Catch The Wind Investor Presentation November 2009


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Catch the Wind is focused on making renewable energy more profitable. The company provides wind sensing technology that accurately determines wind speed and direction, resulting in higher energy output and lower maintenance costs for wind farm operators and turbine manufacturers.

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Catch The Wind Investor Presentation November 2009

  1. 1. 1 Catch the Wind Making Wind Energy Profitable November, 2009 ©2009 Catch the Wind, Inc.
  2. 2. Forward-Looking Statements 2 Certain statements in this presentation may constitute “forward-looking” statements which involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this presentation, such statements use such words as “may”, “will”, “expect”, “continue”, “believe”, “plan”, “intend”, “would”, “could”, “should”, “anticipate” and other similar terminology. These statements reflect current assumptions and expectations regarding future events and operating performance and speak only as of the date of this presentation. Forward- looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to vary significantly from the results discussed in the forward- looking statements, including, but not limited to, the factors discussed under “Risk Factors”. Although the forward-looking statements contained in this presentation are based upon what we believe are reasonable assumptions, neither we, nor the Underwriters, can assure investors our actual results will be consistent with these forward-looking statements. We assume no obligation to update or revise these forward-looking statements to reflect new events or circumstances.
  3. 3. About Catch the Wind (TSX-V: CTW.S) 3 Forward wind Focused on measurement making renewable technology energy more profitable -Wind farm operators -Turbine OEMs We Make Wind Turbines Smarter
  4. 4. Genesis of Catch the Wind 4 4 Optical Air Data Systems Catch the Wind, Inc. (OADS) Established in 1990 Spin-off of OADS Industry leader in fiber-optic $15M Qualifying pulsed LIDAR technology Transaction – Sept. ‘08 SBIR Program Success Story Experienced Roland Tibbetts Awardee - management team Top Small Business Defense Contractor Technology license for all commercial (non- Manassas, VA Small Business aviation) applications of the Year 2007
  5. 5. Technology Applications 5 Military & avionics applications Licensed to Lidar All other commercial applications Technology Licensed* to * Irrevocable, perpetual and transferable
  6. 6. Nacelle-Mounted Smart Turbine Control Vindicator® Laser Wind Sensor (LWS) 6 Aerospace Technology Initially Developed for Safety of Flight Critical Applications Lightweight $70M+ invested in R&D Compact 19 years in development Rugged 27 patents
  7. 7. Substantial Wind Energy Profit is Lost 7 100% Available wind energy 50% Actual efficiency 0
  8. 8. Why? Current Turbine Controls are Reactive 8 Here is where wind is measured … but, here is where the wind is always shifting and gusting today… Reactive Result: No lead time to adjust
  9. 9. 9
  10. 10. See the Wind That’s Coming… 10 Here is where wind is measured Here is where we measure the wind today… 300 meters (20 seconds at 35 mph) Reactive Proactive
  11. 11. Wind Power’s Holy Grail 11 Forecast Benefits (National Renewable Energy Accurately Laboratory Studies) 1. Increased Power Output predicting wind Yaw Improvement approximately 10% Pitch Improvement approximately 5% speed and 2. Decreased Operating direction Costs Cost decrease approximately 10% (from 30% less stress on blades and 10% less overall damage)
