE COMPANY

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HISTORY & FACILITIES

LIGNETICS OF WISCONSIN

The Marth Companies Origin Plant Central

Marathon, WI

6752 STATE HWY 107 N, MARATHON, WI 54448

Fuel Pellets

Hardwood/Softwood

BBQ Pellets

Hardwood

Animal Bedding Pellets

Softwood

Animal Bedding Shavings

Softwood

Industrial Chips

Hardwood/Softwood

Map data: Google © 2020

The Marathon site is the most complex one in the system, employing one of the highest headcounts of people in the actual plant and additional people through Marth Transportation, Inc. MTI, the trucking company, consists of 300 trailers and 25 tractors, with a driver for each truck. The plant can output up to 57,000 tons of pellets per year. This operation produces hardwood BBQ pellets, both hardwood & softwood heating pellets, softwood animal bedding pellets, softwood animal bedding shavings (bulk and baled), and both hardwood & softwood industrial chips as raw material that gets sent on to the Athens location for further processing into wood flour. Notably, this is the only plant that procures roundwood, or full logs, and chips them right there on-site. Distribution of BBQ pellets is focused on the Central region of the country, as far down as Oklahoma, and the heating pellets can be found throughout the Midwest. Animal bedding stays pretty local, as Marth built up many loyal accounts over the years and there are many local farms in the area.

L

ocated at the intersection of two State Highways and minutes west of the I-39 corridor, Marathon City sits above the banks of the Big Rib River on Marathon Hill, where the scenic views inspired the motto “The View’s Great Up Here!”. Nationally and globally recognized for the products created within its limits, Marathon City is an employment center for the region.

The picturesque community combines the best of rural living with the convenience of urban access.

In 1856, a group of German immigrants employed as tradesmen, laborers, and mill workers in Pittsburgh, Pennsylvania planned a colonization scheme to give them an opportunity to improve their lives and that of their children. They had heard of good lands in Wisconsin and made up their minds to become farmers in the West.

The group organized “The Pittsburgh German Homestead Society,” with each member paying into a common treasury in return for eighty acres of land and one village lot. They elected a committee that traveled to the Federal Land Office and acquired 3000 acres that included the present Town of Marathon and eastern two-thirds of the village.

By 1884, the village had grown large enough that its leaders petitioned to incorporate the Village of Marathon City as a separate political entity from the Town of Marathon. Growth continued with the arrival of the railroad in 1891 and the development of agriculture in the surrounding area.

First wheat and then dairy farming provided area farmers with their

livelihood. A large creamery started up in the village and small area cheese factories bought their raw milk for processing. Beginning in the 1950’s, a new crop, ginseng, began to dominate the area's economic interest, with the root crop still being grown here today.

In fact, 90% of the ginseng grown in the U.S. is cultivated in Marathon County.

The community today is home to 1573 residents, and where 2000 people arrive each day to work. It is an ideal place to live with an excellent school system, family-owned businesses, and a small-town feel full of traditions.

Folks in the area enjoy boating, fishing, canoeing, kayaking, biking, hiking, and hunting. The Fun Days Celebration is an annual event held over Labor Day Weekend that consists of a community festival with a carnival, live music, beer, food, and youth activities. Locals also look forward to the nearby Athens Fair and Wisconsin Valley Fair.

Major businesses in the area include Marathon Cheese Corp (the largest cheese packaging company in the country), Menzner Hardwoods (the oldest operating business in Marathon City), and County Materials Corp, a concrete product supplier. Located about 6 miles north of the village boundaries, Marth was considered another beloved family business, patronized by Marathon City over the years. Administrator Andrew Kurtz, a resident since 1998, recalls that the pellet plant has been beneficial to the area as a significant employer that was active in the community and often contributed to the school district's fundraising efforts.

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HISTORY & FACILITIES

MARTH MANUFACTURING

The Wood Flour Plant Central

Athens, WI

1200 PARK VIEW LANE, ATHENS, WI 54411

Wood Flour

Hardwood/Softwood

Map data: Google © 2020

Ten miles down the road from the Marathon plant, this special site solely produces hardwood and softwood wood flour, and lots of it. With a current staff of 4 people, about 38,000 tons of wood flour can move through the plant in a year's time. Despite being the smallest plant in terms of employees, and second smallest in terms of tons shipped (keep in mind it is a finely pulverized powder), this product has historically found its way into multiple industries where it has been considered a vital material in the production of goods such as toilet seats, decking, automotive components, marina products, animal feed, and biopolymers. The Athens plant has one primary customer called UFP, located a couple of hours away, that buys all of its material in bulk for use in deck board. This plant is also of special interest to the Lignetics Group's Innovation Lab, where research and development is revealing other large-scale uses for wood flour in things like cosmetic containers, plant-based resins, and biodegradable drinking straws.

ATHENS

T

he Village of Athens is located in Marathon County, Wisconsin.

Geographically notable, the village is almost halfway between the Equator and North Pole, as well as almost halfway between the Prime Meridian and 180th meridian.

The mostly agricultural area is approximately 25 miles northwest of the City of Wausau.

The area was originally known as Black Creek Falls and founded in 1879

by Fred Rietbrock of the Milwaukee law firm Johnson, Rietbrock, & Halsey.

Inspired by the forest lands of the county, he sought to colonize the town by building houses and roads in his firm's name to attract settlers from big cities. For those that were not farmers, Rietbrock built a sawmill which provided an economic base throughout the early years.

The village was officially surveyed and plotted in 1882, with a village square being laid out in the center. The village square, with a bandstand which provided concerts for the early settlers and mill workers, is still the main focus of the village today.

In 1890, a group of citizens met with Village president Ferdinand Strupp to address the problem of mail and freight ending up in Black River Falls in Jackson County, about 90 miles away.

Strupp renamed the village Athens, based on his love of classic Greek and the similar topography of Athens, Greece. The Village of Athens was incorporated in 1901, from parts of the townships of Bern, Halsey, Rietbrock, and Johnson.

Village Trustee Dwight Lenhard has lived in Athens for 34 years. He remarks that with a variety of schools, churches, and small businesses, the community of 1100 exemplifies what it means to be "Midwest nice" and that Athens offers a sense of security to residents who can get their everyday needs in the immediate vicinity.

Lenhard describes numerous play spaces and parks throughout the village, one of which is located alongside the creek, inviting swimmers and fishermen to its shoreline. A large tract of forested land was donated by the descendants of Fred Rietbrock, and is bordered by the Black Creek which provides recreational opportunities for hikers, bikers, walkers, skiers, snowshoers, and snowmobilers. At the western-most limits, the village has established a free handicap-accessible shooting range and archery range.

Annual events in the village include a Fourth of July celebration and the biggest event of the year, the Athens Fair. Billed as the “Biggest Little Fair in the World”, it draws visitors from far and wide. Softball, Little League, and soccer are popular spectator sports, and Athens also hosts Friday night summer concerts in the famed gazebo.

A small industrial park on the south side of the village limits includes businesses like S.D. Ellenbecker, Janke General Contractors, Rib Mountain Bio, Switlick and Sons Contractors, Essence Oil, Black Rock Ready Mix, and Marth Manufacturing, which provide jobs for local residents, right there in town.

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HISTORY & FACILITIES

PESHTIGO PELLET

Marth Companies Origin Plant Central

Peshtigo, WI

981 NORTH OGDEN RD, PESHTIGO, WI 54157

Fuel Pellets

Hardwood

Map data: Google © 2020

The Peshtigo plant has the convenience of having one of its main suppliers very nearby - as in directly across the street. Aacer Flooring, another significant business and employer in the city, provides the pellet plant a significant amount of sawdust each year. The Peshtigo plant efficiently processes 8-10 truckloads of dry sawdust each work day, and is the only plant in the Lignetics Group system that solely deals with 100% kiln-dried product (which also means it is the only plant without a dryer system). Despite being one of the smallest plants in terms of employees and the smallest in square footage, it is actually one of the most productive plants in terms of labor hours per ton of pellets produced. With 8 employees, the plant produces hardwood fuel pellets only and can output a maximum of 62,000 tons of pellets per year when running at capacity. The finished product is delivered to areas throughout the Central United States.

K

nown as "The City Rebuilt From Ashes", Peshtigo is a city located just off the western shore of Green Bay in Marinette County, Wisconsin. The city is surrounded by the Town of Peshtigo. Its name comes from the Peshtigo River, which flows right through the heart of the city.

of the tragedy. An annual memorial walk begins at the museum and ends at the bridge going over the Peshtigo River every October 8th. 2021 marks the Sesquicentennial of the fire and community events are scheduled the last weekend of September to celebrate and honor the city and its rebirth.

Peshtigo was originally home to the Menominee and Ho-Chunk Indians. In the late 1780s, French explorers came into the area looking to establish fur trading posts. Nearly fifty years later, in 1838, Erastus Bailey and David Jones built the first sawmill at Peshtigo, and from that day on, Peshtigo was closely identified with the lumber industry.

Backed by lumbering, shipping, and railroad interests, it became a prosperous town during the mid19th century. Norwegian, Swedish, English, Yankee, German, Polish, Irish, Bohemian, and French Canadian immigrants all settled in the city.

Today, Peshtigo is a small but thriving community of about 3300 people centered around Badger Paper Mills, Inc., a descendant of the lumber industry and leader in retail, commercial, and office paper products.

Other major employers include Aacer Flooring, nursing home & rehab facilities, and Great Lakes Custom Tool Mfg., Inc. Events such as Bands at Badger, Christmas in July, Peshtigo River Blues, and Peshtigo Historical Day keep the community engaged.

The Peshtigo Fire occurred on October 8th, 1871. Small fires had been intentionally set in the area as land-clearing operations, which was common. Dry conditions and a cold front that day produced strong winds that likely fueled them out of control.

By the time it was over, 1,200,000 acres had burned and between 1500 and 2500 lives were lost. The fire occurred the same day as the Great Chicago Fire, and is considered to be the deadliest wildfire in recorded history.

