QE2 InV Pres Apr 2014
QE2 Acquisi+on Corp. April 2014
Strictly Confiden+al
FORWARD LOOKING INFORMATION This corporate presenta+on (the "Presenta+on") has been prepared by management of QE2 Acquisi+on Corp. (the "Corpora+on") based on public informa+on and the Corpora+on's confiden+al informa+on. This Presenta+on is for informa+on purposes only and is not intended to, and should not be construed to, cons+tute an offer to sell or the solicita+on of an offer to buy securi+es of the Corpora+on in any jurisdic+on. The securi+es of the Corpora+on have not been, and will not be, registered under the United States Securi+es Act of 1933, as amended (the "1933 Act"), or the securi+es laws of any state. By accep+ng this Presenta+on, the recipient agrees that it will not distribute it to others, in whole or in part, and that it will maintain the confiden+ality of all informa+on herein contained. The Corpora+on undertakes no obliga+on to provide the recipient with access to any addi+onal informa+on. We seek safe harbor. QE2 Acquisi+on Corp: Confiden+al
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TABLE OF CONTENTS • • • • • • • •
Execu+ve Summary Leadership Team Our Focus The Customer The Objec+ve The Criteria Value Crea+on Maximizing Efficiencies
• • • • •
Current Share Structure Pillar Contrac+ng Ltd. Appendices Contact Informa+on Disclaimers • Investor Rights
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EXECUTIVE SUMMARY We buy and grow Alberta companies that keep Alberta growing. We have iden+fied and verified a niche in the small to medium-‐sized enterprises involved in the “Alberta Advantage” without being directly +ed to the Oil and Gas sector. Infrastructure | Essen.al Services QE2 Acquisi+on Corp: Confiden+al
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LEADERSHIP TEAM
Leadership Team Mihali (Mike) Belan+s -‐ CEO and Director Dr. Fletcher Morgan – VP Acquisi+ons & Finance Mark Lacoursiere – General Manager of Opera+ons
Independent Board of Directors Maria Nathanail, LLB -‐ Director Joe Gagliardi, CMA -‐ Director
Please refer to the Appendix A for Biographies
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OUR FOCUS: Alberta’s 20 Year Strategic Capital Plan
“The Alberta government has made a commitment to maintain and improve exis+ng infrastructure and has laid out aggressive plans to construct new infrastructure over the next 20 years.” Alberta’s 20-‐Year Strategic Capital Plan (1) (1) hnp://www.infrastructure.gc.ca/prog/agreements-‐ententes/bcf-‐fcc/ab-‐eng.html
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OUR FOCUS: Alberta’s 20 Year Strategic Capital Plan Alberta is currently growing at the fastest rate of any province in Canada and has been the leader of economic growth for the past 20 years. This excep+onal economic landscape is the “Alberta Advantage”. Projected Alberta infrastructure demand due to the economic landscape and con+nued popula+on expansion provides the perfect plaqorm for QE2; we are ideally posi.oned to capitalize on suppor.ng growth requirements of our iden.fied sectors.
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THE CUSTOMER Municipali+es of Alberta & Blue Chip Companies Involved in: Infrastructure | Essen+al Services
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THE OBJECTIVE Focused on growing revenues to $100MM by 2018 Strong Earnings = Strong Dividends to Shareholders
Es.mated Annual Revenues ($ millions)
Strong proven Management team
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Ac+ve Board of Directors
Strong Corporate Governance
Aggressive M&A strategy
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THE CRITERIA FOR ACQUISITION • • • •
Service companies headquartered in Alberta; Demonstrated consistent earning power; Businesses with healthy margins and low or no debt; and, Management in place and willing to stay; min 3 yr. during transi+on.
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VALUE CREATION We make a tangible difference: • Improving capital efficiency; • Growth planning and execu+on; • Reducing opera+onal and financial risks; • Access to our network; and, • Business process improvement.
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MAXIMIZING EFFICIENCIES & EFFECTIVENESS • Economy of scale: combined companies can reduce costs by removing duplica+on, thus increasing profit margins; • Economy of scope: increasing or decreasing the scope of marke+ng and distribu+on; • Fleet op.miza.on: effec+vely u+lizing fleet by minimizing down-‐+me; • Dispatch: more effec+vely dispatching to required service areas; • Geographical Diversifica.on: capturing all available service areas within Alberta; and, • Marke.ng & Sales Channel: expansion through diversifica+on and new customer chains.
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CURRENT SHARE STRUCTURE As of November 1st, 2013
Shares
Class A Shares
1,220,000
Class B Shares
6,880,000
The Corpora8on is authorized to issue an unlimited number of Class A shares, an unlimited number of Class B shares and an unlimited number of preferred shares (issuable in series), of which 1,220,000 Class A shares, 6,880,000 Class B shares and nil preferred shares are issued and outstanding as at November 1st, 2013. The holders of Class A shares are en8tled to vote at mee8ngs of the shareholders of the Corpora8on on the basis of 100 votes for each Class A share held, while the holders of Class B shares are en8tled to vote at mee8ngs of the shareholders of the Corpora8on on the basis of one vote for each Class B share held. Furthermore, the holders of Class A shares have the right at any 8me up to 25 years from the date of issuance to convert Class A shares into Class B shares on the basis of 10 Class B shares for each Class A share. The directors of the Corpora8on may declare a limited dividend payable to the holders of a par8cular class of common shares to the exclusion of the holders of the remaining class of common shares.
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PILLAR CONTRACTING LTD. ACQUISITION COMPLETED OCT 25TH 2013
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U.lity Services, Flagging and Traffic Management. Located in Fort Saskatchewan, AB. Services include: street light bulb replacement & post pain+ng, safety tes+ng for street light integrity, maintenance of traffic lights, safety, flagging services, et.al. Founder will con+nue to operate the business post sale with his two sons. Has a 16 year track record of success and growth. Strong customer base including: major u+lity companies and municipali+es in Alberta and Saskatchewan. Low hanging fruit includes: expansion opportuni+es to private sectors with a focus on parking lots, transmission boxes, cable boxes, oversized loads etc.
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Recurring revenue streams through servicing and maintenance of light standards.
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Ability to expand to Saskatchewan & Manitoba.
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PILLAR CONTRACTING LTD.: Projec+ons Pro-‐forma years ended September 31
* Internal projec+ons based on available company informa+on with adjustments made to “normalize” the business performance, for example, it is a common business prac+ce in owner-‐operated businesses to income split and take dividends.
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Appendix A – Biographies Mihali (Mike) Belan.s – CEO & Director Mike Belan+s has more than 15 years experience iden+fying opportuni+es, inves+ng and consul+ng for companies in both the private and public sectors. He has played an instrumental roll in laying the founda+on for many successful startups. One of his most recent startups has grown to a market cap in excess of $300 million. As CEO, Mr. Belan+s will be involved in all aspects of QE2’s acquisi+ons, investments and new project ini+a+ves. He will also lead the team in sezng the strategy and vision for the organiza+on and ar+cula+ng the road map for growth and a sustainable compe++ve advantage. Mr. Belan+s will be involved in iden+fying prospec+ve targets and market opportuni+es; in the case of acquisi+ons, conduc+ng due diligence, determining appropriate valua+on and structure, developing strategy for and conduc+ng nego+a+ons, driving ac+vi+es to closure and coordina+ng with other business units. He will lead the team to ensure the organiza+on has the drive, mo+va+on and energy it needs to succeed. Dr. Fletcher Morgan -‐ Vice President of Acquisi.ons & Finance Dr. Fletcher Morgan is a strategic and management consultant with over 10 years experience overseeing mul+-‐million dollar projects and programs in the UK and Europe. Dr. Morgan has both a masters and a medical degree from Cambridge University, UK. His analy+cal work has included the US natural gas market and the North American Oil & Gas midstream service sector. In 2012, he acted as an advisor to one of the Big Six Canadian banks on commodity-‐related investment opportuni+es including LNG transporta+on. As VP of Acquisi+ons and Finance, Fletcher will be overseeing the organiza+on of the finance & accoun+ng departments providing procedural recommenda+ons/benchmarks for improvement and managing prepara+on of all financial reports & projected outlooks for both QE2 and the newly acquired companies. Fletcher will also lead iden+fica+on of new business opportuni+es, conduc+ng required due diligence on poten+al targets and managing the acquisi+on process from scoping & planning to modeling & nego+a+ons of final closing transac+ons. Currently, Dr. Morgan is working on comple+ng his CFA.
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Appendix A – Biographies Mark Lacoursiere – Opera.ons Manager Mark Lacoursiere is the founder of Pillar Contrac+ng Ltd. -‐ QE2 Corp’s first acquisi+on. Pillar started in 1998 with a single EPCOR contract and grew to 32 employees, a fleet of vehicles and major contracts with For+s, Atco and most of the major Ci+es of Alberta in less than 14 years. Mr. Lacoursiere is not only a successful entrepreneur but also a ‘Pillar’ of the community. In 2000, Mr. Lacoursiere started a youth rehabilita+on center -‐ Elk Island Child and Youth Ranch. His generosity in spirit helped to provide a stable home life and care for many children that were without a housing op+on. Mr. Lacoursiere will con+nue to lead the growth and success of Pillar as well as take an ac+ve role within QE2 as the General Manager of Opera+ons. Mark will be managing the cul+va+on of new work tenders, overseeing the bidding process and guiding the execu+on of the on-‐the-‐ground tac+cal opera+ons. His knowledge of the Alberta market, ability to develop teams and understanding of opera+on requirements, will help to advance QE2’s financial goals within each new acquisi+on. Maria Nathanail, LLB -‐ Lawyer & Director Maria Nathanail has been prac+cing law since 2006. Her experience has helped her to develop her excellent legal, commercial and business development skills. She is currently an associate with Burstall Winger LLP in Calgary, Alberta, prac+cing in the areas of securi+es, corporate finance, mergers and acquisi+ons and general corporate commercial law. Prior to that, Ms. Nathanail was an associate with Torys LLP and Gowling Lafleur Henderson LLP. Ms. Nathanail obtained a Bachelor of Arts Degree in Poli+cal Science from the University of Calgary and a Juris Doctor from the University of Saskatchewan.
