8-K

UNITED STATES SECURITIES AND

EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) August 11, 2006

NORTHWEST PASSAGE VENTURES, LTD.

(Exact name of registrant as specified in its charter)

Nevada

(State or other jurisdiction of incorporation)

33-110052

(Commission File Number)

20-0177856

(IRS Employer Identification No.)

509 – 207 West Hastings Street, Vancouver, British Columbia, Canada, V6B 1H7

(Address of principal executive offices and Zip Code)

604.687.3113

Registrant's telephone number, including area code

Nil

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

FORWARD LOOKING STATEMENTS

This current report contains forward-looking statements as that term is defined in section 27A of the United States Securities Act of 1933, as amended, and section 21E of the United States Securities Exchange Act of 1934, as amended. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "will", "should", "intends", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential", or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors" on page 3 of this current report, which may cause our or our industry's actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements.

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Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity or performance. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

As used in this current report and unless otherwise indicated, the terms "we", "us" and "our" refer to Northwest Passage Ventures, Ltd. and our wholly-owned subsidiary. Unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to "common shares" refer to the common shares in our capital stock.

ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS

On August 11, 2006, we entered into a share exchange agreement with 6544797 Canada Ltd., a Canadian corporation and wholly-owned subsidiary of our company (the "Purchaser"), Americas Wind Energy Inc., a private Ontario corporation ("Priveco"), and the former shareholders of Priveco.

The closing of the transactions contemplated in the share exchange agreement and the acquisition of all of the issued and outstanding common stock of Priveco occurred on August 11, 2006. In accordance with the closing of the share exchange agreement, we:

(i) caused the Purchaser to issue 30,000,000 class A preference shares in the capital of the Purchaser, giving the right to acquire 30,000,000 common shares in the capital of our company, to the former shareholders of Priveco on the basis of 230.769230769 class A preference shares for every one common share of Priveco; and

(ii) issued 30,000,000 class A special voting shares in the capital of our company, to the former shareholders of Priveco on the basis of 230.769230769 class A special voting shares for every one common share of Priveco,

in exchange for the requisition by our company of all of the 130,000 issued and outstanding common shares of Priveco.

Our company had 22,503,894 common shares and 30,000,000 class A special voting shares issued and outstanding as of August 24, 2006 as a result of the cancellation of 37,541,249 common shares held by Axel Roehlig, the issuance of 2,500,000 common shares, which common shares were issued pursuant to a private placement of 2,500,000 units in connection with the share exchange agreement, and the issuance of 30,000,000 class A special voting shares. The cancellation of stock, the issuance of the 2,500,000 common shares pursuant to the private placement of units and the creation and issuance of the class A special voting shares were conditions to closing of the shares exchange agreement. Accordingly, Axel Roehlig tendered 37,541,249 common shares of our company for cancellation without consideration, we issued 2,500,000 common shares pursuant to a private placement of units and we amended our Articles of Incorporation to create the 30,000,000 class A special voting shares and issued said class A special voting shares to the former shareholders of Priveco. Each class A special voting share entitles the holder thereof to receive notice of, and vote at, all general meetings of our shareholders. As of the closing date, the former shareholders of Priveco held 30,000,000 class A special voting shares, representing approximately 60% of the issued and outstanding voting securities of our company.

In addition, we caused the Purchaser to issue 30,000,000 class A preference shares to the former shareholders of Priveco. The incorporation of the Purchaser and the issuance of the 30,000,000 class A preference shares was in furtherance of the share exchange agreement and to facilitate Canadian tax planning by the former shareholders of Priveco. The class A preference shares in the capital of the Purchaser are exchangeable into an equal number of common shares in the capital of our company upon surrender of a like number of class A special voting shares in the capital of our company. As of the closing date, the former shareholders of Priveco held 30,000,000 class A preference shares in capital of the Purchaser, which class A preference shares are exchangeable into, upon surrender of a like number of class A special voting shares in the capital of our company, approximately 60% of the issued and outstanding common shares in the capital of our company. The share exchange is deemed to be a reverse acquisition for accounting purposes. Priveco, the acquired entity, is regarded as the predecessor entity of August 11, 2006. Starting with the periodic report for the quarter in which the acquisition was consummated, our company will file annual and quarterly reports based on the July 31 fiscal year end of Priveco. Such financial statements will depict the operating results of Priveco, including the acquisition of our company, from August 11, 2006.

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RISK FACTORS

In addition to other information in this current report, the following risk factors should be carefully considered in evaluating our business because such factors may have a significant impact on our business, operating results, liquidity and financial condition. As a result of the risk factors set forth below, actual results could differ materially from those projected in any forward-looking statements. Additional risks and uncertainties not presently known to us, or that we currently consider to be immaterial, may also impact our business, operating results, liquidity and financial condition. If any such risks occur, our business, operating results, liquidity and financial condition could be materially affected in an adverse manner. Under such circumstances, the trading price of our securities could decline, and you may lose all or part of your investment.

RISKS RELATED TO OUR BUSINESS

We have had negative cash flows from operations since inception. We will require additional financing, the availability of which cannot be assured, and if our company is unable to obtain such financing, our business may fail.

To date, we have had negative cash flows from operations and have depended on sales of our equity securities and debt financing to meet our cash requirements. Our ability to develop our business will be dependent upon our ability to raise additional financing. If we are unable to obtain such financing, we will not be able to fully develop our business. Specifically, we will need to raise additional funds to:

- support our planned growth and carry out our business plan;

- continue in our research and development programs;

- address competing technological and market developments;

- establish additional collaborative relationships; and

- market and develop our products and licenses.

We may not be able to obtain additional equity or debt financing on acceptable terms as required. Even if financing is available, it may not be available on terms that are favorable to us or in sufficient amounts to satisfy our requirements. If we require, but are unable to obtain, additional financing in the future, we may be unable to implement our business plan and our growth strategies, respond to changing business or economic conditions, withstand adverse operating results and compete effectively. More importantly, if we are unable to raise further financing when required, we may be forced to scale down our operations and our ability to generate revenues may be negatively affected.

We have a history of losses and nominal operating results, which raise substantial doubt about our ability to continue as a going concern.

Since inception through April 30, 2006, we have incurred aggregate net losses of $957,766 from operations. We can offer no assurance that we will operate profitably or that we will generate positive cash flow in the future. In addition, our operating results in the future may be subject to significant fluctuations due to many factors not within our control, such as the level of competition and general economic conditions.

Our company's operations will be subject to all the risks inherent in the establishment of a developing enterprise and the uncertainties arising from the absence of a significant operating history. No assurance can be given that we may be able to operate on a profitable basis.

Due to the nature of our business and the early stage of our development, our securities must be considered highly speculative. We are engaged in the business of distributing wind power turbines to wind farm developers in North America. We have not realized a profit from our operations to date and there is little likelihood that we will realize any profits in the short or medium term. Any profitability in the future from our business will be dependent upon the successful commercialization of our wind turbines and the licensing of the technology and product lines developed by Lagerwey Windturbine B.V., which are subject to numerous risk factors as set forth herein.

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We expect to continue to incur development costs and operating costs. Consequently, we expect to incur operating losses and negative cash flows until our products and licenses gain market acceptance sufficient to generate a sustainable level of income from the commercialization of our wind turbines and the licensing of the Lagerwey Windturbine B.V. technology and product lines. Our history of losses and nominal operating results raise substantial doubt about our ability to continue as a going concern, as described in the explanatory paragraph in our independent registered public accounting firm's report dated May 29, 2006.

We may lose our competitiveness if we are not able to protect our intellectual property rights against infringement, and any related litigation may be time-consuming and costly.

Our success and ability to compete depends to a significant degree on our ability to protect our intellectual property rights. If any of our competitors copy or otherwise gain access to our intellectual property or develop similar products independently, we may not be able to compete as effectively. We currently rely on internal and external intellectual property rights for our existing product lines and turbine solutions, which include contractual provisions to establish and protect our proprietary rights. This, however, may not be adequate to prevent the unauthorized use of the proprietary technology used in our products and our other intellectual property rights. Further, the laws of foreign countries may provide inadequate protection of such intellectual property rights. We may need to bring legal claims to enforce or protect such intellectual property rights. Any litigation, whether successful or unsuccessful, may result in substantial costs and a diversion of our company's resources. In addition, notwithstanding our rights to our intellectual property, other persons may bring claims against us alleging that we have infringed on their intellectual property rights or claims that our intellectual property rights are not valid. Any claims against us, with or without merit, could be time consuming and costly to defend or litigate, divert our attention and resources, result in the loss of goodwill associated with our business or require us to make changes to our products.

We did not generate any revenues from operations during our most recent fiscal year and if we are unable to develop market share and generate significant revenues from the commercialization or licensing of our product lines, then our business may fail.

We operate in a highly competitive industry and our failure to compete effectively and generate income through the commercialization or licensing of our product lines may adversely affect our ability to generate revenue. Our company's future success will depend on our ability to enhance current products, develop new products and services that meet changing customers needs, advertise and market our products, and respond to emerging industry standards and other technological changes on a timely and cost effective basis. There can be no assurance that our new or existing products will gain market acceptance. Management is aware of similar products and services which our products and services will compete directly against. Many of our competitors have greater financial, technical, sales and marketing resources, better name recognition and a larger customer base than ours. In addition, many of our large competitors may offer customers a broader or superior range of products and services. Some of our competitors may conduct more extensive promotional activities and offer lower commercialization costs to customers than we do, which could allow them to gain greater market share or prevent us from establishing and increasing our market share. Increased competition in the alternative energy industry may result in significant price competition, reduced profit margins or loss of market share, any of which may have a material adverse effect on our ability to generate revenues and successfully operate our business. Our competitors may develop technologies superior to those that our company is currently developing. In the future, we may need to decrease our prices if our competitors lower their prices. Our competitors may be able to respond more quickly to new or changing opportunities, technologies and customer requirements. Such competition will potentially affect our chances of achieving profitability, and ultimately affect our ability to continue as a going concern.

If we fail to effectively manage the growth of our company and the commercialization or licensing of our products and services, our future business results could be harmed and our managerial and operational resources may be strained.

As we proceed with the development of our products and services and the expansion of our commercialization efforts, we expect to experience significant growth in the scope and complexity of our business. We will need to add staff to market our services, manage operations, handle sales and marketing efforts and perform finance and accounting functions. We anticipate that we will be required to hire a broad range of additional personnel in order to successfully advance our operations. This growth is likely to place a strain on our management and operational resources. The failure to develop and implement effective systems, or to hire and retain sufficient personnel for the performance of all of the functions necessary

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to effectively service and manage our potential business, or the failure to manage growth effectively, could have a material adverse effect on our business and financial condition.

Uncertainty in market conditions and other unforeseen factors may negatively affect our operations and financial condition.

We participate in a relatively new marketplace, wind turbine development, which is susceptible to the risks of market change, new competition and other currently unforeseen factors. Any event that negatively affects the sale of our products or services, or a change in competitors' strategies, significant quality problems, negative publicity or evaluation, reduced market acceptance or obsolescence of, our product offerings, a change in our operating environment, could have a material adverse effect on our business, financial condition or results of operations.

If we do not keep pace with our competitors, technological advancements and market changes, our products may become obsolete and our business may suffer.

The market for our products is very competitive, is subject to technological changes and varies for different individual customers. Our growth and future financial performance depend in part on our ability to enhance existing wind turbines and to develop and introduce new turbine and renewable energy solutions to incorporate technological advances that satisfy local regulatory requirements or expectations.

Many of our competitors have significantly greater resources and have developed products and processes that directly compete with our products. Our competitors may develop new wind turbines that directly compete with our wind turbines or even render our wind turbines obsolete. If we are unable to bring our new product lines or renewable energy solutions to market on a timely or cost effective basis, or our competitors are able to develop products that achieve greater market acceptance than ours, our business and financial performance will suffer.

Our ability to hire and retain key personnel will be an important factor in the success of our business and a failure to hire and retain key personnel may result in our inability to manage and implement our business plan.

We are highly dependent upon our management personnel such as Harold Dickout and Frank Pickersgill because of their experience in the development and ongoing operations of our company. The loss of the services of one or more of these individuals may impair management's ability to operate our company. We have not purchased key man insurance on any of these individuals, which insurance would provide us with insurance proceeds in the event of their death. Without key man insurance, we may not have the financial resources to develop or maintain our business until we could replace the individual or to replace any business lost by the death of that person. The competition for qualified personnel in the markets in which we operate is intense. In addition, in order to manage growth effectively, we must implement management systems and recruit and train new employees. We may not be able to attract and retain the necessary qualified personnel. If we are unable to retain or to hire qualified personnel as required, we may not be able to adequately manage and implement our business.

Our company is dependent on various third parties to support our business, such as suppliers, licensors and manufacturers.

We utilize a variety of third parties to support our business, such as suppliers and licensors and manufacturers. Our ability to secure and maintain these relationships will be critical to the success of our business objectives, and conversely the inability to secure these future relationships on reasonable commercial terms represents a risk and could have a material adverse effect on our operations or financial condition.

Most of our assets and all of our directors and officers are outside the United States, with the result that it may be difficult for investors to enforce within the United States any judgments obtained against us or any of our directors or officers.

Although we are organized under the laws of the State of Nevada, United States, our principal business office is located in Toronto, Ontario, Canada. Outside the United States, it may be difficult for investors to enforce judgements against us that are obtained in the United States in any action, including actions predicated upon civil liability provisions of federal securities laws. In addition, all of our directors and officers reside outside the United States, and nearly all of the assets of these persons and our assets are located outside of the United States. As a result, it may not be possible for investors to

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effect service of process within the United States upon such persons or to enforce against us or such persons judgements predicated upon the liability provisions of United States securities laws. There is substantial doubt as to the enforceability against us or any of our directors and officers located outside the United States in original actions or in actions of enforcement of judgments of United States courts or liabilities predicated on the civil liability provisions of United States federal securities laws. In addition, as the majority of our assets are located outside of the United States, it may be difficult to enforce United States bankruptcy proceedings against us. Under bankruptcy laws in the United States, courts typically have jurisdiction over a debtor's property, wherever it is located, including property situated in other countries. Courts outside of the United States may not recognize the United States bankruptcy court's jurisdiction. Accordingly, you may have trouble administering a United States bankruptcy case involving a Nevada company as debtor with most of its property located outside the United States. Any orders or judgements of a bankruptcy court obtained by you in the United States may not be enforceable.

RISKS RELATED TO OUR COMMON STOCK

If we issue additional shares in the future, it will result in the dilution of our existing shareholders.

Our Articles authorizes the issuance of up to 100,000,000 shares of common stock and 30,000,000 class A special voting shares. Our board of directors may choose to issue some or all of such shares to acquire one or more businesses or to provide additional financing in the future. The issuance of any such shares will result in a reduction of the book value and market price of the outstanding shares of our common stock. If we issue any such additional shares, such issuance will cause a reduction in the proportionate ownership and voting power of all current shareholders. Further, such issuance may result in a change of control of our corporation.

Trading of our stock may be restricted by the Securities Exchange Commission's penny stock regulations, which may limit a stockholder's ability to buy and sell our stock.

The Securities and Exchange Commission has adopted regulations which generally define "penny stock" to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and "accredited investors". The term "accredited investor" refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the Securities and Exchange Commission, which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.

NASD sales practice requirements may also limit a stockholder's ability to buy and sell our stock.

In addition to the "penny stock" rules described above, the National Association of Securities Dealers (NASD) has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and other information. Under interpretations of these rules, the NASD believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers.

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The NASD requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

Our common stock is illiquid and the price of our common stock may be negatively impacted by factors which are unrelated to our operations.

Our common stock currently trades on a limited basis on the OTC Bulletin Board. Trading of our stock through the OTC Bulletin Board is frequently thin and highly volatile. There is no assurance that a sufficient market will develop in the stock, in which case it could be difficult for shareholders to sell their stock. The market price of our common stock could fluctuate substantially due to a variety of factors, including market perception of our ability to achieve our planned growth, quarterly operating results of our competitors, trading volume in our common stock, changes in general conditions in the economy and the financial markets or other developments affecting our competitors or us. In addition, the stock market is subject to extreme price and volume fluctuations. This volatility has had a significant effect on the market price of securities issued by many companies for reasons unrelated to their operating performance and could have the same effect on our common stock.

DESCRIPTION OF BUSINESS

CORPORATE HISTORY

We were incorporated pursuant to the laws of the State of Nevada on August 22, 2003 and since inception have been in the development stage of establishing a marine adventure tourism business providing luxury excursions throughout the Pacific Northwest, primarily in and around Vancouver and the Gulf Islands, British Columbia, Canada. We own a website through which we intended to market our services and possibly attract advertisers to our website.

Despite the efforts of our management, we were not successful in implementing our business plan of providing marine adventure tours and have not attracted the business we anticipated. Our anticipated business plans and the operation of our company, as described in our most recent Form 10-KSB have not and will not be achieved or further pursued by our management. Due to our inability to generate sufficient revenues to continue operations, we have decided to seek and identify a different line of business. Accordingly, we abandoned our previous business plan and focussed on the identification of suitable businesses with which to enter a business opportunity or business combination. On August 11, 2006 we entered into a share exchange agreement with Priveco. The share exchange contemplated our company acquiring all of the issued and outstanding common shares of Priveco in exchange for:

(i) 30,000,000 class A preference shares in the capital of the Purchaser, giving the right to acquire 30,000,000 common shares in the capital of our company, and

(ii) 30,000,000 class A special voting shares in the capital of our company.

The closing of the transactions contemplated in the share exchange agreement and the acquisition of all of the issued and outstanding shares of Priveco occurred on August 11, 2006. As at the closing date, the former shareholders of Priveco held approximately 60% of the issued and outstanding voting securities of our company. The acquisition of Priveco is deemed to be a reverse acquisition for accounting purposes. Priveco, the acquired entity, is regarded as the predecessor entity as of August 11, 2006. Starting with the periodic report for the quarter in which the acquisition was consummated, our company will file annual and quarterly reports based on the July 31 fiscal year end of Priveco. Such financial statements will depict the operating results of Priveco, including the acquisition of our company, from August 11, 2006.

BUSINESS SUBSEQUENT TO THE ACQUISITION OF UPSTREAM CANADA

As of the closing date of the share exchange agreement on August 11, 2006, our company commenced the business of distributing wind power turbines to wind farm developers throughout North America. Our business strategy is to generate revenues through the sale of medium sized wind turbines and the licensing of Lagerwey wind turbine technology and product lines.

Our company will focus on the manufacturing and marketing of medium sized (500 – 1,000 megawatt (MW)) wind turbines for the North American market.

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Our strategy is to manufacture as much as possible in North America, providing both cost effectiveness and local content. All of our projects to date have made use of local tower manufacturers.

We are and intend to remain a virtual manufacturer. We will subcontract the components of our wind turbines to qualified manufacturers and manufacturing partners to achieve the best in quality at the lowest cost. As a key part of the strategy of a virtual manufacturer, we will maintain strict quality assurance programs and quality control procedures for our subcontractors and partners.

Suitable applications for our wind turbines include:

- Wind farms;

- Municipal wind power systems;

- Large agricultural wind power systems;

- Imbedded system for industry and mining; and

- Wind systems integrated with other technologies, e.g. wind diesel.

Our company holds an exclusive license from Emergya Wind Technologies B.V., for the technology and product lines in the medium sized wind turbine class developed by Lagerwey Windturbine B.V., for North America. We replaced the European designed power converter in the Lagerwey product with a North American designed and manufactured power converter to meet North American standards and electrical grid requirements. The resulting product combines state of the art European wind turbine technology and experience with North American power electronics.

We intend to license the Lagerwey Direct Drive technology to the North, South and Central American markets. The Lagerwey Direct Drive technology eliminates the main drive gear, the most problematic component of a wind turbine, and is intended to increase reliability and performance of our wind turbines. The Lager Direct Drive technology was purchased by Emergya Wind Technologies B.V., of which our company was one of the initial investors. Our company also provided the funds used by Emergya Wind Technologies B.V. to purchase the Lagerwey technology. We have a license agreement with Emergya Wind Technologies B.V. in respect of the Lagerwey technology for North, South and Central America.

Our license agreement with Emergya Wind Technologies B.V. is exclusive for North America, i.e. the United States, Canada and Mexico, but non-exclusive for South and Central America. We pay a license fee and a 3% royalty for ongoing development.

BRIEF INTRODUCTION TO THE WIND ENERGY INDUSTRY

Certain of the following information, as indicated, is summarized from the American Wind Energy Association (AWEA), available at www.awea.org. The information obtained from the AWEA's website does not form part of this current report.

Wind power is the fastest growing energy source in the world with 28% growth in 2005 (www.awea.org). The industry has come of age and is assuming its place in North America as a major contributor to the electrical energy production market. As it did in Europe, demand driven factors are propelling the industry's dramatic growth.

Governments at all levels throughout North America are spurring demand through various public policy measures, including tax incentives, renewable portfolio standards, direct purchases, and power purchase agreements.