The Peshtigo Fire Museum has a small collection of artifacts from the fire, first-person descriptions of the event, and a graveyard dedicated to victims

Mayor Cathi Malke has been a resident of Peshtigo for 46 years, noting that her favorite part of living there is associating with the tight-knit community. With a lot to offer, including a school system, campground, park, beach, and community playground, she feels that Peshtigo is the perfect place to live, work, raise a family, vacation, and retire. Folks in the area enjoy fishing in the Peshtigo River, relaxing on the water in pontoon boats, kayaking, snowmobiling, cross country skiing, snowshoeing, and ATV riding.

Mayor Malke mentions one of the biggest benefits of having the Marth Peshtigo Pellet plant there as creating opportunities for citizens as an employer over the years.

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HISTORY & FACILITIES

1992

24-year old Steve Walker starts New England Wood Pellet in his garage in Concord, MA - that same year he moves operations to a "business laboratory" in Acton, MA

1995

Walker moves the company to Jaffrey, New Hampshire and leases some land for a plant from J&L Sawdust

1998

Outgrowing his first facility, Walker buys a new site and begins construction nearby

1999

2007

The Schuyler, NY location comes online, and a partnership is launched with Zilkha Biomass Energy

The Jaffrey plant officially comes online, shortly after using a helicopter to fly 3 sawdust silos over to the new site

2003

NEWP makes its first home delivery with a truck supplied by the Pellet Fuels Institute

2006

Expansion projects occur at the Jaffrey plant, and the BioFuel Energy Systems division is started at a separate location nearby - Construction also begins on new plant in NY for further expansion

2009

Additional upgrades occur at the Jaffrey plant to further increase production

HISTORY & FACILITIES

120

NEW ENGLAND WOOD PELLET

2011

The Deposit, NY plant comes online

2012

Steve Walker steps down as CEO to pursue other ventures but stays involved on the board

2014

2017

Rentech Inc. purchases the company

Rentech files for bankruptcy and looks to sell assets

2015

NEWP buys Allegheny Pellet in Youngstown, PA

2018

NEWP is bought by Lignetics Group

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HISTORY & FACILITIES

AN ENTREPRENEUR

New England Wood Pellet Gets Fired Up

Y

oung Steve Walker started his first business, Walker Lawns and Landscaping, in 1981 as a 13-year-old boy. Running it out of his home in Concord, Massachusetts, he was able to hire his first employee at the age of 15, and incorporated the business at 16. Mostly bringing on his friends and gaining customers through word of mouth, Walker learned a lot about management and customer service as the years went on.

Fast forward to 1992, and 24-yearold Walker still had his successful landscaping company, plus an additional venture called Lincoln Industries. His new business had a machine shop, and Walker worked on making robotic process machinery, taking on projects that presented specific challenges. For example, local soccer coaches complained that their goals were always breaking, so Walker set out to produce portable soccer goals that lasted. He also began working with New England Casket Company, who wanted to automate their wood production facilities. This automation project exposed him to the furniture industry and various wood processing procedures for the first time.

automatic feed system and by the environmentally-friendly nature of the wood pellet fuel that they consumed. While impressed by the stoves, he noticed that the wood pellet fuel was coming all the way from a mill in Montana, which seemed like a potential supply problem due to the long distance. These pellets were also expensive, due to the cost of shipping from far away. He bought a bag of the pellets to analyze, bothered by the fact there were no local suppliers.

That night, Walker thought about the practicality of making fuel pellets himself. He knew plenty of wood suppliers that were paying to get rid of their sawdust waste, so what if he stepped in and could turn their waste

A later client of Walker's knew of his past experience with wood processing and asked if he had heard about the new wood pellet stoves that had become popular in the Pacific Northwest, and that were slowly gaining steam in New England. He had not, but thought the idea seemed cool.

As a guy running two businesses and heating his shop with cordwood, the time-consuming nature of replacing the logs was an issue. So he went to go look at a stove in a shop in Littleton, Massachusetts.

Walker was immediately fascinated by the convenience of the stove's

Steve Walker with his first pellets in Acton, MA in 1992

into locally-made wood pellet fuel for heating? He stayed up, soaking the pellets he bought earlier in water to try and figure out how they stayed together. He had a press in his home shop, and cut some parts and pieces to make dies. Soon after, he began making rudimentary pellets, one by one.

Twenty-four hours later, Walker returned to the stove shop, with a bag of homemade pellets in hand, and asked if the owner would consider buying pellets from a local mill. The shop, impressed by his gumption, was encouraging. The owner went on to introduce him to other stove shop owners and even brought him to Pellet Fuel Institute industry meetings.

Walker, who by now was looking for

HISTORY & FACILITIES

122

IN NEW ENGLAND a new intellectual challenge beyond his landscaping business, saw the potential for a successful new venture.

The one problem was that he couldn't get any cooperation from the mills that made wood pellets to share the manufacturing process.

Walker noticed the obvious parallels between wood pellets and animal feed pellets, and reached out to a business called Blue Seal Feeds in Bow, New Hampshire, that made horse and rabbit feed. The manager there was a nice guy and willingly gave him a tour of his plant and explained the pellet-making process. An excited Walker returned home to Massachusetts and began to put together a plan to design and set up a pellet plant. He began purchasing and modifying equipment, even buying out his old high school's machine shop, which had recently discontinued its wood shop class. Having the machine shop turned out to be an important part in helping the process.

Moving operations from his oversized garage to a space he has called his "business laboratory" in Acton, MA, Steve Walker started work to perfect his own brand of pellets. He settled on the name New England Wood Pellet, to take advantage of being the only producer in the area, and also to honor where he was from. It would take nearly a year to get everything working right.

The stove shop in Littleton, MA became one of Walker's first customers, later to be joined by some other scattered shops around Massachusetts and New Hampshire. Production was about 200 tons of pellets his first official year in business. Walker had two dealers helping him sell his product, and he didn't even have a bagging line at first, instead selling the wood pellets in 55 gallon barrels to the shops.

This first "plant" lost money, but Walker had successfully learned the basics of making wood pellets.

The next step was to make them efficiently. With business expanding and the potential clear, Walker began searching for a new plant location. As operating costs were rising in MA, he began exploring outside of state lines.

At this time, a company called J&L Sawdust was supplying New England Wood Pellet with the sawdust it bought and trucked over from wood products finishers across New England (they would later go on to sell stoves under the name Heartline, Inc.). The company was originally based in MA and also looking to relocate out of state. New Hampshire was recruiting businesses pretty aggressively, and J&L Sawdust acquired an old sawmill with 15 acres of property outside the town center in Jaffrey, New Hampshire.

They offered to lease Walker some land to build a plant. Ready to go all-in on pellet-making, Steve Walker sold his landscaping business to finance his new venture.

The current plant in Jaffrey, New Hampshire

The original New England Wood Pellet logo

In 1995 with support from the Public Service of New Hampshire, Walker officially leased the property, which was conveniently right on Route 137.

(PSNH helped resolve some financing and operating cost issues to facilitate a seamless move into NH.) Making his first pellets at the new state-of-the-art plant on November 17th, 1995, Walker had ambitious growth plans as the industry ramped up and wood pellet dealers literally came knocking at his door for more product.

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HISTORY & FACILITIES

Two years later, the company was already outgrowing its first real facility. Walker knew the only way to keep growing was to keep building, and his current plant was not in an industrial zone, prohibiting him from running a third shift if needed. Walker bought a nearby site in Jaffrey with plans for a larger facility, beginning construction there in 1998 (where the plant remains today).

Raw material flow had to stay intact, so the last things that needed to move to the new site were three giant sawdust silos. In order to move them, Walker treated the residents of Jaffrey to an unusual sight: a helicopter flying each silo, one by one, across town to their new location. First posed as a joke, the transportation method ended up being the most cost-effective and feasible way of moving the delicate structures.

The 28-minute aerial event even made national news, with one of Walker's friends in California seeing coverage by the Associated Press.

the plant, BBQ, children's activities, exhibits, and wood-related vendors.

It became so popular that off-site parking and a shuttle bus was needed to accommodate the crowds.

As the winter of 1999-2000 saw fuel oil triple in cost, New England Wood Pellet remained consistent in their pricing and gained many new customers across New England, New York, and as far away as Pennsylvania.

By May of 2000, the Jaffrey plant was producing enough wood pellets to heat 4000 homes. They shipped to dealers, stove shops, feed & grain stores, and nurseries, with Heartline, Inc. remaining as their largest dealer.

In 2001, New England Wood Pellet was recognized alongside 9 other small businesses from over 1200 nominations as a winner of The Fleet Small Business Leadership Awards. Walker's company was specifically recognized for technological innovation in producing high-quality wood pellets for use in stoves and furnaces, and for using high-tech machinery to efficiently produce the pellets.

A Sikorsky S-61 helicopter airlifting a sawdust silo to the new plant in Jaffrey, NH, as reported in the Monadnock Ledger on August 5th, 1999.

Steadily climbing oil prices in the early 2000s continued to drive wood pellet popularity. Due to the increased difficulty in getting dry sawdust from suppliers, Walker had invested in a new dryer that could process green sawdust as supplementary material in October of 2001. He later added a grinder so he could use clean chips, with the future intention of purchasing whole logs to produce a slightly less valuable (higher ash content) wood pellet. The more the company grew, the greater was the need to look beyond sawdust to non-waste, lowgrade wood that would sometimes come straight from the forest.

The new 16,000 square foot Jaffrey plant went online in August of 1999 and employed 11 people. It even went so far as to use the very fuel it was selling to provide heat and hot water to the facility from a wood pellet boiler.

The Jaffrey facility would become known for its "Wood Energy Day" event over the years, an open house to help show people the capabilities of pellet heat. The event was free and family-friendly, featuring tours of

By 2002, the plant was producing 100 tons of pellets a day and employed 24 people, and a slew of contractors including chip brokers and truckers.

New England Wood Pellet had purchased the trucking service from J&L Sawdust, adding its fleet of four tractors and 80 trailers for collecting sawdust in various areas, and also contracted out more trucking than it did itself. While there were about 60 other pellet companies in North

America by this time, there was only one other pellet company in New England with which to compete.

