WATER CAPITAL INC.
FILING STATEMENT
IN RESPECT OF THE QUALIFYING TRANSACTION INVOLVING THE ACQUISITION BY
WATER CAPITAL INC.
OF
SCHNEIDER POWER INC.
Dated as of July 25, 2008
Neither the TSX Venture Exchange Inc. nor any securities regulatory authority has in any way passed
upon the merits of the Qualifying Transaction described in this Filing Statement.
TABLE OF CONTENTS
Page
FORWARD-LOOKING INFORMATION............................................................................................. I
GENERAL MATTERS........................................................................................................................... II
MARKET AND INDUSTRY DATA....................................................................................................... II
CURRENCY............................................................................................................................................. II
GLOSSARY ..............................................................................................................................................1
SUMMARY OF FILING STATEMENT ..............................................................................................15
PART I: INFORMATION CONCERNING WATER CAPITAL ......................................................27
CORPORATE HISTORY OF WATER CAPITAL ..................................................................................27
GENERAL DEVELOPMENT OF THE BUSINESS OF WATER CAPITAL.........................................27
DIRECTORS AND OFFICERS................................................................................................................27
COMPENSATION OF EXECUTIVE OFFICERS OF WATER CAPITAL ............................................32
MANAGEMENT CONTRACTS OF WATER CAPITAL.......................................................................35
INDEBTEDNESS OF DIRECTORS, SENIOR OFFICERS AND PROMOTERS OF WATER
CAPITAL.....................................................................................................................................35
INTEREST OF INSIDERS IN MATERIAL TRANSACTIONS OF WATER CAPITAL ......................35
TRADING OF THE COMMON SHARES OF WATER CAPITAL........................................................35
CAPITAL STRUCTURE OF WATER CAPITAL ...................................................................................36
PRIOR SALES OF SHARES OF WATER CAPITAL.............................................................................36
CAPITALIZATION OF WATER CAPITAL ...........................................................................................36
FULLY DILUTED SHARE CAPITAL OF WATER CAPITAL .............................................................37
ESCROWED SECURITIES OF WATER CAPITAL...............................................................................37
MATERIAL CONTRACTS OF WATER CAPITAL ...............................................................................38
PROMOTER.............................................................................................................................................39
AUDITORS, TRANSFER AGENT AND REGISTRAR OF WATER CAPITAL...................................39
RELATIONSHIP BETWEEN WATER CAPITAL AND PROFESSIONAL PERSONS........................39
SELECTED FINANCIAL INFORMATION OF WATER CAPITAL.....................................................39
MANAGEMENT DISCUSSION AND ANALYSIS OF OPERATING RESULTS OF WATER
CAPITAL.....................................................................................................................................40
FINANCIAL STATEMENTS OF WATER CAPITAL............................................................................42
LEGAL PROCEEDINGS CONCERNING WATER CAPITAL..............................................................42
PART II: INFORMATION CONCERNING SCHNEIDER POWER...............................................43
CORPORATE STRUCTURE, NAME AND INCORPORATION...........................................................43
TABLE OF CONTENTS
(continued)
Page
CORPORATION OVERVIEW.................................................................................................................43
REVENUE MODEL.................................................................................................................................50
COMPETITIVE ADVANTAGES.............................................................................................................50
INDUSTRY OVERVIEW........................................................................................................................52
BUSINESS OF SCHNEIDER POWER ....................................................................................................57
THE PROJECTS.......................................................................................................................................60
REGULATORY INITIATIVES................................................................................................................82
EMISSIONS TRADING AND GREEN CREDITS..................................................................................87
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS OF THE CORPORATION.........................................................91
DIRECTORS AND OFFICERS..............................................................................................................102
EXECUTIVE COMPENSATION...........................................................................................................105
INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS.......................107
CAPITALIZATION ...............................................................................................................................107
SELECTED FINANCIAL INFORMATION ..........................................................................................108
CAPITAL STRUCTURE OF SCHNEIDER POWER............................................................................108
THE OFFERING ....................................................................................................................................108
PRIOR SALES........................................................................................................................................109
PRINCIPAL SHAREHOLDERS ............................................................................................................110
DIVIDEND POLICY..............................................................................................................................110
PROMOTERS.........................................................................................................................................110
MATERIAL CONTRACTS ....................................................................................................................110
AUDITORS ............................................................................................................................................111
LEGAL PROCEEDINGS.......................................................................................................................111
PART III: INFORMATION CONCERNING RESULTING ISSUER ............................................112
THE PROPOSED QUALIFYING TRANSACTION..............................................................................112
RESULTING ISSUER CORPORATE STRUCTURE............................................................................116
NARRATIVE DESCRIPTION OF RESULTING ISSUER’S BUSINESS ............................................117
DESCRIPTION OF RESULTING ISSUER SECURITIES....................................................................117
SELECTED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION ..................................118
PRO FORMA CONSOLIDATED WORKING CAPITAL SUMMARY...............................................118
TABLE OF CONTENTS
(continued)
Page
CALCULATION OF WORKING CAPITAL.........................................................................................118
AVAILABLE FUNDS AND PRINCIPAL USES OF FUNDS ..............................................................118
PRO FORMA CONSOLIDATED CAPITALIZATION OF RESULTING ISSUER.............................119
PRO FORMA RESULTING ISSUER FULLY DILUTED SHARE CAPITAL.....................................120
RESULTING ISSUER DIVIDENDS......................................................................................................120
RESULTING ISSUER ESCROWED SECURITIES ..............................................................................121
RESULTING ISSUER PRINCIPAL SECURITYHOLDERS ................................................................123
RESULTING ISSUER DIRECTORS, OFFICERS AND PROMOTERS ..............................................124
MANAGEMENT AND DIRECTORS OF RESULTING ISSUER........................................................127
PENALTIES OR SANCTIONS ..............................................................................................................127
OTHER REPORTING ISSUER EXPERIENCE.....................................................................................128
RESULTING ISSUER PROPOSED EXECUTIVE COMPENSATION................................................129
INDEBTEDNESS OF RESULTING ISSUER DIRECTORS AND OFFICERS ...................................130
INVESTOR RELATIONS ARRANGEMENTS.....................................................................................130
RESULTING ISSUER OPTIONS AND OTHER RIGHTS TO PURCHASE RESULTING
ISSUER SECURITIES ...............................................................................................................130
RESULTING ISSUER MATERIAL CONTRACTS ..............................................................................132
RESULTING ISSUER AUDITORS .......................................................................................................132
RESULTING ISSUER TRANSFER AGENT AND REGISTRAR........................................................132
LEGAL PROCEEDINGS AGAINST WATER CAPITAL AND SCHNEIDER POWER.....................133
RESULTING ISSUER RISK FACTORS................................................................................................133
SPONSORSHIP......................................................................................................................................144
BOARD APPROVAL .............................................................................................................................144
AUDITORS' CONSENT .........................................................................................................................145
CERTIFICATE OF WATER CAPITAL.................................................................................................146
CERTIFICATE OF SCHNEIDER POWER............................................................................................147
APPENDIX "A" – FINANCIAL STATEMENTS OF WATER CAPITAL INC.
