Long-term investments in sustainability. May 2015

Long-term investmentsin sustainability.

May 2015

The problems are familiar…• Too much CO2 causing unpredictable

climate change

• Communities struggling to retain their economic base and identity

• Increasing concern about GMOs, pesticides, and other contaminants in our food

• Water shortages causing global food insecurity

but there is still good news.

We see tremendous cooperation, innovation, and possibilities.

Out of crisis comes opportunity.Here is one:

Fukushima on March 11, 2011Fukushima I Nuclear Power Plant hit by a tsunami triggered by 9.0 Tōhoku earthquake

Three of the plant's six nuclear reactors melted down

Joined Chernobyl to measure Level 7 on the International Nuclear Event Scale.

Mass Evacuations

Japan evacuated 150,000 residents from a 20-mile radius.

U.S. Nuclear Regulatory Commission recommended 2 million people from a 50-mile radius.

Out of crisis comes opportunity

Out of Japan’s Nuclear Disaster, New Indoor Farms Grow 100x More Food

http://miraigroup.jp/en/

Japan’s new greenhouse technology provided food even in the most hostile environment: 24/7/365



Japan’s Greenhouse Technology

• Hydroponics feeds Japan’s displaced residents• Proven installations• Technical assistance to Japanese Antarctic base

Showa Station• Expanding into China, U.S., Southeast Asia

The Opportunity

Greens, Herbs, Berries

Clean, non-GMO, no pesticidesWith 99% less water100 times/m2 than soil farmingAny climate, year aroundPackaged and delivered Organically Grown, Local Food at a Profit

This Is How We Can Do It

Surplus and/or wasted energyUnusable landClimate controlled buildingsMulti-tier growing platformsHydroponic mediumPolarized waterHigh nutrient, CO2 enriched

Multi-spectrum LED lightingExperienced managementInsured, risk-free investment

Surplus Energy

Biomass

Ethanol

many other industrial processes…

De-salination

Cement

Outline Team Markets Site/Tech Funding Financials

Other Energy

Natural GasCo-Generation

Wind/Solar Hybrid

Geothermal

Unusable Land


Climate Controlled BuildingsStructurally Integrated Panels

1. Steel sheathing

2. Non-CFC polyurethane core, R60


Our Hydroponic Advantages• 99 % less water usage• Polarized, nutrient rich water• CO2 enrichment

• No soil-borne diseases• No pesticides • No animal waste fertilizers• Year around production = stable costs and revenue


Multi-spectrum LED lighting


Packaging and Delivery

• Integrated, efficient, best of class

• Shelf ready• Production local to markets• Maintains freshness


Benefits To Hosting Community

Local employmentinitial constructionlong-term clean tech jobs

Local revenueconstructionproperty taxesspinoffs to other businesses

Local prideleading edge sustainabilityinternational profileincreased self sufficiency


Management Team


Michel Alarcon, President and CEO• 30-year domestic and international career• Government, aeronautics, financial services, health

care, and manufacturing • Building strategic alliances with industry “best of

breed” Americas, Asia, and Europe

Paul Jemmett, Senior VP Special Projects• Canadian Institute of Management • 25 years of experience in development and delivery• Training programs, quality assurance, new products

and services, new markets, corporate security, and customer service and help desk.


John Johnson, Sr. VP Operations• Directed $70m conversion of a 660,000 sq. ft.

hospital from an inpatient to an outpatient facility• Director of Facilities for the City of Kingston with

151 buildings in his portfolio• Led the way for Cienfuegos, Cuba and Kingston,

Ontario to become Sister Cities

Brian Heinz, VP Purchasing• More than 20 years experience in procurement,

contract negotiations, and supplier management• Aeronautics industry • Purchasing process efficiency and cost

management


Steven Moore, VP Communications• Communications and sustainability at Queen’s

University• Clients included Canada’s major banks and major

retailers• Works exclusively with organizations promoting

sustainability• Over 90 articles and four columns in popular

publications • Organic off-the-grid farm, designed earth-sheltered

home.Philippe Archambault, VP Development• Over 20 years of management in oil & gas, retail,

public services (healthcare), gaming, transport, and manufacturing

• United Kingdom and Canada• Health care and logistics• Community building programs in the Kingston region.

Ron Bogart, CFO• Founding Member Mississauga High Technology

Association• Former partner of Ernst & Young• President and Chief Financial Officer of McLaughlin

family’s private investment capital corporation, Greenbriar Holdings Limited


Operations Team

Dario Echeverry, General Manager• Civil engineer specializing in environmental engineering and

banking• Started one of the first environmental engineering firms in

Colombia• Directed the acquisition of Banco de Colombia, the largest

Colombian bank.• Former President and CEO of Inmobiliaria Banco S.A., the largest

Colombian construction firm• Co-directed Fiducolombia S.A., the largest Colombian trust

corporation

Henry Persoon, Chief Technology Officer• World-renowned horticulturist• Pioneered the hydroponic growing of ornamental flowers and

roses• Operated a hydroponic farm in Tortola, British Virgin Islands• Family business is one of the largest flower bulb suppliers in the

world.