By 2003, New England Wood Pellet made its first home delivery with a new truck purchased using Department of Energy funds through the Pellet Fuels Institute. The truck was given to the company to help jump-start the method of getting residential customers the alternative fuel in bulk, and provided support for Steve Walker's goal of adding more commercial customers, ranging from The Harris Center (a land conservation group), to The Audubon Society, to schools and city buildings. In 2004, Walker needed to expand the Jaffrey plant again to keep up with the surging demand of his product, which was already operating twenty-four hours a day, seven days a week.

NEWP's truck making a home delivery of pellets

When Hurricanes Katrina and Rita disrupted the petroleum markets even further in 2005, additional equipment was brought in to Jaffrey to maximize production. A huge new sawdust dryer and a third pellet mill were added to the plant, followed by a fourth in 2006. Geopolitical instability and a particularly cold winter that year meant product was still impossible to keep in stock however, and the company continued to grow between 30-50% year over year.

In August of 2006, Walker started a new division of the company called BioFuel Energy Systems. This division was located in a separate facility in Jaffrey, and functioned as the research, development, and manufacturing arm dedicated to design, testing, and full scale fabrication of wood pellet manufacturing equipment

HISTORY & FACILITIES

124

and machinery. This $1.5 million facility made it possible to make the machinery to quickly build more pellet production facilities. Since existing manufacturers were usually unwilling to modify equipment, this fabrication facility was key to making better equipment than what could be bought, giving NEWP a unique edge. It was the first such facility built exclusively for this purpose in the United States.

Besides contributions that came along with the nature of his business, such as supplying jobs and eliminating wood waste while making a sustainable product, Steve Walker was also very interested in the health of the forest products industry overall, and in giving back to the community. He was involved with various nonprofits and organizations, such as the local Jaffrey Planning Board to make sure community concerns around his expansions were addressed. He became a trustee for the Society for the Protection of New Hampshire Forests.

And he was formally recognized with an Outstanding Forest Industry Award in 2004 for his efforts by the New Hampshire Timberland Owners Association, which represented loggers, landowners, mill owners, and those that buy and sell wood.

The phenomenal growth of what initially started as a one-man-show would not have been possible without key individuals that grew the business with him. Walker was fortunately surrounded by loyal employees, many of whom stayed with him for years.

Walker has stated that the most important quality in the people he wanted as employees was a willingness to learn. Since NEWP was nearly doubling in size every two years or so, it was vital that his employees valued the excitement and challenges that came with essentially working as a new business biannually.

One of these trusted employees was Norwood "Woody" Keeney, New England Wood Pellet's long time Operations and Sales Manager. Woody originally worked for the state of New Hampshire's Department of Energy and got involved with NEWP while Walker was first setting up production in the state. He contributed a lot over

Woody Keeney at the Heat New England Conference in 2011

the years, one highlight being Wood Energy Day at the Jaffrey plant, a great idea for engagement with the public that ultimately ended up translating into sales. He also meticulously saved and archived just about every article or newspaper clipping that mentioned the company or the burgeoning wood pellet industry (which this piece has benefited from).

Then there was Mark Wilson, the COO who effectively helped the company "grow up", and John Amos, a general contractor that lived at the Jaffrey plant, ensuring there were always "boots on the ground" when needed.

Another key employee was Charlie Niebling, a General Manager and former executive at the Society for the Protection of New Hampshire Forests with a passion for the industry. And yet another was Luann Lafreniere, one of the first women to come on staff at the company.

Luann was originally part of a family business that owned an injection molding company. She met Steve Walker in the early days of New England Wood Pellet, when he needed a specific piece made for his equipment. Time passed and plastic injection molding work moved overseas (with many other industries) to stay competitive.

When Luann's father passed away, she tried her hand at real estate for

a bit, but ultimately wanted to get back into manufacturing. She decided to drop in on Steve Walker, who had just upgraded his Jaffrey plant for the second time, and was watching his new packaging robot run its first bag stack.

He told her to return the next day and they would go from there, and she ended up staying with the company from then on out. What began as 20 hours per week turned into full time work within a few months.

As New England Wood Pellet's Business Manager, Luann Lafreniere helped Steve Walker run the day-to day responsibilities of the business, as well as build the company through expansion efforts. She assisted Walker as he went through a round of investors and looked for sites outside of New Hampshire to put a new plant.

The biggest contenders were towns where the paper industry was in decline and a wood pellet plant could fill the vacuum and acquire the same raw materials for use.

In 2006, Walker found the property on which he would put a new plant in Schuyler, NY. Formerly the site of a drive-in movie complex off of Route 5, the location in the Schuyler Business Park was central to the Mohawk Valley's abundance of natural resources and its work force.

Construction on a new $10 million, 72,000 square foot facility began that year. Outfitted with equipment

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HISTORY & FACILITIES

A silo being installed at the new Deposit, NY plant

A view of the Schuyler, NY facility

from the BioFuel Energy Systems fabrication facility, the plant became operational in 2007, manufacturing pellets that were sold primarily in Central New York. That same year, Walker also leased a warehouse space in Palmer, MA that was used as a wood pellet bagging and distribution plant.

Premium wood pellets from British Columbia were delivered there by rail to supplement NEWP's own production and help relieve shortages.

2007 also saw the launch of a partnership with Zilkha Biomass Energy of Texas. Steve Walker had heard about the company's energy generation technology the year prior, and his interest was piqued. Walker had always considered electricity to be one of the highest operational costs of his business, and he had wanted to design a similar system to what Zilkha had created. Their system consisted of a high-efficiency, wood-burning gas turbine system that would create energy and lower the Jaffrey plant's environmental impact. The new power plant was built, owned, and operated

by Zilkha, and was the first commercial use of the technology. It acted as a cogeneration facility for the plant, which resulted in cost savings as well as the lessening of plant emissions.

The Great Recession of 2008 brought a plunge in oil prices that directly impacted the wood pellet industry.

Carefully monitoring usage, Walker took the risk to expand his operation while competitors retracted theirs, leading to the acquisition of their

resources and customers. His risk paid off, and by 2009 additional upgrades to the Jaffrey plant were made to increase production capabilities even further.

The sign at the entrance of the Deposit, NY facility

That year he also received a call from Norbord Industries in Deposit, NY, which had determined that its aging mill was no longer economically viable.

The Executive Vice President had heard Walker wanted to build a new plant, and went the extra mile to seek out a prospective buyer who would continue to manufacture a wood product to try to save as many jobs as possible and also keep the established wood supply chain intact.

Walker purchased the site and converted the former wood-based panel manufacturing plant into a new state-of-the-art pellet manufacturing facility capable of producing 85,000 tons of pellets a year. The new plant was huge and massively spread out; a brand new building housed the production plant and lab, and the pellet mills were on a separate floor. At the time it went online in 2011, it was the largest wood pellet manufacturing plant in the Northeast, providing enough energy to heat 25,000 homes and businesses. Combined, NEWP's three facilities could produce over 250,000 tons of pellets a year.

Steve Walker now had a trifecta of profitable pellet plants and many accolades. A self-professed "tinkerer" who enjoyed building things and fiddling with machinery, he was regarded as a workaholic. From the

outside, he appeared to be a successful, confident entrepreneur, yet those that knew him personally understood he quietly dealt with being dyslexic, a condition that plagued him his whole life. Often regarded as a learning disability, the condition for Walker was responsible for his unusual abilities as well as his challenges. While he had difficulty processing written information, he could easily analyze and dissect a complex business system in his head.

He became one of five individuals to be featured in a HBO2 documentary called Journey Into Dyslexia. The 2011 film showcased successful entrepreneurs with dyslexia, inspiring heartfelt letters from folks around the country to thank Steve Walker for sharing his unique story.

Another point of note is NEWP's certification under the Pellet Fuels Institute. PFI is a North American trade association that promotes energy independence through the efficient use of clean, renewable, densified biomass fuel. When pellets really started taking off, no set of standards to hold them to existed yet. Industry leaders knew that standards would need to be developed, and that they were in a position to create them, before the Environmental Protection Agency did it first.

HISTORY & FACILITIES

According to their website, PFI was incorporated in 1985 in Minnesota as the Fiber Fuels Institute, an organization founded by a group of fuel and equipment manufacturers with the goal of advancing the biomass industry. The Fiber Fuels Institute later merged with the Association of Pellet Fuel Industries and formed the Pellet Fuels Institute. After forming an alliance with the Hearth Products Association, PFI moved to Arlington, Virginia in 1996.

Members of the association began working on the PFI Standards Program in 2005, with the goal of creating an industry-wide uniform certification to bolster product quality. The 3-step fuel certification process began at the mills, followed by an on-site inspection once per month from an accredited auditor and verification of the product quality from the accreditation body, the American Lumber Standard Committee.

A documentation management program was required that included raw materials receiving, production, quality verification of the finished product, periodic inspections, and customer complaints, all of which had to be documented and kept for five years. Today, it is the only American standard approved by the EPA. New England Wood Pellet was the

126

very first manufacturer to qualify for the PFI Standards Program and to display its mark upon their bags.

subsidiary acquired Allegheny Pellet Corporation in Youngsville, PA, which had been in operation since 1993. It would become NEWP's fourth pellet plant, capable of producing 50,000 tons of pellets annually. The brands Allegheny Pellet and Keystone Pellet were assets included with the purchase, which were well-known locally at big box stores.

The PFI Standards Program certification mark

Unexpectedly in 2017, Rentech filed for bankruptcy, largely due to financial troubles associated with one of its plants in Canada and an overall weaker demand for its products. The company sold off its various business entities, and Lignetics Group acquired NEWP in 2018 with financing arranged through Taglich. Mark Wilson agreed to consult throughout the transition for a seamless experience for customers, suppliers, and employees.

After 22 years in the wood pellet business, Walker sold New England Wood Pellet in 2014 to Rentech, Inc., a Los Angeles-based, publicly traded company that had expressed interest due to the company's profitability and well-established plants. Walker had stepped down as the company CEO in 2012, but remained on its Board of Managers and still owned a significant stake. He had felt like he had taken the company as far as it could go from an engineering standpoint, and the entrepreneur was ready to shine his flame brightly on other ventures that were good for the environment.