APPENDIX "B" – FINANCIAL STATEMENTS OF SCHNEIDER POWER INC.
APPENDIX "C" – UNAUDITED PRO FORMA BALANCE SHEET OF THE RESULTING ISSUER
FORWARD-LOOKING INFORMATION
This Filing Statement contains forward-looking information. Often, but not always, forward-looking
information can be identified by the use of words such as "plans", "expects" or "does not expect", "is
expected", "estimates", "intends", "anticipates" or "does not anticipate", or "believes", or variations of
such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or
"will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results, performance or achievements of Water
Capital, Schneider Power or the Resulting Issuer to be materially different from any future results,
performance or achievements expressed or implied by the forward-looking statements. Examples of such
statements include: (A) the intention to complete the Amalgamation, the Offering and the Qualifying
Transaction; (B) the description of the Resulting Issuer that assumes completion of the Amalgamation,
the Offering and the Qualifying Transaction; and (C) in respect of the Resulting Issuer and Schneider
Power, the development plans and status of wind power projects, construction timetables, extent of wind
resources and future growth and performance. Actual results and developments are likely to differ, and
may differ materially, from those expressed or implied by the forward-looking statements contained in
this Filing Statement. Such forward-looking statements are based on a number of assumptions which may
prove to be incorrect, including, but not limited to: the ability of Water Capital and Schneider Power to:
obtain necessary financing; satisfy conditions under the Acquisition Agreement; satisfy the requirements
of the Exchange with respect to the Amalgamation, the Offering and the Qualifying Transaction; the
economy generally; and, in respect of the Resulting Issuer and Schneider Power; results of operations,
levels of activity, future capital and other expenditures (including the amount, nature and sources of
funding thereof), competitive advantages, business prospects and opportunities, construction delays,
extent of wind resources and future growth and performance and anticipated and unanticipated costs. This
forward-looking information should not be relied upon as representing Water Capital's views as of any
date subsequent to the date of this Filing Statement. Although Water Capital and Schneider Power have
attempted to identify important factors that could cause actual actions, events or results to differ
materially from those described in forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly, readers should not place undue
reliance on forward-looking information. The factors identified above are not intended to represent a
complete list of the factors that could affect Water Capital, the Resulting Issuer or Schneider Power.
Additional factors are noted under the heading "Part III: Information Concerning Resulting Issuer - Risk
Factors".
Should one or more of these risks or uncertainties materialize, or should assumptions underlying the
forward-looking information prove incorrect, actual results, performance or achievement may vary
materially from those expressed or implied by the forward-looking information contained in this Filing
Statement. These factors should be carefully considered and readers are cautioned not to place undue
reliance on forward-looking information, which speak only as of the date of this Filing Statement. All
subsequent forward-looking information attributable to Water Capital, the Resulting Issuer or Schneider
Power herein are expressly qualified in their entirety by the cautionary statements contained in or referred
to herein. Water Capital, the Resulting Issuer and Schneider Power do not undertake any obligation to
release publicly any revisions to these forward-looking information to reflect events or circumstances that
occur after the date of this Filing Statement or to reflect the occurrence of unanticipated events, except as
may be required under applicable securities laws.
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GENERAL MATTERS
This Filing Statement contains various company names, product names, trade names, trademarks and
service marks, all of which are the properties of their respective owners.
Information contained on Schneider Power’s website, www.schneiderpower.com, shall not be deemed to
be part of this Filing Statement or incorporated herein by reference.
MARKET AND INDUSTRY DATA
This Filing Statement includes market and industry data that has been obtained from third party sources,
including industry publications, as well as industry data prepared by Schneider Power on the basis of its
knowledge of and experience in the industry in which Schneider Power operates (including
management’s estimates and assumptions relating to such industry based on that knowledge). Schneider
Power's knowledge of such industry has been developed through its experience and participation in such
industry. Although Schneider Power believes such information to be reliable, neither of Water Capital nor
Schneider Power has independently verified any of the data from third party sources referred to in this
Filing Statement or ascertained the underlying economic assumptions relied upon by such sources.
Furthermore, references in this Filing Statement to any publications, reports, surveys or articles prepared
by third parties should not be construed as depicting the complete findings of the entire publication,
report, survey or article. The information in any such publication, report, survey or article is not
incorporated by reference in this Filing Statement.
CURRENCY
Dollar references in this Filing Statement are in Canadian dollars unless otherwise indicated.
GLOSSARY
When used in this Filing Statement, the following terms have the following meanings ascribed thereto:
"Acquisition Agreement" means the agreement dated July 15, 2008 between Water Capital and
Schneider Power providing for the Qualifying Transaction;
"Advanced-Stage" refers to a project that has in place all or substantially all necessary agreements and
permits, including those relating to Site Control, Interconnection Access, PPA or SOC (or that has
submitted an application for an SOC under the RESOP) but which has not yet commenced construction
and which has not yet obtained construction financing;
"Affiliate" means a company that is affiliated with another company as described below.
A company is an "Affiliate" of another company if:
(a) one of them is the subsidiary of the other, or
(b) each of them is controlled by the same Person.
A company is "controlled" by a Person if:
(a) voting securities of the company are held, other than by way of security only, by or for
the benefit of that Person, and
(b) the voting securities, if voted, entitle the Person to elect a majority of the directors of the
company.
