WaterKite™ Magazine

January 30, 2001

Volume 1, Number 1

“It’s difficult to manage your time effectively when you’re trying to fill the roles of President, VP Finance, VP Product Design, VP Marketing, VP Sales, VP Business Development, VP Human Resources, Public Relations Director, Chief Accountant, Chief Web Designer, book-keeper, janitor… Well, you get the picture. Sometimes even important things have to get bumped”

There’s something new in the water…

“The city of Vancouver is like a beautiful jewel… an amazing skyline nestled between the ocean and the mountains, crisscrossed by rivers and surrounded by lush rainforest… it’s no wonder they’ve been chosen to host the 2010 Winter Olympics.”

“Coming to Vancouver from a place like Nova Scotia is like arriving in a brand new country… the economy is vibrant and bustling, people are taking risks every day, normal folks are making and losing fortunes and making them back again. People are used to things happening out here; in fact, they actually seem to expect it. For many of them, it’s the reason they came here to live…”

Finally…

WaterKite™ management has been talking about starting an e-mail newsletter for several months now. Despite the fact that an enormous amount of exciting things happen with us every day, all the excitement has ironically kept WaterKite™ from delivering on this promise.

Until now…

Beginning January 30, 2004, WaterKite™ will begin a series of monthly newsletters, to keep everyone who is interested up to date and informed. People who will be receiving this newsletter include investors, clients, employees, and all of the people and organizations who have helped us (and are still helping us) along the way.

We hope you enjoy hearing about our exciting news and events, but if you wish to be removed from our list, please let us know and we will happily remove you.

Best regards,

Trever Miller, President WaterKite Safety and Rescue, Incorporated

Introducing: The New WaterKite™ Inflatable Series

WaterKite™ recently entered negations with OEM manufacturers to prototype the new WaterKite™ inflatable series. Testing will begin in Vancouver sometime near the end of February.

The new design is the result of several months of intensive research and testing at the Pictou Causeway floodway, using techniques shared with us by the Chris Walker (President, Oceanid. Inventor of the top selling Oceanid Rapid Deployment Craft), whom we met at a recent tradeshow.

The new WaterKite™ design will weigh in at only 15 lbs (down from its current heavy 45), and will significantly reduce drag both with its newer, more streamlined form and by reducing the total surface area of the board that comes in contact with the water.

Equally important is the new, exaggerated rocker profile, upturned on both ends. This allows the WaterKite™ to be steered into large standing waves without the risk of “nose diving” –a troublesome feature of the original prototype which could result in a rescue worker being pulled in to the water.

Vancouver

Since first going public in 2002, the WaterKite™ team has contacted by people from all over the world; from places as far away as Sweden, New Zealand, and Israel, and America, and from provinces across Canada.

As a direct result of our Canada-wide media exposure, some of our more enthusiastic supporters have included the vice-president of the Canadian Lifeboat Institute, two private business angels, and a movie producer… all of which had two things in common: their keen interest in the WaterKite™ and their patron city –Vancouver.

After a disappointing two years in the pursuit of private investment in our efforts to raise capital in Nova Scotia, the WaterKite™ team has made the difficult strategic decision to heed the signs… all of which have been pointing to Halifax’s sister city on the Pacific Coast.

Surrounded by rivers that are open year-round, many of which rush right through the city, the people of Vancouver are no strangers to whitewater. Thriving in a vibrant and bustling economy, they are also no strangers to taking risks. In the two short weeks since they landed in Vancouver, the WaterKite team has succeeded in getting the ball rolling again, with important business milestones and exciting opportunities once again on the horizon.

Finance

1. Madeline Hombert, producer of the upcoming feature film “If I had Wings” (http://www.wingsmovie.com/) met with WaterKite management shortly after their arrival in Vancouver. In addition to rewriting a scene of the film to feature the WaterKite, Madeline has arranged for us to meet with and demonstrate the WaterKite for her film’s major investor, Joseph Shen. Management is planning a demonstration on the Capilano River in North Vancouver, but is holding off on scheduling the demo until authorization is received from GVRD, and direct communication is established with GVRD water-management officials. Communication must be established so as to have forewarning of activity at Cleveland Dam –both for safety concerns and also to be assured of having a strong and heavy stream flow for the event. Demonstrations are expected to be possible as soon as February 6th.