Walker went on to create a new company called IMBY Energy in 2016 with a goal of revolutionizing the way buildings use and generate energy.

After Walker's departure, NEWP continued to grow under new CEO Mark Wilson. In 2015, the Rentech

This purchase gave Lignetics a strong market position in New England and the mid-Atlantic markets, and made its post-acquisition production capacity over a million tons of wood pellets a year. Steve Walker's garage operation had become a wood pellet behemoth in just over two decades, and it's legacy and plants live on as part of the Lignetics Group, now the largest residential wood pellet manufacturing company in the U.S. with plants across the entire country.

ORIGINAL BRANDS IN THE COMPANY

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HISTORY & FACILITIES

LIGNETICS OF NE - JAFFREY

The New Hampshire Plant Northeast

Jaffrey, NH

141 OLD SHARON RD, JAFFREY, NH 03452

Fuel Pellets

Hardwood

Map data: Google © 2020

This Jaffrey location was the flagship New England Wood Pellet plant, and it is situated in the same town as a nearby sister-site that serves as a dedicated fabrication facility and repair shop, complete with corporate offices on site. The Jaffrey pellet plant employs around 23 people and runs on a 24/7 schedule. It is a high-producing operation capable of outputting 119,000 tons of hardwood fuel pellets a year when running at capacity. The plant has two separate systems, one for drying green wood fiber that comes into the plant at between 35-60% moisture content, and one for processing kiln-dried wood fiber, which enters the plant at about 10% moisture. The two systems then come together ahead of the pellet mill. The finished product is distributed throughout the Northeast region, specifically in the states of New Hampshire, Massachusetts, Maine, Vermont, Rhode Island, Connecticut, and parts of New York.

J

affrey New Hampshire is known as a popular vacation destination at the base of the Great Monadnock Mountain. The mountain's name comes from a loosely translated Abenaki word meaning "mountain that stands alone". The term monadnock has been widely adopted by American geologists as a common one for an isolated mountain, many more of which are located in the area. Mount Monadnock was a hiking destination of Henry David Thoreau, Ralph Waldo Emerson, Margaret Fuller, and Rudyard Kipling.

Emerson even celebrated the mountain in the long poem Monadnoc (1846).

Originally inhabited by the Abenaki Indians, the first known colonist to visit the area was Lieutenant Seth Wyman of Groton. Jaffrey was initially a township of Massachusetts, but a boundary dispute settled by King George II gave the town to New Hampshire in 1741. Settlement of "Monadnock #1", as it was known, was begun in 1742 by Abel Platts.

Jaffrey was incorporated as a township in 1773 and named after the Honorable George Jaffrey, member of a wealthy Portsmouth family. When the Revolutionary War broke out in 1775, Jaffrey men answered the call to arms while hard-working women continued raising families and running the farms.

Brave men from the town also served in the War of 1812, World War I, and World War II. Jaffrey was one of the first mountain resort communities in New England.

It became an important stagecoach stop for travelers headed between

Boston and Walpole after the Third New Hampshire Turnpike (Route 124) opened, and later experienced additional growth spurred by the railroad.

Today the town is home to about 5400 people. The outdoor community is active all year round with activities such as swimming, hiking, hunting, fishing, kayaking, skiing, snowshoeing, snowmobiling, and maple sugaring.

Throughout the year, events such as farmer's markets, concerts, the Festival of Fireworks, an annual Reading of the Declaration of Independence, and youth programming like Breakfast with Superheroes and Spaghetti with Santa are held for the community.

The town boasts 2400 jobs, impressive when considering the population. A hub of manufacturing, it is second in jobs in the county, just behind Keene, NH (population 20,000). Some major employers in the town include Atlas PyroVision Entertainment Group, a nationally known agency specializing in fireworks, Apollo Steel, a steel fabricator, and MilliporeSigma, a pharmaceutical company and manufacturer of medical equipment.

Director of Planning and Economic Development Jo Anne Carr has worked in town since 2008 and knew Steve Walker from various committees.

She spoke very fondly about Jaffrey being the place where Walker started NEWP, produced renewable energy, and piloted a co-generation facility, as innovators in the manufacturing industry have been an important part of the town's growth over the decades.

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HISTORY & FACILITIES

LIGNETICS OF NE - SCHUYLER

The First New York Plant Northeast

Schuyler, NY

172 DIAMOND DRIVE, SCHUYLER, NY 13340

Fuel Pellets

Hardwood/Softwood

Map data: Google © 2020

The Schuyler plant was originally outfitted with equipment custom-made for it at the Jaffrey fabrication facility. It is one of a few sites with a separate kiln-dried delivery system and the only site utilizing the uncommon Bliss Pioneer pellet mills. This site allows for the stacking of goods 4 pallets high, which is helpful with the storage of finished good inventory. The location serves as a convenient "home base" for a dedicated sales rep and HR professional, who have offices on site. Like most of the other former NEWP plants, Schuyler had an excellent written Preventative Maintenance check sheet process already in place, which has since been rolled out to all of the other Lignetics Group plants. The plant employs around 22 people and can output 97,000 tons of pellets per year if running at capacity. Both hardwood and softwood fuel pellets are produced here and distributed on to areas throughout the Northeast including Connecticut, Rhode Island, and parts of New York.

S

chuyler is a rural and quiet town in Herkimer County, New York.

Schuyler is known as the place where General Nicholas Herkimer rested two nights before the famous Battle of Oriskany, a pivotal engagement during the Revolutionary War and mentioned in the popular novel and film adaptation, both called Drums Along the Mohawk.

The area was first settled around 1765 by families sponsored from Germany

by Peter Hasenclever. Initially called New Petersburg, the families built structures and worked the land until they paid off their debt to Hasenclever or his financiers. A fort was built there to protect the settlers from raids by the Tories and Indians. The town was named in honor of General Philip Schuyler and formed in 1792 from part of the town of Herkimer. In 1797, a portion was taken to form the newer town of Trenton. Schuyler was further reduced in 1798 to form the town of Deerfield, and in 1806 to form the town of Newport. The town today has a total area of 40.2 square miles, 0.3 square miles of which is water.

The current population stands at approximately 3300 people. Since 1960, the town's housing population has increased by almost 80 percent. Despite having only one intersection and traffic light, development continues as more housing units are built and new businesses look to come in and set up shop. Bordering Utica, the tenth-mostpopulous city in New York, Schuyler offers lots of land and backyard activities, and is only minutes away from a shopping center and hospital.

There are many options for recreation in the area, thanks to the Mohawk River and nearby mountains. Hunting, fishing, snowmobiling, jogging, biking, and other outdoor activities are embraced by the community. Residents also attend races at the nearby UticaRome Speedway. One of the most popular events occurring in Schuyler is the Car & Corn Extravaganza, a free day of family-friendly entertainment that includes a car show, petting zoo, axe throwing, and a famous corn on the cob eating contest. The event draws competitive eaters from across the U.S., including record holder Molly Schuyler (no relation to the town).

Originally known for agriculture in the dairy and produce industries, most folks in Schuyler today work in diverse fields nearby, such for state departments, as dental hygienists, as paralegals, and in manufacturing.

Businesses in the area include Remington Arms (manufacturing), US Materials Handling Corporation (a material handling equipment supplier), and Northern Lights Docks and Ramps (manufacturing). The Lignetics plant is the largest employer in the town, and is located in the Schuyler Business Park alongside many smaller businesses and new prospects.

Anthony Lucenti, the Town Supervisor, has remarked that the town has a very good working relationship with the pellet plant. Noting that the plant donates pellets to the town office building to supplant heating all winter, he also mentioned past contributions that include roadway plowing and sponsored events.

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LIGNETICS OF NE - DEPOSIT

The Second New York Plant Northeast

Deposit, NY

1580 AIRPORT RD, DEPOSIT, NY 13754

Fuel Pellets

Hardwood/Softwood

BBQ Pellets

Hardwood

Animal Bedding Pellets

Softwood

Heating Bricks

Mixed

Map data: Google © 2020

The Deposit plant is located directly across the street from world-class trout fishing in the West Branch Delaware River. Formerly a facility that made particle board, this plant is one of two (the other one is Cascade Locks) that have machines to make heating bricks. It is the only location that has a pile burner instead of a rotary burner. The Deposit site contains the only A-frame building in the Lignetics Group plant system, and has the most covered finished goods storage of all the plants.

It is the pilot site for a computerized maintenance system that will collect data and eventually roll out to the other locations. Besides the bricks, this plant produces hardwood and softwood fuel pellets, hardwood BBQ pellets, and softwood animal bedding pellets with a team of about 21 employees. The plant operates 24/7 and pellet output can reach 107,000 tons of pellets per year when running at capacity. The finished products are shipped throughout the Northeastern U.S.

T

he town of Deposit is located in Delaware County, New York. It contains various hamlets and a village, also named Deposit. A picturesque community nestled in the Catskill Mountains, the village is located at the confluence of Oquaga Creek and the West Branch of the Delaware River. The western portion of the village is located in the adjacent town of Sanford in Broome County, giving it a unique "dual nationality" and a special date for village elections.

The name Deposit was derived from its past as a lumber center. Deposits of logs were placed there in the winter, prior to forming them into rafts to ride the spring high waters down the Delaware River, usually to Philadelphia. Prior to having white settlers, this area was inhabited by several Native American tribes. The position of the Village of Deposit is at the boundary of White and Indian territory as imposed by the 1763 Fort Stanwix Treaty. The village was incorporated in 1811 in Delaware County. Deposit is one of only twelve villages in New York still incorporated under a charter, the other villages having incorporated or re-incorporated under the provisions of Village Law. The Town of Deposit was organized in 1880. In the 1890s, Deposit was a center of publishing with the relocation of the Outing Publishing Company to the town (from New York).

Several magazines, including The Bohemian, were published and printed from Deposit. The Outing Publishing Company went out of business a few years after the failure of the Knapp Bros. Bank in 1909.