A Person beneficially owns securities that are beneficially owned by:
(a) a company controlled by that Person, or
(b) an Affiliate of that Person or an Affiliate of any company controlled by that Person;
"Agency Agreement" means the agency agreement between Schneider Power and the Agent with respect
to the Offering as more particularly described under the heading "Part II: Information Concerning
Schneider Power - The Offering";
"Agent" means D&D Securities Company;
"Aggregate Pro Group" means all Persons who are members of any Pro Group whether or not the
Member is involved in a contractual relationship with the Issuer to provide financing, sponsorship or
other advisory services;
"Air Emissions" has the meaning set out under the heading "Part II: Information Concerning Schneider
Power - Emissions Trading and Green Credits";
"Air Emissions Market" has the meaning set out under the heading "Part II: Information Concerning
Schneider Power Emissions Trading and Green Credits";
"Amalco" means the corporation resulting from the amalgamation of Schneider Power and Newco
pursuant to the Amalgamation;
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"Amalco Shares" means the common shares in the capital of Amalco;
"Amalgamating Corporations" means Schneider Power and Newco;
"Amalgamation" means the amalgamation of Schneider Power and Newco, which is proposed to be
Water Capital’s "Qualifying Transaction" for the purposes of the CPC Policy;
"Arthur Easement" means the 20-year easement agreement between Arthur Wind Farm Inc. and the
landowners, expiring on May 3, 2027, with an initial renewal term of five years on notice by Arthur Wind
Farm Inc. to the landowners;
"Arthur Wind Farm Project" means the Advanced-Stage wind power project entailing the proposed
construction and operation of a wind power farm with up to 10 MW of potential wind power capacity
located approximately 2 km east of the town of Arthur, Ontario;
"Associate" when used to indicate a relationship with a Person, means:
(a) an Issuer of which the Person beneficially owns or controls, directly or indirectly, voting
securities entitling the Person to more than 10 percent of the voting rights attached to all
outstanding voting securities of the Issuer;
(b) any partner of the Person;
(c) any trust or estate in which the Person has a substantial beneficial interest or in respect of
which the Person serves as trustee or in a similar capacity; and
(d) in the case of a Person who is an individual
(i) that Person's spouse or child, or
(ii) any relative of that Person or of his spouse who has the same residence as that
Person; but
(e) where the Exchange determines that two Persons shall, or shall not, be deemed to be
associates with respect to a Member firm, Member corporation or holding company of a
Member corporation, then such determination shall be determinative of their relationships
in the application of Rule D with respect to that Member firm, Member corporation or
holding company.
"AWEA" means the American Wind Energy Association;
"Bid-Ready" refers to a project outside of Ontario that has obtained all or substantially all necessary
permits, but has not yet secured a PPA or construction financing and which is sufficiently advanced that it
may bid in respect to an RFP;
"Broker Warrants" means the warrants to acquire Units to be granted to the Agent in connection with
the Offering;
"Bullfrog" means Bullfrog Power Inc.;
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"Bullfrog PPAs" means the electricity purchase agreements dated May 19, 2006, and October 30, 2006,
between Schneider Power and Bullfrog, an Ontario based green electricity retailer, for power generated
by the Providence Bay Wind Farm;
"Canadian Wind Energy Atlas" means a database of high resolution wind statistics in Canada;
"CanWEA" means the Canadian Wind Energy Association;
"Capacity Factor" means a measure of the percentage of electricity that an electricity-generating source
is expected to produce relative to maximum theoretical production in a given period of time;
"CCA" means Capital Cost Allowance;
"CCE" means Connection Cost Estimate;
"CCRA" means Connection Cost Recovery Agreement;
"CCX" means Chicago Climate Exchange;
"CEE" means Canadian Exploration Expense as defined under the Tax Act;
"CERs" means certified emission reductions;
"CIA" means Connection Impact Assessment;
"CO2" means carbon dioxide;
"Completion of the Qualifying Transaction" means the completion of the Qualifying Transaction as
evidenced by and on the date that the Final Exchange Bulletin is issued by the Exchange;
"Construction Ready" means, in respect of a project, a stage where all permits and agreements are in
place such that construction of the project may commence, but financing of the construction may still be
required;
"Control Person" means any person or company that holds or is one of a combination of persons or
companies that holds a sufficient number of any of the securities of an Issuer so as to affect materially the
control of that Issuer, or that holds more than 20% of the outstanding voting securities of an Issuer except
where there is evidence showing that the holder of those securities does not materially affect the control
of the Issuer;
"CPC" means a corporation:
(a) that has filed and obtained a receipt for a preliminary CPC prospectus from one or more
of the securities regulatory authorities in compliance with the CPC Policy; and
(b) in regard to which the Completion of the Qualifying Transaction has not yet occurred;
"CPC Agents" means, collectively Raymond James Ltd. and Canaccord Capital Corporation;
"CPC Agent's Options" means the options to acquire 250,000 Water Capital Shares granted by Water
Capital to the CPC Agents in connection with its IPO;
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"CPC Escrow Agreement" means the Exchange Form 2F CPC escrow agreement dated February 17,
2006, among Water Capital, the Escrow Agent and certain shareholders of Water Capital in respect of
5,150,000 Water Capital Shares;
"CPC Escrow Shares" means an aggregate of 5,150,000 Water Capital Shares deposited with the Escrow
Agent to be held in escrow pursuant to the terms and conditions of the CPC Escrow Agreement;
"CPC Incentive Options" means the incentive stock options granted by Water Capital to its officers and
directors under the Water Capital Stock Option Plan, as adjusted for any exercise after the date hereof, to
purchase up to 1,250,000 Water Capital Shares at any time until February 16, 2011 at an exercise price of
$0.20 per Water Capital Share ;
"CPC Policy" means Exchange Policy 2.4 Capital Pool Companies of the TSX Venture Exchange
Corporate Finance Manual;
"CRA" means the Canada Revenue Agency and any successor thereto;
"CRCE" means "Canadian renewable and conservation expense" as defined in subsection 66.1(6) of the
Tax Act;
"CRCE Turbine Phase" means a period of time during which Schneider Power would purchase and
install test wind turbines at a windpower site and conduct necessary tests, together with the related
infrastructure including roads, buildings and interconnection facilities;
"Crown Lease" means an agreement to lease Crown Land;
"Crystal Falls Solar Project" means the Tender-Ready solar power project entailing the proposed
construction and operation of a solar power farm with up to 10 MW of potential solar power capacity
located approximately 55 km north of the City of North Bay, Ontario;
"CUCO" means Credit Union Central of Ontario Limited;
"Directive" means the directive dated June 13, 2006 issued by the Minister of Energy to the OPA
concerning the intended electricity supply mix for Ontario in 2025.