  12. 12. We Make Wind Energy More Profitable 12 12 Higher Reduced revenues maintenance costs - Increased production “Recent development of LIDAR - Sale of Renewable Energy systems promises large Certificates (RECs) improvements in cost, compactness, and reliability so that - Production Tax Credits (PTCs) it becomes viable to consider the - Higher capacity payments deployment of such systems on - Preferable external financing large wind turbines. Potential terms; lower weighted average advantages of this approach include cost of capital (WACC) increased turbine energy output and reduced turbine fatigue damage.” NREL
  13. 13. How We See the Wind… Laser Doppler Velocimetry (LDV) 13 1 Three laser beams 2 Lasers reflect off dust 3 We sense the color particles in wind and change and calculate change color wind speed and direction 4 Vindicator® LWS commands optimal turbine alignment and blade pitch 300 meters (20 seconds at 35 mph)
  14. 14. No Forward-Looking Competition 14 14 Conventional Anemometer ZephIR LIDAR Vindicator® Laser Wind Sensor Larger/heavier Larger/heavier Compact/lightweight Moving parts Moving parts No Moving Parts/Rugged Inexpensive Approx. $200,000 per unit Economical Not forward looking Measures up Forward-looking not forward to 300 meters
  15. 15. Improving Economic Value 15 Sample Financial Model* 100 MW Incremental NPV FARM +1% Availability $1.9M 67 1.5-MW Turbines -10k/WTG O&M $5.9M Cost to Purchase $9.4M A/T Cost $5.6M *Per AES Houston Wind Power 2009 | Based on $125K per unit + $15K retrofit kit Assumes 40% corporate tax rate
  16. 16. Industry Validation – WEICan Phase 2 16 Pow er Production Com parison 50 Vindicato r Co ntro l Nacelle Wind Vane Co ntro l Average Power (kW) 40 30 REGION 2 20 REGION 3 10 0 Vindicator® LWS 5.5 6.5 7.5 8.5 9.5 Based on Data collected Apr – June Wind Speed (m /s) 2009 Percentage Increase in Power Production Vindicator® and Wind Vane alternate 20 control every 9 hrs 15 % Increase Vindicator® uses wind vane control 10 algorithm - not optimized REGION 2 REGION 3 5 Vindicator shows increased power 0 production 5.5 6.5 7.5 8.5 9.5 Wind Speed (m/s)
  17. 17. Industry Validation – Nebraska Power 17 T22 T23 T21 Average Active Power 1500 Power (KW) Installed on Vestas V-82 #T22 in June 1000 Integrated by CTW and DNV-GEC Vindicator started controlling the wind turbine on July 8, 2009 500 Control optimization in progress Data collected during August 0 Data shows significant increase in 0 500 1000 1500 power Time (Min)
  18. 18. Nebraska Power - Reduced Stress Loading 18 SWANTech stress wave analysis data taken before and after Vindicator® installation The Random Friction Index (RFI) for T-22 went from worst to best in the group Random and periodic friction decreased significantly on main shaft bearing on T-22 All snapshot data show excellent trends STRESS DATA CORRELATES DIRECTLY TO A PERIOD OF INCREASED WIND POWER OUTPUT FROM T-22
  19. 19. Large Addressable Market 19 *Large turbines, 1.0MW and above Potential Number of Vindicator® Turbines LWS sales* Global installed based (2008) 80,500 $10.1 billion Projected installs (2009 – 2011) 30,000 $3.7 billion Total market opportunity through 2011 $13.8 billion *Based on $125,000 introductory sales price Global Projected Demand: 500,000 turbines with 1.0 MW+ capacity by 2020
  20. 20. Market Sales Forecast 20 20 4000 Number of Units 3500 3000 WRA - Maritime WRA - Terrestrial 2500 Retrofit 2000 OEM 1500 1000 500 0 2009 2010 2011 2012 2013 2014 Unit sales forecast excludes additional product applications
  21. 21. Value-Driving Milestones 21 Q2 2008 WEICan Phase I Testing Q3 2008 WEICan Phase II Testing Q1 2009 Prototype Production First Commercial Sale to AXYS Technologies Maritime Application Licensing Agreement Q2 2009 Control Systems Integration Project Nebraska Public Power District Trial Program Q3 2009 Helimax Trial Program NREL – US Department of Energy Testing Gamesa Agreement - Trial Program BreconRidge – Contract Mfg Agreement Q4 2009 Canadian Hydro Developers - Multiple Unit Development Testing Complete Gamesa Trial Program Q1 2010 Vindicator® LWS Contract Manufacturing