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Appendix A – Biographies Joe Gagliardi, CMA -‐ Director Joe Gagliardi is a Cer+fied Management Accountant and the Founding Partner of a successful Alberta-‐based recrui+ng firm, Recruitment Partners. Prior to his 8 years as a professional recruiter Mr. Gagliardi worked as a senior accoun+ng professional with both private and publically traded organiza+ons, earning him a wide spectrum of experience in industrial manufacturing, oil and gas service companies, food processing and agriculture, where he has held roles from Controller to CFO. Mr. Gagliardi is an ac+ve volunteer in the business community, par+cularly as a Director on the Board of Directors for CMA Alberta and as the Chair of the Business Advisory Council for the J.R. Shaw School of Business (NAIT). As the CFO for QE2 Acquisi+on Corp., Mr. Gagliardi will work as a key member of the Execu+ve Team on all strategic and tac+cal maners as they relate to the corpora+on’s finances. His focus will be in both the target and opera+onal areas of budget management, cost benefit analysis, forecas+ng needs and the securing of new funding. succeed.
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CONTACT INFORMATION Mihali (Mike) Belan.s CEO Direct: 1.403.701.7299 Email: [email protected]
Calgary Mailing Address: 1981 -‐ 246 Stewart Green SW, Calgary, AB, T3H 3C8
Dr. Fletcher Morgan VP of Finance & Acquisi+on Direct: 1.604.355.0262 Email: [email protected]
Edmonton Office Address: 1800 -‐ 10123 99 Street, Sun Life Place, Edmonton, AB T5J 3H1
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Disclaimer: Forward-‐Looking Statements Certain statements and informa+on contained in this Presenta+on cons+tute forward-‐looking informa+on and forward-‐looking statements pursuant to applicable securi+es legisla+on (collec+vely, the "forward-‐looking statements"). Forward-‐looking statements are those that do not relate strictly to historical or current facts, and words such as "an+cipate", "con+nue", "es+mate", "expect", "forecast", "may", "will", "project", "should", "believe" and "intend", or similar expressions, will generally cons+tute forward-‐looking statements. QE2 Acquisi+on Corp.'s (the "Corpora.on") actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-‐looking statements and, accordingly, no assurance can be given that any of the events an+cipated by the forward-‐looking statements will transpire or occur, or if any of them do so, what benefits the Corpora+on will derive therefrom. Such forward-‐looking statements are used in the Presenta+on for the purposes of providing informa+on about current expecta+ons and plans rela+ng to the development of the Corpora+on. Forward-‐looking statements contained in this Presenta+on includes, but is not limited to, statements or informa+on with respect to: the Corpora+on's business strategy; the market in which the Corpora+on operates; the ability of the Corpora+on to successfully integrate businesses; the +ming and nature of equity offerings to be completed by the Corpora+on; the Corpora+on's poten+al revenue; the ability of the Corpora+on to successfully complete mergers and acquisi+ons; the ability of the Corpora+on to realize on the poten+al of target companies; and other expecta+ons, beliefs, plans, objec+ves, assump+ons, inten+ons or statements about future events or performance. Forward-‐ looking statements contained in this Presenta+on reflect the current beliefs and assump+ons of the Corpora+on's management based on informa+on in its possession as of the date of this Presenta+on.
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Disclaimer: Forward-‐Looking Statements Readers are cau+oned that reliance on such informa+on and statements may not be appropriate for other purposes as the Corpora+on's actual results could differ materially from those an+cipated in the forward-‐looking statements as a result of substan+al known and unknown risks and uncertain+es many of which are beyond the Corpora+on's control. Such risks include, but are not limited to: risks regarding future contractual terms; the terms on which acquisi+ons will be completed; the failure of the Corpora+on to successfully integrate different businesses; the failure of the Corpora+on to successfully iden+fy and acquire poten+al acquisi+on targets; loss of markets; counterparty credit risks; environmental risks; inability to retain services; delays resul+ng from or inability to obtain required regulatory approvals; the inability to access sufficient capital from internal and external sources; the impact of general economic condi+ons in Canada; industry condi+ons; lack of poten+al acquisi+on opportuni+es; changes in laws and regula+ons and their interpreta+on and enforcement; the lack of availability of qualified personnel and management; the risk that customers of acquired businesses will not renew their contracts or cancel exis+ng contracts; the risk that acquired companies will not perform as expected under new management; increased compe++on; stock market vola+lity; and varia+ons in market valua+ons of companies with respect to announced transac+ons and the final valua+ons thereof. Readers are cau+oned that the foregoing list of risks to the Corpora+on's performance is not exhaus+ve and that all subsequent forward-‐looking statements, whether wrinen or oral, anributable to the Corpora+on or persons ac+ng on its behalf are expressly qualified in their en+rety by these cau+onary statements. The forward-‐looking statements contained herein are expressly qualified in their en+rety by this cau+onary statement. The forward-‐looking statements included in this Presenta+on are made as of the date of this Presenta+on and the Corpora+on disclaims any inten+on or obliga+on to update or revise any forward-‐looking statements, whether as a result of new informa+on, future events or otherwise, except as expressly required by applicable securi+es legisla+on.
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Disclaimer: Future-‐Oriented Financial Informa+on This Presenta+on contains future-‐oriented financial informa+on and financial outlook informa+on (collec+vely, the "FOFI") about prospec+ve results of opera+ons, net income, financial posi+on, cash flows, and components thereof, all of which are subject to the same assump+ons, risk factors, limita+ons, and qualifica+ons as set forth in the above paragraphs. FOFI contained in this Presenta+on was made as of the date of this Presenta+on and is provided for the purpose of giving a general overview of the business opera+ons of the Corpora+on. The Corpora+on disclaims any inten+on or obliga+on to update or revise any FOFI contained in this Presenta+on, whether as a result of new informa+on, future events or otherwise, unless required pursuant to applicable law. Readers are cau+oned that the FOFI contained in this document should not be used for purposes other than for which it is disclosed herein. The Corpora+on calculates EBITDA as "earnings before interest, taxes, deprecia+on and amor+za+on". EBITDA does not have any standardized meaning prescribed by interna+onal financial repor+ng standards (IFRS) and therefore it may not be comparable with the calcula+on of similar measures for other en++es. Management uses EBITDA to analyze the opera+ng performance of the business. EBITDA as presented is not intended to represent cash provided by opera+ng ac+vi+es, net earnings or other measures of financial performance calculated in accordance with IFRS.
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Investor Rights Securi+es legisla+on in certain of the Canadian provinces provides purchasers of securi+es pursuant to an offering memorandum (such as this Presenta+on) with a remedy for damages or rescission, or both, in addi+on to any other rights they may have at law, where the offering memorandum and any amendment to it contains a "Misrepresenta+on". Where used herein, "Misrepresenta+on" means an untrue statement of a material fact or an omission to state a material fact that is required to be stated or that is necessary to make any statement not misleading in light of the circumstances in which it was made. These remedies, or no+ce with respect to these remedies, must be exercised or delivered, as the case may be, by the purchaser within the +me limits prescribed by applicable securi+es legisla+on. Purchasers should refer to such applicable securi+es legisla+on for the complete text of these rights or consult with a legal adviser. The following statutory rights of ac+on for damages or rescission will only apply to a purchase of securi+es of QE2 Acquisi+on Corp. ("QE2" or the "Corpora.on") in the event that the foregoing presenta+on is deemed to be an offering memorandum pursuant to applicable securi+es legisla+on in the Provinces of Ontario, Saskatchewan, Manitoba, Newfoundland and Labrador, Nova Sco+a, New Brunswick and Prince Edward Island.
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Investor Rights Ontario Securi+es legisla+on in Ontario provides that when an offering memorandum is delivered to an investor to whom securi+es are distributed in reliance upon the "accredited investor" prospectus exemp+on provided in Sec+on 2.3 of NI 45-‐106 – Prospectus and Registra8on Exemp8ons (the "Accredited Investor Exemp+on"), the right of ac+on described below is applicable, unless the prospec+ve purchaser is: (a) an associa+on governed by the Coopera8ve Credit Associa8ons Act (Canada) or a central coopera+ve credit society for which an order has been made under Sec+on 473(1) of that act; (b) a bank, loan corpora+on, trust company, trust corpora+on, insurance company, treasury branch, credit union, caisse populaire, financial services corpora+on, or league that, in each case, is authorized by an enactment of Canada or a jurisdic+on of Canada to carry on business in Canada or a jurisdic+on in Canada; (c) a Schedule III bank, meaning an authorized foreign bank named in Schedule III of the Bank Act (Canada); (d) the Business Development Bank of Canada incorporated under the Business Development Bank of Canada Act (Canada); or (e) a subsidiary of any person referred to in paragraphs (a), (b), (c) or (d), if the person owns all of the vo+ng securi+es of the subsidiary, except the vo+ng securi+es required by law to be owned by the directors of the subsidiary. Where an offering memorandum that contains a Misrepresenta+on is delivered in connec+on with a trade made in reliance on the Accredited Investor Exemp+on or certain other exemp+ons available under applicable securi+es legisla+on in Ontario, a purchaser who purchases a security offered by the offering memorandum during the period of distribu+on will have, without regard to whether the purchaser relied on the Misrepresenta+on, a statutory right of ac+on for damages against the issuer and a selling security holder on whose behalf the distribu+on was made or, while s+ll the owner of securi+es a right of rescission against the issuer or selling security holder on whose behalf the distribu+on was made. If the purchaser elects to exercise the right of rescission, the purchaser will have no right of ac+on for damages. The right of ac+on will be exercisable by the purchaser only if the purchaser commences the ac+on, in the case of any ac+on for rescission, not more than 180 days a}er the date of the transac+on that gave rise to the cause of ac+on and in the case of any ac+on, other than an ac+on for rescission, before the earlier of: (i) 180 days a}er the plain+ff first had knowledge of the facts giving rise to the cause of ac+on; or (ii) three years a}er the date of the transac+on that gave rise to the cause of ac+on. A defendant shall not be liable for a Misrepresenta+on if it proves that the purchaser purchased the securi+es with knowledge of the Misrepresenta+on. In an ac+on for damages, the defendant shall not be liable for all or any por+on of the damages that the defendant proves do not represent the deprecia+on in value of the securi+es as a result of the Misrepresenta+on relied upon. In no case shall the amount recoverable for the Misrepresenta+on that exceeds the price at which the securi+es were offered.