"Director" means the Director appointed under section 278 of the OBCA;
"EA" means Environmental Assessment;
"Effective Date" means the date of this Filing Statement;
"EFI" means Energy Farming Ontario LLC, a Delaware corporation and an experienced international
renewable energy project developer, builder and owner;
"EFI MOU" means the non-binding memorandum of understanding between Schneider Power and EFI;
"Embedded Generation Facility Distribution Connection Agreement" means the agreement entered
into after Interconnection Access has been obtained and construction of an electricity generating facility
has been completed that permits an electrical energy producer to proceed to feed energy into the electrical
grid;
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"Emissions Markets" has the meaning set out under the heading "Part II: Information Concerning
Schneider Power - Emissions Trading and Green Credits";
"Employment Agreements" means the agreements between the Resulting Issuer and the Executives
upon Completion of the Qualifying Transaction;
"EnBW Sale" means sale of German based power company, Elektrizitätswerk Horb a. N. KG to Energie
Baden Würtemberg;
"Enercon" means Enercon GmbH, of Germany;
"Environmental Attributes" means all tangible and intangible rights and benefits associated with the
environmental characteristics of a renewable electricity generation source or the generation of electricity
from a renewable electricity generation facility and includes RECs, green tags, green credits, green-e and
similar measures and labels for the environmental characteristics of renewable electricity sources;
"Environmental Attributes Markets" has the meaning set out under the heading "Part II: Information
Concerning Schneider Power - Emissions Trading and Green Credits";
"EPK Agreement" means the warranty and maintenance agreement between Schneider Power
Providence Bay Inc. and Enercon Canada dated May 3, 2007;
"eRPI" means the Canadian federal government’s ecoENERGY for Renewable Power Initiative;
"ERUs" means emission reduction unit;
"Escrow Agent" means Equity Transfer & Trust Company;
"EUAs" means European Union Allowance;
"EU ETS" means European Union Emissions Trading System;
"Exchange" means the TSX Venture Exchange Inc.;
"Exchange Policy 1.1" means Exchange Policy 1.1 Interpretation of the TSX Venture Exchange
Corporate Finance Manual;
"Exchange Policy 2.2" means Exchange Policy 2.2 Sponsorship and Sponsorship Requirement;
"Exchange Policy 5.4" means Exchange Policy 5.4 - Escrow, Vendor Consideration and Resale
Restrictions;
"Executives" means Thomas Schneider, Bernd Schneider, Jonathan Lundy and John Ng;
"Fairmont Wind Farm Project" means the Pipeline wind power project entailing the proposed
construction and operation of a wind power farm with up to 345 MW of potential wind power capacity
located approximately 15 km south of Erickson, Manitoba;
"Filing Statement" means this filing statement;
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"Final Exchange Bulletin" means the Exchange Bulletin issued by the Exchange following the
Qualifying Transaction Closing and the submission of all required documentation that evidences the final
Exchange acceptance of the Proposed Qualifying Transaction;
"First Nations" means the indigenous people of Canada;
"Flomborn and Olsbruecken Wind Farms" means the 5.4MW of generating capacity owned by JB in
wind farms located approximately 30 km east of Frankfurt, Germany;
"Founders" means Bernd Schneider and Thomas Schneider;
"Framework" means Regulatory Framework for Air Emissions;
"Fully Permitted" means a project which has received its environmental certification to construct the
particular project from the applicable governmental authority;
"GAAP" means Canadian generally accepted accounting principles;
"gigawatts" or "GW" means one thousand MW of electrical power;
"Goodwins Island Wind Farm Project" means the Bid-Ready wind power project entailing the
proposed construction and operation of a wind power farm with up to 20 MW of potential wind power
capacity located approximately 5 km west of Woods Harbour, Shelburne County, Nova Scotia;
"Green Credits" means the Environmental Attributes and reductions of Air Emissions associated with
electricity generation from renewable energy sources such as wind energy that may be unbundled from
the electricity itself, if the electricity is not sold or marketed as green electricity, and sold by producers of
renewable energy and may include Renewable Energy Certificates, green tags, green credits, verified
emission reductions, emission offsets, emission allowances, credits, renewable set-asides and similar
measures of the Environmental Attributes and emissions reductions associated with renewable electricity
generation;
"GWh" means an hour during which one GW of electrical power has been continuously produced;
"Half Warrant" means one-half of an Offering Warrant, that forms a part of a Unit.;
"Hilltop Heights Expansion Project" means the Infill Construction Phase of the Hilltop Heights Wind
Farm Project;
"Hilltop Heights Wind Farm Project" means the Bid-Ready wind power project entailing the proposed
construction and operation of a wind power farm with up to 120 MW of potential wind power capacity
located near Erickson, Manitoba, approximately 50 km south of the Riding Mountain Provincial Park,
Manitoba;
"HONI" means Hydro One Networks Inc.;
"IBU" means independent business unit;
"Infill Construction Phase" means a period following completion of the CRCE Turbine Phase, during
which the remaining number of wind turbines at a wind power site would be purchased and installed to
infill the wind power project;
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"Innisfil Easement" means the 20-year easement agreement entered into between Innisfil Wind Farm
Inc. and individual land owners, expiring on December 31, 2035, and will be renewed automatically for
periods of five years, unless notice to terminate is given pursuant to the terms and conditions of the
Innisfil Easement;
"Innisfil Wind Farm Project" means the Advanced-Stage wind power project entailing the proposed
construction and operation of a wind power project with up to 10 MW of potential wind power capacity
located approximately 5 km west of the town of Innisfil, Ontario, adjacent to Highway 400;
"Insider" as used in relation to an Issuer, means
(a) a director or senior officer of the Issuer;
(b) a director or senior officer of a company that is an Insider or subsidiary of the Issuer;
(c) a Person that beneficially owns or controls, directly or indirectly, voting shares carrying
more than 10% of the voting rights attached to all outstanding voting shares of the Issuer;
or
(d) the Issuer itself if it holds any of its own securities;
"installed solar power capacity" means the electricity generating capacity of a particular completed
solar power project;
"installed wind power capacity" means the electricity generating capacity of a particular completed
wind power project;
"Interconnection Access" means having executed interconnection and transmission agreements with
transmission line owners and/or operators permitting the wind farm or solar farm access to the electrical
grid;
"IPO" means an initial public offering of securities of an Issuer;
"IPP" means an independent power producer;
"IPSP" means Integrated Power System Plan;
"Issuer" means a company and its subsidiaries which have any of its securities listed for trading on the
Exchange and, as the context requires, any applicant company seeking a listing of its securities on the
Exchange;
"JB" means Juwi Beteiligungs GmbH NaturPower 4KG;
"JW" means Juwi Wind US Corp.;
"JW MOU" means the non-binding memorandum of understanding between Schneider Power USA Inc.
