Annual l General l Meeting February 26 th , 2015 Spruce e Ridge - - PowerPoint PPT Presentation

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Annual l General l Meeting

February 26th, 2015

Spruce e Ridge Capital Inc.

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Forward rd-Lo Look

• king

ing Statements nts Advisory

Certain information regarding Spruce Ridge Capital Inc. (“Spruce”) set forth in this document contains forward-looking statements that involve substantial known and unknown risks and uncertainties. The use of any of the words "plan", "expect", "intend", "believe", "should", "anticipate" or other similar words, or statements that certain events or conditions "may" or "will" occur are intended to identify forward-looking statements. In particular, forward-looking statements contained in this document include, but are not limited to, Spruce’s ability to provide serviced lands; the anticipated benefits resulting from servicing the lands; anticipated increases in price of the lands; the ability to develop the lands; securing sufficient capital to develop the lands; anticipated sales, profits, returns, revenue and cash flow; the anticipated pay-back period and the mechanics of such pay-back; the consequences of, and the process following, a catastrophe or economic difficulties. These statements are only predictions and actual events or results may differ materially. Many factors could cause Spruce's actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, Spruce. Such factors include, but are not limited to, industry conditions including changes in laws and regulations, adoption of new laws and regulations, and changes in how laws and regulations are interpreted and enforced; competition; lack of availability of qualified personnel; obtaining required approvals of regulatory authorities; ability to access sufficient capital from internal and external sources; and other factors, many of which are beyond the control of Spruce. Readers are cautioned that the foregoing list

• f factors is not exhaustive. Although the forward-looking statements contained in this document are based upon assumptions

which management believes to be reasonable, Spruce cannot assure investors that actual results will be consistent with these forward-looking statements. With respect to forward-looking statements contained in this document, Spruce has made assumptions regarding, sales, profits, returns, revenue and cash flow will increase according to management's timelines; Spruce will enjoy sufficient success to allow pay-back according to management's timelines. These forward-looking statements are made as of the date of this document and Spruce disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results, or otherwise,

• ther than as required by applicable securities laws. Any financial outlook or future oriented financial information in this investor

presentation, as defined by applicable securities legislation, has been prepared by management of Spruce. Such financial outlook

• r future oriented financial information is provided for the purpose of providing information about management's reasonable

expectations as to the anticipated results of its proposed business activities and may not be appropriate for other purposes.

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Agenda Agenda

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Agenda Agenda

1. Re-Introduction to Spruce Ridge Capital

• Who Spruce Ridge used to be: CCAA History
• Who Spruce Ridge is now: Simmons’ Involvement
• New Board of Directors
• New Team

2. About the Lands 1. Growth of Calgary

• Taking a look back
• Looking Forward: Growth of the City of Calgary

2. Objective, Opportunity and Timeline 3. Summary

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Re Re- Introdu duct ction

• n

to Spruce Ridge Capital Inc. Inc.

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Who Spruce Ridge used to be be…

• Spruce Ridge Capital Inc. (“Spruce Ridge”) was formed in September 2007 for the purpose of acquiring the

925 acres of land located in the M.D. of Foothills (the “Lands”)

• Spruce Ridge was controlled by Harvest as the sole shareholder and Ron Aitkens as its sole director
• Spruce Ridge raised $49M from approximately 1,800 investors by issuing 6% bonds which matured on

December 31, 2012

• Spruce Ridge could not meet its repayment obligations to its bondholders and filed for creditor protection

under CCAA (Companies Creditors Arrangement Act) in August 2012

• A Plan of Arrangement was approved by the bondholders in January 2013 and implemented on May 3,

2013

• The Plan of Arrangement included the following:
• The existing 6% bonds were exchanged for new Class A, non interest bearing bonds and new

common shares. As a result, the bondholders hold 100% of the issued common shares and the shares prior to the implementation were cancelled.

• A new independent Board of Directors was appointed to replace the sole director, Ron Aitkens.

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Who Spruce Ridge is n now…

• Simmons was approached in the spring of 2013 by the Restructuring Officer appointed in the Spruce Ridge

CCAA process to see if there was any interest in the Lands

• On June 27, 2013 Simmons and Spruce Ridge entered into a letter of intent which involved the following:
• $1M investment in bond and share warrants
• Board membership
• Management services
• Simmons along with 2 other investors agreed to these terms and funded Spruce Ridge with $1M
• On December 23, 2013, the Simmons investment closed and management services were transferred in

January 2014

• Jay Simmons and a Simmons nominee were appointed to the Board of Directors

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New Board of Director Directors

Jay Simmons (Managing Director & CEO)

• Mr. Simmons began his career at Deloitte & Touch where he earned a Chartered Accountant designation and focused on Insolvency and Corporate