Mayor Bryan Moore, a user of wood pellets for years, has been a resident of the town his whole life. The current village population stand at about 2300, made up of a thoroughly diverse but tight-knit community of working-class people. Moore describes the scenic beauty of the mountains and river as one of his favorite parts about living in Deposit, and notes that the world-class trout fishing attracts people from all over the world every year, even highprofile figures like Donald Trump Jr. Besides fishing, recreational activities in the area include camping, hiking, kayaking, snowmobiling, and just about anything else you can do outside.

In honor of the town's history, the Deposit Lumberjack Festival is held every year the third weekend in July, which includes a nationally-sanctioned lumberjack competition, tractor & pony pulls, carnival rides, a street fair, food vendors, a parade, live music, fireworks, and more. The annual family-friendly Octoberfest festival is another much-anticipated event.

Though originally known for logging (and later agriculture, before the rebuilding of highways and changing economy), the area is better known today for its stone industry. Bluestone, a sedimentary stone found in only a few places in North America, is mined here and sold throughout the world for sidewalks, countertops, and other uses. Many suppliers of the stone are located near the Lignetics pellet plant.

The plant itself belongs to the Chamber of Commerce, and normally makes a contribution to the Lumberjack Festival every year.

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LIGNETICS OF NE - ALLEGHENY

The Pennsylvania Plant Mid-Atlantic

Allegheny, PA

1055 MATTHEWS RUN RD, YOUNGSVILLE, PA 16371

Fuel Pellets

Hardwood

BBQ Pellets

Hardwood

Map data: Google © 2020

The Allegheny plant is actually located in Youngsville, Pennsylvania, situated close to residential and commercial neighbors. It takes its name from its close proximity to the Allegheny National Forest. Situated in the foothills of the Appalachian mountains and established in 1923, it is the only National Forest in Pennsylvania. Additional property has been successfully purchased to expand the footprint at this location so more raw materials can be stored on-site. Employing about 17 people, this plant is one of six Lignetics Group plants that produces hardwood BBQ pellets. The plant also manufactures hardwood heating pellets, with the capacity to output 71,000 tons of pellets a year when running at capacity. The heating pellets are mostly regionally distributed in Pennsylvania, with a little reach into the eastern part of the United States, especially to big box customers there.

Y

oungsville is a borough located in Brokenstraw Township, a township in Warren County, PA. The county has a population of around 40,000 people, and about 1800 of them reside in Youngsville, a walkable and welcoming hometown community in close proximity to the Allegheny National Forest and Allegheny River.

The Brokenstraw Valley was originally occupied by the Seneca Nation Indians and other Native American tribes.

After the Revolutionary War, parcels of land were given out as rewards for wartime services. In 1792, General William Irvine obtained farmland by the mouth of the Brokenstraw Creek where it meets the Allegheny River.

Matthew Young was a Revolutionary War Veteran and school master. As a tenant farmer, he was hired to oversee the Irvine farm. His service in the militia during the Revolutionary War also earned him 400 acres of his own land. In the spring of 1796, he paddled by boat up the Brokenstraw Creek from Irvine to the site of the future borough of Youngsville. He laid the downtown streets, built a sawmill and started the first school. Young was the first treasurer of Warren County, and the borough now bears his name.

Early in the 19th century, Youngsville was known for lumber, oil, bricks, and farming. Because of Brokenstraw Valley’s lavish forests, logs were cut and floated down the Brokenstraw Creek where it meets the Allegheny River in Irvine and then advanced on to Pittsburgh. As late as the 1960s, Youngsville still had a prosperous

lumber industry, furniture factories, and operational sawmills.

Today Youngsville is a working-class country town with mom-and-pop shops where everyone waves to each other. It prides itself on its teamoriented, goal-directed atmosphere that strives to improve the local economy and the quality of life of its residents.

A group of organized community volunteers known as the Revitalization of Youngsville, or ROY, is very active in raising money and making changes and enhancements around town. They fix deteriorated infrastructure, apply a fresh coat of paint where it is needed, and develop recreational projects such as the new Brokenstraw Creek BikeHike Trail, which has future plans to tie into the existing system of bike trails across Warren County.

The borough enjoys many activities throughout the year, from meetups at the community pool, to attending the nearby County Fair, to the Hometown Christmas Parade during the holidays, where most of the community lights up their houses and competes in a decorating contest. The church-going community also hosts "turkey parties" as fundraisers for the fire department and schools, where lottery tickets for items are sold and raffles are held.

Richard Lauger, the Supervisor of Brokenstraw Township, spoke highly of Lignetics, noting the plant has made donations for turkey parties and that the plant property looks the best it ever has, and the local people welcome a company that shows consideration for the community.

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HISTORY & FACILITIES

2006

Jonathan Strimling, a former NEWP employee, starts American Biomass Corp and PelletSales. com with friends Mark MacLean and Michael VanDerHeyden in Bedford, NH

2007

The company creates the CleanFire brand

2008

The company moves to Goffstown, NH and changes the website domain to WoodPellets.com

2009

The company gets its first major investor

2010

Woodpellets.com is honored by the Better Business Bureau with the prestigious "Perfect Record Award", and the company begins offering premium Douglas fir pellets

2011

Jon Strimling steps down from leadership, and Tim Loucks becomes the new CEO

HISTORY & FACILITIES

136

WOODPELLETS

.COM

2012

The company downsizes and relocates to Bedford, NH

2013

David Nydam steps in as the new CEO

2014

David Nydam institutes the industry's only pellet fuel savings plan, allowing customers to save for their annual fuel purchase over the course of the entire year

2016

The company celebrates its 10th anniversary and acquires Okanagan Pellet

2018

Woodpellets.com moves into its current office location in Bedford, NH

2019

WoodPellets.com is acquired by Lignetics Group

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HISTORY & FACILITIES

CONSUMERS PICK

Convenience Drives A New Sales Model

I

n the mid 2000s, Jonathan Strimling was employed at New England Wood Pellet as the Director of Development. He had always liked woodworking and the smell of a wood pellet plant, and thought there was something nice and natural about wood heating. He closely collaborated with Steve Walker as the company raised capital for NEWP's aggressive growth plans, which included upping the production capacity at the Jaffrey, New Hampshire plant and laying the groundwork for the Schuyler and Deposit facilities in New York that were yet to come.

This was during the same time that the prices of oil and natural gas were skyrocketing, and people were scrambling to find wood pellets for their pellet stoves. Frustrations ran high as certain regions completely ran out of pellets, while other regions had supply, just no economical way of getting the product where it needed to go. Witnessing unprecedented demand and the shortages for wood pellets firsthand, Strimling soon had an idea for a new company that could help bridge the gap, while also providing the ultimate convenience: delivery & direct wholesale. By cutting out the middle man and setting up a new distribution channel, a company could contract with a vast network of mills and sell directly to the retail customer through an online presence.

Striking out on his own as a CEO and bringing on business school colleague Mark MacLean as General Manager, the young men founded a start-up called American Biomass Corporation in 2006 in Manchester, New Hampshire. They launched a website called PelletSales.com as the customer order portal. A third partner, Michael VanDerHeyden, was also brought on to spearhead wholesale opportunities.

The original logo for American Biomass Corporation

The company pledged to only work with manufacturers that had proven quality records, and to take perfect care of the pellets from the mill to a customer's driveway. Home delivery was offered to customers on the eastern seaboard from Maine to Maryland, and in select areas of the Midwest and West Coast. Different brands and products were available in each region, and folks could simply order what they wanted, choose from a menu of delivery options, and indicate where they wanted the pellets to be put. Pellets could either be placed in a customer's driveway via forklift, or

delivered directly into a garage with specialized pallet jacks. Nationwide truckload delivery of 20 tons or more was also available to wholesale customers.

By early 2008, the company had exploded in popularity as people willing to take deliveries kept lining up. In fact, it had become one of New England Wood Pellet's largest customers by that time. A hiring frenzy resulted, and a new space was rented in Goffstown, in close proximity to the major city of Manchester, NH. The warehouse building consisted of offices

A forklift operator making a delivery to a customer's driveway

HISTORY & FACILITIES

138

PELLET DELIVERY on the first floor, with a second level containing additional spaces and a conference room. Within 24 months, 50 employees were hired to form solid departments for logistics, customer service, marketing, and engineering.

Early employees Paul Tlapa and Joy Schmidt came on board just prior to the move to the warehouse, experiencing the rapid growth of the company as it occurred.

Paul Tlapa was the Director of IT, tasked with building the robust e-commerce model that is still in use today. Paul managed the original e-commerce site under the PelletSales. com domain as well as developed a novel web application to facilitate pooling customer orders. PelletSales. com was relaunched as WoodPellets. com, which was a stronger domain property and ultimately became the most recognized web site in the industry. Paul, along with founders Jon and Mark, developed a proprietary e-commerce system that would match fuel brands, pricing, and order minimums with the zip code for the customer. Orders were then mapped out and fulfilled from multiple distribution centers using advanced logistical tools.

Joy Schmidt was hired to help create a unique customer experience, which would evolve to every piece of the business. The founders of the company were all innovators, but they didn't have a customer support team until Joy built it. The company's Quality, Service, & Price Guarantee was put into place to stoke customer confidence, and a team of Pellet Experts stood by to answer the phone lines and address any questions people wanted to ask.

By combining the ideals of good old-fashioned customer service with cutting edge technology and a

Two former drivers for Woodpellets.com with their trucks, ready to haul pallets of product

seamless, customer-centric shopping experience, a convenient and pleasant service was created. And people took note. Within two years, WoodPellets. com had been honored by the Better Business Bureau with a "Perfect Record Award", a prestigious honor bestowed onto businesses that have run operations without a single customer complaint in 36 months or more.

Recognizing the value of brand building, Woodpellets.com had been quick to launch its own proprietary brand of pellets in 2007, called CleanFire. Beginning as a hardwood brand, the higher quality CleanFire softwood pellets were soon added to the product line. By 2010 Woodpellets. com became the first company to offer the exceptional quality Douglas fir softwood pellets from the Pacific Northwest and established CleanFire as the premier brand of pellets in the Northeast. In part due to customer education on BTUs and ash content by its Pellet Experts, the company became an industry leader in upgrading customers from hardwood to softwood

pellets. The CleanFire brand took off to become the company's bread and butter.