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Investor Rights Saskatchewan Saskatchewan securi+es legisla+on provides that where an offering memorandum or amendment to the offering memorandum is sent or delivered to a purchaser that contains a Misrepresenta+on, a purchaser who purchases a security covered by the offering memorandum is deemed to have relied upon that Misrepresenta+on, if it was a Misrepresenta+on at the +me of purchase, and has a right of ac+on for rescission against the issuer or a selling security holder on whose behalf the distribu+on is made or has a right of ac+on for damages against: (a) the issuer or a selling security holder on whose behalf the distribu+on is made; (b) every promoter and director of the issuer or the selling security holder, as the case may be, at the +me the offering memorandum or any amendment to it was sent or delivered; (c) every person or company whose consent has been filed respec+ng the offering, but only with respect to reports, opinions or statements that have been made by them; (d) every person who or company that, in addi+on to the persons or companies men+oned in (a) to (c) above, signed the offering memorandum or the amendment to the offering memorandum; and (e) every person who or company that sells securi+es on behalf of the issuer or selling security holder under the offering memorandum or amendment to the offering memorandum. Such rights of rescission and damages are subject to certain limita+ons including the following: (a) if the purchaser elects to exercise its right of rescission against the issuer or selling security holder, it shall have no right of ac+on for damages against that party; (b) in an ac+on for damages, a defendant will not be liable for all or any por+on of the damages that he, she or it proves do not represent the deprecia+on in value of the securi+es resul+ng from the Misrepresenta+on relied on; (c) no person or company, other than the issuer or a selling security holder, will be liable for any part of the offering memorandum or any amendment to it not purpor+ng to be made on the authority of an expert and not purpor+ng to be a copy of, or an extract from, a report, opinion or statement of an expert, unless the person or company failed to conduct a reasonable inves+ga+on sufficient to provide reasonable grounds for a belief that there had been no Misrepresenta+on or believed that there had been a Misrepresenta+on; (d) in no case shall the amount recoverable exceed the price at which the securi+es were offered; and (e) no person or company is liable in an ac+on for rescission or damages if that person or company proves that the purchaser purchased the securi+es with knowledge of the Misrepresenta+on.
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Investor Rights Saskatchewan Con.nued In addi+on, no person or company, other than the issuer or selling security holder, will be liable if the person or company proves, among other things, that: (a) the offering memorandum was sent or delivered without the person's or company's knowledge or consent and that, on becoming aware of it being sent or delivered, that person or company immediately gave reasonable general no+ce that it was so sent or delivered; or (b) with respect to any part of the offering memorandum purpor+ng to be made on the authority of an expert, or purpor+ng to be a copy of, or an extract from, a report, an opinion or a statement of an expert, that person or company had no reasonable grounds to believe and did not believe that there had been a Misrepresenta+on, the part of the offering memorandum did not fairly represent the report, opinion or statement of the expert, or was not a fair copy of, or an extract from, the report, opinion or statement of the expert. Saskatchewan securi+es legisla+on also provides: (a) similar rights of ac+on for damages and rescission in respect of a Misrepresenta+on in adver+sing and sales literature disseminated in connec+on with an offering of securi+es; (b) that where an individual makes a verbal statement to a prospec+ve purchaser that contains a Misrepresenta+on rela+ng to the security purchased and the verbal statement is made either before or contemporaneously with the purchase of the security, the purchaser is deemed to have relied on the Misrepresenta+on, if it was a Misrepresenta+on at the +me of purchase, and has a right of ac+on for damages against the individual who made the verbal statement; (c) a purchaser with the right to void the purchase agreement and to recover all money and other considera+on paid by the purchaser for the securi+es if the securi+es are purchased from a vendor who is trading in Saskatchewan in contraven+on of Saskatchewan securi+es legisla+on; and (d) a right of ac+on for rescission or damages to a purchaser of securi+es to whom an offering memorandum was not sent or delivered prior to or at the same +me as the purchaser enters into an agreement to purchase the securi+es, as required by the Saskatchewan securi+es legisla+on.
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Investor Rights Manitoba In the event that an offering memorandum, together with any amendment thereto delivered to purchasers of securi+es resident in Manitoba, contains a Misrepresenta+on and it is a Misrepresenta+on at the +me of purchase, the purchaser shall be deemed to have relied upon the Misrepresenta+on and shall have, in addi+on to any other rights it may have at law, (a) a right of ac+on for damages against (i) the issuer, (ii) every director of the issuer at the date of the offering memorandum (collec+vely, the "Directors") and (iii) every person or corpora+on who signed the offering memorandum (collec+vely, the "Signatories"), or (b) a right of rescission against the issuer. If a Misrepresenta+on is contained in a record incorporated by reference in, or is deemed to be incorporated into the offering memorandum, the Misrepresenta+on is deemed to be contained in the offering memorandum. A purchaser of securi+es may elect to exercise a right of rescission against the issuer, in which case the purchaser will have no right of ac+on for damages against the issuer, Directors or Signatories. All persons or companies referred to above that are found to be liable or accept liability are jointly and severally liable. A person or company who is found liable to pay a sum in damages may recover a contribu+on, in whole or in part, from a person who is jointly and severally liable to make the same payment in the same cause of ac+on unless, in all the circumstances of the case, the court is sa+sfied that it would not be just and equitable. Directors or Signatories will not be liable: (a) if they prove the offering memorandum was sent or delivered to the purchaser without their knowledge or consent and, on becoming aware of its delivery, promptly gave general reasonable no+ce that it was delivered without their knowledge and consent; (b) if they prove that, a}er becoming aware of a Misrepresenta+on in the offering memorandum they withdrew their consent to the offering memorandum and gave reasonable general no+ce to the issuer of their withdrawal and the reasons therefore; (c) if, with respect to any part of the offering memorandum purpor+ng to be made on the authority of an expert or to be a copy of, or an extract from, a report, opinion or statement of an expert ("Expert Opinion"), if such person proves they did not have any reasonable grounds to believe and did not believe that there was a Misrepresenta+on or that the relevant part of the offering memorandum did not fairly represent the Expert Opinion or was not a fair copy of, or an extract from, such Expert Opinion; or
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Investor Rights Manitoba Con.nued (d) with respect to any part of the offering memorandum not purpor+ng to be made on an expert's authority, or not purpor+ng to be a copy of, or an extract from an Expert Opinion, unless the Director or Signatory: (i) did not conduct an inves+ga+on sufficient to provide reasonable grounds for a believe that there had been no Misrepresenta+on; or (ii) believed that there had been a Misrepresenta+on. No person or company is liable in an ac+on for rescission or damages if that person or company proves that the purchaser had knowledge of Misrepresenta+on. In an ac+on for damages, the issuer, the Directors and Signatories will not be liable for all or any part of the damages that they prove do not represent the deprecia+on in value of the securi+es as a result of the Misrepresenta+on relied upon. The amount recoverable under the right of ac+on shall not exceed the price at which the securi+es were offered for sale. A purchaser of securi+es to whom the offering memorandum was not delivered prior to such purchase in circumstances where such offering memorandum was required to be delivered, has a right of rescission or a right of ac+on for damages against the issuer or any dealer who failed to deliver the offering memorandum within the prescribed +me. A purchaser to whom the offering memorandum is required to be sent may rescind the contract to purchase the securi+es by sending a wrinen no+ce of rescission to the issuer not later than midnight on the second day, excluding Saturdays, Sundays and holidays, a}er the purchaser signs the agreement to purchase the securi+es. Unless otherwise provided under applicable securi+es legisla+on, no ac+on shall be commenced to enforce a right of ac+on unless the right is exercised: (a) in the case of rescission, not later than 180 days from the day of the transac+on that gave rise to the cause of ac+on; or (b) in the case of an ac+on, other than an ac+on for rescission, the earlier of: (i) 180 days from the day the purchaser first had knowledge of the facts giving rise to the cause of ac+on; and (ii) two years from the day of the transac+on that gave rise to the cause of ac+on.
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Investor Rights Prince Edward Island The right of ac+on for damages or rescission described herein is conferred by Sec+on 112 of the Securi8es Act (Prince Edward Island) (the "PEI Act"). The PEI Act provides, in relevant part, that if an offering memorandum (such as this Corporate Presenta+on) contains a misrepresenta+on, as defined in the PEI Act, a purchaser who purchases a security offered by the offering memorandum during the period of distribu+on has, without regard to whether the purchaser relied on the misrepresenta+on, a right of ac+on for damages. Such purchaser has a statutory right of ac+on for damages against the issuer, the selling security holder on whose behalf the distribu+on is made, every director of the issuer at the date of the offering memorandum and every person who signed the offering memorandum. Alterna+vely, a purchaser who purchases a security offered by the offering memorandum during the period of distribu+on has a right of ac+on for rescission against the issuer or the selling security holder on whose behalf the distribu+on is made, in which case the purchaser shall have no right of ac+on for damages against the persons described above. No such ac+on may be commenced to enforce the right of ac+on for rescission or damages more than: (a) 180 days a}er the day of the transac+on that gave rise to the cause of ac+on, in the case of an ac+on for rescission; or (b) the earlier of: (i) 180 days a}er the plain+ff first had knowledge of the facts giving rise to the cause of ac+on; or (ii) three years a}er the day of the transac+on giving rise to the cause of ac+on, in any other case. The PEI Act provides a number of limita+ons and defences, including the following: (a) no person is liable if the person proves that the purchaser purchased securi+es with knowledge of the misrepresenta+on; (b) in the case of an ac+on for damages, the defendant is not liable for any damages that the defendant proves do not represent the deprecia+on in value of the security resul+ng from the misrepresenta+on; and (c) the amount recoverable by a plain+ff in respect of such ac+on must not exceed the price at which the securi+es purchased by the plain+ff were offered.
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Investor Rights Prince Edward Island Con.nued In addi+on, a person, other than the issuer and selling security holder, is not liable if the person proves that: (a) the offering memorandum was sent to the purchaser without the person's knowledge or consent, and that, upon becoming aware of its being sent, the person had promptly given reasonable no+ce to the issuer that it had been sent without the knowledge and consent of the person; (b) the person, upon becoming aware of the misrepresenta+on in the offering memorandum, had withdrawn the person's consent to the offering memorandum and had given reasonable no+ce to the issuer of the withdrawal and the reason for it; or (c) with respect to any part of the offering memorandum purpor+ng to be made on the authority of an expert or purpor+ng to be a copy of, or an extract from, a report, statement or opinion of an expert, the person had no reasonable grounds to believe and did not believe that: (i) there had been a misrepresenta+on; or (ii) the relevant part of the offering memorandum: (A) did not fairly represent the report, statement or opinion of the expert; or (B) was not a fair copy of, or an extract from, the report, statement or opinion of the expert. In addi+on, a person is not liable with respect to a misrepresenta+on in forward-‐looking informa+on ("FLI") if: (a) the offering memorandum containing the FLI also contains, proximate to the FLI: (i) reasonable cau+onary language iden+fying the FLI as such and iden+fying material factors that could cause actual results to differ materially from a conclusion, forecast or projec+on in the FLI; and (ii) a statement of the material factors or assump+ons that were applied in drawing a conclusion or making a forecast or projec+on set out in the FLI; and (b) the person had a reasonable basis for drawing the conclusions or making the forecast or projec+ons set out in the FLI. The above paragraph does not relieve a person of liability respec+ng FLI in a financial statement required to be filed under Prince Edward Island securi+es laws.