The U.S. federal government supports the industry through the use of a production tax credit ("PTC"). The PTC's spur demand for new wind energy installation through the availability of tax rebates of $.019/kiloWatt (kW) for new wind power generation for a period of 10 years. The current PTC has been extended through 2007.

As States look for renewable energy sources to avoid price fluctuations of conventional energy, to satisfy public support for green electricity, and to spark economic growth, particularly in rural areas, they have adopted a public policy tool known as

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Renewable Portfolio Standards ("RPS"). RPSs mandate that a certain portion of energy production come from renewable sources.

The Canadian government supports the wind industry through the Wind Power Production Incentive Program. This program was designed to spur production of up to 1,000 megaWatts (MW) of wind power by providing a direct cash subsidy to producers of 1.0 cent per kW of production. The federal government has pledged to increase the program to 4,000 MW. This program has been helpful in supporting wind farm development, which in turn benefits manufacturers such as our company.

Consumers appear to be accepting wind power because it offers clean, renewable energy while shunning the traditional sources of thermal, hydro and nuclear generation because of their significant negative environmental effects. Businesses are buying wind energy because it offers competitive and stable costs. Production costs have dropped 90% (www.awea.org) in 20 years due to wind turbine design improvements while at the same time the cost of electrical production from the traditionally dominant source of fossil fuels continues to rise dramatically with record oil prices. The result is that wind power offers fixed prices and competitive economics.

Industry in North America

United States

The U.S. wind energy industry broke earlier annual installed capacity records in 2005, installing nearly 2,500 MW or over $3 billion worth of new generating equipment in 22 states (www.awea.org).

The final tally of 2,431 MW boosted the cumulative U.S. installed wind power fleet by over 35%, bringing the industry's total generating capacity to 9,149 MW. The previous record capacity figure was set in 2001 when 1,697 MW of new capacity was installed (www.awea.org).

Wind energy facilities now installed in the U.S. will produce as much electricity annually as 2.3 million average American households use (www.energy.gov.on.ca), and will displace emissions of more than 15 million tons of carbon dioxide (the leading greenhouse gas) annually (www.awea.org).

The growth in wind power construction comes at a time when customers across the country are facing electricity and natural gas rate hikes due to the natural gas supply shortage. Wind power, which generates energy without using fuel, provides a hedge against rising energy costs because wind energy production is immune from fuel price spikes. The AWEA estimates that an installed capacity of 9,149 MW of wind power will save over half a billion cubic feet of natural gas per day (Bcf/day) in 2006, alleviating a portion of the supply pressure that is now facing the natural gas industry and is driving prices upward.

Canada

Canada has a significant wind energy resource and could reasonably meet 20% of its total energy needs with wind power. It is estimated that Northern Quebec alone has enough wind resource to produce 40% of Canada's energy needs. In addition to the wind resource, it is necessary to consider how much wind energy can be effectively integrated into the electricity grid and at what cost. Based on the experience of other countries it may be possible for Canada to achieve 20% of its electricity needs from wind energy. This would result in 50,000 MW of wind energy capacity. This compares with less than 1,000 MW of wind energy installed in Canada at the beginning of 2006.

PRODUCTS

The AWE 52-750 Model

The AWE 52-750 is a 750 kW direct drive turbine, with an up wind rotor. The rotor consists of three blades that can be actively and individually pitched over their full span.

The AWE 52-750's elegant high tech energy conversion system produces electric power of an excellent quality with its slow running ring generator.

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In direct drive turbines, the number of components has been reduced tremendously. The result is a less vulnerable machine. The rotor and generator rotate as one integrated unit, supported by a designed single bearing system.

The absence of a gearbox simplifies maintenance procedures. The use of a monocoque nacelle also allows "all weather" access to essential systems and controls due to internal access.

The AWE 52-900 Model

The AWE 52-900 is a 900 kW direct drive turbine, with an up wind rotor. The rotor consists of three blades that can be actively and individually pitched over their full span.

The AWE 52-900's elegant high tech energy conversion system produces electric power of an excellent quality with its slow running ring generator.

In direct drive turbines, the number of components has been reduced tremendously. The result is a less vulnerable machine. The rotor and generator rotate as one integrated unit, supported by a designed single bearing system.

The absence of a gearbox simplifies maintenance procedures. The use of a monocoque nacelle also allows "all weather" access to essential systems and controls due to internal access.

The AWE 52-900 turbine is available in two configurations. A 52 meter rotor diameter machine for Class II wind conditions. A 54 meter rotor diameter machine (the AWE 54-900) is also available for Class III lower wind conditions.

The AWE 52-900 comes in three versions:

AWE 52-900-40	with a 40m tower
AWE 52-900-50	with a 50m tower
AWE 52-900-75	with a 75m tower

AWE 54-900 Model

The AWE 54-900 is a 900 kW direct drive turbine, with an up wind rotor. The rotor consists of three blades that can be actively and individually pitched over their full span.

The AWE 54-900's elegant high tech energy conversion system produces electric power of an excellent quality with its slow running ring generator.

In direct drive turbines, the number of components has been reduced tremendously. The result is a less vulnerable machine. The rotor and generator rotate as one integrated unit, supported by a designed single bearing system.

The absence of a gearbox simplifies maintenance procedures. The use of a monocoque nacelle also allows "all weather" access to essential systems and controls due to internal access.

The AWE 54-900 turbine is available in two configurations. A 54 meter rotor diameter machine for Class III wind conditions. A 52 meter rotor diameter machine (the AWE 52-900) is also available for Class II higher wind conditions.

The AWE 54-900 comes in three versions:

AWE 54-900-40	with a 40m tower
AWE 54-900-50	with a 50m tower
AWE 54-900-75	with a 75m tower

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The AWE 52-750, AWE 52-900 and AWE 54-900 Models are ideally suited to the target market segments identified. The following are important features:

1. Crane size and availability:

On a large wind farm, a large crane is brought in and is kept busy until all the wind turbines are erected. Large cranes that are necessary to install and maintain large wind turbines are very expensive to rent and are not readily available. Cranes necessary to install and service medium size turbines on small wind farms are much more readily available and both cheaper to bring in and to utilize once on location.

2. Terrain and access:

For locations that have difficult terrain or are otherwise difficult to access, medium wind turbines are favored because both the crane and the turbine itself are easier and less costly to deliver on site and install.

3. Interconnection Costs:

Smaller, lower capacity transformers and switchgear are required and costs are less than those required for the higher-powered turbines.

4. Capital Outlay:

The lower capital outlay for a medium wind turbine, with additions phased in to complete a small wind farm, makes the whole project easier to finance. A number of our customers are taking this approach.

5. Diversity:

A number of medium sized units can provide continuing energy generation in the event of a shut down of one machine

RESEARCH AND DEVELOPMENT

We are a development stage company and have not generated any significant revenues from our products and licenses. We believe, however, that there are opportunities for our wind turbines and licenses to be efficient in North America. There were elements of our wind turbine installation in Alberta that required scientific research and development activity, and tax credits have been applied for in Canada in respect of such endeavours. We plan additional research and development work on cold weather sites.

MARKET FOR WIND TURBINES

North America is a new market for medium wind turbines and is believed to very large, but not easily quantifiable. We have reviewed the rapidly expanding market for wind turbines in the Americas and believe that there is a very significant market for medium class wind turbines to serve small developers, small wind farms, industrials, farms and ranches, mining applications and government. The result was a determination to license the Lagerwey Direct Drive technology and to enter the market as a manufacturer and supplier of medium wind turbines.

The industry is currently dominated by the large wind turbine market characterized by large wind farms with turbines typically over 1.5 MW in size. This market segment is served by large developers (e.g. Florida Power and Light) and large manufacturers (e.g. General Electric and Vestas). This is not a market in which we intend to compete. The volumes and financial resources required are beyond our means, and, in addition, this segment is very competitive. Margins are believed to be tight and the industry incumbents are believed to be suffering financially despite the business volumes available because of the extension of the PTC.

The large wind turbine manufacturers have traditionally showed little interest in the medium turbine market because the large wind farms are more firmly established and have larger volumes associated with them. Our company intends to target the medium market with a product offering that we believe is technically superior to the offering of the major manufacturers.

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INTELLECTUAL PROPERTY

Intellectual property which we own is protected by careful document control within our company and by signed non-disclosure agreements with all outside parties (e.g. customers and suppliers).

Employees

As of August 11, 2006, we had three employees consisting of Harold Dickout as our Chief Executive Officer, President and Chairman, Frank Pickersgill as our Secretary and John Colmar. We plan to hire additional employees when circumstances warrant.

Customers

We have developed the following marketing and sales strategies for each segment of the medium wind turbine market:

Small Wind Farms

Smaller wind farms are usually below 20 MW in size and are developed by small developers, industrial sites or farmer co-ops. Many jurisdictions such as several U.S. states, as well as Ontario and Quebec in Canada, have local incentives to encourage these smaller community focused projects.

Developers

Developers of small wind farms are our primary customers. The developers and/or their projects will be sourced through the AWEA, the Canadian Wind Energy Association, participation at trade shows, insurers, financiers, and other industry participants.

A key plank in our sales strategy is to work with these developers in the project development stage when they need support and guidance, and provide them with technical support on wind turbines and on the process. This is a strong value added function.

As an additional value-added service, we will provide turnkey solutions according to customer demand.

Our "Working with the Customer" approach puts them in a position where they can negotiate the price rather than simply bidding on projects. We will continue to develop relationships with key wind farm developers in North America. The ideal profile is a developer who contemplates building several wind farms as its portfolio develops.

Wind Power Co-ops

An additional important secondary market are wind power co-ops. We are in contact with co-ops in Canada and the U.S.

Due to the time-consuming and consensus building requirement of selling to co-op purchasers and the low number of turbines involved, large turbine manufacturers are not prepared to devote the necessary time and resources to these types of customers. Our company has already been successful in this market with the sale by Lagerwey of a 750 kW machine to the co-op of Toronto Hydro and Windshare.

Industrial Users

Our company uses a three-pronged approach for this market segment.

The first is the wind farm developer approach used in the small wind farm segment. Some of the same developers with whom we are strengthening and deepening our relationships target both small wind farms and industrial users.

In addition, there are some developers who specifically target this industrial market. These specialists are of great interest since the industrial market requirements are very consistent with a medium wind turbine.

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The agriculture market can be tapped into through presentations to farm organizations, dealer networks and associations, direct mail, local advertising and farm shows.

Suppliers

We will have an ongoing supply arrangement with Emergya Wind Technologies B.V. and Wind En Water Technologies B.V. in the Netherlands for wind turbine components.

We expect to continue to source towers and blades in North America from a number of suppliers and will be actively seeking new North American suppliers of other components as well.

COMPETITION

The alternative energy industry is highly competitive. Numerous entities in the U.S., Canada and around the world compete with our efforts to provide energy. Globally, our largest competitors are Vestas, GE Wind, Siemens (Bonus) and Enercon. In North America, GE Wind and Vestas have over 70% of the market. There are also four other companies, including Suzlon and Gamesa Mitsubishi, that have only a marginal presence in North America. Our company, with what we believe to be is a superior product, focuses on smaller, medium sized projects. The numerous projects which escape the attention of our larger competitors are our core business.

Many of our competitors have substantially greater capital resources and more experience that we do. These companies have greater financial, technical, research, marketing, sales, distribution, service and other resources than us. Moreover, they may offer broader product lines, services and have greater name recognition than we do, and may offer discounts as a competitive tactic.

In addition, rapidly changing technology, evolving industry standards and changing customer needs require that we enhance our products, develop new products and services that meet our customers' changing needs and market our products and services to respond to emerging industry standards in a timely and cost effective manner. There can be no assurance that we will be successful in developing new products and services, enhancing existing products and services or whether such new or enhanced products and services will gain market acceptance.

GOVERNMENT REGULATION

There are no Canadian government regulations which apply specifically to wind turbines and to which we have to comply.

DESCRIPTION OF PROPERTY

Our principal office is located at 24 Palace Arch Drive, Toronto, Ontario, Canada. We believe that our principal office is adequate for our needs.

REPORTS TO SECURITY HOLDERS

We are not required to deliver an annual report to our shareholders, but intend to send notification of availability of our annual report and our audited statements to our shareholders. We are required to file annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission and our filings are available to the public over the internet at the Securities and Exchange Commission's website at http://www.sec.gov.

The public may read and copy any materials filed by us with the Securities and Exchange Commission at the Securities and Exchange Commission's Public Reference Room at 100 F Street N.E. Washington D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the Securities and Exchange Commission at 1-800-732-0330.

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MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS

Overview

You should read the following discussion of our financial condition and results of operations together with the audited financial statements and the notes to the audited financial statements included in this current report. This discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results may differ materially from those anticipated in these forward-looking statements.

We are engaged in the business of manufacturing, marketing and licensing medium sized wind turbines to wind farm developers in North America. We hold an exclusive license from Emergya Wind Technologies B.V., for the technology and product lines in the medium sized wind turbine class developed by Lagerwey Windturbine B.V. of the Netherlands for North America. We plan to distribute our products and licenses to small wind farms, developers of small wind farms, wind power co-ops, industrial users and governmental organizations.

On August 11, 2006, we completed a share exchange agreement with Priveco. As a result of the share exchange agreement, we abandoned our previous marine adventure tours business and commenced the business of manufacturing, marketing and licensing wind turbines. Because we are the successor business to Priveco and because the operations and assets of Priveco represents our entire business and operations from the closing date of the share exchange agreement, our management's discussion and analysis and plan of operations are based on Priveco's financial results for the relevant periods.

RESULTS OF OPERATIONS

Results of Operations for the three months ended April 30, 2006 and April 30, 2005

Revenues

During the three months ended April 30, 2006 and April 30, 2005, we did not generate any revenue.

General and Administrative and Depreciation Expenses

During the three months ended April 30, 2006, we incurred general and administrative expenses and depreciation expenses of $98,427, compared to general and administrative expenses and depreciation expenses of $38,251 for the three months ended April 30, 2005. The increase in these expenses was primarily attributable to an increase in general and administrative expenses, which increased due to payments to employees.

Interest Expenses

During the three months ended April 30, 2006, we incurred interest expenses of $41,803, compared to interest expenses of $32,391 for the three months ended April 30, 2005. The increase in interest expenses was primarily attributable to increased borrowings by our company.

Net Loss

Our net loss for the three months ended April 30, 2006 was $134,532, compared $32,391 for the three months ended April 30, 2005. The most significant contributors to our loss for the three months ended April 30, 2006, were general and administrative expenses and interest expenses, which were $93,242 and $41,803, respectively.

Results of Operations for the nine months ended April 30, 2006 and April 30, 2005

Revenues

During the nine months ended April 30, 2006 and April 30, 2005, we did not generate any revenue.

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Expenses

During the nine months ended April 30, 2006, we incurred general and administrative expenses and depreciation expenses of $156,567, compared to general and administrative expenses and depreciation expenses of $78,918 for the nine months ended April 30, 2005.

Interest Expenses

During the nine months ended April 30, 2006, we incurred interest expenses of $126,917, compared to interest expenses of $63,888 for the nine months ended April 30, 2005. The increase in interest expenses was primarily attributable to increased borrowings by our company.

Net Loss

Our net loss for the nine months ended April 30, 2006 was $262,654, compared $142,806 for the nine months ended April 30, 2005. The most significant contributors to our loss for the nine months ended April 30, 2006, were general and administrative expenses and interest expenses, which were $143,160 and $126,917, respectively.

Results of Operations for the year ended July 31, 2005 and July 31, 2004

Revenues

During the year ended July 31, 2006, we did not generate any revenue. During the year ended July 31, 2004, we generated $640,840 in revenue. Revenue for the year ended July 31, 2004 was derived from the sale of two projects, both of which were commissioned in 2004. The decrease in our revenue for the year ended July 31, 2005 was primarily attributable to the fact that the wind turbines sold to a customer in Nova Scotia were not commissioned in 2005. The project is expected to be completed in fiscal 2007.

Expenses

During the year ended July 31, 2006, we incurred general and administrative expenses and depreciation expenses of $145,054, compared to general and administrative expenses and depreciation expenses of $132,217 for the year ended April 30, 2005. The increase in these expenses was primarily attributable to an increase in general and administrative expenses, which increased due to consulting fees.

Interest Expenses

During the year ended July 31, 2006, we incurred interest expenses of $136,092, compared to interest expenses of $74,805 for the year ended July 31, 2005. The increase in interest expenses was due to interest expense on increased borrowings.

Net Loss

Our net loss for the year ended July 31, 2006 was $243,750, compared $431,939 for the year ended July 31, 2005. The decline in our net loss for the year ended July 31, 2006 compared to our net loss for the year ended July 31, 2005 was primarily due to the significant reduction in research and development expenses incurred.

Liquidity and Capital Resources

At April 30, 2006, we had $95,167 in cash and a working capital deficiency of $3,772,684, compared to $35,179 in cash and a working capital deficiency of $1,379,956 at July 31, 2005 and $6,603 in cash and a working capital deficiency of $19,727 at July 31, 2004.

Presently, our revenues are not sufficient to meet our operating and capital expenses. We have incurred operating losses during the last several years which are likely to continue for the foreseeable future. We anticipate that we will have negative cash flows during the year ended July 31, 2006. Management projects that we will require an additional $3.0, after taking

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into account projected gross revenue, to fund our ongoing operating expenses, working capital requirements and extinguish our debt for the next twelve months. We intend to raise the required funds through the sale of equity securities.

Operating Activities

Our operating activities resulted in net cash flows of $168,191 for the nine months ended April 30, 2006. Operating activities resulted in net cash flows of $11,347 and net cash outflows of $385,637 for the years ended July 31, 2005 and July 31, 2004, respectively. The operating cash flows for the nine months ended April 30, 2005 were primarily attributable to billings on uncompleted contracts in excess of related costs for the period. The operating cash flows for the year ended July 31, 2005 were primarily attributable to accounts receivable and accrued interest for the period. The operating cash outflows for the year ended July 31, 2004 were primarily attributable to our net loss and negative accounts receivable for the period.

Investing Activities

Investing activities resulted in net cash outflows of $143,639 for the nine months ended April 30, 2005. Investing activities resulted in net cash outflows of $1,007 and $11,563 for the years ended July 31, 2005 and July 31, 2004, respectively. The investing activities for the nine month period ended April 30, 2005 consisted of the acquisition of equipment. The net cash outflows from investing activities for the years ended July 31, 2005 and July 31, 2004 consisted of the purchase of capital assets.

Financing Activities

Financing activities resulted in net cash flows of $11,285 for the nine months ended April 30, 2005, which cash flows were primarily attributable to advances from Northwest Passage Ventures, Ltd., Digital Predictive Systems Inc. and Emergya Wind Technologies B.V. Financing activities resulted in net cash outflows of $2,165 for the year ended July 31, 2005, which cash outflows were primarily attributable to repayments to Emergya Wind Technologies B.V. Financing activities resulted in net cash inflows of $229,542 for the year ended July 31, 2004, which cash flows were primarily attributable to advances from Digital Predictive Systems Inc.

Going Concern

Due to recurring losses from operations, in their report on Priveco’s audited financial statements for the year ended July 31, 2005, our independent auditors included an explanatory paragraph regarding substantial doubt about our ability to continue as a going concern. Our financial statements contain additional note disclosures describing the circumstances that lead to this disclosure by our independent auditors.

Off-Balance Sheet Arrangements

Our company has no outstanding derivative financial instruments, off-balance sheet guarantees, interest rate swap transactions or foreign currency contracts. We do not engage in trading activities involving non-exchange traded contracts.

Plan of Operation

We will continue to build the project pipeline and are well positioned to take advantage of the shortages of wind turbines in the medium sized market, by being able to supply units for calendar 2007 before the expiration of the PTC in the U.S., which is currently due the end of 2007.

We sell direct in Canada, and through agents and directly in the U.S. market. We plan to work with manufactures in the Province of Quebec which will meet Quebec content requirements. We also plan to operate as a manufacturer, outsourcing all major components to qualified suppliers. The requirements to be a supplier of our company include have the necessary production capacity to meet our demands, and a having a quality assurance program and a quality control program that will ensure the components supplied will meet our standards.

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Trends and Uncertainties

Our ability to generate revenues in the future is dependent on whether we successfully manufacture and market our products. We will need to form and maintain relationships with suppliers and secure sales contracts with wind farm developers and other customers. We cannot predict when or whether this may happen and this causes uncertainty with respect to the growth of our company and our ability to generate revenues.

Royalties

We are committed under a license agreement to pay to Emergya Wind Technologies B.V. a royalty of 3% of related sales and 40% of any royalties received by our company from our sub-licensees. In addition, we entered into a license agreement with GE Power Technology LLC to obtain certain licenses under GE Power Technology LLC’s patents. We agreed under the terms of the license agreement to pay GE Power Technology LLC a royalty equal to $32,500 per MW for each sale or shipment or portion thereof of a licensed product.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Principal Stockholders

The following table sets forth, as of August 24, 2006, certain information with respect to the beneficial ownership of our common stock by each stockholder known by us to be the beneficial owner of more than 5% of our common stock, as well as by each of our current directors and executive officers as a group. Each person has sole voting and investment power with respect to the shares of common stock, except as otherwise indicated. Beneficial ownership consists of a direct interest in the shares of common stock, except as otherwise indicated.