Restructuring in the Financial and Special Services Department. He went on to build his own private holding company, Simmons Financial Holdings Corp., a personal holding company that takes an active role in a portfolio of businesses that require either financial restructuring or patient and active capital to fund new ventures. Mr. Simmons sits on all the Board of his investment companies and often takes an active role in management. He serves as Chairman and CEO of Durum Properties Inc., a real estate holding company with a portfolio of 6 industrial properties under management as well as 330 acres of development land. Mr. Simmons serves as Director for many companies and is an ICD.D. Robert Brawn

• Mr. Brawn is the President of 1573568 Alberta Ltd., a private investment company. Mr. Brawn sits on the Board of Directors for Black Diamond

Group Ltd., Durum Properties Inc., and Spruce Ridge Capital Inc. He also served as director for many private and public companies, including ATB Financial, United Communities Ltd., Churchill Development Ltd., the Calgary Olympic Organizing Committee and the Calgary Airport Authority. Over the last 20 years he has co-chaired the Calgary Economic Development Authority, chaired the Calgary Winter Festival Foundation, and sat on the advisory council to the University of Calgary. Mr. Brawn was also the President of the Calgary Chamber of Commerce, the Independent Petroleum Association of Canada, Alberta Economic Development Authority, and was LCol. of 746 (Calgary) Communication Squadron and is currently a director and chairman of the Van Horne Institute. Mr. Brawn was recognized in 2001 by the Association of Professional Engineers, Geologists, and Geophysicists of Alberta with a Community Service Award, received the University of Calgary and Bow Valley College’s Distinguished Business Leader Award in 1996, the Calgary Chamber of Commerce's Kay Pringle Memorial Award in 1995, and the Canadian Commemorative Award from the federal government in 1992. In 2012, Mr. Brawn was inducted into the Calgary Business Hall of Fame. Bruce Duckworth

• Mr. Duckworth is an entrepreneur and real estate investor. Prior to 2008 he started, developed and eventually sold a group of printing companies

known as the Sheraton Group of Companies. His last sale being Digital Jungle Inc., which was sold at the end of 2007. Mr. Duckworth remained with Digital Jungle as an executive during 2008 and resigned at the end of that year to pursue other personal investments. Mr. Duckworth is now involved in many real estate investments and manages his holdings through Hunter Duckworth Holdings Ltd. Mr. Duckworth remains involved in his investments and serves as Director for Sheraton Holdings Ltd., Railside Capital Inc., Spruce Ridge Capital Inc. and Foundation Place Capital Inc. Mr. Duckworth also owns and operates an importing business, and serves as President and director for Hunter Duckworth Communications which services the Hotel industry and a variety of printing customers.

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New Board of Director Directors (Cont (Cont’d) d)

Morgan Tudor

• Mr. Tudor has worked as a senior professional in sporting goods retail for over 35 years, including leadership positions in purchasing, logistics, and
• perations. He has been President and owner of the Forzani Tech Shops, Alberta’s Original Running and Walking stores, since 2003. Originally

beginning his career with the Forzani Group Ltd in 1979, he initially held senior positions in operations and continued on to become Vice President of

• purchasing. As FGL Ltd. acquired the Sport Chek and Sports Experts groups, Morgan moved over to manage and control the national supply chain

and designed and built FGL’s distribution centers. Jeff Zakaluk

• Mr. Zakaluk is a highly motivated, award winning, creative sales executive with over 20 years of successful sales and sales management in both

established and territory expansion situations for some of the biggest names in internet and print advertising including Verizon and TELUS, ATB Financial MasterCard, Cameron, Weatherford, and FMC in oil and gas. His achievements include both a nomination for excellence in leadership and induction into the Verizon Hall of Fame for transforming an expansion market sales team to a successful collaborative model adopted throughout the

• company. Mr. Zakaluk holds a Bachelor of Arts degree from the University of Winnipeg and Diploma (Honours) in Commerce, Sales and Marketing

from Red River College.

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New Team

David Laycock (Managing Director, SFHC)

• Mr. Laycock, a partner of Simmons Financial Holdings Corporation, is an entrepreneurial, growth-oriented leader with experience in building

companies across the energy sector and in other industries. He began his career as a strategy consultant at McKinsey & Company where he advised Fortune 1000 companies on new growth initiatives. Mr. Laycock was also a private equity investor at two noted private equity firms, Northgate Capital Partners near San Francisco and Charlesbank Capital Partners in Boston. He later moved on to North West Capital where he was an officer of two of the companies he built, leading one company from an idea through to value in excess of $100 million and leading another through a significant turnaround, during which time the company tripled revenue and became cash flow positive. Mr. Laycock received a Master of Business Administration from Harvard Business School, where he graduated in the top 5% of his class and was named a Baker Scholar. He also received Bachelor of Science in Accounting and a Master of Accountancy from Brigham Young University. He is also involved in various community endeavors, including serving on the Investment committee of the Calgary Chamber of Commerce and as the Board Chair of Attainable Homes Calgary

• Corporation. In 2008, David was named as one of Calgary’s Top 40 Under 40.