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Investor Rights Nova Sco.a The right of ac+on for damages or rescission described herein is conferred by Sec+on 138 of the Securi8es Act (Nova Sco+a) (the "Nova Sco+a Act"). The Nova Sco+a Act provides, in relevant part, that in the event that an offering memorandum (such as this Corporate Presenta+on), together with any amendment thereto, or any adver+sing or sales literature, as defined in the Nova Sco+a Act, contains a misrepresenta+on, as defined in the Nova Sco+a Act, the purchaser to whom the offering memorandum has been delivered and who purchases a security referred to therein will be deemed to have relied upon such misrepresenta+on if it was a misrepresenta+on at the +me of purchase and has, subject to certain limita+ons and defences, a statutory right of ac+on for damages against the issuer or other seller and, subject to certain addi+onal defences, every director of the issuer at the date of the offering memorandum and every person who signed the offering memorandum or, alterna+vely, while s+ll the owner of the securi+es purchased by the purchaser, may elect instead to exercise a statutory right of rescission against the issuer or other seller, in which case the purchaser shall have no right of ac+on for damages against the issuer or other seller, directors of the issuer or any other person who has signed the offering memorandum, provided that, among other limita+ons: (a) no ac+on shall be commenced to enforce the right of ac+on for rescission or damages by a purchaser resident in Nova Sco+a later than 120 days a}er the date on which the payment was made for the securi+es (or a}er the date on which ini+al payment was made for the securi+es where payments subsequent to the ini+al payment are made pursuant to a contractual commitment assumed prior to, or concurrently with, the ini+al payment); (b) no person will be liable if it proves that the purchaser purchased the securi+es with knowledge of the misrepresenta+on; (c) in the case of an ac+on for damages, no person will be liable for all or any por+on of the damages that it proves do not represent the deprecia+on in value of the securi+es as a result of the misrepresenta+on relied upon; and (d) in no case will the amount recoverable in any ac+on exceed the price at which the securi+es were offered to the purchaser.
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Investor Rights Nova Sco.a Con.nue In addi+on, a person or company, other than the issuer, will not be liable if that person or company proves that: (a) the offering memorandum or any amendment thereto was sent or delivered to the purchaser without the person's or company's knowledge or consent and that, on becoming aware of its delivery, the person or company gave reasonable general no+ce that it was delivered without the person's or company's knowledge or consent; (b) a}er delivery of the offering memorandum or any amendment thereto and before the purchase of the securi+es by the purchaser, on becoming aware of any misrepresenta+on in the offering memorandum or amendment thereto the person or company withdrew the person's or company's consent to the offering memorandum or any amendment thereto, and gave reasonable general no+ce of the withdrawal and the reason for it; or (c) with respect to any part of the offering memorandum or any amendment thereto purpor+ng: (i) to be made on the authority of an expert; or (ii) to be a copy of, or an extract from, a report, an opinion or a statement of an expert, the person or company had no reasonable grounds to believe and did not believe that: (A) there had been a misrepresenta+on; or (B) the relevant part of the offering memorandum or any amendment thereto did not fairly represent the report, opinion or statement of the expert, or was not a fair copy of, or an extract from, the report, opinion or statement of the expert. Furthermore, no person or company, other than the issuer, will be liable with respect to any part of the offering memorandum or any amendment thereto not purpor+ng: (a) to be made on the authority of an expert; or (b) to be a copy of, or an extract from, a report, opinion or statement of an expert, unless the person or company: (i) failed to conduct a reasonable inves+ga+on to provide reasonable grounds for a belief that there had been no misrepresenta+on; or (ii) believed that there had been a misrepresenta+on. If a misrepresenta+on is contained in a record incorporated by reference into, or deemed incorporated by reference into, the offering memorandum or any amendment thereto, the misrepresenta+on is deemed to be contained in the offering memorandum or amendment thereto.
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Investor Rights Newfoundland and Labrador The right of ac+on for damages or rescission described herein is conferred by Sec+on 130.1 of the Securi8es Act (Newfoundland and Labrador) (the "Newfoundland Act"). The Newfoundland Act provides, in relevant part, that where an offering memorandum (such as this Corporate Presenta+on) contains a misrepresenta+on, as defined in the Newfoundland Act, a purchaser who purchases securi+es offered by the offering memorandum during the period of distribu+on has, without regard to whether the purchaser relied upon the misrepresenta+on, a statutory right of ac+on (a) for damages against (i) the issuer, (ii) every director of the issuer at the date of the offering memorandum, and (iii) every person or company who signed the offering memorandum and (b) for rescission against the issuer. The Newfoundland Act provides a number of limita+ons and defences in respect of such rights. Where a misrepresenta+on is contained in an offering memorandum, a person or company shall not be liable for damages or rescission: (a) where the person or company proves that the purchaser purchased the securi+es with knowledge of the misrepresenta+on; (b) in the case of an ac+on for damages, the defendant is not liable for all or any part of the damages that the defendant proves do not represent the deprecia+on in value of the security as a result of the misrepresenta+on; and (c) in no case will the amount recoverable in any ac+on exceed the price at which the securi+es were offered under the offering memorandum.
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Investor Rights Newfoundland and Labrador Con.nued In addi+on, no person or company, other than the issuer, is liable: (a) where the person or company proves that the offering memorandum was sent to the purchaser without the person's or company's knowledge or consent and that, on becoming aware of its being sent, the person or company promptly gave reasonable no+ce to the issuer that it was sent without the knowledge and consent of the person or company; (b) if the person or company proves that the person or company, on becoming aware of the misrepresenta+on in the offering memorandum, withdrew the person's or company's consent to the offering memorandum and gave reasonable no+ce to the issuer of the withdrawal and the reason for it; (c) if, with respect to any part of the offering memorandum purpor+ng to be made on the authority of an expert or purpor+ng to be a copy of, or an extract from, a report, opinion or statement of an expert, the person or company proves that the person or company did not have any reasonable grounds to believe and did not believe that: (i) there had been a misrepresenta+on; or (ii) the relevant part of the offering memorandum: (A) did not fairly represent the report, opinion or statement of the expert; or (B) was not a fair copy of, or an extract from, the report, opinion or statement of the expert; or (d) with respect to any part of the offering memorandum not purpor+ng to be made on the authority of an expert and not purpor+ng to be a copy of, or an extract from, a report, opinion or statement of an expert, unless the person or company: (i) did not conduct an inves+ga+on sufficient to provide reasonable grounds for a belief that there had been no misrepresenta+on; or (ii) believed there had been a misrepresenta+on. Sec+on 138 of the Newfoundland Act provides that no ac+on shall be commenced to enforce these rights more than: (a) in the case of an ac+on for rescission, 180 days a}er the date of the transac+on that gave rise to the cause of ac+on; or (b) in the case of an ac+on for damages, the earlier of: (i) 180 days a}er the date that the purchaser first had knowledge of the facts giving rise to the cause of ac+on; or (ii) three years a}er the date of the transac+on that gave rise to the cause of ac+on.
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Investor Rights New Brunswick The right of ac+on for damages or rescission described herein is conferred by Sec+on 150 of the Securi8es Act (New Brunswick) (the “New Brunswick Act”). Sec+on 2.1 of New Brunswick Securi+es Commission Rule 45-‐802 Prospectus and Registra+on Exemp+ons provides that the statutory rights of ac+on for damages or rescission referred to in Sec+on 150 of the New Brunswick Act apply to informa+on rela+ng to an offering memorandum (such as this Presenta+on) that is provided to a purchaser of securi+es in connec+on with a distribu+on made in reliance on the “accredited investor” prospectus exemp+on in Sec+on 2.3 of NI 45-‐106. The New Brunswick Act provides, in relevant part, that where an offering memorandum (such as this Presenta+on) contains a misrepresenta+on, as defined in the New Brunswick Act, a purchaser who purchases securi+es offered by the offering memorandum shall be deemed to have relied on the misrepresenta+on if it was a misrepresenta+on at the +me of purchase and: (a) the purchaser has a right of ac+on for damages against the issuer and any selling security holder(s) on whose behalf the distribu+on is made; or (b) where the purchaser purchased the securi+es from a person referred to in paragraph (a), the purchaser may elect to exercise a right of rescission against the person, in which case the purchaser shall have no right of ac+on for damages against the person. This statutory right of ac+on is available to New Brunswick purchasers whether or not such purchasers relied on the misrepresenta+on. However, there are various defences available to the issuer and the selling security holder(s). In par+cular, no person will be liable for a misrepresenta+on if such person proves that the purchaser purchased the securi+es with knowledge of the misrepresenta+on when the purchaser purchased the securi+es. Moreover, in an ac+on for damages, the amount recoverable shall not exceed the price at which the securi+es were offered. If the purchaser intends to rely on the rights described in (a) or (b) above, such purchaser must do so within strict +me limita+ons. The purchaser must commence an ac+on to cancel the agreement within 180 days a}er the date of the transac+on that gave rise to the cause of ac+on. The purchaser must commence its ac+on for damages within the earlier of: (a) one year a}er the purchaser first had knowledge of the facts giving rise to the cause of ac+on; or (b) six years a}er the date of the transac+on that gave rise to the cause of ac+on.
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Resale Restric+ons General The shares will be subject to a number of resale restric+ons, including a restric+on on trading. Un+l the restric+on on trading expires, a shareholder will not be able to trade the shares unless the shareholder complies with an exemp+on from the prospectus and registra+on requirements under securi+es legisla+on. Manitoba Resale Restric.ons Unless permined under securi+es legisla+on, a shareholder must not trade the shares without the prior wrinen consent of the regulator in Manitoba unless: 1. QE2 has filed a prospectus with the regulator in Manitoba with respect to the securi+es the shareholder purchased and the regulator in Manitoba has issued a receipt for that prospectus; 2. or the shareholder held the securi+es for at least 12 months. The regulator in Manitoba will consent to a shareholders trade if the regulator is of the opinion that to do so is not prejudicial to the public interest.