Name and Address of Beneficial Owner	Amount and Nature of Beneficial Ownership(1)	Percentage of Class(1)
Jean Adams PO Box 260 Leeward Hwy Providenciales Turks Caicos Islands	1,437,750	6.39%
Brown Brothers harriman & Co. 140 Broadway New York, New York USA 10005	2,865,914	12.74%
Alexander Budwah PO Box 260 Leeward Hwy Providenciales Turks Caicos Islands	1,150,200	5.11%
Daisy Dawson PO Box 8 Leeward Hwy Providenciales Turks Caicos Islands	1,533,600	6.81%
Samuel Hamilton PO Box 62 Providenciales Turks Caicos Islands	1,437,750	6.39%
Dennico Johnson PO Box 103 Grand Turk Turks Caicos Islands	1,629,450	7.24%
Dennis Jones PO Box 236 Providenciales Turks Caicos Islands	1,917,000	8.52%

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Lanesborough Balfour Trust 280 Nelson Street Suite 501 Vancouver, BC, Canada V6B 2E2	1,821,150	8.09%
Regina Holdings Alliance Limited Redcliffe Street PO Box 1679 St. Johns, Antigua	2,070,360	9.20%
Novelette Williams PO Box 228 Providenciales Turks Caicos Islands	1,533,600	6.81%
Robert Edwards c/o 24 Palace Arch Drive Toronto, Ontario M9A 2S1	1,846,154(2)	7.58%(2)
Harold Dickout c/o 24 Palace Arch Drive Toronto, Ontario M9A 2S1	19,107,692(3)	49.92%(3)
Frank Pickersgill c/o 24 Palace Arch Drive Toronto, Ontario M9A 2S1	6,276,923(4)	21.81%(4)
Digital Predictive Systems Inc. c/o 24 Palace Arch Drive Toronto, Ontario M9A 2S1	2,769,231(5)	10.96%(5)
Directors and Executive Officers as a Group (2 persons)	28,153,846(6)	55.58%(6)

 

⁽¹⁾ Based on 22,503,894 shares of common stock issued and outstanding as of August 24, 2006. Except as otherwise indicated, we believe that the beneficial owners of the common stock listed above, based on information furnished by such owners, have sole investment and voting power with respect to such shares, subject to community property laws where applicable. Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. Shares of common stock subject to option or warrants currently exercisable, or exercisable with 60 days, are deemed outstanding for the purposes of computing percentage ownership of the person holding such option or warrants, but are not deemed to be outstanding for purposes of computing the percentage ownership of any other person.

   

⁽²⁾ Includes 1,846,154 shares of common stock issuable to Robert Edwards upon exchange of 1,846,154 class A preference shares in the capital of the Purchaser and 1,846,154 class A special voting shares in the capital of our company, which class A preference shares in the capital of the Purchaser and class A special voting shares in the capital of our company were issued to Mr. Edwards in connection with the share exchange contemplated by the share exchange agreement dated August 11, 2006 between our company, the Purchaser, Priveco and the former shareholders of Priveco.

   

⁽³⁾ Includes 19,107,692 shares of common stock issuable to Harold Dickout upon exchange of 19,107,692 class A preference shares in the capital of the Purchaser and 19,107,692 class A special voting shares in the capital of our company, which class A preference shares in the capital of the Purchaser and class A special voting shares in the capital of our company were issued to Mr. Dickout in connection with the share exchange contemplated by the share exchange agreement dated August 11, 2006 between our company, the Purchaser, Priveco and the former shareholders of Priveco. Mr. Dickout is a director and the President, Chief Executive Officer and Chairman of our company.

   

⁽⁴⁾ Includes 6,276,923 shares of common stock issuable to Frank Pickersgill upon exchange of 6,276,923 class A preference shares in the capital of the Purchaser and 6,276,923 class A special voting shares in the capital of our company, which class A preference shares in the capital of the Purchaser and class A special voting shares in the capital of our company were issued to Mr. Pickersgill in connection with the share exchange contemplated by the share

 

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exchange agreement dated August 11, 2006 between our company, the Purchaser, Priveco and the former shareholders of Priveco. Mr. Pickersgill is a director and the Secretary of our company.

 

⁽⁵⁾ Includes 2,769,231 shares of common stock issuable to Digital Predictive Systems Inc., a company controlled by Shashi Dewan, a director of our company, upon exchange of 6,276,923 class A preference shares in the capital of the Purchaser and 6,276,923 class A special voting shares in the capital of our company, which class A preference shares in the capital of the Purchaser and class A special voting shares in the capital of our company were issued to Digital Predictive Systems Inc. in connection with the share exchange contemplated by the share exchange agreement dated August 11, 2006 between our company, the Purchaser, Priveco and the former shareholders of Priveco.

   

⁽⁶⁾ Includes 19,107,692 shares of common stock issuable to Mr. Dickout, 6,276,923 shares of common stock issuable to Mr. Pickersgill and 2,769,231 shares of common stock issuable to Digital Predictive Systems Inc., a company controlled by Mr. Dewan, a director of our company.

 

MANAGEMENT

Directors and Executive Officers, Promoters and Control Persons

The following individuals serve as the directors and executive officers of our company and our subsidiary. All directors of our company and our subsidiary hold office until the next annual meeting of our shareholders or until their successors have been elected and qualified. The executive officers of our company and our operating subsidiary are appointed by our board of directors and hold office until their death, resignation or removal from office.

Name	Position Held with our Company	Age	Date First Elected or Appointed
Harold C.F. Dickout	President, Chief Executive Officer, Chairman and Director	71	August 21, 2006
Frank D. Pickersgill	Secretary and Director	66	August 21, 2006
Shashi Dewan	Director	65	August 21, 2006

BUSINESS EXPERIENCE

The following is a brief account of the education and business experience during at least the past five years of each director, executive officer and key employee of our company and the executive officers of our subsidiary, indicating the person's principal occupation during that period, and the name and principal business of the organization in which such occupation and employment were carried out.

Harold Dickout, Director, President, Chief Executive Officer and Chairman

Mr. Dickout was the Chief Executive Officer of SRE Controls, whose business included the design, manufacture, marketing and sale of drive controls for electronic vehicles. Prior to this, Mr. Dickout was the Chairman, President and Chief Executive Officer of Square D Canada, a major manufacturer of electrical distribution and control equipment. From 2002 to the present, Mr. Dickout has been the Chief Executive Officer of Americas Wind Energy Inc., which he co-founded with Mr. Pickersgill. Americas Wind Energy Inc. is in the business of supplying wind turbines to the wind power industry throughout North America and owns the rights to Lagerwey wind turbine technology for the Americas.

Frank Pickersgill, Director and Secretary

Mr. Pickersgill obtained his Bachelor’s of Science, Engineering, degree from the University of Manitoba in 1962 and his Masters in Business Administration from Harvard Business School in 1967. From 1997 through 2002, Mr. Pickersgill established and operated MFP Management Corporation, a family management and holding company, which founded and managed Prolion North America. Prolion North America’s business included the assembly and marketing of automatic

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“robotic” milking systems for Prolion BV, a Dutch manufacturer of automatic milking systems. From 2002 to the present, Mr. Pickersgill has been the Vice President and Secretary of Americas Wind Energy Inc., which he co-founded with Mr. Dickout. Americas Wind Energy Inc. is in the business of supplying wind turbines to the wind power industry throughout North America and owns the rights to Lagerwey wind turbine technology for the Americas.

Shashi Dewan, Director

Dr. Dewan obtained his Ph.D. in Electrical Engineering from the University of Toronto in 1966. Dr. Dewan has co-authored three major books on power electronics and related applications. He has over three hundred publications and twenty-five patents. He was awarded the Newell Power Electronics award in 1977 and the Killam Fellowship in 1980. Dr. Dewan founded Inverpower Controls, a company which he took public on the Toronto Stock Exchange in 1994. Presently, Dr. Dewan has been the President of Digital Predictive Systems Inc., whose business includes the sale of power electronic systems and investments in the development of virtual prototyping of power electronic systems, wind power converters and precision magnet power supplies for high energy physics.

Family Relationships

There are no family relationships among our current directors or officers.

Board and Committee Meetings

Our board of directors held no formal meetings during the year ended June 30, 2005. All proceedings of our board of directors were conducted by resolutions consented to in writing by all the directors and filed with the minutes of the proceedings of the directors. Such resolutions consented to in writing by the directors entitled to vote on that resolution at a meeting of the directors are, according to the corporate laws of the State of Nevada and our By-laws, as valid and effective as if they had been passed at a meeting of our directors duly called and held.

We currently do not have nominating, compensation or audit committees or committees performing similar functions nor do we have a written nominating, compensation or audit committee charter. Our board of directors does not believe that it is necessary to have such committees because it believes that the functions of such committees can be adequately performed by our board of directors, consisting of Harold Dickout, Frank Pickersgill and Shashi Dewan.

We do not have any defined policy or procedure requirements for shareholders to submit recommendations or nominations for directors. Our board of directors believes that, given the early stages of our development, a specific nominating policy would be premature and of little assistance until our business operations develop to a more advanced level. We do not currently have any specific or minimum criteria for the election of nominees to our board of directors and we do not have any specific process or procedure for evaluating such nominees. Our board of directors assesses all candidates, whether submitted by management or shareholders, and makes recommendations for election or appointment.

A shareholder who wishes to communicate with our board of directors may do so by directing a written request addressed to the president, Harold C.F. Dickout, to 24 Palace Arch Drive, Toronto, Ontario, Canada M9A 2S1.

Audit Committee Financial Expert

Our board of directors has determined that we do not have a board member that qualifies as an "audit committee financial expert" as defined in Item 401(e) of Regulation S-B, nor do we have a board member that qualifies as "independent" as the term is used in Item 7(d)(3)(iv)(B) of Schedule 14A under the Securities Exchange Act of 1934, as amended, and as defined by Rule 4200(a)(14) of the NASD Rules.

We believe that our board of directors is capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting. The board of directors of our company does not believe that it is necessary to have an audit committee because our company believes that the functions of an audit committees can be adequately performed by our board of directors. In addition, we believe that retaining an independent director who would qualify as an "audit committee financial expert" would be overly costly and burdensome and is not warranted in our circumstances given the early stages of our development and the fact the we have not generated any revenues from operations to date.

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Section 16(a) Beneficial Ownership Compliance

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers and directors and persons who own more than 10% of a registered class of our equity securities to file with the Securities and Exchange Commission initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of our common stock and other equity securities, on Forms 3, 4 and 5 respectively. Executive officers, directors and greater than 10% shareholders are required by the Securities and Exchange Commission regulations to furnish us with copies of all Section 16(a) reports they file. We are not aware of any director, executive officer or beneficial owner of more than 10% of the outstanding common stock who or which has not timely filed reports required by Section 16(a) of the Exchange Act during or in respect of the fiscal year of our successor company ended June 30, 2005.

Involvement in Certain Legal Proceedings

Our directors, executive officers and control persons have not been involved in any of the following events during the past five years:

1.             any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

2.             any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

3.             being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or

4.             being found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.

EXECUTIVE COMPENSATION

Remuneration of Directors and Executive Officers

The following table sets forth the compensation paid to our President and Chief Executive Officer and key persons earning over $100,000 in total annual salary and bonus, for all services rendered in all capacities for the fiscal years ended June 30, 2005 and 2004:

SUMMARY COMPENSATION TABLE
		Annual Compensation			Long Term Compensation
					Awards		Payouts
Name and Principal Position	Year	Salary	Bonus	Other Annual Compen- sation	Securities Underlying Options/ SARs Granted	Restricted Shares or Restricted Share Units	LTIP Payouts	All Other Compen- sation
Axel Roehlig(1) Director, President, Chief Executive Officer, Chief Financial Officer, Secretary and Treasurer	2005 2004	Nil Nil	Nil Nil	Nil Nil	Nil Nil	Nil Nil	Nil Nil	Nil Nil

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⁽¹⁾ Axel Roehlig was appointed as our President, Chief Executive Officer and Chief Financial Officer in August 2003 and was appointed our Secretary and Treasurer in July 2005. Mr. Roehlig resigned as our President, Chief Executive Officer, Chief Financial Officer, Secretary and Treasurer on August 21, 2006.

 

Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Values

There were no stock options granted during the fiscal year ended June 30, 2005 and there were no stock options outstanding as at August 10, 2006.

Stock Options and Stock Appreciation Rights

There were no grants of stock options or stock appreciation rights made during the fiscal year ended June 30, 2005 to our executive officers and directors and there were no stock options or stock appreciation rights outstanding on August 10, 2006.

Long-Term Incentive Plans

There are no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers, except that our directors and executive officers may receive stock options at the discretion of our board of directors. We do not have any material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers, except that stock options may be granted at the discretion of our board of directors.

We have no plans or arrangements in respect of remuneration received or that may be received by our executive officers to compensate such officers in the event of termination of employment (as a result of resignation, retirement, change of control) or a change of responsibilities following a change of control, where the value of such compensation exceeds $60,000 per executive officer.

Compensation Of Directors

To date, we have no employees other than our officers. Neither our company’s officers nor directors have been paid any compensation. Moreover, we presently have no formal employment agreements or other contractual arrangements with our officers or directors or any one else regarding the commitment of time or the payment of salaries or other compensation. When funds allow, we anticipate that our officers will be offered a compensation package.

Employment Contracts

In the past three years no executive officer has received any amounts in connection with an executive officer’s resignation, retirement, or other termination. No executive officer received any amounts in the last three years in connection with a change in control of our company or a change in the executive officer's responsibilities after a change in control.

There are no compensatory plans or arrangements, including payments to be received from our company, with respect to any person which would in any way result in payments to any such person because of his resignation, retirement, or other termination of such person’s employment with our company or its subsidiaries, or any change in control of our company, or a change in the person’s responsibilities following a change in control of our company.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Except as set out below, none of the following persons has had any direct or indirect material interest in any transaction to which our company was or is a party, or in any proposed transaction to which our company proposes to be a party during the last two years:

(a) any director or officer of our company;

(b) any proposed director of officer of our company;

23

(c) any person who beneficially owns, directly or indirectly, shares carrying more than 5% of the voting rights attached to our common stock; or

(d) any member of the immediate family of any of the foregoing persons (including a spouse, parents, children, siblings, and in-laws).

Our company entered into a loan agreement with Digital Predictive Systems Inc., a company controlled by Shashi Dewan, a director of our company, which matures on October 12, 2006. Interest is charged at 10%, compounded monthly. Repayment is to be made in full, including interest, at maturity. The loan is secured by a general security agreement over our company’s assets and all license agreements. As at April 30, 2006, the amount owing to Digital Predictive Systems Inc. was $1,678,567.

DESCRIPTION OF SECURITIES

We are authorized to issue 100,000,000 common shares with a par value of $0.001 per share and 30,000,000 class A special voting shares. As at August 24, 2006, we had 22,503,894 common shares issued and outstanding and 30,000,000 class A special voting shares issued and outstanding.

The common shares have the following rights and restrictions:

(a) holders of common shares are entitled to one vote for each share that they own at any shareholders' meeting;

(b) holders of common shares are entitled to receive such dividends as may be declared by our board of directors out of funds legally available;

(c) upon liquidation, holders of common shares are entitled to participate pro-rata in a distribution of assets available for such distribution to shareholders; and

(d) there are no conversion, pre-emptive, or other subscription rights or privileges with respect to any shares.

The class A special voting shares have the following rights and restrictions:

(a) Each holder of class A special voting shares will be entitled to exercise, at all meetings of the shareholders of the corporation, one vote for each class A special voting share held by such holder;

(b) holders of class A special voting shares shall have no rights to participate in any return of capital of the corporation on a liquidation or otherwise; and

(c) class A special voting shares carry no right to receive dividends.

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The bid and ask prices of our common stock, as reported on Yahoo Finance on August 24, 2006, were $1.60 and $4.00, respectively.

Our common shares are quoted for trading on the OTC Bulletin Board under the symbol "NWPV". The following quotations obtained from stockwatch.com reflect the highs and low bids for our common stock based on inter-dealer prices, without retail mark-up, mark-down or commission an may not represent actual transactions. The high and low bid prices of our common stock for the periods indicated below are as follows:

24

National Association of Securities Dealers OTC Bulletin Board(1)
Quarter Ended		High	Low
March 31, 2006		No Trades	No Trades
December 31, 2005		No Trades	No Trades
September 30, 2005		No Trades	No Trades
June 30, 2005		No Trades	No Trades
(1)	Over-the-counter market quotations reflect inter-dealer prices without retail mark-up, mark-down or commission, and may not represent actual transactions.

Our common shares are issued in registered form. The transfer agent and registrar for our common stock is Pacific Stock Transfer Company, Suite 240, 500 East Warm Springs Road, Las Vegas, Nevada 89119. On August 24, 2006, the shareholders' list of our common shares showed 17 registered shareholders and 22,503,894 common shares issued and outstanding.

Dividends

We have not declared any dividends since incorporation and do not anticipate that we will do so in the foreseeable future. Although there are no restrictions that limit the ability to pay dividends on our common shares, it is our intention to retain future earnings for use in our operations and the expansion of our business.

Securities Authorized for Issuance Under Equity Compensation Plans

We do not have any equity compensation plans in place.

LEGAL PROCEEDINGS

As of August 11, 2006, we know of no material, active, or pending legal proceeding against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our company’s directors, proposed directors, officers, or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our company’s interest.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS

Madsen & Associates, CPA’s Inc. has been engaged as the principal independent accountants. There has been no change in our certifying accountant for the past two most recent fiscal years or interim period.

INDEMNIFICATION OF DIRECTORS AND OFFICERS

Nevada corporation law provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, except an action by or in the right of the corporation, by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys’ fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with the action, suit or proceeding if he acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful.

25

Nevada corporation law also provides that to the extent that a director, officer, employee or agent of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding, or in defense of any claim, issue or matter therein, the corporation shall indemnify him against expenses, including attorneys’ fees, actually and reasonably incurred by him in connection with the defense.

Our Articles of Incorporation authorize our company to indemnify our directors and officers to the fullest extent permitted under Nevada law.

Our Bylaws require us to indemnify each person (including the heirs, executors, administrators, or estate of such person) who is or was a director or officer of our company to the fullest extent permitted or authorized by current or future legislation or judicial or administrative decision against all fines, liabilities, costs and expenses, including attorneys' fees, arising out of his or her status as a director, officer, agent, employee or representative of our company. The foregoing right of indemnification is not exclusive of other rights to which those seeking an indemnification may be entitled. Our company may also maintain insurance, at our expense, to protect itself and all officers and directors against fines, liabilities, costs and expenses, whether or not we would have the legal power to indemnify them directly against such liability. Costs, charges and expenses (including attorneys' fees) incurred by a present or former director of officer of our company in defending a civil or criminal proceeding are to be paid by our company in advance of the final disposition thereof upon receipt of an undertaking to repay all amounts advanced if it is ultimately determined that the person is not entitled to be indemnified by us as authorized by our Bylaws, and upon satisfaction of other conditions required by current or future legislation.

ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES

In connection with the share exchange agreement, on August 11, 2006 we completed a private placement offering of 2,500,000 units, at a price of $1.00 per unit, with Roche Capital Group S.A., with each unit consisting of one common share in the capital of our company and one common share purchase warrant. Each common share purchase warrant is non-transferable and entitles the holder thereof to purchase one common share in the capital of the company, at a price of $1.50 per share, for a period of two years from the closing of the private placement. We issued the common shares and the common share purchase warrants in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933 to non-U.S. Persons (as that term is defined in Regulation S under the Securities Act of 1933).

In connection with the closing of the share exchange agreement on August 11, 2006, our company issued 30,000,000 class A special voting shares to the four former shareholders of Priveco. We issued the common shares in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933 to non-U.S. Persons (as that term is defined in Regulation S under the Securities Act of 1933).

ITEM 5.01 CHANGES IN CONTROL OF THE REGISTRANT

Upon the closing of the share exchange agreement on August 11, 2006, we issued an aggregate of 30,000,000 class A special voting shares and caused the Purchaser to issue 30,000,000 class A preference shares, giving the right to acquire 30,000,000 common shares in the capital of our company, to the shareholders of Priveco in consideration for the acquisition of all 130,000 issued and outstanding common shares of Priveco, on the basis of 230.769230760 class A special voting shares in the capital of the Purchaser and 230.769230769 class A preference shares of our company for every one common share of Priveco. The issuance was a result of the closing of the share exchange agreement which occurred on August 11, 2006 among our company, the Purchaser, Priveco and the shareholders of Priveco. As a result of the share exchange, the former shareholders of Priveco own 30,000,000 class A special voting shares, representing approximately 60% of the issued and outstanding voting securities of our company. The issuance of the 30,000,000 class A special voting shares of our company resulted in a change of control of our company. The closing of the share exchange agreement was conditional upon our company having no more than 20,004,000 common shares issued and outstanding at the closing date. As a result, Axel Roehlig tendered 37,541,249 common shares for cancellation without consideration.