In 2009, the company completed a second round of venture capital financing. A new investment firm came on board, and the business scaled up even further. Around this time, there was a focus to develop whole-

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house pellet heating systems, as were popular in Europe. Venture funding was used to figure out the best ways to get pellets from a delivery truck into a customer's home, and to automatically feed the boiler or furnace with fuel.

The goal was to offer consumers a carbon-friendly whole-house heating system that could compete directly with oil and gas.

The engineers at WoodPellets.com also created a novel product called "pellet pods", which were essentially low-cost automatic feeding systems for the much more prevalent pellet stove residential market. Once erected, the pods could pull pellets into a bucket sitting next to the stove which was feed by a storage compartment in the customer's basement.

Pellet boilers were becoming more common as well, and towns and states were offering incentives to convert from oil and propane to pellet burners. The caveat was figuring out how to have the fuel auto fed into the appliance, which had not yet been done. Prototypes were created, but ultimately the demand wasn't as great as with smaller heating appliances like pellet stoves. After a significant spend, the investment company took the reigns and business focus pivoted back to home deliveries and wholesale customers.

to weather the unpredictability of the business. In 2014, another pellet shortage occurred due to a few different circumstances including an unseasonably cold winter and unprecedented customer demand. The shortage was made worse by a number of mill fires that further reduced the supply of fuel. It was a perfect storm that brought to light just how vulnerable the pellet industry really was to demand shocks, and how many people relied on pellets as their sole source of heat. Despite the challenges, WoodPellets.com was one of the few suppliers with inventory that winter and never stopped making deliveries.

Nydam continued to look to technology to improve efficiency, reduce costs, and establish profitability.

He recognized the need for a dedicated marketing manager and hired Rachel Cornell soon after joining the organization. Together with Rachel, the business deployed a strong email marketing focus using paid search to help drive new customers. Under Nydam, the company also instituted the industry's only pellet fuel savings plan in 2014 - allowing customers to save for their annual fuel purchase over the course of the entire year.

In late 2011, Jon Strimling was replaced by a new CEO, Tim Loucks. Tim was tasked with bringing profitability to WoodPellets.com and building a sustainable organization that could support future growth. Focus was returned to the core business of residential heating and as a result, the company was dramatically downsized.

A move to Bedford, NH was facilitated in 2012. Tim was also responsible for streamlining business processes, introducing new technologies, and automating many core business functions. Three years later, after successfully maintaining the company's positioning in the industry, Loucks handed the CEO reins over to David Nydam.

Nydam was a good fit for the company and looked for opportunities to continue its growth as well as how

Most of the team in 2019 in their current office space

In 2016, American Biomass Corporation celebrated the 10th anniversary of WoodPellets.com and also acquired the Okanagan Pellets brand from the bankrupt Viridis Energy. This acquisition provided WoodPellets. com with one of the industry's most recognized brands of wood pellet fuel and established new sales growth opportunities for their wholesale business. Two years later in 2018, the company moved to a new space in Bedford, NH, where the office remains to this day.

Because of the extreme seasonality of the business, Nydam realized that it would be in the best interest of the company to partner up with another business. He began looking for the right match, and eventually found Lignetics Group, which had its own network of mills across the country. Negotiations ensued, and Lignetics acquired Woodpellets.com in early 2019. The acquisition allowed WoodPellets.com to expand their CleanFire line, add BBQ pellets, and consolidate their supply chain.

Lignetics Group has helped the business expand even further by funding new growth, finding new

HISTORY & FACILITIES

140

The exterior of the WoodPellets.com office in Bedford, NH

warehouse options, and streamlining delivery operations. In addition, the company has provided new expertise and deep experience to tackle the complex logistics and fulfillment challenges that WoodPellets.com faces with its internet business model.

With over 50,000 customers in its database and 5,000-7,000 people placing orders averaging 3 tons each, the e-commerce business is doing quite well. Starting with an ambitious idea and three motivated New Englanders, the first service for wood

pellet delivery on a nationwide scale revolutionized the way people get their pellets. Now more than ever, nothing will ever beat convenience, especially when it is coupled with excellent customer service.

ORIGINAL BRANDS IN THE COMPANY

141

HISTORY & FACILITIES

1987

Bruce Lisle reads about wood pellets in Hearth and Home Magazine

1988

Lisle develops a combination pellet plant and co-generation facility in Nova Scotia, naming the company Mapleleaf Technologies

1993

Lisle buys BioShell’s Lac-Mégantic, Quebec plant due to better logistics than Nova Scotia, and keeps Energex as the company name - a sales office is established in West Lebanon, New Hampshire

1989

The company ships the first railcar full of wood pellets to Nova Scotia for demo purposes

1990

Lisle purchases wood pellet fuel from Eureka Pellet in Montana and packages it under Mapleleaf Technologies to seed the market on the east coast

1994

The Pellet Fuels Institute emerges in Minnesota

1995

Natural gas poses a threat to the business as market factors come to light during a Las Vegas trade show

1996

Industry leaders band together for a trade show in Charlotte, NC, and the PFI moves to Virginia

1999

Bruce Lisle buys the American Hardwoods plant in West Virginia, with the intent to move it

HISTORY & FACILITIES

142

ENERGEX

2000

Energex buys the Mifflintown plant from Juniata Wood Pellets

2007

Lisle decides to sell the Energex business to a private equity company in Philadelphia

2013

Lisle returns to save Energex from near |bankruptcy

2001

Energex hauls up equipment from West Virginia to expand the new plant, and it goes online

2004

Office space is added to Mifflintown and the sales headquarters is relocated there from NH

2005

Further expansion of plant begins over the next two years through the addition of 2 more pellet mills and a large dryer

2008

Lisle leaves company to pursue other interests

2020

Energex is acquired by Lignetics Group

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HISTORY & FACILITIES

AN INTERNATIONAL

Energex Establishes a Footprint in Canada

B

ruce Lisle is yet another forefather of the wood pellet industry. Beginning with a grassroots effort that helped to create the East Coast market for wood pellets in the early years, and later through building his company, Energex, Lisle made quite a few contributions to the rise of biomass use in North America and is considered a significant figure.

Lisle's path to pellets came from an unexpected beginning; the oil industry. After one semester at Boston University, he took advice from a friend and moved out to Colorado to complete his BS in Accounting in Denver. After graduating in 1978, Lisle took a job that summer with Davis Oil Company in Denver as a revenue accountant. The company was owned by industrialist and oil tycoon Marvin Davis, who would become a major real estate developer in Denver in the late 70s and early 80s. After spending a couple of years with Davis Oil and witnessing the "boom cycles" for which the industry is known, Lisle left to work as an accountant for a smaller oil company for awhile. Then, knowing he still wanted to do something in the oil business but not necessarily accounting for companies, he stepped out on his own for a bit.

Once he ran out of money, Lisle contemplated his next career move. He had other interests, such as aviation and leasing planes. A fellow he had met along the way from Grand Junction, CO, had developed a lime-based binder that could be mixed with coal fines to negate the sulfur dioxide emissions that resulted from burning coal. Once the materials were combined and run through a briquetting machine, the dense briquettes were easy to transport and less messy than coal to handle, making them an ideal heating fuel in residential applications.

An excited Lisle saw potential in this new heating fuel, and looked into the logistics of building a plant. His interest in coal took him to Nova Scotia, Canada, where there were plenty of coal mines. During a business trip geared towards the development of a facility in Cape Breton, Lisle met the woman that would become his bride, and relocated to Nova Scotia permanently.

Lisle engaged the Nova Scotia Research Foundation (which had been established by the province to seek solutions to problems of economic development and rehabilitation through the cooperation of universities and the National Research Council) to research the coal briquette idea further and explore the feasibility of building a plant in the area. While the product was great, it was determined that there simply wasn't enough market interest in it to green-light the project.

Serendipitously in 1987, Lisle was handed a copy of Hearth & Home magazine (which was called Wood 'n Energ y at the time) that contained an article discussing the development of wood pellets on the west coast of the United States. With his interest piqued (in the days pre-internet), Lisle did some research, eventually getting assistance again from the Nova Scotia Research Foundation, who confirmed the trend of a rapidly growing market.

Lisle made a due-diligence trip to the west coast, visiting a pellet mill in Washington and the Earth Stove headquarters in Tualatin, Oregon.

Earth Stove was manufacturing pellet stoves at the time, in additional to the wood stoves it had originally built its name on. While in Oregon, Lisle made a special excursion to Joe Traeger's place in Mount Angel, where he had his very first meal off of a pellet grill.

Inspired and informed upon his return to Canada, Lisle determined that wood pellets were a viable and valuable new fuel option, and he had the opportunity to be amongst the first to offer them in his region. Officially squashing the coal idea in favor of a wood pellet plant, he opened an office, hired an engineer, picked a location, raised some money, and began developing a combination pellet plant and 15 megawatt cogeneration facility in North Sydney (Cape Breton), Nova Scotia. His new company would be known as Mapleleaf Technologies.

By 1989, Lisle was ready to showcase the benefits of wood pellets to the region. He had acquired 30 Whitfield and Earth stoves, along with some Traeger furnaces, and shipped the very first railcar full of wood pellet fuel ever to Nova Scotia for demonstration purposes. As the Cape Breton plant was looking like a sure thing, the next step was to seed the market and create demand for wood pellets.

Bruce Lisle with his young son Kenny in 1990, in front of his Whitfield stove at home

Modular Energy Corporation of Virginia was one of the very first pellet plants built in the Northeast United States. Lisle began purchasing fuel from MEC and trucked it up to Nova Scotia.

Delivery issues soon forced him to abandon MEC and find a new supplier for fuel elsewhere. A company called

HISTORY & FACILITIES

144

PELLET PRESENCE Eureka Pellet in Montana was the next best option (and one of the only places you could get pellets from on the east coast in those days, as Steve Walker of New England Wood Pellet also learned at the time). Though further away, they were a reliable source, and where Lisle had gotten that first railcar of pellets for his demos.