and JW concerning the development of renewable power projects in the United States;
"kilovolts" or "kV" means one thousand volts of electrical power;
"kilowatt hour" or "kWh" means an hour during which one kW of electrical power has been
continuously produced;
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"kilowatts" or "kW" means one thousand watts of electrical power;
"Kyoto Protocol" means the Kyoto Protocol to the United Nations Framework Convention on Climate
Change;
"Land Easement Agreements" means collectively all land easement agreements entered into between
Schneider Power or its subsidiaries with a landowner;
"Letter of Intent" means the letter dated March 12, 2008 pursuant to which Water Capital and Schneider
Power agreed to undertake the Proposed Qualifying Transaction;
"LUP" means Land Use Permit;
"Manitoba Hydro" means the Crown corporation Manitoba Hydro;
"Maximum Offering" means the offering and issuance by Schneider Power of 4,000,000 Units to occur
concurrently with the Qualifying Transaction Closing;
"Minimum Offering" means the offering and issuance by Schneider Power of 2,000,000 Units to occur
concurrently with the Qualifying Transaction Closing;
"MB Hydro’s Renewable Energy Request for Proposal" means a written request for proposal, by
Manitoba Hydro, using a collective number, to gather proposals submitted by perspective vendors. The
request for proposal allows the bidder to "propose" different methods of carrying out the work;
"megawatt hour" or "MWh" means an hour during which 1 MW of electrical power has been
continuously produced;
"megawatts" or "MW" means one thousand kW of electrical power;
"Member" has the meaning in Exchange Rule A 1.00;
"Met Mast" means a wind monitoring tower;
"Ministry of the Environment" means the Ontario Ministry of the Environment;
"MIP" means market incentive program;
"MI 52-110" means Multilateral Instrument 52-110 - Audit Committees;
"MNR" means the Ontario Ministry of Natural Resources;
"MOU" means memorandum of understanding;
"NAV Canada" means Canada's civil air navigations services provider;
"Newco" means Water Capital Amalco Inc., the wholly-owned subsidiary of Water Capital incorporated
under the OBCA for the purposes of completing the Amalgamation;
"Newco Shares" means common shares in the capital of Newco;
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"Non-Arm's Length Parties" means: (a) in relation to a company: (i) a promoter, officer, director, other
Insider or Control Person of that company and any Associates or Affiliates of any such persons; or (ii)
another entity or an Affiliate of that entity, if that entity or its Affiliate have the same promoter, officer,
director, Insider or Control Person as the company; and (b) in relation to an individual, any Associate of
the individual or any company of which the individual is a promoter, officer, director, Insider or Control
Person;
"Non-Arm's Length Parties to the Qualifying Transaction" means the Vendor(s) (as defined in the
CPC Policy), any Target Company(ies) (as defined in the CPC Policy) and includes, in relation to
Significant Assets or Target Company(ies), the Non Arms' Length Parties of the Vendor(s), the Non
Arm's Length Parties of any Target Company(ies) and all other parties to or associated with the
Qualifying Transaction and Associates or Affiliates of all such other parties;
"Non-Arm's Length Qualifying Transaction" means a proposed Qualifying Transaction where the
same party or parties or their respective Associates and Affiliates are Control Persons in both the CPC
and in relation to the Significant Assets which are to be the subject of the proposed Qualifying
Transaction;
"NSPI" means Nova Scotia Power Inc.;
"OBCA" means the Business Corporations Act (Ontario);
"OEB" means the Ontario Energy Board;
"Offering" means the offering and issuance of Units by Schneider Power to occur concurrently with the
Qualifying Transaction Closing;
"Offering Closing" means the completion of the issue and sale of the Units pursuant to the Offering;
"Offering Closing Date" means the date on which the Closing occurs, which is expected to take place on
or about the date of the Qualifying Transaction or such other date as the Agent and Schneider Power may
agree;
"Offering Price" means $0.50 per Unit;
"Offering Shares" means the Schneider Power Common Shares to be purchased by subscribers but
excludes Schneider Power Common Shares acquired on the exercise of an Offering Warrant granted in
accordance with the Offering;
"Offering Warrant" means the share purchase warrants issued by Schneider Power pursuant to the
Offering entitling the holder thereof to purchase one Schneider Power Common Share at a price of $0.75
per share for two years following the closing of the Offering;
"OMNR" means the Ontario Ministry of Natural Resources;
"OPA" means the Ontario Power Authority;
"Owner's Engineer" means an engineer retained by the owner of a power project to provide a third-party
peer review of the engineering in respect of the project;
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"person" means a natural person, partnership, limited partnership, corporation, joint stock company, trust,
unincorporated association, joint venture or other entity or governmental authority, and pronouns have a
similarly extended meaning;
"Pipeline" refers to an exploratory project that has not obtained all or substantially all of the necessary
permits, a PPA or construction financing;
"Post-Consolidation Water Capital Shares" means the Water Capital Shares after the consolidation of
its shares on the basis of two existing shares for one new share;
"potential wind power capacity" means the proposed electricity generating capacity of a development
stage wind power project;
"PPA" means a power purchase agreement, including SOCs;
"Principals" means:
(a) a Person or company who acted as a promoter of the Issuer within two years or their
respective Associates or Affiliates, before the IPO prospectus or Final Exchange Bulletin
confirming final acceptance of a transaction;
(b) a director or senior officer of the Issuer or any of its material operating subsidiaries at the
time of the IPO Prospectus or the proposed RI listing on the TSX;
(c) a 20% holder - a Person who holds securities carrying more than 20% of the voting rights
attached to the Issuer's outstanding securities immediately before and immediately after
the Issuer's IPO or immediately after the proposed RI listing on the TSX for non-IPO
transactions;
(d) a 10% holder - a person that:
(i) holds securities carrying more than 10% of the voting rights attached to the
Issuer's outstanding securities immediately before and immediately after the
Issuer's IPO or immediately after the proposed RI listing on the TSX for non-IPO
transactions; and
(ii) has elected or appointed, or has the right to elect or appoint, one or more
directors or senior officers of the Issuer or any of its material operating
subsidiaries.