ITEM 5.02 DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS.

Harold Dickout, Frank Pickersgill and Shashi Dewan were appointed as directors of our company as of August 21, 2006. A description of Mr. Dickout's, Mr. Pickersgill and Mr. Dewan's business experience over the past five years can be found in Item 2.01 of this current report. Mr. Dickout, was also appointed President and Chief Executive Officer and Chairman of

26

our company as of August 21, 2006. Mr. Pickersgill, was appointed as Secretary of our company as of August 21, 2006.

There are no definitive arrangements that have been made regarding committees of our company to which Mr. Dickout, Mr. Pickersgill and Mr. Dewan are expected to be named. The appointment of Mr. Dickout, Mr. Pickersgill and Mr. Dewan to our board of directors was prearranged in accordance with the provisions of the share exchange agreement dated August 11, 2006 and in compliance with section 14(f) of the Securities Act of 1934, as amended, and Rule 14(f)-1 thereunder. The appointment of Mr. Dickout, Mr. Pickersgill and Mr. Dewan to our board of directors was a condition precedent to the closing of the share exchange agreement. Mr. Dickout, Mr. Pickersgill and Mr. Dewan were selected for appointment based on their familiarity and experience with Priveco and the new business of our company as of the closing date.

Apart from the share exchange agreement, and the transactions contemplated therein, Mr. Dickout, Mr. Pickersgill and Mr. Dewan have not had a direct or indirect material interest in any transaction of our company during the last two years, or proposed transaction, to which our company was or is to be a party.

Axel Roehlig resigned as President, Chief Executive Officer, Chief Financial Officer, Secretary and Treasurer of our company prior to Harold Dickout's appointment as President. The resignation was a condition of closing of the share exchange agreement.

ITEM 5.03 CHANGE IN FISCAL YEAR

On August 11, 2006, in connection with the closing of the share exchange agreement, we changed our fiscal year end to July 31. The share exchange, contemplated by the share exchange agreement, is deemed to be a reverse acquisition for accounting purposes. Priveco, the acquired entity, is regarded as the predecessor entity of August 11, 2006. Starting with the periodic report for the quarter in which the acquisition was consummated, our company will file annual and quarterly reports based on the July 31 fiscal year end of Priveco. Such financial statements will depict the operating results of Priveco, including the acquisition of our company, from August 11, 2006.

ITEM 5.06 CHANGE IN SHELL COMPANY STATUS

Management has determined that, as of the closing of the share exchange agreement, our company has ceased to a shell company as defined in Rule 12b-2 of the United States Securities Exchange Act of 1934, as amended. Please refer to Item 2.01 of this current report for a detailed description of the share exchange agreement and the business of our company following the closing date.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

Priveco's financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles. It is the opinion of management that the audited financial statements for the year ended July 31, 2005 include all adjustments necessary in order to ensure that the financial statements are not misleading. The following financial statements are included in this current report:

1. Audited financial statements of Priveco for the years ended July 31, 2005 and 2004.

2. Interim financial statements of Priveco for the three and nine months ended April 30, 2006 and 2005.

3. Unaudited pro forma consolidated information as at July 31, 2005 has not been provided in this current report as such information would not provide meaningful disclosure of our company as a result of the accounting effect of the acquisition of Priveco. The share exchange is deemed to be a reverse acquisition for accounting purposes. Priveco, the acquired entity, is regarded as the predecessor entity as of August 11, 2006. Starting with the periodic report for the quarter in which the acquisition was consummated, our company will file annual and quarterly reports based on the July 31 fiscal year end of Priveco. Such financial statements will depict the operating results of Priveco, including the acquisition of our company from August 11, 2006. As our company has abandoned our prior marine adventure tours business and had negligible assets and liabilities as at June 30, 2005, pro forma financial information, which would depict our company and Priveco on a combined basis as at July 31, 2005, would not provide meaningful disclosure of our company.

27

AMERICAS WIND ENERGY INC.

FINANCIAL STATEMENTS

For the Year Ended July 31, 2005 and 2004

28

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

FINANCIAL STATEMENTS

JULY 31, 2005 AND 2004

(EXPRESSED IN U.S. DOLLARS)

CONTENTS

Report of Independent Registered Public Accounting Firm	1
Balance Sheets	2
Statements of Operations	3
Statements of Stockholders' Deficit	4
Statements of Cash Flows	5
Notes to Financial Statements	6 - 16

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Americas Wind Energy Inc.

We have audited the accompanying balance sheets of Americas Wind Energy Inc. as of July 31, 2005, and 2004, and the related statements of operations, stockholders' deficit, and cash flows the years ended July 31, 2005 and 2004 and cumulative from inception (July 29, 2002) through July 31, 2005. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Americas Wind Energy Inc. as of July 31, 2005, and 2004, and the results of its operations and its cash flows for the years ended July 31, 2005 and 2004 and cumulative from inception (July 29, 2002) through July 31, 2005, in conformity with accounting principles generally accepted in the United States.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in note 1 to the financial statements, the Company is in the development stage, has been experiencing recurring losses, and has insufficient working capital to meet its planned business operations. These and other factors raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

	"SF PARTNERSHIP, LLP"
CHARTERED ACCOUNTANTS

Toronto, Canada

May 29, 2006

F-2

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Balance Sheets

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

		2005		2004
ASSETS
Current Assets
Cash	$	35,179	$	6,603
Accounts receivable and other		33		101,182
Goods and Services Tax receivable		20,018		4,880
Total Current Assets		55,230		112,665
Investment in Emergya Wind Technologies B.V. (note 3)		737,916		-
Advances to Emergya Wind Technologies B.V. (note 3)		-		748,092
Equipment, Net (note 4)		7,479		9,838
Intangible Asset (note 5)		1,780,385		1,639,375
Total Assets	$	2,581,010	$	2,509,970
LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities	$	146,707	$	100,093
Due to stockholders(note 6)		108,692		32,299
Current portion of long-term loan (note 7)		1,179,787		-
Total Current Liabilities		1,435,186		132,392
Long-Term Debt, Less Current Portion
Due to Emergya Wind Technologies B.V. (note 7)		359,855		1,623,838
Due to Digital Predictive Systems Inc. (note 8)		1,421,552		1,165,975
Total Long-Term Debt		1,781,407		2,789,813
Total Liabilities		3,216,593		2,922,205
Commitments and Contingencies (note 12)
STOCKHOLDERS' DEFICIT
Capital Stock (note 9)		65		64
Accumulated Other Comprehensive Income		59,464		39,063
Accumulated Deficit During the Development Stage		(695,112)		(451,362)
Total Stockholders' Deficit		(635,583)		(412,235)
Total Liabilities and Stockholders' Deficit	$	2,581,010	$	2,509,970

(The accompanying notes are an integral part of these financial statements)

F-3

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Statements of Operations

For the Years Ended July 31, 2005, and 2004, and Cumulative

from Inception (July 29, 2002) through July 31, 2005

(Expressed in U.S. Dollars)

					Cumulative
					from Inception
					(July 29, 2002)
					through July 31,
		2005		2004	2005
Revenue	$	-	$	640,840	$	640,840
Cost of Sales		-		891,975		891,975
Gross Loss		-		(251,135)		(251,135)
Expenses
General and administrative		141,894		130,492		286,003
Professional fees		-		-		3,334
Consulting fees		-		-		1,563
Telephone and internet		-		-		856
Bank charges		-		-		53
Depreciation		3,160		1,725		4,885
Total Expenses		145,054		132,217		296,694
Loss from Operations		(145,054)		(383,352)		(547,829)
Other Income (Expense)
Other income		37,396		26,218		63,614
Interest expense		(136,092)		(74,805)		(210,897)
Total Other Expenses		(98,696)		(48,587)		(147,283)
Net Loss		(243,750)		(431,939)		(695,112)
Foreign currency translation adjustment		20,401		40,306		59,464
Total Comprehensive Loss	$	(223,349)	$	(391,633)	$	(635,648)
Loss Per Share:
Loss per Share - Basic and Diluted	$	2.39	$	4.32
Weighted Average Number of Shares
Outstanding During the Periods -
Basic and Diluted		101,836		100,000

(The accompanying notes are an integral part of these financial statements)

F-4

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Statements of Stockholders' Deficit

From Inception (July 29, 2002) Through July 31, 2005

(Expressed in U.S. Dollars)

				Accumulated
				Other				Total
	Common Stock			Comprehensive		Accumulated		Stockholders'
	Shares	Par Value		Income		Deficit		Deficit
Stock issued at inception at July 29,
2002 $0.001 per share	100,000	$	64	$	-	$	-	$	64
Foreign currency translation
adjustment	-		-		(1,243)		-		(1,243)
Net loss for the year	-		-		-		(19,423)		(19,423)
Balance, July 31, 2003	100,000	$	64	$	(1,243)	$	(19,423)	$	(20,602)
Foreign currency translation
adjustment	-		-		40,306		-		40,306
Net loss for the year	-		-		-		(431,939)		(431,939)
Balance, July 31, 2004	100,000	$	64	$	39,063	$	(451,362)	$	(412,235)
Shares issued for cash on August 2004
- $0.0005 per share	2,000		1		-		-		1
Foreign currency translation
adjustment	-		-		20,401		-		20,401
Net loss for the year	-		-		-		(243,750)		(243,750)
Balance, July 31, 2005	102,000	$	65	$	59,464	$	(695,112)	$	(635,583)

(The accompanying notes are an integral part of these financial statements)

F-5

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Statements of Cash Flows

For the Years Ended July 31, 2005, 2004 and Cumulative

from Inception (July 29, 2002) Through July 31, 2005

Expressed in U.S. Dollars

					Cumulative
					from Inception
					(July 29, 2002)
					Through July 31,
		2005		2004	2005
Cash Flows from Operation
Net loss	$	(243,750)	$	(431,939)	$	(695,112)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Depreciation		3,160		1,725		4,885
Accrued interest		98,902		48,899		147,801
Changes in operating assets and liabilities
Accounts receivable and other		101,149		(101,111)		(33)
Work in progress		-		69,369		-
GST receivable		(15,138)		(4,880)		(20,018)
Due to stockholders		67,024		32,300		99,324
Net cash (used in) provided by operating activities		11,347		(385,637)		(463,153)
Cash Flows from Investing Activities
Purchase of capital assets		(1,007)		(11,563)		(12,570)
Net cash used in investing activities		(1,007)		(11,563)		(12,570)
Cash Flows from Financing Activities
Advances to Emergya Wind Technologies B.V.		(19,761)		(737,239)		(757,000)
Repayment to Emergya Wind Technologies B.V.		(55,760)		-		(55,760)
Advances from Digital Predictive Systems Inc.		26,753		1,090,690		1,117,443
Accounts payable and accrued liabilities		46,602		(123,909)		146,693
Issuance of common stock		1		-		65
Net cash provided by (used in) financing activities		(2,165)		229,542		451,441
Effect of Exchange Rate Change on Cash		20,401		40,306		59,461
Net Increase in Cash		28,576		127,352		35,179
Cash - beginning of year		6,603		133,955		-
Cash - end of year	$	35,179	$	6,603	$	35,179
Supplemental Disclosures of Cash Flow Information
The Company had cash flows arising from interest
and income taxes paid as follows:
Cash paid for interest	$	-	$	-	$	-
Cash paid for income taxes	$	-	$	-	$	-

Supplemental Information (note 11)

(The accompanying notes are an integral part of these financial statements)

F-6

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

1. Organization, Development Stage Activities, and Going Concern

Organization

Americas Wind Energy Inc. (the "Company") was incorporated under the Ontario Business Corporations Act on July 29, 2002. The Company distributes wind power turbines to wind farm developers throughout North America.

Development Stage Activities

The Company's business activity is the distribution of wind power turbines to wind farm developers in North America. The Company has researched and developed wind turbines to be efficient in the North American market. The Company has also commenced discussions with strategic market partners to seek equity financing through a private placement of common stock.

Going Concern

The Company's financial statements are presented on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has experienced recurring losses from operations that raise substantial doubt as to its ability to continue as a going concern. For the years ended July 31, 2005, and 2004, the Company experienced net losses of $243,750 and $431,939, respectively. As of July 31, 2005, the Company had an accumulated deficit during the development stage of $695,112.

The Company's continuance as a going concern is dependent on the success of the efforts of its directors and principal shareholders in providing financial support in the short term, the success of the Company in raising additional long-term equity or debt financing either from its own resources or from third parties, the commercialization of one or more of the Company's research projects and the Company achieving profitable operations. In the event that such resources are not secured, the assets may not be realized or liabilities discharged at their carrying amounts, and difference from the carrying amounts reported in these financial statements could be material.

The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the inability of the Company to continue as a going concern.

F-7

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies

The accounting policies of the Company are in accordance with accounting principles generally accepted in the United States, and their basis of application is consistent with that of the previous year. Set forth below are the Company's significant accounting policies:

a) Basis of Presentation

The accompanying financial statements were prepared from the accounts of the Company under the accrual basis of accounting in United States dollars.

b) Equipment

Equipment is recorded at cost. Depreciation, based on the estimated useful lives of the assets, is provided as follows:

Computer equipment 30% declining balances

c) Cash

Cash consists of cash on account with major financial institutions.

d) Research and Development

Research and development costs are expensed as incurred. Research and development expenses consist primarily of consulting fees and materials.

Costs incurred in obtaining license rights to technology in the research and development stage, and that have no alternative future uses are expensed as incurred.

Research and development costs have been included in the cost of sales category of the accompanying statements of operations since the Company is unable to separate the actual cost of sales from the research and development component.

e) Investments

Investments in shares are classified as long term, are available for sale and are stated at fair market value. The net excess of fair market value over cost is included in accumulated other comprehensive income (loss) on the statement of stockholders' deficit.

F-8

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies (cont'd)

f) Revenue Recognition

The Company recognizes revenues on a completed contract basis. Under this method, the revenue and costs related thereto are deferred until such time as the project is completed, the customer takes ownership and assumes risks of loss, collection is probable, persuasive evidence of an arrangement exists, and the sales price is fixed or determinable. The amount of any excess accumulated costs over related billings will be described as "Costs of uncompleted contracts in excess of related billings" and will be a current asset. The amount of any excess accumulated billings over related costs will be described as "Billings on uncompleted Contracts in excess of related costs" and will be a current liability.

g) Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These estimates are based on management's best knowledge of current events and actions the Company may undertake in the future. Actual results may ultimately differ from those estimates. These estimates are reviewed on an ongoing basis and as adjustments become necessary, they are reported in earnings in the period in which they become known.

h) Income Taxes

The Company accounts for income taxes pursuant to Statement of Financial Accounting Standards ("SFAS") No. 109, "Accounting for Income Taxes". Deferred tax assets and liabilities are recorded for differences between the financial statement and tax basis of the assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is recorded for the amount of income tax payable or refundable for the period, increased or decreased by the change in deferred tax assets and liabilities during the period.

F-9

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies (cont'd)

i) Foreign Currency Translation

The Company accounts for foreign currency translation pursuant to SFAS No.52, "Foreign Currency Translation". The Company's functional currency is the Canadian dollar. All assets and liabilities are translated into United States dollars using the rates prevailing at the end of the year. Revenues and expenses are translated using the average exchange rates prevailing throughout the year.

Unrealized foreign exchange amounts resulting from translations at different rates according to their nature are included in accumulated other comprehensive income or loss.

Realized foreign currency transaction gains and losses are recognized as income or expense when they arise.

j) Comprehensive Income or Loss

The Company applies the provisions of Financial Accounting Standards Board’s (FASB) SFAS No. 130 “Reporting Comprehensive Income.” Unrealized gains and losses from foreign exchange translation are reported in the accompanying statements as comprehensive income (loss).

k) Earnings or Loss Per Share

The Company accounts for earnings or loss per share pursuant to SFAS No. 128, "Earnings per Share", which requires disclosure on the financial statements of "basic" and "diluted" earnings (loss) per share. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the year. Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding plus potentially dilutive securities outstanding for each year. Potentially dilutive securities include stock options and warrants, and shares of common stock issuable upon conversion of the Company's convertible notes.

l) Impairment of Long-Lived Assets

In accordance with SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets", long-lived assets to be held and used are analysed for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. The Company evaluates at each balance sheet date whether events and circumstances have occurred that indicate possible impairment. If there are indications of impairment, the Company uses future undiscounted cash flows of the related asset or asset grouping over the remaining life in measuring whether the assets are recoverable. In the event such cash flows are not expected to be sufficient to recover the recorded asset values, the related asset or asset grouping are written down to their estimated fair value. Long-lived assets to be disposed of are reported at the lower of the carrying amount or the fair value of the asset less cost to sell.

F-10

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies (cont'd)

m) Financial Instruments

Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from the financial instruments. The carrying amounts reported in the accompanying financial statements for current assets and current liabilities approximates fair value because of the short-term maturity of these financial instruments.

SFAS No. 105, "Disclosure +of Information About Financial Instruments with Off-Balance Sheet Risk and Financial Instruments with Concentration of Credit Risk", requires disclosure of any significant off-balance sheet risk and credit risk concentration. The Company does not have significant off-balance sheet risk or credit concentration. The Company maintains cash with major financial institutions. Management does not consider this to be a significant credit risk as these banks and financial institutions are well-known.

The long-term debt due to Emergya Wind Technologies B.V. was received and is payable in Euros, resulting in a currency risk.

n) Recent Accounting Pronouncements

In December 2004, the FASB issued SFAS No. 153, "Exchanges of Non-monetary Assets, an amendment of APB Opinion No. 29". SFAS No. 153 replaces the exception from fair value measurement in APB Opinion No. 29 for non-monetary exchanges of similar productive assets with a general exception from fair value measurement for exchanges of non-monetary assets that do not have commercial substance. A non-monetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange. SFAS No. 153 is to be applied prospectively, and is effective for non-monetary asset exchanges occurring in fiscal periods after the December 2004 issuance of SFAS No. 153. The adoption of SFAS No. 153 is not expected to have a material impact on the Company's results of operations or financial position.

In December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share Based Payment" ("SFAS No. 123R"). SFAS No. 123R requires the Company to measure the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. The cost of the employee services is recognized as compensation cost over the period that an employee provides service in exchange for the award. SFAS No. 123R is effective January 1, 2006. The adoption of this standard is not expected to have a material impact on the financial position or results of operations of the Company.

F-11

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies (cont'd)

n) Recent Accounting Pronouncements (cont'd)

In March 2005, the FASB issued FASB Staff Position ("FSP") No. 46(R)-5, "Implicit Variable Interests under FASB Interpretation No. ("FIN") 46 (revised December 2003), Consolidation of Variable Interest Entities" ("FSP FIN 46R-5"). FSP FIN 46R-5 provides guidance for a reporting enterprise on whether it holds an implicit variable interest in Variable Interest Entities ("VIEs") or potential VIEs when specific conditions exist. This FSP is effective in the first period beginning after March 3, 2005 in accordance with the transition provisions of FIN 46 (revised December 2003), "Consolidation of Variable Interest Entities - an Interpretation of Accounting Research Bulletin No. 51" ("FIN 46R"). The adoption of FSP FIN 46R-5 is not expected to have a material impact on the Company's results of operations or financial position.

In March 2005, the FASB issued Interpretation No. 47, "Accounting for Conditional Asset Retirement Obligations" ("FIN 47"), which will result in (1) more consistent recognition of liabilities relating to asset retirement obligations, (2) more information about expected future cash outflows associated with those obligations, and (3) more information about investments in long-lived assets because additional asset retirement costs will be recognized as part of the carrying amounts of the assets. FIN 47 clarifies that the term "conditional asset retirement obligation" as used in SFAS No. 143, "Accounting for Asset Retirement Obligations", refers to a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement are conditional on a future event that may or may not be within the control of the entity. The obligation to perform the asset retirement activity is unconditional even though uncertainty exists about the timing and/or method of settlement. Uncertainty about the timing and/or method of settlement of a conditional asset retirement obligation should be factored into the measurement of the liability when sufficient information exists. FIN 47 also clarifies when an entity would have sufficient information to reasonably estimate the fair value of an asset retirement obligation. FIN 47 is effective no later than the end of fiscal years ending after December 15, 2005. The adoption of FIN 47 is not expected to have a material impact on the financial position or results of operations of the Company.

