TPT September 2010

I ndustry N ews

Pure completes acquisition of Pressure Pipe Inspection Company PURE Technologies Ltd has announced that it has concluded the purchase of The Pressure Pipe Inspection Company (PPIC) for up to CAD$34.9mn in cash and common stock of Pure. PPIC, a privately-held company with headquarters in Mississauga, Ontario, is a leader in large-diameter water and wastewater pipeline condition assessment. PPIC is currently active in North America (including Mexico), South America, the Philippines and Hong Kong. The base purchase price is $30mn with provision for a maximum additional payment of $4.9mn should PPIC generate revenues of $24.9mn for the fiscal year ended 30 September 2010. The amount of the additional payment will be reduced on a dollar-for-dollar basis for every dollar that fiscal 2010 revenues fall short of $24.9mn. The purchase price is based on a PPIC working capital balance of $800,000 at closing and will be adjusted up or down on a dollar-for-dollar basis depending on the actual working capital at closing. Consideration paid at closing was $8,955,776 in cash and Pure issued 3,782,476 shares valued at $4.44 per share, which was negotiated as part of the transaction. This consideration is net of a holdback amount, which when released, would be paid in cash in the amount of $800,551 and a further 776,903 shares. Any additional payments will be paid approximately 29% in cash and 71% in Pure common stock with an attributed value of $4.44. Dr Brian Mergelas, formerly the chief executive officer of PPIC, is now Pure’s senior vice-president, corporate strategy & development. Dr Mergelas has published over fifty papers in academic and industry journals, and is a recognised expert in the field of pipeline condition assessment. He will be a key contributor to shaping Pure’s strategic direction and in identifying future opportunities to grow Pure’s business. Commenting on the transaction, Pure’s chief executive officer, Mr Peter Paulson, said, “This is a significant milestone for Pure and for the international water technology sector. The combined Pure/PPIC entity will be a world leader in the field of condition assessment and asset management for water and wastewater pipelines. We are excited about the opportunity to work with Dr Mergelas and his team as we continue to build awareness of the need for cost-effective strategies and solutions for the enormous challenges facing pipeline operators around the world. “Working together, we will be able to deliver a cohesive and powerful message to the industry about the value of technology- driven proactive asset management. We are also looking forward to working with PPIC’s research and development team to accelerate the introduction of new condition assessment tools for pipelines.” Pure Technologies Ltd – Canada Fax: +1 403 266 6570

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S eptember 2010

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