2. Meeting with Dave Thomas, Partner, Rocket Builders (http://www.rocketbuilders.com/); Canada IT (http://www.canadait.com/), and Financing Forum (http://www.financingforum.com/), scheduled for February 5th to discuss business angels in the area that he thinks would be a match for the WaterKite™ venture. Big thanks to our advisory board member, Terry Norman, for this great contact in the Vancouver venture capital community.

3. WaterKite official Marketing Plan has been finished, and is now undergoing final review/editing before being submitted to ACOA with an application for WaterKite’s first round of government financing.

The WaterKite™ sales team is confident that managers and occupational safety supervisors will be receptive to our message of “keeping them out of the water is the best way to keep your field technicians safe…"

…and themselves of trouble.

“Rescue Canada is a registered Canadian non-profit organisation, and a founding member of the IRIA (International Rescue Instructors Association). IRIA members are recognised by Courts across North America as the subject matter expert source regarding operations in the swift water environment involving swimming, boat operation, diving, rope applications and helicopter operations”

WaterKite™ Safety and Rescue, Inc. P.O. Box 1125 Stellarton, NS BOK1SO Canada

Vancouver Phone: (604) 716-4717

Fax: (902) 396-4660

E-mail: info@waterkite.ca

We’re on the Web! www.waterkite.ca

February Sales Prospects

The WaterKite™ Sales team has decided to focus its sales efforts on the more occupational safety related clients. This strategy will continue at until further swift water rescue training has been completed by the demo team, and management have completed a detailed task analysis and safe operating procedures for rescue operations. For more information on this mission-critical project, please refer to the headline below.

Occupational safety applications, on the other hand, are better off being developed in direct cooperation with the client’s operations managers and field technicians. Similar to our project with the IRIA, our first step will be to perform a detailed task analysis. Tasks will be identified in which the WaterKite™ can be applied to make employee jobs safer, easier, or more effective in the field. A detailed task analysis will be preformed, and safe operating procedures written into the organisation’s employee safety manual or field guide.

Organisations that the WaterKite™ Sales Team is targeting for the month of February include:

1. Greater Vancouver Regional District – Watershed Management

Responsible for the continued safety and supply of water to the Greater Vancouver Area. Relies heavily on the work of field technicians, who continually monitor and maintain the cities three watersheds, which cover 585 square km of forested land and combine with six storage lakes, six dams, 22 reservoirs, and more than 550 km of water mains to make up the GVRD portion of the Lower Mainland water system.

2. Environment Canada – Water Survey Canada – Pacific Division

The Water Survey of Canada is the national agency responsible for the collection, interpretation and dissemination of standardized water resource data and information in Canada. The agency plays a major role in the activities of numerous international and interprovincial boards and commissions involved in the management of Canada's water resources. It is the designated agency responsible for water resource monitoring in support of interjurisdictional agreements and treaties. The Pacific Division, headquartered in Vancouver, BC, is responsible for carrying out the Water Survey Program’s mandate in BC and the Yukon.

3. BC Hydro

BC Hydro owns 61 dams at 42 reservoirs to supply its hydroelectric power generation. Two of these dams are amongst the highest in the world. Built between 1903 and 1984, many of BC's dams are now reaching an age where improvements are necessary to ensure continuing safe performance and public safety. BC Hydro’s Dam Safety Program is a key component of managing these dams and ensuring their ongoing safety. The program forms part of the overall BC Hydro risk management program and is key to the management and avoidance of catastrophic losses in the event of an emergency. BC Hydro remains committed to integrating safety in all they do. In many areas they excel and are conducting their operations in a way that minimizes the chance of injury to employees, contractors and the public.