F-12

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies (cont'd)

n) Recent Accounting Pronouncements (cont'd)

In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections", which replaces APB Opinion No. 20, "Accounting Changes", and SFAS No. 3, "Reporting Accounting Changes in Interim Financial Statements - An Amendment of APB Opinion No. 28". SFAS No. 154 provides guidance on the accounting for and reporting of changes in accounting principles and error corrections. SFAS No. 154 requires retrospective application to prior period financial statements of voluntary changes in accounting principle and changes required by new accounting standards when the standard does not include specific transition provisions, unless it is impracticable to do so. SFAS No. 154 also requires certain disclosures for restatements due to correction of an error. SFAS No. 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005, and is required to be adopted by the Company as of January 1, 2006. The impact that the adoption of SFAS No. 154 will have on the Company's results of operations and financial condition will depend on the nature of future accounting changes adopted by the Company and the nature of transitional guidance provided in future accounting pronouncements.

In July 2005, the FASB issued an exposure draft of a proposed interpretation, Accounting for Uncertain Tax Positions an Interpretation of FASB Statement No. 109 (“SFAS No. 109”). This interpretation would apply to all open tax positions accounted for in accordance with SFAS No. 109, including those acquired in business combinations. It is a proposed asset recognition approach to apply a dual threshold for uncertain tax positions. The interpretation would allow the recognition of a tax benefit when it is probable that it could be sustained upon audit. The interpretation defines “probable” as it is defined in SFAS No. 5, “Accounting for Contingencies.” FASB has not established an effective date for the interpretation. The Company is currently reviewing the effect, if any, the proposed guidance will have on its financial position.

3. Investment in and Advances to Emergya Wind Technologies B.V.

In fiscal 2004, the Company entered into a loan agreement with Emergya Wind Technologies B.V. ("EWT"). Pursuant to the agreement, the loan was to be converted into common shares of EWT. The loan carried an interest rate of 5% per annum, to be paid at time of conversion. On July 20, 2005, the Company converted the outstanding loan balance of $739,542 into 923 common shares of EWT, representing a 31.2% ownership interest. Accordingly, the Company recorded an investment in EWT of $737,916 at July 31, 2005. At May 29, 2006 the investment represented a 16.72% ownership interest. The $1,626 difference between the date of conversion and reporting date is the result of the exchange fluctuation.

F-13

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

4. Equipment, Net

			2005				2004
			Accumulated				Accumulated
		Cost	Depreciation			Cost	Depreciation
Computer equipment	$	12,570	$	5,091	$	11,563	$	1,725
Net carrying amount			$	7,479			$	9,838

The accumulated depreciation for both 2005 and 2005 include the exchange translation effects.

5. Intangible Asset

On April 23, 2004, the Company entered into a license agreement with EWT to obtain the North American intellectual property rights and know-how relating to EWT's medium capacity wind turbines, for an indefinite period of time. The license fee was EUR 1,350,000 and the license was measured at $1,601,670, the fair value at the date the licensing agreement was entered into. The asset is not amortized due to the indefinite life term of the agreement. There is no assessed impairment noted.

6. Due to Stockholders

The amounts due to stockholders bears interest at 10% annually, with no fixed repayments term.

7. Due to Emergya Wind Technologies B.V Inc.

In fiscal 2004, the Company entered into a loan agreement relating to the intangible assets described in note 5. The liability component is as follows:

		2005		2004
Due to Emergya Wind Technologies B.V. Inc.	$	1,539,641	$	1,623,838
Less: current portion		1,179,787		-
Long-term portion	$	359,854	$	1,623,838

The loan is non interest bearing with fixed repayment terms of 7% of related sales until fully paid.

Subsequent to fiscal 2005, the Company amended the agreement that $1,179,787 would be paid in the current year and the following $359,854 would be paid in the 2007 fiscal year.

F-14

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

8. Due to Digital Predictive Systems Inc.

The amount due to Digital Predictive Systems Inc. has a three-year term which matures October 12, 2006. Interest is charged at 10%, compounded monthly. Repayment is to be made in full, including interest, at maturity. The loan is secured by a general security agreement over the Company's assets and all license agreement rights.

9. Capital Stock

Authorized

Unlimited	common shares
Unlimited	class "A" special shares
Unlimited	class "B" special shares
Unlimited	class "C" special shares
Unlimited	class "D" special shares

		2005		2004
Issued and Outstanding
102,000  (2004: 100,000) shares of common
stock, which hold no par value.	$	65	$	64

During the year, the Company issued 2,000 shares for proceeds of $1.

10. Income Taxes

The provision for income taxes has been computed as follows:

		2005		2004
Expected income tax recovery at the statutory rate of 18%	$	(43,875)	$	(77,749)
Less: valuation allowance		43,875		77,749
Provision for income taxes	$	-	$	-

F-15

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

10. Income Taxes (cont'd)

The components of future income taxes are as follows:

		2005		2004
Net operating loss carryforwards:
Scientific research and development expense	$	-	$	314,560
Net operating loss carry forward		76,457		30,236
Less - Valuation allowance		(76,457)		(344,796)
Deferred income taxes	$	-	$	-

The Company has net operating loss carryforwards available to be applied against future years income. Due to the losses incurred in the current year and expected future operating results, it is more likely than not that the deferred tax asset resulting from the tax losses available for carry forward will not be realized through the reduction of future income tax payments. Accordingly a 100% valuation allowance has been recorded for deferred income tax assets.

As of July 31, 2005, and 2004, the Company had approximately $430,506 and $18,053, respectively, of federal and state net operating loss carryforwards available to offset future taxable income, such carryovers expire in various years through 2012.

11. Supplemental Information

Non-cash financing and investing activities:

		2005		2004
Investment in Emergya Wind Technologies B.V.	$	737,916	$	-
Advance to Emergya Wind Technologies B.V.		(737,916)		-
Purchase of Intangible assets		-		(1,639,375)
Due to Emergya Wind Technologies B.V.		-		1,639,375
	$	-	$	-

F-16

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

12. Commitments and Contingencies

The Company has committed under a license agreement to pay to EWT a royalty of 3% of related sales and 40% of any royalties received by the Company from its sub-licensees.

13. Subsequent Events

On May 11, 2005, the Company entered into a license agreement with GE Power Technology LLC ("GEPT") to obtain certain licenses under GEPT's patents. The Company has agreed under this license agreement to pay GEPT a royalty equal to $32,500 per megawatt for each sale or shipment of portion thereof of a licensed product.

29

AMERICAS WIND ENERGY INC.

INTERIM FINANCIAL STATEMENTS

THREE MONTH AND NINE MONTH PERIOD ENDED APRIL 30, 2006 AND 2005

30

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

INTERIM FINANCIAL STATEMENTS

THREE MONTH AND NINE MONTH PERIOD ENDED APRIL 30, 2006 AND 2005

CONTENTS

Interim Balance Sheet	1
Interim Statements of Operations	2
Interim Statements of Cash Flows	3
Notes to Interim Financial Statements	4 - 11

FF-1

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Interim Balance Sheets

April 30, 2006 and July 31, 2005

(Expressed in United States Dollars)

(Unaudited)

		2006
ASSETS
Current
Cash	$	95,167
Loan receivable		45,584
GST Receivable		18,744
Total Current Assets		159,495
Investment in Emergya Wind Technologies B.V. (note 3)		809,006
Equipment, Net (note 4)		137,711
Intangible Asset (note 5)		1,951,906
Total Assets	$	3,058,118
LIABILITIES
Current
Accounts payable	$	210,883
Billings on uncompleted contracts in excess of related costs		317,769
Due to stockholders (note 6)		208,971
Due to Emergya Wind Technologies (note 7)		1,263,607
Due to Northwest Passage Ventures Ltd. (note 8)		252,382
Due to Digital Predictive Systems Inc. (note 9)		1,678,567
Total Current Liabilities		3,932,179
Total Liabilities		3,932,179
Commitments and Contingencies (note 12)
STOCKHOLDERS' DEFICIT
Capital Stock (note 10)		90
Accumulated Other Comprehensive Income		83,615
Deficit Accumulated during the development stage		(957,766)
Total Stockholder's Equity (Deficit)		(874,061)
Total Liabilities and Stockholders' Equity	$	3,058,118

(The accompanying notes are an integral part of these interim financial statements)

FF-2

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Interim Statement of Operations

Three Months and Nine Months Ended April 30, 2006 and 2005

(Expressed in United States Dollars)

(Unaudited)

									July 29,
									2002 (Date of
	Three		Three		Nine		Nine		Inception)
	Months		Months		Months		Months		through
	Ended		Ended		Ended		Ended		April 30,
	2006		2005		2006		2005		2006
Revenue	$	-	$	-	$	-	$	-	$	640,840
Cost of Sales		-		-		-		-		891,975
Gross Profit		-		-		-		-		(251,135)
Expenses
General and administrative		93,242		37,454		143,160		76,549		434,969
Depreciation		5,185		797		13,407		2,369		18,292
Total Expenses		98,427		38,251		156,567		(78,918)		(453,261)
Loss from Operations		(98,427)		(38,251)		(156,567)		78,918		(704,396)
Other income		-		-		2,378		-		65,992
Recovery of expenses		22,100		-		34,598		-		34,598
Finance fee		(16,402)		-		(16,146)		-		(16,146)
Interest expense		(41,803)		(32,391)		(126,917)		(63,888)		(337,814)
Total Other Income (Expenses)		(36,105)		(32,391)		(106,087)		(63,888)		(253,370)
Provision for income taxes		-		-		-		-		-
Net Loss		134,532		70,642		262,654		142,806		957,766
Foreign currency translation		8,050		(4,027)		24,151		(12,081)		83,615
Comprehensive Loss	$	126,482	$	74,669	$	238,503	$	154,887	$	874,151
Loss per Share – Basic
and Diluted	$	1.09	$	0.69	$	2.39	$	1.40
Weighted average number of
shares outstanding during the
periods - basic and diluted		123,156		102,000		110,073		101,788

(The accompanying notes are an integral part of these interim financial statements)

FF-3

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Interim Statement of Cash Flows

Nine Months Ended April 30, 2006 and 2005

(Expressed in United States Dollars)

(Unaudited)

					For the period
					from July 29,
					2002 (Inception)
	2006		2005		to April 30, 2006
Cash Flows from Operating Activities
Net (loss)	$	(262,654)	$	(142,806)	$	(957,766)
Adjustments for:
Depreciation		13,407		3,160		18,292
Accrued Interest		114,758		63,888		147,801
		(134,489)		(75,758)		(791,673)
Changes in non-cash working capital
Loan receivable		(45,551)		(7,430)		(45,584)
Investment in EWT		(71,090)		(838,206)		(71,090)
GST receivable		1,274		(9,334)		(18,744)
Due to stockholders		100,278		45,934		199,602
Billings on uncompleted contract in excess of
related cost		317,769		81,129		317,769
Net Cash Flows from Operating Activities		168,191		(803,665)		(409,720)
Cash Flows from Financing Activities
Issuance of common stock		25		-		90
Repayments to Emergya Wind Technologies B.V.		(447,555)		-		(503,315)
Advances from Northwest Passage Ventures Ltd.		252,382		-		252,382
Advances from Digital Predictive Systems Inc.		142,257		(4,167)		1,374,458
Advances to Emergya Wind Technologies B.V.		-		748,092		(757,000)
Accounts payable and accrued liabilities		64,176		43,697		210,869
Net Cash Flows from Financing Activities		11,285		787,622		577,484
Cash Flows from Investing Activities
Acquisition of equipment		(143,639)		(1,386)		(156,209)
Net Cash Flows from Investing Activities		(143,639)		(1,386)		(156,209)
Effect of Exchange Rate Change on Cash		24,151		(12,081)		83,612
Change in Cash		59,988		(29,510)		95,167
Cash – beginning of period		35,179		6,603		-
Cash - end of period	$	95,167	$	(22,907)	$	95,167
Supplemental disclosures of cash flow information:
The Company had cash flows arising from interest
and income taxes paid as follows:
Income taxes	$	-	$	-	$	-
Interest	$	-	$	-	$	-

(The accompanying notes are an integral part of these interim financial statements)

FF-4

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

1. Operations, Development Stage Activities, and Going Concern

Americas Wind Energy Inc. (the "Company"), was incorporated under the Ontario Business Corporations Act on July 29, 2002. The Company distributes wind power turbines to wind farm developers throughout North America.

Development Stage Activities

The Company business activity is the distribution of wind power turbines to wind farm developers in North America. The Company has researched and developed wind turbines to be efficient in the North American market. The Company has also commenced discussions with strategic market partners to seek equity financing through a private placement of common stock.

Going Concern Assumption

The Company's financial statements are presented on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has experienced recurring losses from operations that raise substantial doubt as to its ability to continue as a going concern. For the nine month period ended April 30, 2006, and the year ended July 31, 2005, the Company experienced net losses of $262,654 and $243,750 respectively. As of April 2005, the Company had an accumulated deficit during the development stage of $957,766.

The Company's ability to continue as a going concern is contingent upon its ability to secure debt and equity financing, and attain profitable operations.

The Company continuance as a going concern is dependent on the success of the efforts of its directors and principal shareholders in providing financial support in the short term, the success of the Company in raising additional long-term equity or debt financing either from its own resources or from third parties, the commercialization of one or more of the Company's research projects and the Company achieving profitable operations. In the event that such resources are not secured, the assets may not be realized or liabilities discharged at their carrying amounts, and difference from the carrying amounts reported in these financial statements could be material.

The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the inability of the Company to continue as a going concern.

FF-5

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

2. Summary of Significant Accounting Policies

a) Basis of Financial Statement Presentation

The accompanying unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the requirements of item 310 (b) of Regulation S-B. Accordingly, certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to the rules and regulations of Securities and Exchange Commission. The financial statements reflect all adjustments (consisting on of normal recurring adjustments), which, in the opinion of management, are necessary for a fair presentation of the results for the periods presented. There have been no significant changes of accounting policy since July 31, 2005. The results from operations for the interim periods are not indicative of the results expected for the full fiscal year or any future period. These financial statements should be read in conjunction with the audited financial statements and notes thereto for the fiscal year ended July 31, 2005 as filed with the Securities and Exchange Commission.

b) Recent Accounting Pronouncements

In December 2004, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 153, "Exchanges of Non-monetary Assets, an amendment of Accounting Principles Board ("APB") Opinion No. 29". SFAS No. 153 replaces the exception from fair value measurement in APB Opinion No. 29 for non-monetary exchanges of similar productive assets with a general exception from fair value measurement for exchanges of non-monetary assets that do not have commercial substance. A non-monetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange. SFAS No. 153 is to be applied prospectively, and is effective for non-monetary asset exchanges occurring in fiscal periods after the December 2004 issuance of SFAS No. 153. The adoption of SFAS No. 153 is not expected to have a material impact on the Company's results of operations or financial position.

In December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share Based Payment" ("SFAS No. 123R"). SFAS No. 123R requires the Company to measure the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. The cost of the employee services is recognized as compensation cost over the period that an employee provides service in exchange for the award. SFAS No. 123R is effective January 1, 2006. The adoption of this standard is not expected to have a material impact on the financial position or results of operations of the Company.

FF-6

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

2. Summary of Significant Accounting Policies (cont'd)

b) Recent Accounting Pronouncements (cont'd)

In March 2005, the FASB issued FASB Staff Position ("FSP") No. 46(R)-5, "Implicit Variable Interests under FASB Interpretation No. ("FIN") 46 (revised December 2003), Consolidation of Variable Interest Entities" ("FSP FIN 46R-5"). FSP FIN 46R-5 provides guidance for a reporting enterprise on whether it holds an implicit variable interest in Variable Interest Entities ("VIEs") or potential VIEs when specific conditions exist. This FSP is effective in the first period beginning after March 3, 2005 in accordance with the transition provisions of FIN 46 (revised December 2003), "Consolidation of Variable Interest Entities - an Interpretation of Accounting Research Bulletin No. 51" ("FIN 46R"). The adoption of FSP FIN 46R-5 is not expected to have a material impact on the Company's results of operations or financial position.

In March 2005, the FASB issued Interpretation No. 47, "Accounting for Conditional Asset Retirement Obligations" ("FIN 47"), which will result in (1) more consistent recognition of liabilities relating to asset retirement obligations, (2) more information about expected future cash outflows associated with those obligations, and (3) more information about investments in long-lived assets because additional asset retirement costs will be recognized as part of the carrying amounts of the assets. FIN 47 clarifies that the term "conditional asset retirement obligation" as used in SFAS No. 143, "Accounting for Asset Retirement Obligations", refers to a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement are conditional on a future event that may or may not be within the control of the entity. The obligation to perform the asset retirement activity is unconditional even though uncertainty exists about the timing and/or method of settlement. Uncertainty about the timing and/or method of settlement of a conditional asset retirement obligation should be factored into the measurement of the liability when sufficient information exists. FIN 47 also clarifies when an entity would have sufficient information to reasonably estimate the fair value of an asset retirement obligation. FIN 47 is effective no later than the end of fiscal years ending after December 15, 2005. The adoption of FIN 47 is not expected to have a material impact on the financial position or results of operations of the Company.

FF-7

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

2. Summary of Significant Accounting Policies (cont'd)

b) Recent Accounting Pronouncements (cont'd)

In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections", which replaces APB Opinion No. 20, "Accounting Changes", and SFAS No. 3, "Reporting Accounting Changes in Interim Financial Statements - An Amendment of APB Opinion No. 28". SFAS No. 154 provides guidance on the accounting for and reporting of changes in accounting principles and error corrections. SFAS No. 154 requires retrospective application to prior period financial statements of voluntary changes in accounting principle and changes required by new accounting standards when the standard does not include specific transition provisions, unless it is impracticable to do so. SFAS No. 154 also requires certain disclosures for restatements due to correction of an error. SFAS No. 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005, and is required to be adopted by the Company as of January 1, 2006. The impact that the adoption of SFAS No. 154 will have on the Company's results of operations and financial condition will depend on the nature of future accounting changes adopted by the Company and the nature of transitional guidance provided in future accounting pronouncements.

In July 2005, the FASB issued an exposure draft of a proposed interpretation, Accounting for Uncertain Tax Positions an Interpretation of FASB Statement No. 109 (“SFAS No. 109”). This interpretation would apply to all open tax positions accounted for in accordance with SFAS No. 109, including those acquired in business combinations. It is a proposed asset recognition approach to apply a dual threshold for uncertain tax positions. The interpretation would allow the recognition of a tax benefit when it is probable that it could be sustained upon audit. The interpretation defines “probable” as it is defined in SFAS No. 5, “Accounting for Contingencies.” FASB has not established an effective date for the interpretation. The Company is currently reviewing the effect, if any, the proposed guidance will have on its financial position.

FF-8

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

3. Investment in and Advances to Emergya Wind Technologies B.V.

In fiscal 2004, the Company entered into a loan agreement with Emergya Wind Technologies B.V. ("EWT"). Pursuant to the agreement, the loan was to be converted into common shares of EWT. The loan carried an interest rate of 5% per annum, to be paid at time of conversion. On July 20, 2005, the Company converted the outstanding loan balance of $739,542 into 923 common shares of EWT, representing a 31.2% ownership interest. Accordingly, the Company recorded an investment in EWT of $809,006 at April 30, 2006. At July 12, 2006 the investment represented a 16.72% ownership interest. The $71,091 difference between the date of conversion and reporting date is the result of the exchange fluctuations.

4. Equipment, Net

Equipment is comprised as follows:

				2006
				Accumulated
		Cost		Depreciation
Computer Equipment	$	13,781	$	7,427
Computer Software		4,720		1,770
Manufacturing Equipment		138,818		10,411
Total Capital Assets	$	157,319	$	19,608
Net carrying amount			$	137,711

5. Intangible Asset

On April 23, 2004, the Company entered into a license agreement with EWT to obtain the North American intellectual property rights and know-how relating to EWT's medium capacity wind turbines, for an indefinite period of time. The license fee was EUR 1,350,000 and the license was measured at the fair value at the date the licensing agreement was entered into. At April 30, the license was $1,951,906. The asset is not amortized due to the indefinite life term of the agreement.

FF-9

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

6. Due to Stockholders

The amounts due to shareholders bears interest at 10% annually with no fixed repayments term.

7. Due to Emergya Wind Technologies B.V. Inc.

In fiscal 2004, the Company entered into a loan agreement relating to the intangible assets described in note 5. The liability component is as follows:

		2006
Due to Emergya Wind Technologies B.V. Inc.	$	1,263,607
Less: current portion		1,263,607
Long-term portion	$	-

The Company amended the license agreement terms of payment and accordingly, the balance is due within the next 12 months.

8. Due to Northwest Passage Ventures Ltd.

The amount due to Northwest Passage Ventures Ltd. matures at the earlier of March 17, 2007, or within ten days of the closing of the Formal Agreement entered into by Northwest and the Company. The amount bears interest at 7%, compounded annually and is payable at the maturity date.

9. Due to Digital Predictive Systems Inc.

The amount due to Digital Predictive Systems Inc. has a three-year term which matures October 12, 2006. Interest is charged at 10%, compounded monthly. Repayment is to be made in full, including interest, at maturity. The loan is secured by a general security agreement over the Company's assets and all license agreement rights.