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Strictly Confiden+al
FORWARD LOOKING INFORMATION This corporate presenta+on (the "Presenta+on") has been prepared by management of QE2 Acquisi+on Corp. (the "Corpora+on") based on public informa+on and the Corpora+on's confiden+al informa+on. This Presenta+on is for informa+on purposes only and is not intended to, and should not be construed to, cons+tute an offer to sell or the solicita+on of an offer to buy securi+es of the Corpora+on in any jurisdic+on. The securi+es of the Corpora+on have not been, and will not be, registered under the United States Securi+es Act of 1933, as amended (the "1933 Act"), or the securi+es laws of any state. By accep+ng this Presenta+on, the recipient agrees that it will not distribute it to others, in whole or in part, and that it will maintain the confiden+ality of all informa+on herein contained. The Corpora+on undertakes no obliga+on to provide the recipient with access to any addi+onal informa+on. We seek safe harbor. QE2 Acquisi+on Corp: Confiden+al
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TABLE OF CONTENTS • • • • • • • •
Execu+ve Summary Leadership Team Our Focus The Customer The Objec+ve The Criteria Value Crea+on Maximizing Efficiencies
• • • • •
Current Share Structure Pillar Contrac+ng Ltd. Appendices Contact Informa+on Disclaimers • Investor Rights
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EXECUTIVE SUMMARY We buy and grow Alberta companies that keep Alberta growing. We have iden+fied and verified a niche in the small to medium-‐sized enterprises involved in the “Alberta Advantage” without being directly +ed to the Oil and Gas sector. Infrastructure | Essen.al Services QE2 Acquisi+on Corp: Confiden+al
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LEADERSHIP TEAM
Leadership Team Mihali (Mike) Belan+s -‐ CEO and Director Dr. Fletcher Morgan – VP Acquisi+ons & Finance Mark Lacoursiere – General Manager of Opera+ons
Independent Board of Directors Maria Nathanail, LLB -‐ Director Joe Gagliardi, CMA -‐ Director
Please refer to the Appendix A for Biographies
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OUR FOCUS: Alberta’s 20 Year Strategic Capital Plan
“The Alberta government has made a commitment to maintain and improve exis+ng infrastructure and has laid out aggressive plans to construct new infrastructure over the next 20 years.” Alberta’s 20-‐Year Strategic Capital Plan (1) (1) hnp://www.infrastructure.gc.ca/prog/agreements-‐ententes/bcf-‐fcc/ab-‐eng.html
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OUR FOCUS: Alberta’s 20 Year Strategic Capital Plan Alberta is currently growing at the fastest rate of any province in Canada and has been the leader of economic growth for the past 20 years. This excep+onal economic landscape is the “Alberta Advantage”. Projected Alberta infrastructure demand due to the economic landscape and con+nued popula+on expansion provides the perfect plaqorm for QE2; we are ideally posi.oned to capitalize on suppor.ng growth requirements of our iden.fied sectors.
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THE CUSTOMER Municipali+es of Alberta & Blue Chip Companies Involved in: Infrastructure | Essen+al Services
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THE OBJECTIVE Focused on growing revenues to $100MM by 2018 Strong Earnings = Strong Dividends to Shareholders
Es.mated Annual Revenues ($ millions)
Strong proven Management team
QE2 Acquisi+on Corp: Confiden+al
Ac+ve Board of Directors
Strong Corporate Governance
Aggressive M&A strategy
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THE CRITERIA FOR ACQUISITION • • • •
Service companies headquartered in Alberta; Demonstrated consistent earning power; Businesses with healthy margins and low or no debt; and, Management in place and willing to stay; min 3 yr. during transi+on.
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VALUE CREATION We make a tangible difference: • Improving capital efficiency; • Growth planning and execu+on; • Reducing opera+onal and financial risks; • Access to our network; and, • Business process improvement.
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MAXIMIZING EFFICIENCIES & EFFECTIVENESS • Economy of scale: combined companies can reduce costs by removing duplica+on, thus increasing profit margins; • Economy of scope: increasing or decreasing the scope of marke+ng and distribu+on; • Fleet op.miza.on: effec+vely u+lizing fleet by minimizing down-‐+me; • Dispatch: more effec+vely dispatching to required service areas; • Geographical Diversifica.on: capturing all available service areas within Alberta; and, • Marke.ng & Sales Channel: expansion through diversifica+on and new customer chains.
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CURRENT SHARE STRUCTURE As of November 1st, 2013
Shares
Class A Shares
1,220,000
Class B Shares
6,880,000
The Corpora8on is authorized to issue an unlimited number of Class A shares, an unlimited number of Class B shares and an unlimited number of preferred shares (issuable in series), of which 1,220,000 Class A shares, 6,880,000 Class B shares and nil preferred shares are issued and outstanding as at November 1st, 2013. The holders of Class A shares are en8tled to vote at mee8ngs of the shareholders of the Corpora8on on the basis of 100 votes for each Class A share held, while the holders of Class B shares are en8tled to vote at mee8ngs of the shareholders of the Corpora8on on the basis of one vote for each Class B share held. Furthermore, the holders of Class A shares have the right at any 8me up to 25 years from the date of issuance to convert Class A shares into Class B shares on the basis of 10 Class B shares for each Class A share. The directors of the Corpora8on may declare a limited dividend payable to the holders of a par8cular class of common shares to the exclusion of the holders of the remaining class of common shares.
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PILLAR CONTRACTING LTD. ACQUISITION COMPLETED OCT 25TH 2013
• • •
•
•
•
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U.lity Services, Flagging and Traffic Management. Located in Fort Saskatchewan, AB. Services include: street light bulb replacement & post pain+ng, safety tes+ng for street light integrity, maintenance of traffic lights, safety, flagging services, et.al. Founder will con+nue to operate the business post sale with his two sons. Has a 16 year track record of success and growth. Strong customer base including: major u+lity companies and municipali+es in Alberta and Saskatchewan. Low hanging fruit includes: expansion opportuni+es to private sectors with a focus on parking lots, transmission boxes, cable boxes, oversized loads etc.
•
Recurring revenue streams through servicing and maintenance of light standards.
•
Ability to expand to Saskatchewan & Manitoba.
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PILLAR CONTRACTING LTD.: Projec+ons Pro-‐forma years ended September 31
* Internal projec+ons based on available company informa+on with adjustments made to “normalize” the business performance, for example, it is a common business prac+ce in owner-‐operated businesses to income split and take dividends.
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Appendix A – Biographies Mihali (Mike) Belan.s – CEO & Director Mike Belan+s has more than 15 years experience iden+fying opportuni+es, inves+ng and consul+ng for companies in both the private and public sectors. He has played an instrumental roll in laying the founda+on for many successful startups. One of his most recent startups has grown to a market cap in excess of $300 million. As CEO, Mr. Belan+s will be involved in all aspects of QE2’s acquisi+ons, investments and new project ini+a+ves. He will also lead the team in sezng the strategy and vision for the organiza+on and ar+cula+ng the road map for growth and a sustainable compe++ve advantage. Mr. Belan+s will be involved in iden+fying prospec+ve targets and market opportuni+es; in the case of acquisi+ons, conduc+ng due diligence, determining appropriate valua+on and structure, developing strategy for and conduc+ng nego+a+ons, driving ac+vi+es to closure and coordina+ng with other business units. He will lead the team to ensure the organiza+on has the drive, mo+va+on and energy it needs to succeed. Dr. Fletcher Morgan -‐ Vice President of Acquisi.ons & Finance Dr. Fletcher Morgan is a strategic and management consultant with over 10 years experience overseeing mul+-‐million dollar projects and programs in the UK and Europe. Dr. Morgan has both a masters and a medical degree from Cambridge University, UK. His analy+cal work has included the US natural gas market and the North American Oil & Gas midstream service sector. In 2012, he acted as an advisor to one of the Big Six Canadian banks on commodity-‐related investment opportuni+es including LNG transporta+on. As VP of Acquisi+ons and Finance, Fletcher will be overseeing the organiza+on of the finance & accoun+ng departments providing procedural recommenda+ons/benchmarks for improvement and managing prepara+on of all financial reports & projected outlooks for both QE2 and the newly acquired companies. Fletcher will also lead iden+fica+on of new business opportuni+es, conduc+ng required due diligence on poten+al targets and managing the acquisi+on process from scoping & planning to modeling & nego+a+ons of final closing transac+ons. Currently, Dr. Morgan is working on comple+ng his CFA.
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Appendix A – Biographies Mark Lacoursiere – Opera.ons Manager Mark Lacoursiere is the founder of Pillar Contrac+ng Ltd. -‐ QE2 Corp’s first acquisi+on. Pillar started in 1998 with a single EPCOR contract and grew to 32 employees, a fleet of vehicles and major contracts with For+s, Atco and most of the major Ci+es of Alberta in less than 14 years. Mr. Lacoursiere is not only a successful entrepreneur but also a ‘Pillar’ of the community. In 2000, Mr. Lacoursiere started a youth rehabilita+on center -‐ Elk Island Child and Youth Ranch. His generosity in spirit helped to provide a stable home life and care for many children that were without a housing op+on. Mr. Lacoursiere will con+nue to lead the growth and success of Pillar as well as take an ac+ve role within QE2 as the General Manager of Opera+ons. Mark will be managing the cul+va+on of new work tenders, overseeing the bidding process and guiding the execu+on of the on-‐the-‐ground tac+cal opera+ons. His knowledge of the Alberta market, ability to develop teams and understanding of opera+on requirements, will help to advance QE2’s financial goals within each new acquisi+on. Maria Nathanail, LLB -‐ Lawyer & Director Maria Nathanail has been prac+cing law since 2006. Her experience has helped her to develop her excellent legal, commercial and business development skills. She is currently an associate with Burstall Winger LLP in Calgary, Alberta, prac+cing in the areas of securi+es, corporate finance, mergers and acquisi+ons and general corporate commercial law. Prior to that, Ms. Nathanail was an associate with Torys LLP and Gowling Lafleur Henderson LLP. Ms. Nathanail obtained a Bachelor of Arts Degree in Poli+cal Science from the University of Calgary and a Juris Doctor from the University of Saskatchewan.
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Appendix A – Biographies Joe Gagliardi, CMA -‐ Director Joe Gagliardi is a Cer+fied Management Accountant and the Founding Partner of a successful Alberta-‐based recrui+ng firm, Recruitment Partners. Prior to his 8 years as a professional recruiter Mr. Gagliardi worked as a senior accoun+ng professional with both private and publically traded organiza+ons, earning him a wide spectrum of experience in industrial manufacturing, oil and gas service companies, food processing and agriculture, where he has held roles from Controller to CFO. Mr. Gagliardi is an ac+ve volunteer in the business community, par+cularly as a Director on the Board of Directors for CMA Alberta and as the Chair of the Business Advisory Council for the J.R. Shaw School of Business (NAIT). As the CFO for QE2 Acquisi+on Corp., Mr. Gagliardi will work as a key member of the Execu+ve Team on all strategic and tac+cal maners as they relate to the corpora+on’s finances. His focus will be in both the target and opera+onal areas of budget management, cost benefit analysis, forecas+ng needs and the securing of new funding. succeed.
