Infrastructure & Special Situations

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1 discover The Power of Independent Insight GARP Small-Cap Stocks Green, Infrastructure & Special Situations Visit:

2 Overview Brief KeyStone Explanation Market Overview Why Green? Why Now? 2 Green GARP BUYs Infrastructure & Construction 1 BUY Special Situations Integrated Communication Hardware/Software Manufacturer Specialty Paper Manufacturer Oil Service Stock

3 KeyStone Financial Founded in 1998, Registered Financial Advisor BUY/SELL Recommendations Buy profitable growing companies at a reasonable price - GARP Independent Insight We do not get paid by the companies we recommend We are not affiliated with a brokerage who underwrites stocks We simply look for the best companies Small Caps - Undercovered Market Segment Lack of coverage create potential inefficiencies We put people before institutions

4 Market Overview 2007: Issued more SELL recommendations than at any other period over the last 5 years. 2008: 6 consecutive years of positive returns is unlikely More stocks will go down than up in 2008 Stock Pickers Market Pockets of Strength 1. Green Companies Clean and Making Green 2. Infrastructure & Construction 3. Special Situations

5 Why Now?: The Six C's Driving Green Technology 1. Costs: Clean energy costs falling, fossil fuel energy costs rising. 2. Consumer: Demanding cleaner products and services that use resources efficiently, reduce costs. 3. Capital: Green Tech has become big business. 4. Competition: Governments are competing aggressively in the high-stakes race to dominate in the clean-tech sector and build the jobs of the future. 5. China: Continued demand from maturing economies, powerful demand for resources from China, India, and other developing nations. 6. Climate: The debate around climate change has gone from question mark to peer-reviewed certainty, - businesses are taking heed.

6 Green GARP STOCK China Solar and Clean Energy Solutions Inc. (CSOL:OTC:BB) Price: $1.90 Sector: Manufacturing Alternative Energy Produces solar water heaters and coal-fired boilers, and manufactures and designs space-heating products, which are primarily used in residences in China. Acquisition: manufacturing and selling flat plate solar water heaters, and installation and engineering of central solar hot water systems for business users including schools, hotels, hospitals, and factories in China, the EU, and North America Month Revenues: Increased 57% to $25 million from $16 million in the same period of Month Earnings: Increased 35.4% to 1.4 million, or $0.20 per share, from $1.04 million, or $0.13 per share in the same period of 2006.

7 Green GARP STOCK Strong Legislative Support for Solar Products in China Along the lines of the Kyoto Protocol, on February 28, 2005, China passed the Chinese Renewable Energy Law, - target of increasing the share of renewable energy to 10% by million of the 350 million households in China are in rural areas only 10% of rural households have water heaters of any kind. Acquire Shenzhen PengSangPu Solar Industrial January 16, Specializes in manufacturing and selling flat plate solar water heaters, and installation and engineering of central solar hot water systems for business users including schools, hotels, hospitals, and factories products sold in China, the EU, and North America. Expected to contribute $13.6 million, after-tax net profit of $1.3 million or $0.16 per share in 2008.

8 Green GARP STOCK CVTech Group Inc. (CVT:TSX) Price: $1.15 Sector: Manufacturing/Electrical Construction CVTech Group, through its four subsidiaries, operates in two distinct industries: the design, manufacture, and sale of continuously variable power transmission systems and the construction and maintenance of electrical power houses, substations, and transmission and distribution lines Q3 revenues rose 37% to $30.23 million from $22.05 million in Q3 earnings jumped to $1.1 million or $0.02 per share from $201,000 or under $0.004 per share. Healthy Balance Sheet Good Working Capital - $10.8 million cash or $0.20 per share in the bank.

9 Green GARP STOCK Demand for clean hydro electric projects runof-river type projects increasing (CAN & U.S.) Construction and maintenance of electrical transmission and distribution lines as well as electrical substations and power houses Well positioned to service the demand. 2 recent Hydro-Quebec contract wins: $9.8 and $4.3 million The company also has a 74% interest in the Indian company, CVTech Castmaster India PVT Ltd. Currently, work jointly with the Indian car manufacturer Tata Motors Ltd.

10 CVTech Group Inc. (CVT:TSX)

11 Six Forces Driving Canada s Infrastructure & Construction 1. Decades of under-investment and neglect have left our country s roads, schools, bridges, airports, etc. in need of repair, expansion, and upgrade. 2. Governments (both federal and provincial) are generally in good financial shape. 3. Governments have found new and effective ways to finance infrastructure projects 4. Committed effort to strengthen Canada s infrastructure to improve international trade flows 5. Environmental issues are forcing the government to invest in green infrastructure such as wind power, water purification, and light rail transit. 6. Enormous activity in the oil sands and mining segments

12 Infrastructure Pick Empire Industries Ltd. (EIL:TSX-V) Price: $0.49 Sector: Infrastructure (Steel) Supplies and erects structural steel, and provides structural and construction engineering services for western Canadian markets. For worldwide markets, the company designs and manufactures amusement park rides, and a wide variety of industrial products. Q revenues rose 64% to $27.5 million from $16.8 million in the same period of Q operating profit rose 125% to $2.7 million from $1.2 million in the same period of EPS for the first 9 months of 2007 were $0.04 per share, up from $0.01 in the same period of 2006.

13 Peer Comparison Chart

14 Empire Industries Ltd. (EIL:TSX-V)

15 Special Situation Hardware/Software Com. Sangoma Technologies Corporation (STC:TSX-V) Price: $1.13 Sector: Hardware/Software (Communications) Manufactures hardware and software that aids in the communication between computing devices and Wide Area networks and telephone networks. Fiscal Q revenues rose 70% to $3.07 million from $1.80 million in the same period of fiscal Fiscal Q earnings rose 147% to $756,814 or $0.026 per share from $306,775 or $0.011 per share in the same period of fiscal Sangoma finished the quarter with zero debt, $3.82 million in cash in the bank and working capital of $7.25 million.

16 Quarter-Over-Quarter Growth

17 Special Situation Fortress Paper Ltd. (FTP:TSX) Price: $8.50 Sector: Specialty Paper Producer of security and other specialty papers. Fortress Paper operates two paper mills, the Landqart Mill located in Switzerland and the Dresden Mill located in Germany. Fortress Paper's security papers include banknote, passport and visa papers and its specialty papers include nonwoven wallpaper base products, and graphic and technical papers. Q revenues grew to $37.5 million compared to $34.1 million in the prior quarter. Q earnings rose to $2.28 million or approximately $0.20 per share. As at December 31, 2007 Cash: $45.3 million. Debt levels manageable.

18 Special Situation Norex Exploration Services Inc. (NRX:TSX) Price: $1.10 Sector: Oil & gas Services Norex provide premium 2D, 3D, 4D and 3C land-based seismic data acquisition services in Canada and the United States. Norex is the largest operator of ARAM- ARIES(R) recording equipment in Canada. Q revenues grew to $34.36 million from $28.48 million in Q4 of the prior year. Q earnings rose to $2.35 million or $0.06 per share from $1.27 million or $0.04 per share in Q4 of the prior year. Over the past several years, Norex has created one of the largest seismic acquisition company's in Canada Strong competitive position allowing it to take advantage of the cyclical nature of its business. Consolidate in down cycles Produce strong cash flow and earnings in up cycles

19 Thank you ladies and gentlemen