FF-10

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

10. Capital Stock

Authorized

Unlimited number of common shares

Unlimited number of Class "A" special shares

Unlimited number of Class "B" special shares

Unlimited number of Class "C" special shares

Unlimited number of Class "D" special shares

		2006
Issued and Outstanding
130,000 (2005: 102,000) shares of common stock, which hold no par value	$	90

During the period, the Company issued 28,000 shares for proceeds of $25.

11. Income Taxes

The Company's current income taxes are as follows:

		2006		2005
Expected income tax recovery at the statutory rates
of 18% (2005 - 18%)	$	47,278	$	43,875
Valuation allowance		(47,278)		(43,875)
Provision for income taxes	$	-	$	-

The Company has deferred income tax assets as follows:

		2006
Deferred Income Tax Assets
Loss carry-forwards	$	124,768
Valuation allowance for deferred income tax assets		(124,768)
Deferred income taxes	$	-

FF-11

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

11. Income Taxes (cont'd)

The Company has net operating loss carryforwards available to be applied against future years income. Due to the losses incurred in the current year and expected future operating results, it is more likely than not that the deferred tax asset resulting from the tax losses available for carry forward will not be realized through the reduction of future income tax payments. Accordingly a 100% valuation allowance has been recorded for deferred income tax assets.

As of April 30, 2006 and July 31, 2005, the Company had approximately $693,160 and $430,506 respectively, of federal and state net operating loss carryforwards available to offset future taxable income, such carryovers expire in various years through 2013.

12. Commitments and Contingencies

The Company has committed under a license agreement to pay to EWT a royalty of 3% of related sales and 40% of any royalties received by the Company from its sub-licensees.

13. Subsequent Events

On May 11, 2005, the Company entered into a license agreement with GE Power Technology LLC ("GEPT") to obtain certain licenses under GEPT's patents. The Company has agreed under this license agreement to pay GEPT a royalty equal to $32,500 per megawatt for each sale or shipment of portion thereof of a licensed product.

14. Comparative Figures

Certain figures for the prior year have been reclassified to conform with the current year's financial statement presentation.

31

Exhibits

Copies of the following documents are included as exhibits to this current report pursuant to Item 601 of Regulation S-B:

Exhibit Number			Description
(2)			Plan of Purchase, Sale, Reorganization, Arrangement, Liquidation or Succession
2.1*			Share Exchange Agreement dated August 11, 2006, among Northwest Passage Ventures, Ltd., 6544797 Canada Ltd., Americas Wind Energy Inc. and the shareholders of Americas Wind Energy Inc.
(3)			Articles of Incorporation and By-laws
3.1			Articles of Incorporation (incorporated by reference from our Registration Statement on Form SB-2 filed on October 29, 2003).
3.2			Bylaws (incorporated by reference from our Registration Statement on Form SB-2 Filed on October 29, 2003).
3.3*			Certificate of Amendment filed with the Nevada Secretary of State on June 19, 2006
(10)			Material Contracts
10.1*			Participation and Shareholders Agreement dated July 20, 2005, among Americas Wind Energy Inc., Wind en Water Technologies B.V., DOEN Participaties B.V., Meltech Holding B.V. and Emergya Wind Technologies B.V.
10.2*			License Agreement dated April 23, 2004, among Americas Wind Energy Inc. and Emergya Wind Technologies B.V.
(21)			Subsidiaries of the Small Business Issuer
			6544797 Canada Ltd. Americas Wind Energy Inc.
	*	Filed herewith

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

NORTHWEST PASSAGE VENTURES, LTD.

/s/ Harold C.F. Dickout                                             

Harold C.F. Dickout

Chief Executive Officer

Date: September 11, 2006

EX-2

SHARE EXCHANGE AGREEMENT

THIS AGREEMENT dated for reference the 11th day of August, 2006.

AMONG:

NORTHWEST PASSAGE VENTURES LTD. of Suite 509 – 207 West Hastings Street, Vancouver, British Columbia

(“Northwest”)

AND

6544797 CANADA LTD., with a registered and records office at 800 – 885 West Georgia Street, Vancouver, British Columbia, V6C 3H1

(the “Purchaser”)

AND:

AMERICAS WIND ENERGY INC. of 24 Palace Arch Drive, Toronto, Ontario

(the “Target”)

AND:

THE SHAREHOLDERS OF TARGET, as listed on Schedule “A”

(the “Target Shareholders”)

WHEREAS:

A.The Target Shareholders are the registered and beneficial owners of all of the issued and outstanding common shares (the “Target Shares”) in the capital of the Target, consisting of 130,000 common shares in the capital of the Target;

B. The Purchaser is a wholly owned subsidiary of Northwest, a Nevada corporation;

C.Pursuant to a letter agreement, dated March 13, 2006, between the Target and Northwest, Northwest agreed to:

(i) cause the Purchaser to issue 30,000,000 class A preference shares (the “Preferred Shares”) in the capital of the Purchaser, giving the right to acquire 30,000,000

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common shares in the capital of Northwest, which Preferred Shares have the rights and restrictions as set out in Schedule “B” attached hereto; and

(ii) issue 30,000,000 class A special voting shares (the “Special Voting Shares”) in the capital of Northwest,

to the Target Shareholders as consideration for the exchange of the Target Shares held by the Target Shareholders, in the course of a reorganization of the capital of the Target as contemplated by section 85 of the Income Tax Act (Canada);

D.Pursuant to the terms of this Agreement and a Call Option Agreement, attached hereto as Schedule “C” (the “Call Option Agreement”) to be entered into by each one of the Target Shareholders and Northwest, each of the Target Shareholders has granted an option to Northwest to acquire the Preferred Shares and the Special Voting Shares in exchange for an equal number of common shares in the capital of Northwest; and

E.Upon the terms and subject to the conditions set forth in this Agreement, the Target Shareholders have respectively agreed to exchange the Target Shares for the Preferred Shares and the Special Voting Shares (the “Share Exchange”).

THEREFORE in consideration of the premises and of the mutual covenants and agreements herein set forth, the parties hereto covenant and agree with each other as follows:

1. INTERPRETATION

1.1 In this Agreement, except as otherwise expressly provided:

(a) “Agreement” means this Share Exchange Agreement, including the preamble and the Schedules hereto, as it may from time to time be supplemented or amended and in effect;

(b) all references in this Agreement to a designated “Section” or other subdivision or to a Schedule is to the designated Section or other subdivision of, or Schedule to, this Agreement;

(c) the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Section or other subdivision or Schedule;

(d) the headings are for convenience only and do not form a part of this Agreement and are not intended to interpret, define, or limit the scope, extent or intent of this Agreement or any provision hereof;

(e) the singular of any term includes the plural, and vice versa; the use of any term is equally applicable to any gender and, where applicable, a body corporate; the word “or” is not exclusive; the word “including” means including without limitation or prejudice to the generality of any description, definition, term or phrase preceding that word, and the word “include” and its derivatives will be

- 3 -

construed accordingly; the expression “to the knowledge of” or any similar expression as applied to a corporation or individual, refers to, (A) in the case of an individual, the knowledge as at the relevant date that such individual had or would have had had he exercised due diligence in making enquiries in relation to the matter in question from all sources of information likely to provide him with knowledge of same, and (B) in the case of a corporate person, the knowledge (as aforementioned) of a director or officer thereof as at the relevant date;

(f) any accounting term not otherwise defined has the meanings assigned to it in accordance with generally accepted accounting principles applicable in Canada;

(g) except as otherwise provided, any dollar amount referred to in this Agreement means the lawful currency of the United States; and

(h) any other term defined within the text of this Agreement has the meaning so ascribed.

1.2 The following are the Schedules to this Agreement, form part of this Agreement and are incorporated herein by reference:

(a) Schedule “A” – List of Shareholders of Americas Wind Energy Inc.;

(b) Schedule “B” - Special Rights and Restrictions attached to Class A Preference Shares Without Par Value;

(c) Schedule “C” – Call Option Agreement;

(d) Schedule “D” – Financial Statements of Americas Wind Energy Inc.;

(e) Schedule “E” – List of Assets of Americas Wind Energy Inc.;

(f) Schedule “F” – Continuing Contractual Obligations of Americas Wind Energy Inc.;

(g) Schedule “G” – Northwest Passage Ventures Ltd. – Outstanding Litigation;

(h) Schedule “H” – Outstanding Rights to Acquire shares of Northwest Passage Ventures Ltd.;

(i) Schedule “I” – Financial Statements of Northwest Passage Ventures Ltd.;

(j) Schedule “J” – List of Assets of Northwest Passage Ventures Ltd.; and

(k) Schedule “K” – Continuing Contractual Obligations of 6544797 Canada Ltd. and Northwest Passage Ventures Ltd.

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2. CLOSING

2.1 The closing of the transactions contemplated herein will take place at 4:30 p.m. (Vancouver time), on August 11, 2006, or such other date as may be agreed to by the parties hereto (the “Closing Date”). The closing may take place by exchange of the appropriate solicitor’s undertakings, which will involve each party’s solicitors delivering to his or her counterpart all required consideration and documentation, to be held in trust and not released until all required closing deliveries have been made and all conditions to closing have been satisfied or waived by the party which has the benefit of such conditions.

3. SHARE EXCHANGE

3.1 Upon and subject to the terms and conditions of this Agreement, the Target Shareholders, Northwest and the Purchaser hereby agree that, on the Closing Date, all of the Target Shares shall be exchanged for an aggregate of 30,000,000 Preferred Shares on the basis of 230.769230769 Preferred Shares for each Target Share and an aggregate of 30,000,000 Special Voting Shares on the basis of 230.769230769 Special Voting Shares for each Target Share owned by the Target Shareholders.

4. RESTRICTED SECURITIES

4.1 The Target Shareholders acknowledge that any common shares in the capital of Northwest issued on exchange of the Preferred Shares and the Special Voting Shares (the “Exchange Shares”), pursuant to the terms and conditions set forth in this Agreement and the Call Option Agreement, and the rights and restrictions of the Preferred Shares, will have such hold periods as are required under applicable securities laws and as a result may not be sold, transferred or otherwise disposed, except pursuant to an effective registration statement under the United States Securities Act of 1933, as amended (the “1933 Act”), or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act and in each case only in accordance with applicable state securities laws.

4.2 The parties hereto acknowledge that each of the Target Shareholders are resident in Ontario, and that Northwest has advised the Target Shareholders that the Purchaser and Northwest are relying on an exemption from the prospectus requirements of the Securities Act (Ontario) to issue the Preferred Shares and the Special Voting Shares, respectively, to each of the Target Shareholders and, as a consequence, certain protections, rights and remedies provided by the Securities Act (Ontario), including statutory rights of rescission or damages, will not be available to the Target Shareholders.

4.3 The Target Shareholders acknowledge that neither the Purchaser nor Northwest is a reporting issuer in any of the Provinces of Canada and therefore resale of any of the Preferred Shares, Special Voting Shares or Exchange Shares by Target Shareholders resident in Ontario is restricted except pursuant to an exemption from applicable securities legislation.

- 5 -

4.4 It is understood and agreed by the parties hereto that they will provide and execute all such representations and collateral agreements as are reasonably necessary to ensure that the issuance of the Preferred Shares, Special Voting Shares and Exchange Shares complies with the requirements of all applicable securities legislation.

4.5 It is understood and agreed that the certificates evidencing the Preferred Shares, Special Voting Shares and Exchange Shares and will bear the following legends:

“THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN OFFSHORE TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN) PURSUANT TO REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").

NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT. "UNITED STATES" AND "U.S. PERSON" ARE AS DEFINED BY REGULATION S UNDER THE 1933 ACT.

THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO A HOLD PERIOD IN ALL PROVINCES IN CANADA AND MAY NOT BE TRADED IN ANY OF THE PROVINCES OF CANADA EXCEPT AS PERMITTED BY APPLICABLE SECURITIES LEGISLATION.”

4.6 The Purchaser and Northwest acknowledge that the Target Shares acquired pursuant to the terms of this Agreement will have such hold periods as are required under applicable securities laws and as a result may not be sold, transferred or otherwise disposed, except pursuant to an effective registration statement under the 1933 Act or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act and in each case only in accordance with applicable state securities laws.

4.7 The Purchaser and Northwest acknowledge that the Target is not a reporting issuer in any of the Provinces of Canada and therefore resale of any of the Target Shares is restricted except pursuant to an exemption from applicable securities legislation.

- 6 -

4.8 It is understood and agreed that the certificates evidencing the Target Shares will bear the following legends:

“NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT. "UNITED STATES" AND "U.S. PERSON" ARE AS DEFINED BY REGULATION S UNDER THE 1933 ACT.”

5. ACKNOWLEDGEMENTS OF THE TARGET SHAREHOLDERS

5.1 Each one of the Target Shareholders acknowledges and agrees that:

(a) none of the Preferred Shares, Special Voting Shares or Exchange Shares have been or will be registered under the 1933 Act, or under any state securities or “blue sky” laws of any state of the United States, and, unless so registered, may not be offered or sold in the United States or, directly or indirectly, to U.S. Persons, as that term is defined in Regulation S under the 1933 Act (“Regulation S”), except in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act;

(b) neither the Purchaser nor Northwest have undertaken, and will have no obligation, to register any of the Preferred Shares, Special Voting Shares or Exchange Shares under the 1933 Act;

(c) the Purchaser and Northwest are entitled to rely on the acknowledgements, agreements, representations and warranties and the statements and answers of the Target Shareholders contained in this Agreement, and each of the Target Shareholders will hold harmless the Purchaser and Northwest from any loss or damage either one may suffer as a result of any such acknowledgements, agreements, representations and/or warranties made by that Target Shareholder not being true and correct;

(d) each of the Target Shareholders has been advised to consult their own respective legal, tax and other advisors with respect to the merits and risks of an investment

- 7 -

in the Preferred Shares, Special Voting Shares and Exchange Shares and, with respect to applicable resale restrictions, is solely responsible (and neither the Purchaser or Northwest is in any way responsible) for compliance with applicable resale restrictions;

(e) none of the Preferred Shares, Special Voting Shares or Exchange Shares are listed on any stock exchange or automated dealer quotation system and no representation has been made to the Target Shareholders that any of the Preferred Shares, Special Voting Shares or Exchange Shares will become listed on any stock exchange or automated dealer quotation system, except that currently certain market makers make market in the common shares of Northwest on the National Association of Securities Dealers, Inc.’s Over-the-Counter Bulletin Board;

(f) each of the Target Shareholders is outside the United States when receiving and executing this Agreement and is acquiring the Preferred Shares, Special Voting Shares or Exchange Shares as principal for their own account, for investment purposes only, and not with a view to, or for, resale, distribution or fractionalization thereof, in whole or in part, and no other person has a direct or indirect beneficial interest in the Preferred Shares, Special Voting Shares or Exchange Shares;

(g) none of the Preferred Shares, Special Voting Shares or Exchange Shares may be offered or sold to a U.S. Person (as defined in Regulation S) or for the account or benefit of a U.S. Person prior to the end of the Restricted Period (as defined herein); and

(h) neither the Securities and Exchange Commission (the “SEC”) nor any other securities commission or similar regulatory authority has reviewed or passed on the merits of the Preferred Shares, Special Voting Shares or the Exchange Shares.

6. ACKNOWLEDGEMENTS OF THE PURCHASER AND NORTHWEST

6.1 Each of the Purchaser and Northwest acknowledges and agrees that:

(a) none of the Target Shares have been or will be registered under the 1933 Act, or under any state securities or “blue sky” laws of any state of the United States, and, unless so registered, may not be offered or sold in the United States or, directly or indirectly, to U.S. Persons, as that term is defined in Regulation S, except in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act;

(b) the Target has not undertaken, and will have no obligation, to register any of the Target Shares under the 1933 Act;

(c) the Target is entitled to rely on the acknowledgements, agreements, representations and warranties and the statements and answers of the Purchaser

- 8 -

and Northwest contained in this Agreement, and each of Northwest and the Purchaser will hold harmless the Target from any loss or damage it may suffer as a result of any such acknowledgements, agreements, representations and/or warranties made by the Purchaser or Northwest, as the case may be, not being true and correct;

(d) each of the Purchaser and Northwest have been advised to consult their own respective legal, tax and other advisors with respect to the merits and risks of an investment in the Target Shares and, with respect to applicable resale restrictions, is solely responsible (and the Target is in no way responsible) for compliance with applicable resale restrictions; and

(e) neither the SEC nor any other securities commission or similar regulatory authority has reviewed or passed on the merits of the Target Shares.

7. REPRESENTATIONS AND WARRANTIES OF THE TARGET SHAREHOLDERS AND THE TARGET

7.1 Each of the Target Shareholders, individually concerning their respective shares, and the Target, jointly and severally therewith, warrant and represent to the Purchaser and Northwest with the intent that each of the Purchaser and Northwest will rely thereon in entering into this Agreement and in concluding the Share Exchange contemplated herein, that:

(a) each Target Shareholder is the sole registered holder and beneficial owner of such number of common shares in the capital of the Target as set out in Schedule “A” attached hereto;

(b) other than as disclosed in Schedule “A” attached hereto, each of the Target Shares are free and clear of all liens, any actual, pending or threatened hold periods, trading restrictions, lien charges, claims, options, set-offs, encumbrances, voting agreements, voting trusts, escrow restrictions or other limitations or restrictions of any nature whatsoever;

(c) each of the Target Shareholders does not have any interest, legal or beneficial, direct or indirect, in any shares of, or the assets or business of, the Target other than their ownership of the Target Shares;

(d) each of the Target Shareholders has the power and capacity and good and sufficient right and authority to enter into this Agreement on the terms and conditions herein set forth and will on the Closing Date have the right to transfer the legal and beneficial title and ownership of the Target Shares to the Purchaser;

(e) each of the Target Shareholders has had adequate opportunity to obtain from representatives of the Purchaser and Northwest such information, in addition to the representations set forth in this Agreement, as is necessary to evaluate the merits and risks of the Target Shareholders’ investment in the Preferred Shares, Special Voting Shares and Exchange Shares and each of the Target Shareholders

- 9 -

has sufficient experience in business, financial and investment matters to be able to evaluate the risks involved in the acquisition of the Preferred Shares, Special Voting Shares and Exchange Shares to be issued to the Target Shareholders pursuant to the terms of this Agreement and to make informed investment decisions with respect to such investment;

(f) none of the Target Shareholders is a U.S. Person;

(g) none of the Target Shareholders is acquiring the Preferred Shares, Special Voting Shares or Exchange Shares for the account or benefit of, directly or indirectly, any U.S. Person;

(h) each of the Target Shareholders is acquiring the Preferred Shares, Special Voting Shares or Exchange Shares for investment only and not with a view to resale or distribution and, in particular, each of the Target Shareholders has no intention to distribute either directly or indirectly any of the Preferred Shares, Special Voting Shares or Exchange Shares in the United States or to U.S. Persons;

(i) each of the Target Shareholders is outside the United States when receiving and executing this Agreement and is acquiring the Preferred Shares, Special Voting Shares or Exchange Shares as principal for their own account, for investment purposes only, and not with a view to, or for, resale, distribution or fractionalization thereof, in whole or in part, and no other person has a direct or indirect beneficial interest in such Preferred Shares, Special Voting Shares or Exchange Shares;

(j) each of the Target Shareholders understands and agrees that none of the Preferred Shares, Special Voting Shares or Exchange Shares has been or will be registered under the 1933 Act, or under any state securities or “blue sky” laws of any state of the United States, and, unless so registered, may not be offered or sold in the United States or, directly or indirectly, to U.S. Persons except in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act and in each case only in accordance with applicable state securities laws;

(k) each of the Target Shareholders understands and agrees that offers and sales of any of:

(i) the Preferred Shares prior to the expiration of a period of one year after the date of original issuance of the Preferred Shares,

(ii) the Special Voting Shares prior to the expiration of a period of one year after the date of original issuance of the Special Voting Shares, or

(iii) the Exchange Shares prior to the expiration of a period of one year after the date of issuance of any Exchange Shares

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(the “Restricted Period”),

shall only be made in compliance with the safe harbor provisions set forth in Regulation S, pursuant to the registration provisions of the 1933 Act or an exemption therefrom, and that all offers and sales after the Restricted Period shall be made only in compliance with the registration provisions of the 1933 Act or an exemption therefrom and in each case only in accordance with applicable state securities laws;

(l) each of the Target Shareholders understands and agrees not to engage in any hedging transactions involving any of the Special Voting Shares, Preferred Shares or Exchange Shares unless such transactions are in compliance with the provisions of the 1933 Act;

(m) each of the Target Shareholders understands and agrees that each of the Purchaser or Northwest, as applicable, will refuse to register any transfer of the Preferred Shares, Special Voting Shares or Exchange Shares not made in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act or pursuant to an available exemption from the registration requirements of the 1933 Act;

(n) each of the Target Shareholders acknowledges that such Target Shareholder has not acquired the Preferred Shares, Special Voting Shares or Exchange Shares as a result of, and will not themselves engage in, any “directed selling efforts” (as defined in Regulation S under the 1933 Act) in the United States in respect of any of the Preferred Shares, Special Voting Shares or Exchange Shares which would include any activities undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for the resale of any of the Preferred Shares, Special Voting Shares or Exchange Shares; provided however, that each of the Target Shareholders may sell or otherwise dispose of any of the Preferred Shares, Special Voting Shares or Exchange Shares pursuant to registration of any of the Preferred Shares, Special Voting Shares or Exchange Shares pursuant to the 1933 Act and any applicable state securities laws or under an exemption from such registration requirements and as otherwise provided herein;

(o) if any of the Target Shareholders are ordinarily resident in Ontario, each of the Target Shareholders is acquiring the Preferred Shares and Special Voting Shares under an exemption from prospectus requirements of the Securities Act (Ontario) and, accordingly, any such Preferred Shares and Special Voting Shares so acquired may only be sold, disposed or otherwise transferred pursuant to an exemption from prospectus requirements of the Securities Act (Ontario) or pursuant to any other applicable securities laws;

(p) each of the Target Shareholders acknowledges that such Target Shareholder may only sell, dispose or otherwise transfer a Preferred Share in conjunction with a

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Special Voting Share and a Special Voting Share in conjunction with a Preferred Share;

(q) each of the Target Shareholders is:

(i) an accredited investor, as defined by National Instrument 45-106, Prospectus and Registration Exemptions,

(ii) acquiring securities with an aggregate value of more than CDN$150,000, or

(iii) delivering Target Shares held by them that have a fair value of more than CDN$150,000;

(r) each of the Target Shareholders is not aware of any advertisement of any of the Preferred Shares, Special Voting Shares or Exchange Shares; and

(s) no person has made to any of the Target Shareholders any written or oral representations:

(i) that any person will resell or repurchase any of the Preferred Shares, Special Voting Shares or Exchange Shares,

(ii) that any person will refund the purchase price of any of the Preferred Shares, Special Voting Shares or Exchange Shares,

(iii) as to the future price or value of any of the Preferred Shares, Special Voting Shares or Exchange Shares, or

(iv) that any of the Preferred Shares, Special Voting Shares or Exchange Shares will be listed and posted for trading on any stock exchange or automated dealer quotation system or that application has been made to list and post any of the Preferred Shares, Special Voting Shares or Exchange Shares of the Purchaser or Northwest on any stock exchange or automated dealer quotation system.