In calculating these percentages, the securities include securities issued to the holder under outstanding
convertible securities in both the holder's securities and the total securities outstanding.
A company, more than 50% held by one or more Principals will be treated as a Principal. In calculating
this percentage, the securities include the securities of an entity that may be issued to the Principals under
outstanding convertible securities in both the Principals' securities of the entity and the total securities of
the entity outstanding. Any securities of the Issuer that this entity holds will be subject to escrow
requirements.
A Principal's spouse and their relatives that live at the same address as the Principal are treated as
Principals and any securities of the Issuer they hold are subject to escrow requirements;
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"Production Tax Credit" means the United States Federal wind production tax credit;
"Proposed Qualifying Transaction" means the Amalgamation;
"Providence Bay Expansion Easement" means easement agreement entered into between Schneider
Power and Schneider Power Spring Bay Inc. expiring on June 12, 2028, on the land on which the
Providence Bay Expansion Project is expected to be constructed;
"Providence Bay Expansion Project" means the Advanced-Stage wind power project entailing the
proposed construction and operation of an expansion of Providence Bay Wind Farm with up to 6.5 MW
of potential wind power capacity at Spring Bay, located in the Township of Central Manitoulin, on
Manitoulin Island, Ontario;
"Providence Bay Wind Farm" means Schneider Power’s wind farm currently operating near Providence
Bay, in the township of Central Manitoulin, on Manitoulin Island, Ontario;
"Qualifying Transaction" means a transaction where a CPC acquires Significant Assets other than cash,
by way of purchase, amalgamation, merger or arrangement with another company or by other means;
"Qualifying Transaction Closing" means the closing of the Amalgamation;
"Qualifying Transaction Closing Date" means the date on which the Qualifying Transaction Closing
occurs;
"Rapid City Wind Farm Project" means the Pipeline wind power project entailing the proposed
construction and operation of a wind power project with up to 345 MW of potential wind power capacity
located approximately 15 km southwest of Erickson, Manitoba;
"Regulations" mean the rules and regulations associated with the Tax Act, as amended from time to time;
"Related Parties" means the promoter, officers, directors and other Insiders of a company, and
Associates or Affiliates thereof;
"Renewable Energy Certificates" or "RECs" means the Environmental Attributes of electricity
generated from renewable sources which are certified by an independent entity in accordance with a
regulated or voluntary program, where generally one REC is quantified and certified as all or substantially
all of the Environmental Attributes associated with 1 MW of renewable electricity generation;
"Renewable Portfolio Standard" means a government regulatory requirement or initiative that requires a
percentage of all electricity supplied in a particular jurisdiction to be generated from defined renewable
energy sources which generally include wind, solar, biomass and geothermal energy;
"RESOP" means the Ontario Renewable Energy Standard Offer Program;
"Resulting Issuer" means Water Capital after the Qualifying Transaction Closing;
"Resulting Issuer Escrow Agreement" means the escrow agreement to be entered into by the Resulting
Issuer, the Escrow Agent and certain security holders of the Resulting Issuer in respect of 14,174,454
Resulting Issuer Shares, 862,384 Resulting Issuer Options and $170,000 principal amount of convertible
debentures;
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"Resulting Issuer Escrow Securities" means the 14,174,454 Resulting Issuer Shares, 862,384 Resulting
Issuer Options and $170,000 principal amount of convertible debentures that will be subject to escrow
pursuant to Exchange Policy 5.4 and the Resulting Issuer Escrow Agreement;
"Resulting Issuer Options" means the CPC Incentive Options and Schneider Options as they exist
following the Qualifying Transaction Closing;
"Resulting Issuer Shares" means common shares in the capital of the Resulting Issuer;
"Resulting Issuer Stock Option Plan" means the stock option plan of the Resulting Issuer (See "Part III:
Information Concerning Resulting Issuer - Resulting Issuer Options and Other Rights to Purchase
Resulting Issuer Securities");
"Resulting Issuer Warrants" means the Broker Warrants, Schneider Warrants and Offering Warrants as
they exist following Completion of the Qualifying Transaction;
"RFP" means a request for proposals;
"RPS" means Renewable Portfolio Standard;
"RWDA" means the Rayleigh Wind Distribution Analysis;
"SCADA" means the Enercon online data collection and remote monitoring system;
"Schneider Power" means Schneider Power Inc.;
"Schneider Power Management Team" means Thomas Schneider, Bernd Schneider, Jonathan Lundy
and John Ng;
"Schneider Options" means the options to purchase Schneider Power Common Shares which have been
granted by Schneider Power to current and former directors, officers, employees or consultants;
"Schneider Power Common Shares" means common shares in the capital of Schneider Power;
"Schneider Power Shareholders" means the shareholders of Schneider Power;
"Schneider Power Subsidiaries" means Schneider Power Ventures Inc., Schneider Power International
Inc., Schneider Power Generation Inc., Schneider Wind Service Group Inc., Schneider Urban Solar Inc.,
Schneider Power Providence Bay Inc., Schneider Power Spring Bay Inc., Arthur Wind Power Inc.,
Innisfil Wind Power Inc., Trout Creek Wind Power Inc., Schneider Power USA Inc., and Schneider
Power Caribbean Inc.;
"Schneider Warrants" means the options and warrants to purchase Schneider Power Common Shares
which have been granted by Schneider Power to investors;
"Seed Shares" has the meaning specified in Exchange Policy 1.1;
"Significant Assets" means one or more assets or businesses which, when purchased, optioned or
otherwise acquired by a CPC, together with any other concurrent transactions, would result in the CPC
meeting the minimum listing requirements of the Exchange;
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"Site Control" means secure legal access to the land on which the proposed wind farm or solar farm will
be located, either by ownership of the land in fee simple, or by executed lease or easement agreements;
"SO2" means Sulphur Dioxide, a compound composed of one sulfur and two oxygen molecules. Sulfur
dioxide emitted into the atmosphere through natural and anthropogenic processes is changed in a complex
series of chemical reactions in the atmosphere to sulfate aerosols. These aerosols are believed to result in
negative radiative forcing (i.e., tending to cool the Earth's surface) and do result in acid deposition (e.g.,
acid rain).