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CONTACT INFORMATION Mihali (Mike) Belan.s CEO Direct: 1.403.701.7299 Email: [email protected]
Calgary Mailing Address: 1981 -‐ 246 Stewart Green SW, Calgary, AB, T3H 3C8
Dr. Fletcher Morgan VP of Finance & Acquisi+on Direct: 1.604.355.0262 Email: [email protected]
Edmonton Office Address: 1800 -‐ 10123 99 Street, Sun Life Place, Edmonton, AB T5J 3H1
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Disclaimer: Forward-‐Looking Statements Certain statements and informa+on contained in this Presenta+on cons+tute forward-‐looking informa+on and forward-‐looking statements pursuant to applicable securi+es legisla+on (collec+vely, the "forward-‐looking statements"). Forward-‐looking statements are those that do not relate strictly to historical or current facts, and words such as "an+cipate", "con+nue", "es+mate", "expect", "forecast", "may", "will", "project", "should", "believe" and "intend", or similar expressions, will generally cons+tute forward-‐looking statements. QE2 Acquisi+on Corp.'s (the "Corpora.on") actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-‐looking statements and, accordingly, no assurance can be given that any of the events an+cipated by the forward-‐looking statements will transpire or occur, or if any of them do so, what benefits the Corpora+on will derive therefrom. Such forward-‐looking statements are used in the Presenta+on for the purposes of providing informa+on about current expecta+ons and plans rela+ng to the development of the Corpora+on. Forward-‐looking statements contained in this Presenta+on includes, but is not limited to, statements or informa+on with respect to: the Corpora+on's business strategy; the market in which the Corpora+on operates; the ability of the Corpora+on to successfully integrate businesses; the +ming and nature of equity offerings to be completed by the Corpora+on; the Corpora+on's poten+al revenue; the ability of the Corpora+on to successfully complete mergers and acquisi+ons; the ability of the Corpora+on to realize on the poten+al of target companies; and other expecta+ons, beliefs, plans, objec+ves, assump+ons, inten+ons or statements about future events or performance. Forward-‐ looking statements contained in this Presenta+on reflect the current beliefs and assump+ons of the Corpora+on's management based on informa+on in its possession as of the date of this Presenta+on.
QE2 Acquisi+on Corp: Confiden+al
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Disclaimer: Forward-‐Looking Statements Readers are cau+oned that reliance on such informa+on and statements may not be appropriate for other purposes as the Corpora+on's actual results could differ materially from those an+cipated in the forward-‐looking statements as a result of substan+al known and unknown risks and uncertain+es many of which are beyond the Corpora+on's control. Such risks include, but are not limited to: risks regarding future contractual terms; the terms on which acquisi+ons will be completed; the failure of the Corpora+on to successfully integrate different businesses; the failure of the Corpora+on to successfully iden+fy and acquire poten+al acquisi+on targets; loss of markets; counterparty credit risks; environmental risks; inability to retain services; delays resul+ng from or inability to obtain required regulatory approvals; the inability to access sufficient capital from internal and external sources; the impact of general economic condi+ons in Canada; industry condi+ons; lack of poten+al acquisi+on opportuni+es; changes in laws and regula+ons and their interpreta+on and enforcement; the lack of availability of qualified personnel and management; the risk that customers of acquired businesses will not renew their contracts or cancel exis+ng contracts; the risk that acquired companies will not perform as expected under new management; increased compe++on; stock market vola+lity; and varia+ons in market valua+ons of companies with respect to announced transac+ons and the final valua+ons thereof. Readers are cau+oned that the foregoing list of risks to the Corpora+on's performance is not exhaus+ve and that all subsequent forward-‐looking statements, whether wrinen or oral, anributable to the Corpora+on or persons ac+ng on its behalf are expressly qualified in their en+rety by these cau+onary statements. The forward-‐looking statements contained herein are expressly qualified in their en+rety by this cau+onary statement. The forward-‐looking statements included in this Presenta+on are made as of the date of this Presenta+on and the Corpora+on disclaims any inten+on or obliga+on to update or revise any forward-‐looking statements, whether as a result of new informa+on, future events or otherwise, except as expressly required by applicable securi+es legisla+on.
QE2 Acquisi+on Corp: Confiden+al
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Disclaimer: Future-‐Oriented Financial Informa+on This Presenta+on contains future-‐oriented financial informa+on and financial outlook informa+on (collec+vely, the "FOFI") about prospec+ve results of opera+ons, net income, financial posi+on, cash flows, and components thereof, all of which are subject to the same assump+ons, risk factors, limita+ons, and qualifica+ons as set forth in the above paragraphs. FOFI contained in this Presenta+on was made as of the date of this Presenta+on and is provided for the purpose of giving a general overview of the business opera+ons of the Corpora+on. The Corpora+on disclaims any inten+on or obliga+on to update or revise any FOFI contained in this Presenta+on, whether as a result of new informa+on, future events or otherwise, unless required pursuant to applicable law. Readers are cau+oned that the FOFI contained in this document should not be used for purposes other than for which it is disclosed herein. The Corpora+on calculates EBITDA as "earnings before interest, taxes, deprecia+on and amor+za+on". EBITDA does not have any standardized meaning prescribed by interna+onal financial repor+ng standards (IFRS) and therefore it may not be comparable with the calcula+on of similar measures for other en++es. Management uses EBITDA to analyze the opera+ng performance of the business. EBITDA as presented is not intended to represent cash provided by opera+ng ac+vi+es, net earnings or other measures of financial performance calculated in accordance with IFRS.
QE2 Acquisi+on Corp: Confiden+al
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Investor Rights Securi+es legisla+on in certain of the Canadian provinces provides purchasers of securi+es pursuant to an offering memorandum (such as this Presenta+on) with a remedy for damages or rescission, or both, in addi+on to any other rights they may have at law, where the offering memorandum and any amendment to it contains a "Misrepresenta+on". Where used herein, "Misrepresenta+on" means an untrue statement of a material fact or an omission to state a material fact that is required to be stated or that is necessary to make any statement not misleading in light of the circumstances in which it was made. These remedies, or no+ce with respect to these remedies, must be exercised or delivered, as the case may be, by the purchaser within the +me limits prescribed by applicable securi+es legisla+on. Purchasers should refer to such applicable securi+es legisla+on for the complete text of these rights or consult with a legal adviser. The following statutory rights of ac+on for damages or rescission will only apply to a purchase of securi+es of QE2 Acquisi+on Corp. ("QE2" or the "Corpora.on") in the event that the foregoing presenta+on is deemed to be an offering memorandum pursuant to applicable securi+es legisla+on in the Provinces of Ontario, Saskatchewan, Manitoba, Newfoundland and Labrador, Nova Sco+a, New Brunswick and Prince Edward Island.
QE2 Acquisi+on Corp: Confiden+al
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Investor Rights Ontario Securi+es legisla+on in Ontario provides that when an offering memorandum is delivered to an investor to whom securi+es are distributed in reliance upon the "accredited investor" prospectus exemp+on provided in Sec+on 2.3 of NI 45-‐106 – Prospectus and Registra8on Exemp8ons (the "Accredited Investor Exemp+on"), the right of ac+on described below is applicable, unless the prospec+ve purchaser is: (a) an associa+on governed by the Coopera8ve Credit Associa8ons Act (Canada) or a central coopera+ve credit society for which an order has been made under Sec+on 473(1) of that act; (b) a bank, loan corpora+on, trust company, trust corpora+on, insurance company, treasury branch, credit union, caisse populaire, financial services corpora+on, or league that, in each case, is authorized by an enactment of Canada or a jurisdic+on of Canada to carry on business in Canada or a jurisdic+on in Canada; (c) a Schedule III bank, meaning an authorized foreign bank named in Schedule III of the Bank Act (Canada); (d) the Business Development Bank of Canada incorporated under the Business Development Bank of Canada Act (Canada); or (e) a subsidiary of any person referred to in paragraphs (a), (b), (c) or (d), if the person owns all of the vo+ng securi+es of the subsidiary, except the vo+ng securi+es required by law to be owned by the directors of the subsidiary. Where an offering memorandum that contains a Misrepresenta+on is delivered in connec+on with a trade made in reliance on the Accredited Investor Exemp+on or certain other exemp+ons available under applicable securi+es legisla+on in Ontario, a purchaser who purchases a security offered by the offering memorandum during the period of distribu+on will have, without regard to whether the purchaser relied on the Misrepresenta+on, a statutory right of ac+on for damages against the issuer and a selling security holder on whose behalf the distribu+on was made or, while s+ll the owner of securi+es a right of rescission against the issuer or selling security holder on whose behalf the distribu+on was made. If the purchaser elects to exercise the right of rescission, the purchaser will have no right of ac+on for damages. The right of ac+on will be exercisable by the purchaser only if the purchaser commences the ac+on, in the case of any ac+on for rescission, not more than 180 days a}er the date of the transac+on that gave rise to the cause of ac+on and in the case of any ac+on, other than an ac+on for rescission, before the earlier of: (i) 180 days a}er the plain+ff first had knowledge of the facts giving rise to the cause of ac+on; or (ii) three years a}er the date of the transac+on that gave rise to the cause of ac+on. A defendant shall not be liable for a Misrepresenta+on if it proves that the purchaser purchased the securi+es with knowledge of the Misrepresenta+on. In an ac+on for damages, the defendant shall not be liable for all or any por+on of the damages that the defendant proves do not represent the deprecia+on in value of the securi+es as a result of the Misrepresenta+on relied upon. In no case shall the amount recoverable for the Misrepresenta+on that exceeds the price at which the securi+es were offered.