7.2 Each of the Target Shareholders and the Target warrant and represent, jointly and severally, to the Purchaser and Northwest with the intent that each of the Purchaser and Northwest will rely thereon in entering into this Agreement and in concluding the Share Exchange contemplated herein, that:

(a) the Target is a corporation duly incorporated, validly existing and in good standing under the laws of the Province of Ontario and has the power, authority and capacity to enter into this Agreement and to carry out its terms;

(b) the authorized capital of the Target consists of:

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(i) an unlimited number of common shares, without par value, of which 130,000 common shares have been validly issued, are outstanding and are fully paid and non-assessable,

(ii) an unlimited number of class “A” special shares, none of which are issued and outstanding,

(iii) an unlimited number of class “B” special shares, none of which are issued and outstanding,

(iv) an unlimited number of class “C” special shares, none of which are issued and outstanding, and

(v) an unlimited number of class “D” special shares, none of which are issued and outstanding;

(c) the Target Shares represent 100% of the issued and outstanding share capital of the Target;

(d) the execution and delivery of this Agreement and the completion of the transactions contemplated hereby has been duly and validly authorized by all necessary corporate action on the part of the Target, and this Agreement constitutes a legal, valid and binding obligation of the Target enforceable in accordance with its terms except as limited by laws of general application affecting the rights of creditors;

(e) no consent, approval, order or authorization of, or registration, declaration or filing with, any governmental authority is required by or with respect to the Target in connection with the execution and delivery of this Agreement by the Target or the consummation by the Target of the transactions contemplated hereby;

(f) there is no litigation, proceeding or governmental investigation in progress, pending, threatened or contemplated against or relating to the Target, the business of the Target, or the transactions contemplated by this Agreement;

(g) on the Closing Date, the Target shall have no financial liabilities or outstanding indebtedness, except as is disclosed on the Target Financial Statements (as defined herein);

(h) neither the Target, nor any of the Target Shareholders has any specific information relating to the Target which is not generally known or which has not been disclosed to the Purchaser and Northwest and which if known could reasonably be expected to have a material adverse effect on the value of the Target Shares or on the Target as a whole;

(i) neither the Target, nor any of the Target Shareholders have made any untrue statement to the Purchaser or Northwest nor has any of them failed to state a

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material fact that is required to be stated or that is necessary to prevent a statement that is made from being materially false or misleading in the circumstances in which it was made;

(j) to the best of the Target Shareholders’ knowledge, all of the assets of the Target are in good working order and contain no latent defects;

(k) neither the Target, nor any of the Target Shareholders are aware of any infringement by the Target of any registered patent, trademark or copyright;

(l) no person has any agreement, right, option or privilege, consensual or arising by law, present or future, contingent or absolute, or capable of becoming an agreement, right or option:

(i) to require the Target to issue any further or other shares in its capital or any other security convertible or exchangeable into shares in its capital or to convert or exchange any securities into or for shares in the capital of the Target,

(ii) for the issue or allotment of any of the authorized but unissued shares in the capital of the Target,

(iii) to require the Target to purchase, redeem or otherwise acquire any of the issued and outstanding shares in the capital of the Target,

(iv) other than disclosed in Schedule “A” attached hereto, to purchase or otherwise acquire any shares in the capital of the Target, or

(v) which is capable of becoming an agreement for the acquisition of any of the material assets of the Target;

(m) the Target is registered to carry on business in all jurisdictions in which it currently carries on business;

(n) the making of this Agreement and the completion of the transactions contemplated hereby and the performance of and compliance with the terms hereof does not and will not:

(i) conflict with or result in a breach of or violate any of the terms, conditions, or provisions of the constating documents of the Target,

(ii) conflict with or result in a breach of or violate any of the terms, conditions or provisions of any law, judgment, order, injunction, decree, regulation or ruling of any court or governmental authority, domestic or foreign, to which the Target or the Target Shareholders are subject or constitute or result in a default under any agreement, contract or commitment to which the Target or the Target Shareholders are a party,

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(iii) subject to obtaining any necessary consents of applicable regulatory authorities, give to any person any remedy, cause of action, right of termination, cancellation or acceleration in or with respect to any agreement, contract, or commitment to which the Target is a party,

(iv) give to any government or governmental authority, including any governmental department, commission, bureau, board, or administrative agency any right of termination, cancellation, or suspension of, or constitute a breach of or result in a default under any permit, license, control, or authority issued to any of the entities and which is necessary or desirable in connection with the conduct and operation of the business of the Target as currently conducted, or

(v) subject to obtaining any necessary consents of applicable regulatory authorities, constitute a default by the Target or an event which, with the giving of notice or lapse of time or both, might constitute an event of default or non-observance under any agreement, contract, indenture or other instrument relating to any indebtedness of the Target which would give any person the right to accelerate the maturity for the payment of any amount payable under that agreement, contract, indenture, or other instrument;

(o) the audited financial statements of the Target for the year ended July 31, 2005 and the interim financial statements for the nine months ended April 30, 2006, attached as Schedule “D” hereto (the “Target Financial Statements”) were prepared in accordance with United States generally accepted accounting principles applied on a basis consistent with prior reporting periods, are true and correct in every material respect and present fairly and accurately the financial condition and position of the Target as at the date thereof and the results of the operations of the Target;

(p) the Target has good and marketable title to all of the assets as listed in Schedule “E” attached hereto, and such assets are free and clear of any financial encumbrances, except as disclosed in the Target Financial Statements;

(q) the Target has not guaranteed, or agreed to guarantee, any indebtedness or other obligation of any person except as described in the Target Financial Statements;

(r) the corporate records of the Target, as required to be maintained under its statute of incorporation and constating documents, are accurate, complete and up-to-date in all material respects and all material transactions of the Target have been properly recorded in its books or filed with its records;

(s) other than approvals and filings required under applicable securities laws, no authorization, approval, order, license, permit or consent of any governmental authority, regulatory body or court, and no registration, declaration or filing by the Target with any such governmental authority, regulatory body or court is

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required in order for the Target to complete the contemplated Share Exchange, to duly perform and observe the terms and provisions of this Agreement, and to render this Agreement legal, valid, binding and enforceable in accordance with its terms;

(t) there is no basis for and there are no actions, suits, judgments, investigations or proceedings outstanding or pending, or to the knowledge of the Target Shareholders, threatened against or affecting the Target at law or in equity or before or by any court or federal, state, municipal or other governmental authority, department, commission, board, tribunal, bureau or agency;

(u) the Target holds all permits, licenses, consents and authorizations issued by any governmental authority which are necessary in connection with the operation of its businesses and the ownership of its properties and assets;

(v) the Target has filed all necessary tax returns and in all jurisdictions required to be filed, all returns affecting workers compensation with the appropriate agency, incorporation capital tax returns, if required, and any other material reports and information required to be filed by the Target with any governmental authority;

(w) the Target has paid all income, sales and capital taxes payable as and when due; the Target has withheld and remitted to tax collection authorities such taxes as are required by law to be withheld and remitted as and when due; the Target has paid all instalments of corporate taxes due and payable, and there is not presently outstanding nor does the Target expect to receive any notice of reassessment from any applicable tax collecting authority;

(x) the Target has not declared or paid any dividends of any kind or declared or made any other distributions of any kind whatsoever including, without limitation, by way of redemption, repurchase or reduction of its authorized capital;

(y) other than as disclosed in Schedule “F” attached hereto, the Target has no outstanding material contractual obligations whatsoever relating to or affecting the conduct of its businesses or any of its property or assets or for the purchase, sale or leasing of any property other than those contracts entered into by the Target in the course of its normal and ordinary day to day business;

(z) other than as disclosed in Schedule “F” hereto, there are no management contracts or consulting contracts to which the Target is a party or by which it is bound, and save and except as disclosed in the Target Financial Statements, no amount is payable or has been agreed to be paid by the Target to any person as remuneration, pension, bonus, share of profits or other similar benefit and no director, officer or member, or former director, officer or member, of the Target, nor any associate or affiliate of any such person, has any claim of any nature against, or indebted to, the Target;

(aa) there has been no material adverse change in financial condition and position of the Target and no damage, loss, destruction or other change in circumstances

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materially affecting the business, property or assets of the Target or its right or capacity to carry on business since the date of the Target Financial Statements; and

(bb) the Target has not waived or surrendered any right of substantial value and has not made any gift of money or of any property or assets.

8. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND NORTHWEST

8.1 The Purchaser and Northwest represent and warrant, jointly and severally, to the Target Shareholders and the Target, with the intent that the Target Shareholders and the Target will rely thereon in entering into this Agreement and in concluding the Share Exchange contemplated herein, that:

(a) the Purchaser is a corporation duly incorporated, validly existing and in good standing under the federal laws of Canada and has the power, authority and capacity to enter into this Agreement and to carry out its terms;

(b) Northwest is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Nevada, and has the power, authority and capacity to enter into this Agreement and to carry out its terms;

(c) the authorized capital of the Purchaser consists of:

(i) an unlimited number of common shares, without par value, of which 10 common shares have been validly issued, are outstanding and are fully paid and non-assessable, and

(ii) 30,000,000 of Preferred Shares, without par value, of which none have been issued;

(d) Northwest is the sole shareholder of all of the issued and outstanding common shares in the capital of the Purchaser;

(e) the authorized capital of Northwest consists of:

(i) 100,000,000 common shares, with par value US$0.0001, of which 57,545,143 common shares have been validly issued, are outstanding and are fully paid and non-assessable, and

(ii) 30,000,000 Special Voting Shares, without par value, of which none have been issued;

(f) the execution and delivery of this Agreement and the completion of the transactions contemplated hereby has been duly and validly authorized by all necessary corporate action on the part of each of the Purchaser and Northwest, and this Agreement constitutes a legal, valid and binding obligation of each of the

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Purchaser and Northwest enforceable in accordance with its terms except as limited by laws of general application affecting the rights of creditors;

(g) no consent, approval, order or authorization of, or registration, declaration or filing with, any governmental authority is required by or with respect to the Purchaser in connection with the execution and delivery of this Agreement by the Purchaser or the consummation by the Purchaser of the transactions contemplated hereby;

(h) no consent, approval, order or authorization of, or registration, declaration or filing with, any governmental authority is required by or with respect to Northwest in connection with the execution and delivery of this Agreement by Northwest or the consummation by Northwest of the transactions contemplated hereby, except for such consents, approvals, orders, authorizations, registrations, declarations, qualifications or filings as may be required by the National Association of Securities Dealers and under applicable federal and state securities laws in connection with the transactions set forth herein;

(i) other than set out on Schedule “G” attached hereto, there is no litigation, proceeding or governmental investigation in progress, pending, threatened or contemplated against or relating to the Purchaser or Northwest, the business of the Purchaser, Northwest, or the transactions contemplated by this Agreement;

(j) on the Closing Date, Northwest shall have no financial liabilities or outstanding indebtedness, except as is disclosed on the Northwest Financial Statements (as defined herein);

(k) neither the Purchaser nor Northwest has any specific information relating to Northwest or the Purchaser which is not generally known or which has not been disclosed to the Target or the Target Shareholders and which if known could reasonably be expected to have a material adverse effect on the value of the Exchange Shares or Preferred Shares or on Northwest or the Purchaser as a whole;

(l) neither Northwest nor the Purchaser have made any untrue statement to the Target or the Target Shareholders nor has any of them failed to state a material fact that is required to be stated or that is necessary to prevent a statement that is made from being materially false or misleading in the circumstances in which it was made;

(m) neither Northwest nor the Purchaser are aware of any infringement by Northwest or the Purchaser of any registered patent, trademark or copyright;

(n) other than set out on Schedule “H” attached hereto, no person has any agreement, right, option or privilege, consensual or arising by law, present or future, contingent or absolute, or capable of becoming an agreement, right or option:

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(i) to require Northwest or the Purchaser to issue any further or other shares in either of its respective capital or any other security convertible or exchangeable into shares in either of its respective capital or to convert or exchange any securities into or for shares in either of its respective capital,

(ii) for the issue or allotment of any of the authorized but unissued shares in the capital of Northwest or the Purchaser,

(iii) to require Northwest or the Purchaser to purchase, redeem or otherwise acquire any of the issued and outstanding shares in either the capital of Northwest or the Purchaser,

(iv) to purchase or otherwise acquire any shares in the capital of either Northwest or the Purchaser, or

(v) which is capable of becoming an agreement for the acquisition of any of the material assets of either Northwest or the Purchaser;

(o) each of the Purchaser and Northwest is registered to carry on business in all jurisdictions in which it currently carries on business;

(p) the making of this Agreement and the completion of the transactions contemplated hereby and the performance of and compliance with the terms hereof does not and will not:

(i) conflict with or result in a breach of or violate any of the terms, conditions, or provisions of the constating documents of either Northwest or the Purchaser,

(ii) conflict with or result in a breach of or violate any of the terms, conditions or provisions of any law, judgment, order, injunction, decree, regulation or ruling of any court or governmental authority, domestic or foreign, to which any of Northwest or the Purchaser are subject or constitute or result in a default under any agreement, contract or commitment to which any of Northwest or the Purchaser are a party,

(iii) subject to obtaining any necessary consents of applicable regulatory authorities, give to any person any remedy, cause of action, right of termination, cancellation or acceleration in or with respect to any agreement, contract, or commitment to which Northwest or the Purchaser, as the case may be, is a party,

(iv) give to any government or governmental authority, including any governmental department, commission, bureau, board, or administrative agency any right of termination, cancellation, or suspension of, or constitute a breach of or result in a default under any permit, license, control, or authority issued to any of the entities and which is necessary or

- 19 -

desirable in connection with the conduct and operation of the business of each of the Purchaser or Northwest as currently conducted, or

(v) subject to obtaining any necessary consents of applicable regulatory authorities, constitute a default by Northwest or the Purchaser or an event which, with the giving of notice or lapse of time or both, might constitute an event of default or non-observance under any agreement, contract, indenture or other instrument relating to any indebtedness of Northwest or the Purchaser which would give any person the right to accelerate the maturity for the payment of any amount payable under that agreement, contract, indenture, or other instrument;

(q) the financial statements of Northwest for the year ended June 30, 2005 and the interim financial statements for the nine months ended March 31, 2006, attached as Schedule “I” hereto (the “Northwest Financial Statements”) were prepared in accordance with United States generally accepted accounting principles applied on a basis consistent with prior reporting periods, are true and correct in every material respect and present fairly and accurately the financial condition and position of Northwest as at the date thereof and the results of the operations of Northwest;

(r) Northwest has good and marketable title to all of its respective assets as listed in Schedule “J” attached hereto, and such assets are free and clear of any financial encumbrances, except as disclosed in the Northwest Financial Statements;

(s) Northwest has not guaranteed, or agreed to guarantee, any indebtedness or other obligation of any person except as described in the Northwest Financial Statements;

(t) the Purchaser has not guaranteed, or agreed to guarantee, any indebtedness or other obligation of any person;

(u) the corporate records of Northwest and the Purchaser, as required to be maintained by it under its respective statute of incorporation and constating documents, are accurate, complete and up-to-date in all material respects and all material transactions of Northwest and the Purchaser have been promptly and properly recorded in each of its books or filed with its records;

(v) each of the Purchaser and Northwest holds all permits, licenses, consents and authorizations issued by any governmental authority which are necessary in connection with the operation of each of its respective business and the ownership of each of its respective assets;

(w) each of the Purchaser and Northwest has filed all necessary tax returns and in all jurisdictions required to be filed by it, all returns affecting workers compensation with the appropriate agency, incorporation capital tax returns, if required, and any other material reports and information required to be filed by Northwest or the Purchaser with any governmental authority;

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(x) each of the Purchaser and Northwest has paid all income, sales and capital taxes payable by either of them as and when due; each of the Purchaser and Northwest has withheld and remitted to tax collection authorities such taxes as are required by law to be withheld and remitted as and when due; each of the Purchaser and Northwest has paid all instalments of corporate taxes due and payable, and there is not presently outstanding nor does Northwest or the Purchaser expect to receive any notice of reassessment from any applicable tax collecting authority;

(y) other than as disclosed in Schedule “K” attached hereto, Northwest has no outstanding material contractual obligations whatsoever relating to or affecting the conduct of its business or any of its assets or for the purchase, sale or leasing of any assets other than those contracts entered into by Northwest in the course of its normal and ordinary day to day business;

(z) other than as disclosed in Schedule “K” attached hereto there are no management contracts or consulting contracts to which Northwest is a party or by which it is bound, and save and except as disclosed in the Northwest Financial Statements, no amount is payable or has been agreed to be paid by Northwest to any person as remuneration, pension, bonus, share of profits or other similar benefit and no director, officer or member, or former director, officer or member, of Northwest, nor any associate or affiliate of any such person, has any claim of any nature against, or indebted to, Northwest;

(aa) other than as disclosed in Schedule “K” attached hereto, the Purchaser has no outstanding material contractual obligations whatsoever relating to or affecting the conduct of its businesses or any of its assets or for the purchase, sale or leasing of any assets other than those contracts entered into by the Purchaser in the course of its normal and ordinary day to day business;

(bb) other than as disclosed in Schedule “K” attached hereto there are no management contracts or consulting contracts to which the Purchaser is a party or by which it is bound and no amount is payable or has been agreed to be paid by the Purchaser to any person as remuneration, pension, bonus, share of profits or other similar benefit and no director, officer or member, or former director, officer or member, of the Purchaser, nor any associate or affiliate of any such person, has any claim of any nature against, or indebted to, the Purchaser;

(cc) there has been no material adverse change in financial condition and position of Northwest and no damage, loss, destruction or other change in circumstances materially affecting the business, property or assets of Northwest or its right or capacity to carry on business since the dates of the Northwest Financial Statements;

(dd) Northwest has not waived or surrendered any right of substantial value and has not made any gift of money or of any property or assets;

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(ee) the Preferred Shares and the Special Voting Shares to be issued to the Target Shareholders hereunder, and the Exchange Shares to be issued on exchange of the Preferred Shares and Special Voting Shares, will, when issued, be validly issued, fully paid and non-assessable;

(ff) there are no orders ceasing or suspending trading in the securities of Northwest and, to the best of the knowledge of Northwest, no proceedings for this purpose have been instituted or are pending, contemplated or threatened;

(gg) each of the Purchaser and Northwest has had adequate opportunity to obtain from representatives of the Target such information, in addition to the representations set forth in this Agreement, as is necessary to evaluate the merits and risks of an investment in the Target Shares and each of the Purchaser and Northwest has sufficient experience in business, financial and investment matters to be able to evaluate the risks involved in the acquisition of the Target Shares to be issued to the Purchaser pursuant to the terms of this Agreement and to make informed investment decisions with respect to such investment;

(hh) each of the Purchaser and Northwest understands and agrees that none of the Target Shares have been or will be registered under the 1933 Act, or under any state securities or “blue sky” laws of any state of the United States, and, unless so registered, may not be offered or sold in the United States, or, directly or indirectly, to U.S. Persons, pursuant to an effective registration statement under the 1933 Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act and in each case only in accordance with applicable state securities laws;

(ii) each of the Purchaser and Northwest acknowledges that it has not acquired the Target Shares as a result of, and will not themselves engage in, any “directed selling efforts” (as defined in Regulation S under the 1933 Act) in the United States in respect of any of the Target Shares which would include any activities undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for the resale of any of the Target Shares; and

(jj) each of the Purchaser and Northwest understands and agrees that offers and sales of any of the Target Shares prior to the expiration of a period of one year after the date of issuance of any such shares shall only be made in compliance with the safe harbor provisions set forth in Regulation S, pursuant to the registration provisions of the 1933 Act or an exemption therefrom, and that all offers and sales after such one year period shall be made only in compliance with the registration provisions of the 1933 Act or an exemption therefrom and in each case only in accordance with applicable state securities laws.