Alexandre Gomez –Project Advisor • Raised on a hydroponic farm• Growing plants his entire life• Knows the ups and downs of hydroponic greenhouses• Experience in aquaponics, aeroponics, soil row farming

Ashley Peebles - Agriculturalist• agriculturalist for over 15 years• trained by some of the best master growers in California• expertise in commercial growing of indoor plants• specializing in cannabis and other medicinal herbs


Fresh Produce Markets

ObservationsResilient during economic downturnsGlobal trend toward clean, natural foodConsistently high demandExtreme weather conditions damaging field cropsDrought conditions creating water shortages

AssumptionsWeather patterns continue to be unpredictableOrganic and local demand will continue to increaseTransportation will become increasingly expensive


Equivalency ArrangementOrganic operations certified by the USDA organic regulations or Canada Organic Regime may be labeled and sold as organic in both countries.

=


Products

5% Berries

10% Medicinal Herbs

20% Lettuce

65% Micro Greens


Two Million Pounds a WeekConditional Purchase Agreements


Integrated Controls

• Filtered air and water• MCS® natural gas-fired on-site power

technology • Component systems are portable, modular, built

and assembled off-site• Minimal site work• Scalable

Outline Team Markets Funding FinancialsSite/Tech

Proven Technology

• High-efficiency automated multi-

spectrum solid state lighting

• Complete information management and environmental controls

• State of the art algae nutrient

systems • Structural Insulated Panel building

systems


Proprietary Technology

Patented water treatment process • improved plant health• larger plants with higher levels of nutrients• less time than standard growing protocols• prevents mold and bacteria, extends shelf

life• high and stable oxygen reduction potential

(ORP)

Technology + staff expertise providecredible presence on which to build a successful long-term enterprise


Sample Site - St. Marys, Ontario


• Eight million people in southern Ontario market

• Three main distributors an hour’s drive away

• Underserved with organic produce

• Nov-Apr, Canada imports most fresh produce

• Local production reduces costs and carbon footprint

• Six million people in Detroit area within three hours

Construction Requirements


25 acre pilot site


Intention of interest from Scotiabank to fund 75% of project construction ($26 million) as long -term debt

For two years, then replaced with 10-year mortgage

Stipulation of an in-place insurance policy and $9 million in seed capital

Cash Flow projections indicate repayment of mortgage well within 10 years.

Risk Insurance

1. “All Risk” Construction and Operational Coverage

2. Comprehensive Boiler and Machinery with Business Interruption

3. Customer and Supplier Risk (including feedstock)

4. Credit Risk of Customer, Payments and Bankruptcy

5. Transportation, including ocean cargo, plus delay in start-up of the project

6. Third Party Liability Outline Team Markets Funding FinancialsSite/Tech

Financial Assumptions


1) Lease land, obtain power and heat/cooling for flat $750K/month commencing in month 12

2) Power requirement

Months 1-6 0 MGW $2KMonths 6-9 1 MGW $125KMonths 9 – 12 3 MGW $375KMonth 13 forward 6 MGW $750K

3) Construction draws at 6% - no principal repayments for 1 year.4) Construction financing replaced by mortgage with 10 year term5) Construction team in place until month 12

Financial Assumptions


6) 25 year amortization at 6% at the end of year 1

7) Salaries are indexed - 2% /year

8) Insurance expense on funding draws - 2%/annum of amount outstanding

9) Depreciation and amortization - straight line over 10 years; half rate in acquisition year

10) Corporate income tax rate - 35%

Revenue Year 1

Month Micro Greens Lettuce Total Revenue12345678 1.0 0.8 1.89 1.0 0.8 1.810 1.0 0.8 1.811 1.8 1.0 2.812 1.8 1.0 2.8Total 11.1


($CDN million)

Revenue Year 2


Month MedicinalHerbs

Strawberries %Blueberries

Micro Greens Lettuce Total

1 0.03 0.02 2.6 1 3.652 0.01 0.02 2.6 1 3.633 0.03 0.02 2.6 1 3.654 0.01 0.02 2.6 1 3.635 0.03 0.02 2.6 1 3.656 0.01 0.02 2.6 1 3.637 0.03 0.02 2.6 1 3.658 0.01 0.02 2.6 1 3.639 0.03 0.02 2.6 1 3.6510 0.01 0.02 2.6 1 3.6311 0.03 0.02 2.6 1 3.6512 0.01 0.02 2.6 1 3.63Total 44.0

($CDN million)

Cash Flow Years 1 & 2


($CDN)Numbers may differ slightly due to rounding

Balance Sheet Years 1 & 2


($CDN)

The problems are familiar…• Too much CO2 causing unpredictable

climate change

• Communities struggling to retain their economic base and identity

• Increasing concern about GMOs, pesticides, and other contaminants in our food

• Water shortages causing global food insecurity

We can help.

Please join us.

Documents

Long-term investments in sustainability. May 2015