By 1990, Lisle made a deal with Eureka to package their wood pellet fuel (under Mapleleaf Technologies) while waiting for his own plant to be up and running. Box cars full of product were routed from Eureka to Palmer, Massachusetts, where it was transshipped onto trucks for distribution. While money was lost on each ton, the goal was to build customer awareness of pellet fuel in the eastern market, where the Cape Breton plant eventually hoped to do business.

Eventually, despite having the money raised for the plant, the project was unable to move forward. Provincial government participation was required to a certain extent, and Bruce Lisle was not able to get the clearance needed to develop a major industrial plant in the Cape Breton area. Once the government turned down the project, he again had to look at new options.

BioShell, a unit of Shell Petroleum, had built three plants in Canada in the late 1970s and early 1980s, two in Northern Ontario (Hearst and Iroquois Falls), and one in Lac-Mégantic, Quebec. These facilities were actually the very first pellet plants built on the East Coast. On March 5th of 1992, Lisle called Roger Paquette, the president of BioShell in Montreal. He figured the company might want to do a joint venture plant in Nova Scotia, or maybe there was another opportunity with which he could get involved.

After a friendly conversation, Paquette explained that BioShell wasn't interested in another plant. The two men hung up. Lisle sat down, loaded a bowl of tobacco in his pipe, and realized that BioShell might actually be for sale. He called Paquette back and asked the question. It turned out that Shell was consolidating and getting rid of non-traditional units, such as the pellet plant division. Lisle drove to Montreal, brought back information from Paquette, drafted an offer, and sent it in.

After getting invited to London to discuss the offer and negotiating back and forth a bit, Lisle agreed to buy two of the three pellet plants for three million Canadian dollars.

Returning to Canada, he consulted his finance sources in Toronto and made a deal with a well-to-do family who was interested in partnering up.

Money was raised, and the focus was narrowed to just take the Lac-Mégantic plant in Quebec (the second oldest plant, built in 1981).

A winter shot of the Lac-Mégantic plant

Exactly a year after his cold call to Roger Paquette, on March 5th of 1993 Bruce Lisle signed the purchase and sale agreement at 8:00 p.m. in Toronto to buy the Lac-Mégantic plant from BioShell. By 9:00 a.m. the next morning, he was setting up a trade show booth at the Hearth Products Association Expo in Nashville, Tennessee. By June, he had taken over operations at Lac-Mégantic and the new company was known as Energex, the trade name with a nice ring to it that BioShell had been using for their wood pellet fuel. In September of 1993, Lisle added a sales office in West Lebanon, New Hampshire, a strategic location within the coveted New England market near a conversion of interstates and close to an airport.

The Lac-Mégantic plant had been the largest wood pellet manufacturer in North America when Lisle bought it, and was known for bark fuel, or pellets made out of bark. This fuel produced more ash compared to non-bark fuel, but was still very clean

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HISTORY & FACILITIES

burning and mainly used for industrial or institutional customers, in large appliances. Contracts with industrial customers, such as a pulp mill in Maine, were inherited with the plant.

Residential heating had not yet taken off in a big way, but Lisle was operating on the "build it and they will come" theory. By July 1st he broke ground on a packaging plant at the location, and full production was up and running by that December. He began processing strict sawdust without bark for the anticipated residential market.

At Lisle's first trade show in 1993, he had encountered two other pellet companies, Catamount Pellets from North Adams, Massachusetts, and Dry Creek Products from Arcade, NY. Along with Energex, they were the first to establish commercial mills for the Northeast residential bag market. Lisle came to know key individuals from each company (whom he considered friendly competitors), and who, like Lisle, would later become Pellet Fuel Institute presidents.

By the mid-1990s, many more plants began to spring up across the eastern United States, and interest had taken a firm hold in Canada, too. The residential market was growing, and a variety of Eastern pioneers tried their hand at pellet-making, with some creating lasting legacies and others dropping out of the industry for one reason or another as time went on.

But none of the stove manufacturers at the HPA Expo were addressing this issue. In addition, pellet stove manufacturers were now launching a large number of gas units, positioning gas as the star of the trade show, and making wood pellets seem like a passing fad of yesteryear. Needless to say, producers were very dismayed.

Lisle would later refer to this Expo as the "Las Vegas Gas Show". Shaken up by the experience, he and the other Eastern producers banded together to strongly market the "Pellet Option".

As a tongue-in-cheek reminder that pellets are not only a cleaner burning option but also a safer one, Bruce Lisle designed "Wood Pellets, No Go Boom" buttons, which he would wear to any event he subsequently attended.

The following year's Expo was held in Charlotte, North Carolina. All pellet producers through PFI had collectively raised money and booked a meeting room where they enticed attendees to come through giveaways of truckloads of fuel, stoves, and even cash. The event culminated in a talk by Barb Shine from Dry Creek Pellets, who preached about the pellet option and exposed new potential customers to its merits. The collective marketing effort in Charlotte in 1996 and at future Expos would greatly help to grow the market and the industry as a whole.

Charlotte also became the conduit for

the Pellet Fuels Institute affiliating with the HPA. As the association was now dominated by residential pellet fuel producers, they naturally wanted PFI to focus more on the residential market than the industrial one.

Some PFI Directors, including Lisle, initiated talks with the president of the HPA about joining forces. Formal discussions would follow and by the end of 1996, PFI moved to Arlington, VA, where both institutions would still keep their own Board and financial structure, but benefit from shared services and resources and reduced overhead. Members would also now benefit from only paying dues to one association instead of multiple regional affiliates.

The button design.

A discouraging moment came at the Hearth, Patio and Barbecue Association (HPA) Expo in Las Vegas in 1995. All of the Eastern producers were still just ramping up production, and what they were seeing on the show floor was not conducive to the further development of their market.

Certain problem factors had come to light, such as the difference of ash content between Eastern and Western fuel pellets. Softwoods grow in less mineral-dense soils, resulting in less ash than hardwoods, which comprise the main species of wood for the Eastern pellet market. The ash pans in most stoves were very small and needed to be emptied often by Eastern customers, which was not very convenient for people.

Bruce Lisle, Averill Cook, Bob Massengill, and Barb Shine, leaders of PFI as it moved in with the HPA

HISTORY & FACILITIES

As the industry continued its growth pattern, Bruce Lisle yearned to expand.

The Lac-Mégantic plant was a beast of a facility, but the idea of having a presence in the continental U.S. was appealing, and he began looking at opportunities in the mid-Atlantic market. A bag supplier told him about a plant called American Hardwoods in West Virginia that was for sale. Lisle went to look at the site in April of 1999, put it into bankruptcy to clear the title, and closed the deal to buy it that October. The plant had been closed and was in distressed shape, and the idea was to tear it down and rebuild it in the future.

wife. The bankruptcy judge had allowed only 30 days to move the plant, so Lisle leased the property from the wife and operated until February, and then promptly moved it. He unbolted everything and used multiple flatbed trucks to relocate the plant 50 miles away to an industrial storage yard in the Corridor H area of West Virginia. The location was on a four lane road that had easy access between Clarksburg, WV and Winchester, VA. However, a closer look at the overall logistics of that location gave Lisle cold feet about staying there permanently, and the search for a new location continued.

One unforeseen hiccup was that the plant was located on land that was owned by a man and his estranged

Lisle flew to Harrisburg, PA in May of 2000 to look at locations in that area next. He knew about Juniata Wood

Pellets in Mifflintown, and liked the location, so he called up the owner to discuss a sale. The plant was originally started by a couple of guys in the mulch business that just so happened to be looking to sell. By September 30th, Lisle closed the deal.

The plant came with a pellet mill and a grinder, and in early 2001 specialty cranes were used to haul up the equipment from the industrial park in WV. The plant was further expanded that summer with the addition of a rotary dryer and a better feed system, going online by late 2001. An on-site office to replace the West Lebanon, NH location was built in 2004. The years 2005-2006 brought additional improvements with a larger dryer and two more pellet mills to increase

A panoramic view of the Mifflintown, PA plant

A Bruce with son Kenny at the Mifflintown, PA plant in 2001

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A truck dumping sawdust at the PA plant

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production capacity to 125,000 tons of wood pellets per year. Today, the plant is the foremost supplier of hardwood pellets in the mid-Atlantic region.

Energex's continued growth led to questions about the best way forward for the company, and if it made sense to continue development and add more capital into the company. The joint shareholders brought in an outside consultant, and it was determined that the ideal situation would be to sell while the pellet market was booming. The board members agreed and in late 2006, the company entered negotiations with Element Partners, a private equity company in Philadelphia, PA. A deal agreeing to sell them the company was closed on March 31st, 2007, with Bruce Lisle staying on the run the company.

The remainder of 2007 turned out to be tough for the business, with a longterm supplier of raw materials deciding to give their sawdust supply to a related party that wanted to get into the pellet business. Energex needed to find new raw materials, which was a daunting task as the winter that year was cold enough to create surging demand for the product. One thing the private equity company didn't totally understand was how the nature of the business was reliant on each year's weather cycle and ever-changing.

Meanwhile back at Energex, things were not going so smoothly. A CEO had been brought in to manage back in 2008 when Bruce Lisle left, and a few years later, the company was limping along with a step into bankruptcy court. By 2013, the company reached out to Lisle and brought him back to turnaround the business, which he was able to triple in value through a re-branding and modernization of the company.

One of his accomplishments was the success of the home delivery arm of the company. This effort had initially been researched back before Lisle left the company, and was fully implemented around 2011. Upon his return, home delivery was expanded with "Pellets Express" trucks that continue to provide this service to residential and select commercial accounts.

Lisle also spearheaded a licensing deal with Jim Beam to produce flavored pellets for grilling. BBQ pellets made by the largest industry player at the time, Traeger, were flavored with oils. Lisle was a purist, however, and decided that the best pellets for authentic BBQ flavor would be a pure wood pellet made from different species, such as apple wood, and from real Jim Beam bourbon barrel staves.

It proved to be a good move, since the

Traeger company would eventually deal with bad press from flavoring their pellets with the oils. Consumers spoke up in favor of all-natural wood smoke flavor.