"SOC" or "Standard Offer Contract" means a power purchase agreement in the Province of Ontario;
"subscriber" means a subscriber for Units pursuant to the Offering;
"Tax Act" means the Income Tax Act (Canada) as amended from time to time;
"Tender-Ready" refers to a project in Ontario that has obtained all or substantially all of the necessary
permits, but has not secured construction financing or been tendered to the RESOP;
"terawatt hour" or "TWh" means an hour during which one TW of electrical power has been
continuously produced;
"terawatts" or "TW" means one million MW of electrical power;
"Trout Creek Easements" means the 20-year easement agreement entered into by Trout Creek Wind
Farms Inc. and individual landowners with the first easement expiring March 29, 2027 and the second
easement agreement expiring on May 1, 2027, with an initial renewal term of five years in respect of each
easement agreement on notice of Trout Creek Wind Power Inc. to the landowners;
"Trout Creek Wind Farm Project" means the Advanced-Stage wind power project entailing the
proposed construction and operation of a wind power farm with up to 10 MW of potential wind power
capacity located approximately 1 km east of the town of Trout Creek, Ontario;
"Turbine Capacity", measured in MW, is an indication of the maximum energy production capability of
a wind turbine;
"Turbine Supply Agreement" means the agreement being negotiated between Schneider Power and
Enercon providing for the supply of wind turbines for the Providence Bay Expansion Project, Arthur
Wind Farm Project, Trout Creek Wind Far Project and Innisfil Wind Farm Project;
"Unit" means a unit consisting of one Offering Share and one Half Warrant distributed pursuant to the
Offering;
"VERs" means verified emission reductions;
"Water Capital" means Water Capital Inc.;
"Water Capital Shareholders" means the shareholders of Water Capital;
"Water Capital Shares" means common shares in the capital of Water Capital prior to the consolidation
of Water Capital Shares approved by the Water Capital Shareholders at its annual and special meeting of
its shareholders held on May 2, 2008; and
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"WEC" means Wind Energy Converters.
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SUMMARY OF FILING STATEMENT
The following is a summary of information relating to Water Capital, Schneider Power and the Resulting
Issuer (assuming Completion of the Qualifying Transaction) and should be read together with the more
detailed information and financial data and statements contained elsewhere in this Filing Statement.
Certain capitalized terms used but not defined in this summary are defined elsewhere in this Filing
Statement.
The Companies
Water Capital
Water Capital was incorporated pursuant to the provisions of the OBCA on July 8, 2005 and completed
its initial public offering as a CPC on April 27, 2006. The Water Capital Shares were listed on the
Exchange under the symbol WCP.P on May 3, 2006. Water Capital's business has been restricted to the
identification and evaluation of potential acquisitions or interests that could lead to the completion of its
Qualifying Transaction under the CPC Policy. See "Part I: Information Concerning Water Capital".
Schneider Power
Schneider Power was incorporated pursuant to the provisions of the OBCA on April 14, 2004 and is a
Canadian-based independent power producer and developer of renewable energy projects and provider of
related services. Schneider Power’s strategy focuses on growth areas in distributed renewable power
generation, carbon dioxide reduction and energy conservation. Schneider Power has in North America 1.6
MW of wind power capacity in operation, 36.5 MW of Advanced-Stage wind power projects, 26.5 MW
of which with long-term PPAs, and 150 MW of Bid-Ready or Tender-Ready wind and solar power
projects. In addition, Schneider Power has in excess of 1,000 MW of Pipeline wind and solar projects.
Schneider Power has one operating wind farm, Providence Bay Wind Farm, with 1.6 MW of power
generation capacity.
Schneider Power’s Advanced-Stage projects, namely, the Providence Bay Expansion Project, Arthur
Wind Farm Project, Innisfil Wind Farm Project and Trout Creek Wind Farm Project, are variously
scheduled to commence construction in 2008 or 2009.
The Qualifying Transaction
Water Capital and Schneider Power entered into an Acquisition Agreement dated July 15, 2008. The
Acquisition Agreement provides:
(a) Water Capital shall amend its articles so that the issued and outstanding Water Capital
Shares are consolidated on the basis of one new share for two existing shares;
(b) Schneider Power will complete a three-cornered amalgamation with Newco, a newlyformed,
wholly-owned subsidiary of Water Capital pursuant to which Schneider Power
Shareholders will receive one Post-Consolidation Water Capital Share for every
Schneider Power Common Share previously held;
(c) Water Capital and Amalco shall amalgamate and be continued as one company with the
name "Schneider Power Inc."; and
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(d) The Schneider Options, Schneider Warrants, Offering Warrants and Broker Warrants
will be adjusted to enable the holders thereof to acquire Resulting Issuer Shares upon
exercise of their respective options or warrants.
Following the Qualifying Transaction Closing, the following securities will be outstanding:
Minimum Offering Maximum Offering
Resulting Issuer Shares 56,634,599 58,634,599
Resulting Issuer Options
CPC Incentive Options 625,000 625,000
Schneider Options 1,426,363 1,426,363
2,051,363 2,051,363
Resulting Issuer Warrants
Broker Warrants 210,000 420,000
Offering Warrants 1,000,000 2,000,000
Schneider Warrants 9,877,428 9,877,428
11,087,428 12,297,428
Total 69,773,390 72,983,390
Note:
(1) In addition, it is intended that the Resulting Issuer will grant options to acquire 1,670,000 Resulting Issuer shares to the
directors, officers, employees and consultants of the Resulting Issuer.
On a non-diluted basis, following the Qualifying Transaction Closing, the former Schneider Power
Shareholders will hold 50,259,599 (88.7%) of the outstanding Resulting Issuer Shares and the former
Water Capital Shareholders will hold 6,375,000 (11.3%) of such Resulting Issuer Shares in case of the
Minimum Offering and 52,259,599 (89.1%) and 6,375,000 (10.9%), respectively, in case of the
Maximum Offering. Accordingly, the Amalgamation will constitute a "reverse takeover" of Water Capital
for accounting purposes.
Completion of the Qualifying Transaction is conditional on obtaining all necessary regulatory approvals,
including the approval of the Exchange and other conditions contained in the Acquisition Agreement that
are typical for a transaction of this type. The board of directors of Water Capital and Schneider Power
have approved of the Proposed Qualifying Transaction and all necessary shareholder approvals of both
companies have been obtained.
The Proposed Qualifying Transaction was negotiated on an arm’s length basis, involves arm’s length
parties and is not a Non-Arm’s Length Qualifying Transaction under the policies of the Exchange.