4. BC Department of Water, Land, and Air Protection

Responsible for the Province of British Columbia’s

o Environmental protection of water, land and air quality including climate change and environmental emergencies (such as floods)

o Environmental stewardship of biodiversity, including wildlife, fish and protected areas

o Park and wildlife recreation management, including hunting, angling, park recreation, and wildlife viewing

o Environmental monitoring and enforcement including the Conservation Officer Service, and State of Environment reporting

1. DFO (Oceans and Fisheries Canada) – Pacific Division

Fisheries and Oceans Canada is the lead federal government department responsible for developing and implementing policies and programs in support of Canada's economic, ecological and scientific interests in oceans and inland waters. This mandate includes responsibility for the conservation and sustainable use of Canada's fisheries resources while continuing to provide safe, effective and environmentally sound marine services that are responsive to the needs of Canadians in a global economy. Including those who serve in our fleet, at each of the six regional offices and at headquarters in Ottawa, Fisheries and Oceans Canada employs approximately 10,000 people across the country. Oceans and Fisheries Canada’s Pacific regional office is located in Vancouver, BC

Task Analysis, Safe Operating Procedures, and Training Program

Rescue Canada –the certifying body for swift water rescue in Canada - has been contracted to consult with WaterKite™ management in the development of WaterKite™ standard operating procedures (SOP), Safety Manual, and training program.

The assessment, prioritization and management of risk and the development of operational principles regarding training, equipment and delivery of service are fundamental building blocks of a safe, efficient and effective rescue system.

Through critical needs and task analysis, and Standard of Care comparisons, risks are prioritized and tasks are broken down to specific skills and knowledge components, so that operational guidelines / procedures, training and equipment purchases are applicable, supportable and defendable.

The record shows, and prior experience confirms, that other management tools which have been used to determine operational parameters in life at risk occupations, such as crisis reaction, personal opinion and personal agendas, stand alone experience, whimsy, etc. are often flawed. And the results, again in critical life at risk occupations, can be fatal and are difficult to defend in court.

The principles of personal responsibility and common sense, based on fact, provide the best results and are the foundations for Rescue Canada's operation. RC has completed projects for a number of private organisations and public agencies. The recommendations have been implemented successfully and in a number of instances have been incorporated into legislation.

News Bites

1. Board of Advisors

WaterKite™ management would like to formerly welcome to the team three new members to our board of advisors:

Terry J. Norman

o M. Sc. in Business Administration, University of British Columbia, Vancouver

o B. Comm., McGill University, Montreal

o Consultant to the Information Technology community

o Chairman of the Board of Directors of DiaPhonics Inc

o Member of the Board and Chief Financial Officer for Web Centrex Inc

Jim Lavalley

o B.Sc., Queens University

o Managing Director, Rescue Canada

o Executive Director, International Rescue Instructors Association

Captain Albert Lee

o Director, The Nautical Institute, BC Branch

o VP, Executive Committee, Canadian Lifeboat Institute

o Member, Naval Officers Association of British Columbia

o Member, Company of Master Mariners, Canada

o Retired Captain of the Singapore Navy

2. Swift water Rescue Training

WaterKite™ management is proud to announce that WaterKite™ Founder and President Trever Miller will be receiving his next level of swift water rescue training in Squamish, BC beginning Februar7 29 and ending March 3. This will bring Mr. Miller up to his Technician Level, or Level III Swift water Rescue Training. Many thanks go out to Northern Opportunities for Business Ltd (NOBL) for their continued support in this and other areas.

3. Go Team Canada!!

Management will be meeting with representatives from Team Canada to discuss possible export opportunities for the WaterKite™ to foreign markets, and possible roles that Team Canada can play in helping WaterKite™ realize these goals.

The meeting is scheduled for March 12 at 2:00 pm, and will be taking place at the BC Business Services Society in Downtown Vancouver.

4. Web News: The numbers are in…

WaterKite’s web promotion efforts continue to pay off, with solid gains in web traffic for the third straight month in a row. Total unique visitors this month topped 1200 (1273 to be exact), up from 572 in the month of October. Average unique visitors per day are up to 41, from 18 in the same month.

Total search strings that resulted in highly qualified target marketing leads included swift water rescue (19 hits), water rescue equipment (12 hits), military special ops (7 hits), swift water rescue pictures (5 hits), swift water rescue equipment (4 hits), flood control products (3 hits), and water rescue supplies (3 hits). Actual search engine rankings can be found by going to Google.com and searching on each string.

WaterKite™ management continues to work on and improve the company website whenever we can budget the time, and expect our climb up the search engine charts to continue for the foreseeable future.