Another milestone was achieving qualification into the PFI Standards Program, for residential and commercial-grade pellet fuel. Energex wanted to be known for excellent and consistent product, and already had rigorous testing protocols in place. The company maintained a continuous record of production, packaging, and raw materials in order to ensure the product would be as dependable as possible. Once the PFI standards program was established, Energex made a big investment to become certified. They officially became the eighth company (and first Canadian plant) to join the program in 2015 and qualify to display the prestigious PFI Quality Mark on their pellet bags.

A member of PFI for decades, Bruce Lisle was passionate about the organization and its work. He served a director of PFI for 19 years, as Chair of the Standards for a time and then Chair of Government Affairs for many years after that. He was also President for four years. In keeping the Lisle legacy going, his son, Kenny Lisle, is now the Chairman of PFI.

Bruce Lisle decided to leave Energex in March of 2008 for what he called his "five year vacation". During this time he formed a consulting entity called Biomass Thermal Energy, and also started a new venture called North American Biomass Boilers. Commercial and industrial heat generation had already existed, but the industry was lacking in boilers to burn the plentiful biomass product available (which included other materials besides pellets, such as switchgrass).

Plus, he knew that there was better margin to be made selling bulk fuel instead of bagged fuel. He turned an airplane hangar into a fabrication shop and office, and developed a pellet furnace for poultry houses in partnership with Hearth and Home Technologies, followed by other boilers for institutional applications.

An Energex trade show booth set up at the Hearth & Home Expo in 2014

HISTORY & FACILITIES

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Bruce Lisle also innovated the first 20lb bag of pellets. The normal size was a 40lb bag, but there turned out to be a demand for smaller bags as well. Unsurprisingly, Lisle has received awards and accolades for his contributions to the pellet industry. In 2008 he was bestowed the PFI Pillar Award for service to the industry. Most recently in 2020, he was awarded the Excellence in Bioenergy Award by the International Biomass Conference, an honor he proudly calls his "Lifetime Achievement Oscar".

By the time Lisle sold Energex to Lignetics Group in the beginning of 2020, he had built a huge company that included over 20 well-known brands in the eastern market, including Fireside Ultra, Stove Chow, Nature's Own, and Premier Pellets. With the acquisition, Lignetics Group finally had a plant outside of the United States, cementing its new reputation as an international powerhouse. And Bruce Lisle has stayed on as part of Lignetics Group's merger and acquisition team, leaning on years of industry expertise to lead strategic initiatives as the company continues to expand even further.

Bruce & Kenny Lisle in D.C.

Bruce Lisle with his Excellence in Bioenergy Award

Bruce Lisle speaking on pellet manufacturing at a conference in Wels, Austria in 2020

(SOME) ORIGINAL BRANDS IN THE COMPANY

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LIGNETICS OF LAC-MÉGANTIC

The Canadian Plant Northeast

Lac-Mégantic, QC, Canada

3891 PRÉSIDENT KENNEDY, LAC-MÉGANTIC, QC, G6B 3B8

Fuel Pellets

Hardwood/Softwood

Map data: Google © 2020

The Lac-Mégantic plant is the only plant located across the Canadian border, in Quebec. It is a huge operation, running 24/7 and capable of outputting over 139,000 tons of pellets a year when running at capacity, making it one of the highest producers in the system. The plant is unique in that instead of a linear system in which sawdust comes in, gets pulverized, is extruded into pellets, and then gets bagged, the manufactured pellets made here are moved via conveyor belt to a large warehouse, where they sit until they are ready to go out in bulk or are front-loaded to a separate packaging area. The plant employs one of the highest headcounts at 35 people and solely makes hardwood and softwood fuel pellets, some of which are exported in bulk to Europe via ship. Bagged brands made here include Green Supreme and Stove Chow, which is bought by Home Depot. The pellets are sold throughout the Northeastern region of the United States, and to select areas in Canada.

P

er Wikipedia, Lac-Mégantic is a town in the Eastern Townships region of Quebec, Canada. It is located on Lac Mégantic, a freshwater lake after which the town was named.

The region was originally inhabited by the Abenaki, a Native American tribe.

The name of Mégantic comes from the Abenaki word "namesokanjik" which translates to "place where the fish are held".

The first known European in the region was a Catholic missionary who arrived in 1646 to convert the Abenaki. The first colonists to settle in the region came two centuries later, around 1850, and were of French Canadian or Scottish origin. The region's economy in its early days was propelled by the logging industry due to the vast swaths of old-growth forests. Many related industries operated in the region, and Lake Mégantic was used for log floating, with a steamboat used to tow the logs to the sawmill.

Originally called Mégantic (renamed Lac-Mégantic in 1958), the town was founded in 1884 after the Canadian Pacific Railway began construction of the final segment of its transcontinental railway linking Montreal with the Atlantic Ocean port of Saint John, New Brunswick.

This line opened in 1889, and Mégantic became the meeting place of two railroads at that time: the CPR and the Quebec Central Railway.

An important figure of Lac-Mégantic was Joseph Édouard Eugène Choquette, a priest, who, in his spare time, was an amateur scientist. He was the catalyst

for the creation of an electric lighting system which, on the eve of Christmas in 1898, illuminated the entire city; and a power company. Father Choquette was also an amateur photographer.

On July 6th, 2013, tragedy struck when an unmanned freight train carrying crude oil ran away and derailed near the downtown area, causing multiple tank cars to catch fire and explode.

Forty-seven people were killed or presumed dead in the explosion and ensuing blaze, and most downtown buildings (including the town's library and archives) were lost or had to be demolished due to petroleum contamination of the underlying grounds. The city has since rebuilt.

Today, the city has a population of about 6,000. Bruce Lisle spent a good deal of time there during the first couple of years after he bought the pellet plant, and he provided a glowing review of the community and his experience doing business there. The industrious population worked hard and was very knowledgeable, and the town itself was bustling with tourism and people seeking outdoor activities like sledding and riding Ski-Doos in the winter, and recreational lake activities in the summer.

Lac-Mégantic remains an important center of agriculture, logging, lumber, and pulp and paper. Other businesses in the area besides Lignetics include Tafisa Canada, a huge particleboard business, Bestar, a local furniture manufacturer, and forestry company Industries Manufacturières Mégantic, part of Masonite International.

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LIGNETICS OF MIFFLINTOWN

The Energex USA Plant Mid-Atlantic

Mifflintown, PA

95 ENERGEX DRIVE, MIFFLINTOWN, PA. 17059

Fuel Pellets

Hardwood

BBQ Pellets

Hardwood

Map data: Google © 2020

The Mifflintown plant, located in rural Pennsylvania and close to residential and industrial neighbors, is another large producer of pellets. With a headcount of around 37 employees on staff, this plant can output 125,000 tons of pellets per year when running at capacity. Mifflintown has enough storage space to hold product over the weekend and only runs its packaging line during the week. It proudly houses the newest bagging and palletizing operation of all the plants in the Lignetics Group system. Back when the plant was owned by Energex, this location was the corporate headquarters for the company and where the hardwood Jim Beam BBQ pellets started being made, using actual barrel staves that had held whiskey. Jim Beam BBQ pellets continue to come from this plant, as well as hardwood Ol' Hick BBQ pellets. Other products made here include Green Supreme and Stove Chow hardwood fuel pellets, which are sold mostly in Pennsylvania and the mid-Atlantic region.

T

he Juniata River Valley includes Mifflin and Juniata Counties in Central Pennsylvania. Mostly rural in nature, the region boasts fertile farm fields, the wide and clear Juniata River, a series of covered bridges, and mountains and ridges covered in lush forests. Commerce and industry are focused around Mifflintown and Lewistown, the county seats, but it also exists in smaller towns nearby. It would be easy, but not correct, to confuse Mifflintown in Juniata County with Mifflin County, which is located right next door.

Scot-Irish immigrants began to make their way to the valley in 1752, after a treaty with the Iroquois people.

German farmers arrived shortly thereafter and helped clear the land known today as Juniata and Mifflin Counties. When the Indians formed an alliance with the British during the Revolutionary War, loyal patriots guarded General Washington’s flank against attacks. Local militia had formed and answered Washington’s call. They made their way south to become a vital reinforcement to Washington’s fort on the Potomac.

Mifflintown was originally laid out in 1791 on lands belonging to John Harris, and the town was named in honor of Governor Thomas Mifflin. Juniata County, named for the river flowing through it, was erected from Mifflin County in 1831. Juniata, a Seneca name, originally meant “standing stone”, but a later connotation favors “blue waters”.

Juniata and Mifflin Counties had everything needed by the early

settlers. The river offered an ideal source of water, food, and transportation, and a good hunter could easily provide food for his family.

Prior to the Civil War, lumbering was the first industry, leading to a number of iron-producing furnaces.

The population of Juniata County today is about 24,700. Mifflintown is considered a bedroom community for Harrisburg, PA which is about a 45 minutes away. Cost of living is fairly affordable, and coupled with the beauty of the area, it is a very attractive place to put down roots. The community is comprised of hardworking, salt-of-the-earth people who are always willing to help their neighbors. Folks look forward to the annual County Fair and Harvest Festival, and local farmers markets.

It is an active community too, where people hunt, fish, kayak, and otherwise enjoythe meandering Juniata River.

Rhonda Moore, a 16-year Chamber of Commerce employee and the current Executive Director, lists some major businesses in the area that include two wineries, a distillery, the Port Royal Speedway (a popular tourist attraction), DuMor Inc. (which makes outdoor equipment like trash cans, park benches, and stadium seating), and of course, Lignetics.

The pellet plant has hosted tours for local educators and students to explain how the plant was developed and to expose them to the kinds of jobs in the county. The tours appeal to a new generation of potential workers, should they choose to remain in the area.

LEADERSHIP & LOOKING AHEAD The future is bright as the company moves forward with continued acquisitions and growth, while fine-tuning and developing the sustainable products of tomorrow and beyond.

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BOARD MEMBERS

WILLIAM MORRIS

DOUGLAS HAILEY

DALE OUTHOUS

JUSTIN JACOBS

SEAN QUINN

KEN TUCKER

BOB SOUREK

STEVE MCCALLE

JERRY SECUNDY

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THE FUTURE OF LIGNETICS GROUP

EXPANDING SUSTAINABLE POSSIBILITIES