Judy Rattanavong (Vice President)

• Ms. Rattanavong obtained her Bachelor of Commerce degree from the University of Saskatchewan, specializing in Finance and Human Resource
• Management. Ms. Rattanavong joined Simmons Financial Holdings Corporation (SFHC) in 2007 and is currently the Vice President of the
• rganization. In her time with SFHC, she brings experience in private equity including start-ups and turn-arounds. Ms. Rattanavong also serves as the

Vice President of many real estate holding companies including Durum Properties Inc., Flax Properties LP and Spruce Ridge Capital Inc.; she also serves as Vice President and director for Foundation Place Capital Inc. Ms. Rattanavong currently operates and manages over 13 properties including 1,250 acres of development land. Kristi Beunder Kristi has over twenty years of solid urban and rural planning experience. Her career’s primary focus has been in service to the private sector, but she has a background in the public sector as a planner for several municipalities. As a result, she offers her clients a rich experience and knowledge in municipal and policy matters, as well as private sector land use planning and development. Kristi has been the project manager and lead planner for numerous complex land development projects. Some projects of note are Heritage Pointe, Artesia and Hawks Landing. She brings an unparalleled level of expertise, insight, and sensitivity to each project. Kristi seeks out creative and achievable solutions to all planning challenges. She takes pride in her mature partnerships within the land development industry, including: engineering, surveying, environmental science and construction firms. Kristi is an effective communicator who crafts a unique approach for each stakeholder and approving authority. She is a qualified expert witness at the Municipal Government Board, The Alberta Energy Resources Conservation Board, and the Court of Queen’s Bench. In 2005 Kristi was awarded an Alberta Centennial Medal for outstanding contribution to her community. Kristi’s personal passion and leadership in equestrian sport also gives her a unique perspective on rural land development and the pursuit of excellence.

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About About the L Lands

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Spruce e Ridge Details

• 925 acres on the NE corner of Hwy 22 (Cowboy

Trail) and 242 Ave W (Plumbers Road)

• 3km from the Calgary City Limits
• MD of Foothills, AB
• Land Use Classification: Agricultural District
• Outstanding Views populated with The Who’s

Who of Calgary

• Community: Spruce Meadows; Cross Conservation

Lands; Calgary Polo Club; Strathcona Tweedsmuir; Numerous Private Stables; Black Diamond Polo Club; Millarville Farmer’s Market

Hwy 22 242 Ave W

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Growth o

• f

Calgary ry

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Taking g a Lo Look Back

1984 2012 2005 1995

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Taking g a Lo Look Back

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Taking g a Lo Look Back

• 200,000

400,000 600,000 800,000 1,000,000 1,200,000 Year 1891 1901 1906 1911 1916 1921 1926 1931 1936 1941 1946 1951 1956 1961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011 Population Year

Calgary's Population Growth from 1800 to 2011

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Looking ng Forward

City of Calgary Growth Report

• Calgary growth forecast between 2014

and 2018 is an increase in population of 114, 300

• To accommodate this growth, the City of

Calgary will need 2,232 hectares of land

• The City of Calgary has a capacity with

approved area structure plans of 5,590 hectares which would accommodate 380,542 new residents

• How long until the City of Calgary runs
• ut of land? 2022?

Conventional Development for Spruce Ridge is Many Years Away

Southwest Ring Road

http://www.calgary.ca/PDA/pd/Documents/Publications/calgary-snapshots-2014.pdf

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Objecti tive ve, Opportu tuni nity y & Timelin ine

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Objecti tive: ve: Create e Value for Shareho hold lders rs

• Time is Money (faster is better)
• Art of the Do-able
• What will the MD of Foothills

approve?

• What will be accepted by the

community?

• What do the consumers want?

Country Residential

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Opportu tunit nity: y: Working ng with the Community ty

• Partner with our neighbor:

the Cross Conservation

• Develop a plan of

conservation by design: 100 single family homes surrounded by nature and hiking trails

• Attract buyers by providing

purchaser a tax benefit by gifting ecologically sensitive lands

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Timelin ine

2020 2

2015 2018 2017 2016 2019 2020 FINISH

Fundraising, Planning & Submit Applications Seek MD of Foothills Approvals Sell or Seek Development Partner Finance & Begin Infrastructure Development Develop, Market & Sell

Potential Exit Potential Exit Potential Exit

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Summary ry

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Summary ry

• Spruce Ridge owns a spectacular piece of land
• We have a quality Board of Directors
• We have a dedicated and well aligned management team
• We have an execution plan to create value

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Questio ions ns? Thank you