The Resulting Issuer Principal Business
The Resulting Issuer’s principal business and primary objectives will be the principal business and
primary objectives of Schneider Power. See "Part III: Information Concerning Resulting Issuer -
Narrative Description of Resulting Issuer’s Business".
Interests of Insiders, Promoters or Control Persons
No Insider, promoter or Control Person of Water Capital or their Associates and Affiliates (before giving
effect to the Qualifying Transaction) have any interest in Schneider Power other than as provided in this
Filing Statement.
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The Insiders, promoters and Control Persons of Water Capital and their Associates and Affiliates have an
interest in the Qualifying Transaction as a result of their ownership of Water Capital Shares and CPC
Incentive Options as set out under the headings "Part I: Information Concerning Water Capital –
Escrowed Securities of Water Capital and Compensation of Executive Officers of Water Capital".
Upon Completion of the Qualifying Transaction, Richard Boxer and Timothy Gallagher shall continue as
directors of the Resulting Issuer and in that capacity, shall be entitled to fees and participation in the
Resulting Issuer Stock Option in accordance with the policies established by the Resulting Issuer.
Board of Directors and Management
Immediately following the Qualifying Transaction Closing:
(a) the board of directors of the Resulting Issuer is expected to be comprised of the following
six individuals: Bernd Schneider; Thomas Schneider; Jonathan Lundy; Ralf Krueger;
Richard Boxer and Timothy Gallagher.
(b) the audit committee of the Resulting Issuer is expected to be comprised of: Richard
Boxer (Chair); Timothy Gallagher and Ralf Krueger; and
(c) the compensation, corporate governance and nominating committee is expected to be
comprised of: Richard Boxer (Chair) and Jonathan Lundy.
The management team of the Resulting Issuer is expected to be comprised of the following individuals:
Bernd Schneider, Chairman
Thomas Schneider, Vice-Chairman and President
Jonathan Lundy, Chief Executive Officer
John Ng, Chief Financial Officer
See "Part III: Information Concerning Resulting Issuer - Resulting Issuer Directors, Officers and
Promoters".
Selected Pro Forma Consolidated Financial Information:
The following amounts are based on the interim unaudited financial statements of Water Capital for the
three months ended February 29, 2008 and the interim unaudited financial statements of Schneider Power
for the three months ended March 31, 2008 after giving effect to the Completion of the Qualifying
Transaction.
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Minimum Offering Maximum Offering
Current Assets $4,051,563 $4,891,563
Total Assets $10,796,171 $11,636,171
Current Liabilities $2,008,376 $2,008,376
Total Liabilities $4,603,790 $4,603,790
Pro Forma Consolidated Working Capital Summary:
Water Capital and Schneider Power would have $2,043,187 in pro forma working capital in case of the
Minimum Offering and $2,883,187 in pro forma working capital in case of the Maximum Offering based
on the interim unaudited financial statements of Water Capital for the three months ended February 29,
2008 and the interim unaudited financial statements of Schneider Power for the three months ended
March 31, 2008 after giving effect to the Completion of the Qualifying Transaction. Of this amount,
$1,875,437 would be from Water Capital and $167,750 would be from Schneider Power in case of the
Minimum Offering, and $1,795,437 will be from Water Capital and $1,087,750 from Schneider Power in
case of the Maximum Offering.
Calculation of Working Capital
Current Assets Minimum Offering Maximum Offering
Cash $3,578,689 $4,418,689
Accounts Receivable $125,799 $125,799
Other Receivables $12,140 $12,140
Deposits and Prepaid Expenses $334,935 $334,935
Current Liabilities Minimum Offering Maximum Offering
Bank Indebtedness $1,160,000 $1,160,000
Accounts Payable and Accrued Liabilities $785,896 $785,896
Current Portion of Long-term Debt $62,480 $62,480
Working Capital $2,043,187 $2,883,187
Available Funds and Principal Uses of Funds
The following table sets out information respecting the Resulting Issuer's sources of cash and intended
uses of cash upon completion of the Qualifying Transaction. The amounts presented are estimates only.
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Source of Funds Minimum Offering Maximum Offering
Pro Forma Consolidated Working Capital $2,043,187 $2,883,187
Use of Funds Minimum Offering Maximum Offering
Construction Related Deposits:
- Revenue Meters $60,000 $60,000
- Transformers $180,000 $180,000
Project Development (Canada & USA) $303,187 $1,143,187
Working Capital $1,500,000 $1,500,000
Total use of funds $2,043,187 $2,883,187
Exchange Listing & Market Trading Price of Water Capital Shares
The Water Capital Shares have been listed and posted for trading on the Exchange under the symbol
"WCP.P" since May 3, 2006. Trading was halted on March 10, 2008 in connection with the
announcement of Water Capital’s Proposed Qualifying Transaction with Schneider Power. The closing
price of the Water Capital Shares on March 10, 2008 which was the last day that they traded prior to the
Effective Date was $0.15 per share. See "Part I: Information Concerning Water Capital - Prior Sales –of
Shares of Water Capital and Trading of the Common Shares of Water Capital."
Conflicts of Interest
There are potential conflicts of interest to which some of the directors, officers, insiders and promoters of
Water Capital will be subject in connection with the operations of Water Capital. Some of the directors,
officers, insiders and promoters are engaged in and will continue to be engaged in corporations or
businesses which may be in competition with the search by Water Capital for businesses or assets in order
to close a Qualifying Transaction. Accordingly, situations may arise where some or all of the directors,
officers, insiders and promoters will be in direct competition with Water Capital. Conflicts, if any, will be
subject to the procedures and remedies as provided under the OBCA.
David Farquharson is a director, officer and shareholder of the Agent and owns 100,000 Schneider Power
Common Shares which represent 0.21% of the issued and outstanding shares of Schneider Power and
upon Completion of the Qualifying Transaction will represent 0.19% and 0.17% respectively of the issued
and outstanding shares of the Resulting Issuer in case of the Minimum Offering or in the event of the
Maximum Offering. Andrew Gustajtis is a director, officer and shareholder of the Agent and owns
700,000 Schneider Power Common Shares which represent 1.45% of the issued and outstanding shares of
Schneider Power and upon Completion of the Qualifying Transaction will represent 1.24% and 1.19%
respectively of the issued and outstanding shares of the Resulting Issuer in case of the Minimum Offering
or in t