QE2 Acquisi+on Corp: Confiden+al
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Investor Rights Saskatchewan Saskatchewan securi+es legisla+on provides that where an offering memorandum or amendment to the offering memorandum is sent or delivered to a purchaser that contains a Misrepresenta+on, a purchaser who purchases a security covered by the offering memorandum is deemed to have relied upon that Misrepresenta+on, if it was a Misrepresenta+on at the +me of purchase, and has a right of ac+on for rescission against the issuer or a selling security holder on whose behalf the distribu+on is made or has a right of ac+on for damages against: (a) the issuer or a selling security holder on whose behalf the distribu+on is made; (b) every promoter and director of the issuer or the selling security holder, as the case may be, at the +me the offering memorandum or any amendment to it was sent or delivered; (c) every person or company whose consent has been filed respec+ng the offering, but only with respect to reports, opinions or statements that have been made by them; (d) every person who or company that, in addi+on to the persons or companies men+oned in (a) to (c) above, signed the offering memorandum or the amendment to the offering memorandum; and (e) every person who or company that sells securi+es on behalf of the issuer or selling security holder under the offering memorandum or amendment to the offering memorandum. Such rights of rescission and damages are subject to certain limita+ons including the following: (a) if the purchaser elects to exercise its right of rescission against the issuer or selling security holder, it shall have no right of ac+on for damages against that party; (b) in an ac+on for damages, a defendant will not be liable for all or any por+on of the damages that he, she or it proves do not represent the deprecia+on in value of the securi+es resul+ng from the Misrepresenta+on relied on; (c) no person or company, other than the issuer or a selling security holder, will be liable for any part of the offering memorandum or any amendment to it not purpor+ng to be made on the authority of an expert and not purpor+ng to be a copy of, or an extract from, a report, opinion or statement of an expert, unless the person or company failed to conduct a reasonable inves+ga+on sufficient to provide reasonable grounds for a belief that there had been no Misrepresenta+on or believed that there had been a Misrepresenta+on; (d) in no case shall the amount recoverable exceed the price at which the securi+es were offered; and (e) no person or company is liable in an ac+on for rescission or damages if that person or company proves that the purchaser purchased the securi+es with knowledge of the Misrepresenta+on.
QE2 Acquisi+on Corp: Confiden+al
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Investor Rights Saskatchewan Con.nued In addi+on, no person or company, other than the issuer or selling security holder, will be liable if the person or company proves, among other things, that: (a) the offering memorandum was sent or delivered without the person's or company's knowledge or consent and that, on becoming aware of it being sent or delivered, that person or company immediately gave reasonable general no+ce that it was so sent or delivered; or (b) with respect to any part of the offering memorandum purpor+ng to be made on the authority of an expert, or purpor+ng to be a copy of, or an extract from, a report, an opinion or a statement of an expert, that person or company had no reasonable grounds to believe and did not believe that there had been a Misrepresenta+on, the part of the offering memorandum did not fairly represent the report, opinion or statement of the expert, or was not a fair copy of, or an extract from, the report, opinion or statement of the expert. Saskatchewan securi+es legisla+on also provides: (a) similar rights of ac+on for damages and rescission in respect of a Misrepresenta+on in adver+sing and sales literature disseminated in connec+on with an offering of securi+es; (b) that where an individual makes a verbal statement to a prospec+ve purchaser that contains a Misrepresenta+on rela+ng to the security purchased and the verbal statement is made either before or contemporaneously with the purchase of the security, the purchaser is deemed to have relied on the Misrepresenta+on, if it was a Misrepresenta+on at the +me of purchase, and has a right of ac+on for damages against the individual who made the verbal statement; (c) a purchaser with the right to void the purchase agreement and to recover all money and other considera+on paid by the purchaser for the securi+es if the securi+es are purchased from a vendor who is trading in Saskatchewan in contraven+on of Saskatchewan securi+es legisla+on; and (d) a right of ac+on for rescission or damages to a purchaser of securi+es to whom an offering memorandum was not sent or delivered prior to or at the same +me as the purchaser enters into an agreement to purchase the securi+es, as required by the Saskatchewan securi+es legisla+on.
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Investor Rights Manitoba In the event that an offering memorandum, together with any amendment thereto delivered to purchasers of securi+es resident in Manitoba, contains a Misrepresenta+on and it is a Misrepresenta+on at the +me of purchase, the purchaser shall be deemed to have relied upon the Misrepresenta+on and shall have, in addi+on to any other rights it may have at law, (a) a right of ac+on for damages against (i) the issuer, (ii) every director of the issuer at the date of the offering memorandum (collec+vely, the "Directors") and (iii) every person or corpora+on who signed the offering memorandum (collec+vely, the "Signatories"), or (b) a right of rescission against the issuer. If a Misrepresenta+on is contained in a record incorporated by reference in, or is deemed to be incorporated into the offering memorandum, the Misrepresenta+on is deemed to be contained in the offering memorandum. A purchaser of securi+es may elect to exercise a right of rescission against the issuer, in which case the purchaser will have no right of ac+on for damages against the issuer, Directors or Signatories. All persons or companies referred to above that are found to be liable or accept liability are jointly and severally liable. A person or company who is found liable to pay a sum in damages may recover a contribu+on, in whole or in part, from a person who is jointly and severally liable to make the same payment in the same cause of ac+on unless, in all the circumstances of the case, the court is sa+sfied that it would not be just and equitable. Directors or Signatories will not be liable: (a) if they prove the offering memorandum was sent or delivered to the purchaser without their knowledge or consent and, on becoming aware of its delivery, promptly gave general reasonable no+ce that it was delivered without their knowledge and consent; (b) if they prove that, a}er becoming aware of a Misrepresenta+on in the offering memorandum they withdrew their consent to the offering memorandum and gave reasonable general no+ce to the issuer of their withdrawal and the reasons therefore; (c) if, with respect to any part of the offering memorandum purpor+ng to be made on the authority of an expert or to be a copy of, or an extract from, a report, opinion or statement of an expert ("Expert Opinion"), if such person proves they did not have any reasonable grounds to believe and did not believe that there was a Misrepresenta+on or that the relevant part of the offering memorandum did not fairly represent the Expert Opinion or was not a fair copy of, or an extract from, such Expert Opinion; or
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Investor Rights Manitoba Con.nued (d) with respect to any part of the offering memorandum not purpor+ng to be made on an expert's authority, or not purpor+ng to be a copy of, or an extract from an Expert Opinion, unless the Director or Signatory: (i) did not conduct an inves+ga+on sufficient to provide reasonable grounds for a believe that there had been no Misrepresenta+on; or (ii) believed that there had been a Misrepresenta+on. No person or company is liable in an ac+on for rescission or damages if that person or company proves that the purchaser had knowledge of Misrepresenta+on. In an ac+on for damages, the issuer, the Directors and Signatories will not be liable for all or any part of the damages that they prove do not represent the deprecia+on in value of the securi+es as a result of the Misrepresenta+on relied upon. The amount recoverable under the right of ac+on shall not exceed the price at which the securi+es were offered for sale. A purchaser of securi+es to whom the offering memorandum was not delivered prior to such purchase in circumstances where such offering memorandum was required to be delivered, has a right of rescission or a right of ac+on for damages against the issuer or any dealer who failed to deliver the offering memorandum within the prescribed +me. A purchaser to whom the offering memorandum is required to be sent may rescind the contract to purchase the securi+es by sending a wrinen no+ce of rescission to the issuer not later than midnight on the second day, excluding Saturdays, Sundays and holidays, a}er the purchaser signs the agreement to purchase the securi+es. Unless otherwise provided under applicable securi+es legisla+on, no ac+on shall be commenced to enforce a right of ac+on unless the right is exercised: (a) in the case of rescission, not later than 180 days from the day of the transac+on that gave rise to the cause of ac+on; or (b) in the case of an ac+on, other than an ac+on for rescission, the earlier of: (i) 180 days from the day the purchaser first had knowledge of the facts giving rise to the cause of ac+on; and (ii) two years from the day of the transac+on that gave rise to the cause of ac+on.
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Investor Rights Prince Edward Island The right of ac+on for damages or rescission described herein is conferred by Sec+on 112 of the Securi8es Act (Prince Edward Island) (the "PEI Act"). The PEI Act provides, in relevant part, that if an offering memorandum (such as this Corporate Presenta+on) contains a misrepresenta+on, as defined in the PEI Act, a purchaser who purchases a security offered by the offering memorandum during the period of distribu+on has, without regard to whether the purchaser relied on the misrepresenta+on, a right of ac+on for damages. Such purchaser has a statutory right of ac+on for damages against the issuer, the selling security holder on whose behalf the distribu+on is made, every director of the issuer at the date of the offering memorandum and every person who signed the offering memorandum. Alterna+vely, a purchaser who purchases a security offered by the offering memorandum during the period of distribu+on has a right of ac+on for rescission against the issuer or the selling security holder on whose behalf the distribu+on is made, in which case the purchaser shall have no right of ac+on for damages against the persons described above. No such ac+on may be commenced to enforce the right of ac+on for rescission or damages more than: (a) 180 days a}er the day of the transac+on that gave rise to the cause of ac+on, in the case of an ac+on for rescission; or (b) the earlier of: (i) 180 days a}er the plain+ff first had knowledge of the facts giving rise to the cause of ac+on; or (ii) three years a}er the day of the transac+on giving rise to the cause of ac+on, in any other case. The PEI Act provides a number of limita+ons and defences, including the following: (a) no person is liable if the person proves that the purchaser purchased securi+es with knowledge of the misrepresenta+on; (b) in the case of an ac+on for damages, the defendant is not liable for any damages that the defendant proves do not represent the deprecia+on in value of the security resul+ng from the misrepresenta+on; and (c) the amount recoverable by a plain+ff in respect of such ac+on must not exceed the price at which the securi+es purchased by the plain+ff were offered.
QE2 Acquisi+on Corp: Confiden+al
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Investor Rights Prince Edward Island Con.nued In addi+on, a person, other than the issuer and selling security holder, is not liable if the person proves that: (a) the offering memorandum was sent to the purchaser without the person's knowledge or consent, and that, upon becoming aware of its being sent, the person had promptly given reasonable no+ce to the issuer that it had been sent without the knowledge and consent of the person; (b) the person, upon becoming aware of the misrepresenta+on in the offering memorandum, had withdrawn the person's consent to the offering memorandum and had given reasonable no+ce to the issuer of the withdrawal and the reason for it; or (c) with respect to any part of the offering memorandum purpor+ng to be made on the authority of an expert or purpor+ng to be a copy of, or an extract from, a report, statement or opinion of an expert, the person had no reasonable grounds to believe and did not believe that: (i) there had been a misrepresenta+on; or (ii) the relevant part of the offering memorandum: (A) did not fairly represent the report, statement or opinion of the expert; or (B) was not a fair copy of, or an extract from, the report, statement or opinion of the expert. In addi+on, a person is not liable with respect to a misrepresenta+on in forward-‐looking informa+on ("FLI") if: (a) the offering memorandum containing the FLI also contains, proximate to the FLI: (i) reasonable cau+onary language iden+fying the FLI as such and iden+fying material factors that could cause actual results to differ materially from a conclusion, forecast or projec+on in the FLI; and (ii) a statement of the material factors or assump+ons that were applied in drawing a conclusion or making a forecast or projec+on set out in the FLI; and (b) the person had a reasonable basis for drawing the conclusions or making the forecast or projec+ons set out in the FLI. The above paragraph does not relieve a person of liability respec+ng FLI in a financial statement required to be filed under Prince Edward Island securi+es laws.