  22. 22. Major Trial Programs 22 • Multi-unit testing • Direct side-by-side comparison with non- Vindicator® mounted turbines • First trial program with OEM • Gamesa G8X 2.0 MW • Integrates Vindicator® LWS with turbine control • Cooperative Research and Development Agreement • Primary research lab of U.S. DOE • 3-year program to develop new advanced smart turbine control systems
  23. 23. Vindicator® LWS for Grid Control 23 Positioning to be required equipment to connect to the grid
  24. 24. Management Team 24 Phil Rogers 21 years experience as successful small business defense contractor; - President & CEO/Director Former director of Special Projects, Lockheed Skunk Works David Samuels Extensive public company CFO and capital raising experience; - CFO/Director Significant experience with emerging growth technology companies Claudia Jaques 5 years Associate General Counsel - Corporate Securities, Freddie Mac; - VP General Counsel 8 years experience with large law firm – corporate & securities William Fetzer 3 years Business Development Director - VP Business Development 10 years as President of Strategic Business Management Company Daniel Lacroix Designed state of the art, world class Fiber Optical Manufacturing Facility - VP Manufacturing 20 years high technology manufacturing experience
  25. 25. Board of Directors 25 David Garman Alisa Rogers • Former U.S. Under Secretary of Energy • Co-founder and President of OADS, LLC • Assistant Secretary for Energy Efficiency and Renewable Energy. Phil Rogers David Samuels • President and CEO of Catch the Wind, Inc. • Extensive public company CFO and • 20 years experience as successful small capital markets experience business defense contractor • Significant experience with emerging • Former director of Special Projects, Lockheed growth technology companies Skunk Works Richard McGraw Addition of Two Wind Industry • Co-founder Bayview Public Ventures Executives • Extensive GreenTech experience • Private Equity Investor
  26. 26. Financing History 26 Sept. 2008 May 2009 $15 Million CDN $21.8 Million CDN Qualifying Private Placement Transaction 16.7 million shares 11.5 million issued ($1.30) shares issued Significant Price ($1.30) Premium
  27. 27. Working Capital Usage 27 Average ‘Burn Rate’ per Month $1.3M $1.2 M CAPEX CAPEX G&A G&A Materials Materials Manufacturing Manufacturing Resources Resources Q1 09 Q2 09 Cash position at June 30 was $19M Ramp-up period – new hires, business development Beta units currently manufactured by hand Burn expected to decline by year-end due to low fixed cost structure
  28. 28. Market Sales Forecast 28 28 4000 Number of Units 3500 3000 WRA - Maritime WRA - Terrestrial 2500 Retrofit 2000 OEM 1500 1000 500 0 2009 2010 2011 2012 2013 2014 Unit sales forecast excludes additional product applications
  29. 29. Equity Market Information 29 Ticker Symbol: CTW.S – V 52-Week Range: $0.50 - $2.00 Shares Outstanding: 54.9 Million Fully Diluted: 60.1 Million Market Capitalization: ~$100 Million Holders: Insiders 46% Institutional 46% Retail 8%
  30. 30. Liquidity Initiatives 30 Analyst Coverage NBF Rupert Merer; RCC Matt Gowing Expansion of sell-side analyst coverage Focus on retail investors Investor meetings Add-on to equity raise Broaden US Investor Base First round “.S” restriction expired Second round “.S” restriction expires May 2010 Potential for future US SEC registration
  31. 31. Investment Summary 31 Additive technology focused on making wind energy more profitable Vindicator® LWS is based on proven technology No competition Significant existing market with enormous upside potential Multiple sales channels Essential for “Grid Control” Extensive patent portfolio; high barriers to entry Non-capital intensive business Experienced management team delivering on milestones
  32. 32. 32 Investor Contacts: David Samuels, CFO Catch the Wind (703) 393-0754 ext.107 Joe Racanelli Equicom Group (416) 815-0700 ext. 243