QE2 Acquisi+on Corp: Confiden+al
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Investor Rights Nova Sco.a The right of ac+on for damages or rescission described herein is conferred by Sec+on 138 of the Securi8es Act (Nova Sco+a) (the "Nova Sco+a Act"). The Nova Sco+a Act provides, in relevant part, that in the event that an offering memorandum (such as this Corporate Presenta+on), together with any amendment thereto, or any adver+sing or sales literature, as defined in the Nova Sco+a Act, contains a misrepresenta+on, as defined in the Nova Sco+a Act, the purchaser to whom the offering memorandum has been delivered and who purchases a security referred to therein will be deemed to have relied upon such misrepresenta+on if it was a misrepresenta+on at the +me of purchase and has, subject to certain limita+ons and defences, a statutory right of ac+on for damages against the issuer or other seller and, subject to certain addi+onal defences, every director of the issuer at the date of the offering memorandum and every person who signed the offering memorandum or, alterna+vely, while s+ll the owner of the securi+es purchased by the purchaser, may elect instead to exercise a statutory right of rescission against the issuer or other seller, in which case the purchaser shall have no right of ac+on for damages against the issuer or other seller, directors of the issuer or any other person who has signed the offering memorandum, provided that, among other limita+ons: (a) no ac+on shall be commenced to enforce the right of ac+on for rescission or damages by a purchaser resident in Nova Sco+a later than 120 days a}er the date on which the payment was made for the securi+es (or a}er the date on which ini+al payment was made for the securi+es where payments subsequent to the ini+al payment are made pursuant to a contractual commitment assumed prior to, or concurrently with, the ini+al payment); (b) no person will be liable if it proves that the purchaser purchased the securi+es with knowledge of the misrepresenta+on; (c) in the case of an ac+on for damages, no person will be liable for all or any por+on of the damages that it proves do not represent the deprecia+on in value of the securi+es as a result of the misrepresenta+on relied upon; and (d) in no case will the amount recoverable in any ac+on exceed the price at which the securi+es were offered to the purchaser.
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Investor Rights Nova Sco.a Con.nue In addi+on, a person or company, other than the issuer, will not be liable if that person or company proves that: (a) the offering memorandum or any amendment thereto was sent or delivered to the purchaser without the person's or company's knowledge or consent and that, on becoming aware of its delivery, the person or company gave reasonable general no+ce that it was delivered without the person's or company's knowledge or consent; (b) a}er delivery of the offering memorandum or any amendment thereto and before the purchase of the securi+es by the purchaser, on becoming aware of any misrepresenta+on in the offering memorandum or amendment thereto the person or company withdrew the person's or company's consent to the offering memorandum or any amendment thereto, and gave reasonable general no+ce of the withdrawal and the reason for it; or (c) with respect to any part of the offering memorandum or any amendment thereto purpor+ng: (i) to be made on the authority of an expert; or (ii) to be a copy of, or an extract from, a report, an opinion or a statement of an expert, the person or company had no reasonable grounds to believe and did not believe that: (A) there had been a misrepresenta+on; or (B) the relevant part of the offering memorandum or any amendment thereto did not fairly represent the report, opinion or statement of the expert, or was not a fair copy of, or an extract from, the report, opinion or statement of the expert. Furthermore, no person or company, other than the issuer, will be liable with respect to any part of the offering memorandum or any amendment thereto not purpor+ng: (a) to be made on the authority of an expert; or (b) to be a copy of, or an extract from, a report, opinion or statement of an expert, unless the person or company: (i) failed to conduct a reasonable inves+ga+on to provide reasonable grounds for a belief that there had been no misrepresenta+on; or (ii) believed that there had been a misrepresenta+on. If a misrepresenta+on is contained in a record incorporated by reference into, or deemed incorporated by reference into, the offering memorandum or any amendment thereto, the misrepresenta+on is deemed to be contained in the offering memorandum or amendment thereto.
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Investor Rights Newfoundland and Labrador The right of ac+on for damages or rescission described herein is conferred by Sec+on 130.1 of the Securi8es Act (Newfoundland and Labrador) (the "Newfoundland Act"). The Newfoundland Act provides, in relevant part, that where an offering memorandum (such as this Corporate Presenta+on) contains a misrepresenta+on, as defined in the Newfoundland Act, a purchaser who purchases securi+es offered by the offering memorandum during the period of distribu+on has, without regard to whether the purchaser relied upon the misrepresenta+on, a statutory right of ac+on (a) for damages against (i) the issuer, (ii) every director of the issuer at the date of the offering memorandum, and (iii) every person or company who signed the offering memorandum and (b) for rescission against the issuer. The Newfoundland Act provides a number of limita+ons and defences in respect of such rights. Where a misrepresenta+on is contained in an offering memorandum, a person or company shall not be liable for damages or rescission: (a) where the person or company proves that the purchaser purchased the securi+es with knowledge of the misrepresenta+on; (b) in the case of an ac+on for damages, the defendant is not liable for all or any part of the damages that the defendant proves do not represent the deprecia+on in value of the security as a result of the misrepresenta+on; and (c) in no case will the amount recoverable in any ac+on exceed the price at which the securi+es were offered under the offering memorandum.
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Investor Rights Newfoundland and Labrador Con.nued In addi+on, no person or company, other than the issuer, is liable: (a) where the person or company proves that the offering memorandum was sent to the purchaser without the person's or company's knowledge or consent and that, on becoming aware of its being sent, the person or company promptly gave reasonable no+ce to the issuer that it was sent without the knowledge and consent of the person or company; (b) if the person or company proves that the person or company, on becoming aware of the misrepresenta+on in the offering memorandum, withdrew the person's or company's consent to the offering memorandum and gave reasonable no+ce to the issuer of the withdrawal and the reason for it; (c) if, with respect to any part of the offering memorandum purpor+ng to be made on the authority of an expert or purpor+ng to be a copy of, or an extract from, a report, opinion or statement of an expert, the person or company proves that the person or company did not have any reasonable grounds to believe and did not believe that: (i) there had been a misrepresenta+on; or (ii) the relevant part of the offering memorandum: (A) did not fairly represent the report, opinion or statement of the expert; or (B) was not a fair copy of, or an extract from, the report, opinion or statement of the expert; or (d) with respect to any part of the offering memorandum not purpor+ng to be made on the authority of an expert and not purpor+ng to be a copy of, or an extract from, a report, opinion or statement of an expert, unless the person or company: (i) did not conduct an inves+ga+on sufficient to provide reasonable grounds for a belief that there had been no misrepresenta+on; or (ii) believed there had been a misrepresenta+on. Sec+on 138 of the Newfoundland Act provides that no ac+on shall be commenced to enforce these rights more than: (a) in the case of an ac+on for rescission, 180 days a}er the date of the transac+on that gave rise to the cause of ac+on; or (b) in the case of an ac+on for damages, the earlier of: (i) 180 days a}er the date that the purchaser first had knowledge of the facts giving rise to the cause of ac+on; or (ii) three years a}er the date of the transac+on that gave rise to the cause of ac+on.
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Investor Rights New Brunswick The right of ac+on for damages or rescission described herein is conferred by Sec+on 150 of the Securi8es Act (New Brunswick) (the “New Brunswick Act”). Sec+on 2.1 of New Brunswick Securi+es Commission Rule 45-‐802 Prospectus and Registra+on Exemp+ons provides that the statutory rights of ac+on for damages or rescission referred to in Sec+on 150 of the New Brunswick Act apply to informa+on rela+ng to an offering memorandum (such as this Presenta+on) that is provided to a purchaser of securi+es in connec+on with a distribu+on made in reliance on the “accredited investor” prospectus exemp+on in Sec+on 2.3 of NI 45-‐106. The New Brunswick Act provides, in relevant part, that where an offering memorandum (such as this Presenta+on) contains a misrepresenta+on, as defined in the New Brunswick Act, a purchaser who purchases securi+es offered by the offering memorandum shall be deemed to have relied on the misrepresenta+on if it was a misrepresenta+on at the +me of purchase and: (a) the purchaser has a right of ac+on for damages against the issuer and any selling security holder(s) on whose behalf the distribu+on is made; or (b) where the purchaser purchased the securi+es from a person referred to in paragraph (a), the purchaser may elect to exercise a right of rescission against the person, in which case the purchaser shall have no right of ac+on for damages against the person. This statutory right of ac+on is available to New Brunswick purchasers whether or not such purchasers relied on the misrepresenta+on. However, there are various defences available to the issuer and the selling security holder(s). In par+cular, no person will be liable for a misrepresenta+on if such person proves that the purchaser purchased the securi+es with knowledge of the misrepresenta+on when the purchaser purchased the securi+es. Moreover, in an ac+on for damages, the amount recoverable shall not exceed the price at which the securi+es were offered. If the purchaser intends to rely on the rights described in (a) or (b) above, such purchaser must do so within strict +me limita+ons. The purchaser must commence an ac+on to cancel the agreement within 180 days a}er the date of the transac+on that gave rise to the cause of ac+on. The purchaser must commence its ac+on for damages within the earlier of: (a) one year a}er the purchaser first had knowledge of the facts giving rise to the cause of ac+on; or (b) six years a}er the date of the transac+on that gave rise to the cause of ac+on.
QE2 Acquisi+on Corp: Confiden+al
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Resale Restric+ons General The shares will be subject to a number of resale restric+ons, including a restric+on on trading. Un+l the restric+on on trading expires, a shareholder will not be able to trade the shares unless the shareholder complies with an exemp+on from the prospectus and registra+on requirements under securi+es legisla+on. Manitoba Resale Restric.ons Unless permined under securi+es legisla+on, a shareholder must not trade the shares without the prior wrinen consent of the regulator in Manitoba unless: 1. QE2 has filed a prospectus with the regulator in Manitoba with respect to the securi+es the shareholder purchased and the regulator in Manitoba has issued a receipt for that prospectus; 2. or the shareholder held the securi+es for at least 12 months. The regulator in Manitoba will consent to a shareholders trade if the regulator is of the opinion that to do so is not prejudicial to the public interest.
QE2 Acquisi+on Corp: Confiden+al
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