9. COVENANTS

9.1 Between the execution date and the Closing Date, the Target Shareholders:

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(a) will cause the Target to afford to the Purchaser, Northwest and their respective authorized representatives access during normal business hours to all properties, books, contracts, commitments, records of the Target and furnish such copies (certified if requested) thereof and other information as such parties may reasonably request, and to permit the Purchaser, Northwest and their respective authorized representatives to make such audit of the books of account of the Target as the Purchaser or Northwest may reasonably see fit;

(b) will diligently take all reasonable steps to obtain, prior to the Closing Date, all consents and approvals required to complete the transactions contemplated herein in accordance with the terms and conditions hereof and give such assurances as may be required in the reasonable opinion of the Purchaser’s and Northwest’s counsel for more perfectly consummating the transactions contemplated hereby and referenced herein;

(c) will cause the Target to conduct its business and affairs diligently and only in the ordinary course, and preserve and maintain the assets and goodwill of the Target;

(d) will not sell or otherwise in any way alienate or dispose of or encumber any of the Target’s assets;

(e) will cause the Target to maintain insurance coverage of the scope and in the amounts presently held; and

(f) will not permit the Target to make or agree to make any payment to any director, officer, employee or agent of the Target except in the ordinary course of business and at the regular rates of salary and commission for such person or as reasonable reimbursement for expenses incurred by such person in connection with the Target.

9.2 Between the execution date and the Closing Date, the Purchaser and Northwest shall:

(a) cause to be reserved for issuance that number of shares of common stock of Northwest as are equal in number to the Preferred Shares so as to allow for the issuance of the Exchange Shares; and

(b) take all such steps as soon as practicable to cause to be issued to the Target Shareholders that number of Special Voting Shares as are equal to the number of Preferred Shares.

10. NON-MERGER

10.1 The representations, warranties, covenants and agreements of the Target and the Target Shareholders contained herein and those contained in the documents and instruments delivered pursuant hereto will be true at and as of the Closing Date as though made at the Closing Date and will survive the Closing Date for a period ending 24 months after Closing Date, and notwithstanding the completion of the transactions herein contemplated, the waiver of any condition contained herein (unless such waiver expressly

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releases each of the Target and the Target Shareholders of such representation, warranty, covenant or agreement), or any investigation by the Purchaser or Northwest, the same will remain in full force and effect for the said same 24 month period after the Closing Date. The representations, warranties, covenants and agreements of the Target and the Target Shareholders contained herein related to financial and tax matters will be true at and as of the Closing Date as though made at the Closing Date and will survive the Closing Date for a period of five years after the Closing Date.

10.2 The representations, warranties, covenants and agreements of the Purchaser and Northwest contained herein and those contained in the documents and instruments delivered pursuant hereto will be true at and as of the Closing Date as though made at the Closing Date and will survive the Closing Date for a period ending 24 months after the Closing Date, and notwithstanding the completion of the transactions herein contemplated, the waiver of any condition contained herein (unless such waiver expressly releases each of the Purchaser and Northwest of such representation, warranty, covenant or agreement), or any investigation by the Target or the Target Shareholders, the same will remain in full force and effect for the said same 24 month period after the Closing Date. The representations, warranties, covenants and agreements of the Purchaser and Northwest contained herein related to financial and tax matters will be true at and as of the Closing Date as though made at the Closing Date and will survive the Closing Date for a period of five years after the Closing Date.

11. CONFIDENTIALITY

11.1 Each party agrees that all information provided to it by another party (collectively “Confidential Information”) shall be held in complete confidence by it and by its advisors and representatives and shall not, without the prior written consent of that other party, be disclosed to any other person, nor used for any other purpose, other than in connection with the evaluation, negotiation and finalization of the transactions contemplated herein. However, a party’s obligation does not apply to Confidential Information:

(a) which is generally available to third parties (unless available as a result of a breach of this Agreement);

(b) which is lawfully in the possession of a party and which was not acquired directly or indirectly from another party; or

(c) the disclosure of which is required by any applicable law or by any supervisory or regulatory body to whose rules a party is subject.

12. CONDITIONS PRECEDENT

12.1 The obligations of the Purchaser and Northwest to consummate the transactions herein contemplated are subject to the fulfilment of each of the following conditions at the times stipulated:

(a) this Agreement and the purchase of the Target Shares has been approved by the board of directors of the Target on or before the Closing Date;

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(b) the acknowledgements, representations and warranties of the Target Shareholders and the Target contained herein are true and correct in all respects at and as of the Closing Date except as may be in writing disclosed to and approved by each of the Purchaser and Northwest;

(c) all covenants, agreements and obligations hereunder on the part of the Target Shareholders and the Target to be performed or complied with at or prior to the Closing Date, including the Target Shareholders’ and the Target’s obligations to deliver the documents and instruments herein provided for, have been performed and complied with at and as of the Closing;

(d) between the date hereof and the Closing Date, the Target shall not have experienced any event, circumstance or condition or have taken any action or become subject to any action of any character adversely affecting the Target, materially reducing the value of the Target or materially reducing the value of the Target Shares;

(e) on or before the Closing Date, no federal, state, provincial, regional or municipal government of any country applicable to the Target and its business or any agency thereof will have enacted any statute or regulation, announced any policy or taken any action that will materially and adversely affect the Target;

(f) on or before the Closing Date, counsel for the Purchaser and Northwest shall have performed a due diligence review of the Target and its affairs, and each of the Purchaser and Northwest shall be satisfied in its sole discretion as to the operations of the Target after completion of its due diligence investigation thereof; and

(g) no action, suit or proceeding concerning the Target will be pending or threatened by or before any court of competent jurisdiction or governmental entity wherein an unfavourable judgment, order, decree, stipulation or injunction would affect materially and adversely the Target, and no such judgment, order, decree stipulation or injunction will be in effect.

12.2 The conditions set forth in Section 12.1 are for the exclusive benefit of the Purchaser and Northwest and may be waived by the Purchaser and Northwest in writing in whole or in part at any time.

12.3 The obligations of the Target Shareholders and the Target to consummate the transactions herein contemplated are subject to the fulfilment of each of the following conditions at the times stipulated:

(a) this Agreement and the sale of the Preferred Shares, Special Voting Shares and Exchange Shares have been approved by each of the boards of directors of the Purchaser or Northwest on or before the Closing Date;

(b) Northwest shall have amended its articles to create for issuance the Special Voting Shares, in accordance with the provisions of Nevada law governing

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corporations in respect of shareholder consent and in accordance with notice and filing provisions of applicable securities laws;

(c) the representations and warranties of the Purchaser and Northwest contained herein are true and correct in all material respects at and as of the Closing Date except as may be in writing disclosed to and approved by the Target Shareholders and the Target;

(d) all covenants, agreements and obligations hereunder on the part of the Purchaser and Northwest to be performed or complied with at or prior to the Closing Date, including in particular the Purchaser’s and Northwest’s obligations to deliver the documents and instruments herein provided for, have been performed and complied with as at the Closing Date;

(e) between the date hereof and the Closing Date, the Purchaser has not experienced any event, circumstance or condition or has taken any action or become subject to any action of any character adversely affecting the Purchaser, materially reducing the value of the Purchaser, or materially reducing the value of the Preferred Shares;

(f) between July 1, 2005 and the Closing Date, Northwest has not experienced any event, circumstance or condition or has taken any action or become subject to any action of any character adversely affecting Northwest, materially reducing the value of Northwest, or materially reducing the value of the Exchange Shares;

(g) on or before the Closing Date, counsel for the Target Shareholders and the Target shall have performed a due diligence review of the Purchaser and Northwest, and the Target Shareholders and the Target shall be satisfied in their sole discretion as to the state of the business assets and the operations of the Purchaser after completion of their due diligence investigation thereof;

(h) on or before the Closing Date, Northwest shall have completed a private placement (the “Private Placement”) for gross proceeds of $2,500,000, of which €850,000 and $250,000 has been advanced to the Target pursuant to two separate short-term loans between Northwest and the Target dated June 27, 2006 and March 14, 2006, respectively, which Private Placement will consist of 2,500,000 units, each unit of which will consist of one common share (the “Private Placement Share”) in the capital of Northwest and one share purchase warrant (the “Warrant”), each Warrant of which will entitle the holder to purchase one common share at an exercise price of $1.50 per share for a period of two years from the closing of the Private Placement, at a price per unit of $1.00;

(i) on or before the Closing Date, Northwest will have no more than 20,004,000 shares of its common stock issued and outstanding, excluding any Private Placement Shares, and

(j) on or before the Closing Date, Axel Roehlig will surrender for cancellation the 37,541,249 shares of Northwest’s common stock (the “Control Shares”) which

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Axel Roehlig owns directly or indirectly, and Northwest will cancel the Control Shares.

12.4 The conditions set forth in Section 12.3 are for the exclusive benefit of the Target Shareholders and the Target and may be waived by the Target Shareholders and the Target in whole or in part at any time.

12.5 The respective obligations of each party to this Agreement to consummate the transactions herein contemplated are subject to all consents, approvals, authorizations, waivers and orders of any regulatory authorities, shareholders or third parties required or necessary or desirable for the completion of the transactions contemplated herein having been obtained or received by the Target, the Target Shareholders, the Purchaser and Northwest.

12.6 Northwest hereby undertakes to issue the Exchange Shares as retraction or redemption of the Preferred Shares occurs in accordance with the Call Option Agreement.

13. TRANSACTIONS OF THE TARGET SHAREHOLDERS AT THE CLOSING

13.1 At or before the Closing, the Target Shareholders and the Target will execute and deliver or cause to be executed and delivered all documents, instruments, resolutions and share certificates as are necessary to effectively transfer and assign the Target Shares to the Purchaser, free and clear of all liens, including the following:

(a) certified copies of the resolutions of the directors of the Target approving this Agreement and the Share Exchange;

(b) certified copies of resolutions of the directors of the Target authorizing the transfer of the Target Shares;

(c) executed copies of this Agreement;

(d) share certificates representing the Target Shares in the name of the Target Shareholders duly endorsed for transfer;

(e) all corporate records and books of account of the Target including, minute books, share register books, share certificate books and annual reports;

(f) the corporate seal of the Target, if any;

(g) releases, in form and substance satisfactory to the Purchaser and Northwest, acting reasonably, executed by the Target Shareholders in favor of the Target releasing the Target from any and all manner of actions, causes of action, suits, proceedings, debts, dues, profits, expenses, contracts, damages, claims, demands and liabilities whatsoever, in law or equity, which the Target Shareholders ever had, now have, or may have against the Target for or by reason of any matter, cause or thing whatsoever done or omitted to be done by the Target Shareholders

- 27 -

up to the Closing Date other than in respect of obligations of the Target to the Target Shareholders arising in respect of:

(i) earned but unpaid salary and unpaid benefits for the then current pay period, and

(ii) any obligations pursuant to indemnities granted to the Target Shareholders by the Target in connection with acts as a director of the Target provided that such indemnities shall be ineffective in respect of any act or omission which would constitute a default or breach pursuant to this Agreement or which render any representation or warranty given hereunder untrue or inaccurate;

(h) a closing warranty and certificate from the Target Shareholders and an officer of the Target confirming that the conditions to be satisfied by the Target Shareholders, the Target Shareholders and the Target, unless waived, set out in Section 12.1 have been satisfied at the Closing Date and that all representations and warranties of the Target Shareholders and the Target contained in this Agreement are true at and as of the Closing Date;

(i) an opinion of the Target Shareholders’ and the Target’s solicitors addressed to the Purchaser and Northwest and their respective solicitors in a form reasonably satisfactory to such solicitors to the effect that:

(i) the Target has been duly incorporated and is a validly existing corporation in good standing under the laws of its jurisdiction of incorporation,

(ii) the authorized and issued share capital of the Target is as represented and warranted in this Agreement,

(iii) such counsel is not aware of any litigation, proceedings or investigations pending or threatened against the Target not disclosed in this Agreement, and

(iv) all necessary approvals from the Target have been obtained and are in full force and effect with respect to the transfer of the Target Shares to the Purchaser as contemplated herein;

(j) a Call Option Agreement in the form attached as Schedule “C” hereto, duly executed by the Target Shareholders; and

(k) all such other documents and instruments as the Purchaser’s and Northwest’s solicitors may reasonably require.

14. TRANSACTIONS OF THE PURCHASER AND NORTHWEST AT THE CLOSING

14.1 At or before the Closing, the Purchaser and Northwest will execute and deliver or cause to be executed and delivered all documents, instruments, resolutions and share

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certificates as are necessary to effectively issue the Preferred Shares and the Special Voting Shares to the Target Shareholders, free and clear of all liens, including the following:

(a) certified copies of the resolutions of the directors of the Purchaser and Northwest approving this Agreement and the Share Exchange;

(b) certified copies of the resolutions of the directors of the Purchaser authorizing the issuance of the Preferred Shares to the Target Shareholders;

(c) certified copies of the resolutions of the directors of Northwest authorizing the issuance of the Special Voting Shares to the Target Shareholders;

(d) executed copies of this Agreement;

(e) share certificates representing the Preferred Shares registered in the names of the Target Shareholders;

(f) share certificates representing the Special Voting Shares registered in the names of the Target Shareholders;

(g) a release, in form and substance satisfactory to the Target, acting reasonably, executed by Axel Roehlig in favour of Northwest and Purchaser releasing Northwest and the Purchaser from any and all manner of actions, causes of action, suits, proceedings, debts, dues, profits, expenses, contracts, damages, claims, demands and liabilities whatsoever, in law or equity, which Axel Roehlig ever had, now has, or may have against Northwest or the Purchaser for or by reason of any matter, cause or thing whatsoever done or omitted to be done by Axel Roehlig up to the Closing Date other than in respect of obligations of Northwest and the Purchaser to Axel Roehlig arising in respect of:

(i) earned but unpaid salary and unpaid benefits for the then current pay period, and

(ii) any obligations pursuant to indemnities granted to the Northwest Principals by Northwest in connection with acts as directors or officers of Northwest provided that such indemnities shall be ineffective in respect of any act or omission which would constitute a default or breach pursuant to this Agreement or which render any representation or warranty given hereunder untrue or inaccurate;

(h) a closing warranty and certificate of an officer of each of the Purchaser and Northwest confirming that the conditions to be satisfied by the Purchaser and Northwest, unless waived, set out in Section 12.3 have been satisfied at the Closing and that all representations and warranties of the Purchaser and Northwest contained in this Agreement are true at and as of the Closing Date;

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(i) an opinion of the Purchaser’s and Northwest’s solicitors addressed to the Target Shareholders and the Target and their respective solicitors in a form reasonably satisfactory to such solicitors to the effect that:

(i) each of the Purchaser and Northwest has been duly incorporated and are validly existing as corporations in good standing under the laws of their respective jurisdictions of incorporation;

(ii) the authorized and issued share capital of each of the Purchaser and Northwest is as represented and warranted in this Agreement;

(iii) such counsel is not aware of any litigation, proceedings or investigations pending or threatened against either the Purchaser or Northwest not disclosed in this Agreement; and

(iv) all necessary approvals from each of the Purchaser and Northwest has been obtained and are in full force and effect with respect to the allotment, creation and issuance of the Preferred Shares, the Exchange Shares and the Special Voting Shares as contemplated herein;

(j) a Call Option Agreement in the form attached as Schedule “C” hereto, in respect of each of the Target Shareholders, duly executed by Northwest;

(k) a certificate of an officer of Northwest attaching a copy of Northwest’s articles of incorporation and bylaws, as amended through the Closing Date;

(l) a certificate of an officer of the Purchaser attaching a copy of the Purchaser’s articles of incorporation and bylaws, as amended through the Closing Date;

(m) a written resignation of Axel Roehlig, as sole director and officer of Northwest and the Purchaser, in the form and substance reasonably satisfactory to the Target;

(n) a directors’ resolution of the Purchaser accepting the resignation of Axel Roehlig and appointing Harold C. F. Dickout, Shashi B. Dewan and Frank D. Pickersgill as directors of the Purchaser;

(o) a directors’ resolution of Northwest accepting the resignation of Axel Roehlig and appointing Harold C. F. Dickout, Shashi B. Dewan and Frank D. Pickersgill as directors of Northwest; and

(p) all such other documents and instruments as the Target Shareholders’ solicitors may reasonably require.

15. TIME OF THE ESSENCE

15.1 Time is of the essence of this Agreement.

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16. FURTHER ASSURANCES

16.1 The parties will execute and deliver all such further documents and instruments and do all such acts and things as may be reasonably necessary or required to carry out the full intent and meaning of this Agreement and to effect the transactions contemplated by this Agreement.

17. SUCCESSORS AND ASSIGNS

17.1 This Agreement will enure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, administrators, successors and permitted assigns. This Agreement may not be assigned by a party hereto without the prior written consent of the other parties.

18. COUNTERPARTS

18.1 This Agreement may be executed in several counterparts and by facsimile transmission, each of which will be deemed to be an original and all of which will together constitute one and the same instrument.

19. NOTICE

19.1 Any notice required or permitted to be given under this Agreement will be validly given if in writing and delivered or sent by pre-paid registered mail or facsimile transmission, to the following addresses:

(a) If to the Target Shareholders or the Target:

AMERICAS WIND ENERGY INC.

24 Palace Arch Drive

Toronto, Ontario M9A 2S1

Facsimile: (416) 233-6493

with a copy to:

SUTHERLAND MARK FLEMMING SNYDER-PENNER PROFESSIONAL CORPORATION

Barristers and Solicitors

300 – 255 King St. N.

Waterloo, Ontario N2J 4V2

Attention:	Paul B. Flemming
Facsimile:	(519) 725-2500

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(b) If to the Purchaser or Northwest:

NORTHWEST PASSAGE VENTURES LTD.

509 –207 West Hastings Street

Vancouver, British Columbia V6B 1H7

Attention:	Axel Roehlig
Facsimile:	(604) 687-3113

with a copy to:

CLARK WILSON LLP

Barristers and Solicitors

800 – 885 West Georgia Street

Vancouver, British Columbia V6C 3H1

Attention:	William L. Macdonald, Esq.
Facsimile:	(604) 687-6314

or to such other address as any party may specify in writing to the other parties.

19.2 Any notice delivered on a business day or sent by facsimile transmission will be deemed conclusively to have been effectively given on the date notice was delivered or sent by facsimile transmission.

19.3 Any notice sent by prepaid registered mail will be deemed conclusively to have been effectively given on the third business day after posting; but if at the time of posting or between the time of posting and the third business day thereafter there is a labour disturbance affecting postal service, then the notice will not be effectively given until actually delivered.

20. ASSIGNMENT

20.1 The Purchaser and the Target acknowledge that the Target Shares may be transferred by the Target Shareholders prior to Closing in connection with certain tax planning and in this regard the Purchaser, Northwest and the Target hereby consents to an assignment by the Target Shareholders of any or all of its interests under this Agreement to one or more affiliates or associates of the Target Shareholders, as those terms are defined in the Business Corporations Act (British Columbia).

21. ENTIRE AGREEMENT

21.1 This Agreement contains the sole and entire agreement between the parties and any modifications must be in writing and signed by each party. The parties will in good faith investigate and negotiate the most tax effective method of carrying out the intentions of this Agreement.

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22. TENDER

22.1 Tender may be made upon the Target Shareholders or Purchaser or upon the Purchaser’s Solicitors and money may be tendered by cheque certified by a chartered bank or by electronic wire transfer.

23. PROPER LAW

23.1 This Agreement will be governed by and construed in accordance with the laws of the Province of British Columbia and the laws of Canada applicable therein and the parties will attorn to the Courts thereof.

IN WITNESS WHEREOF the parties have caused this Agreement to be executed and delivered this 11th day of August, 2006.

NORTHWEST PASSAGE VENTURE LTD.

Per:	/s/ Axel Roehlig
	Authorized Signatory

6544797 CANADA LTD.

Per:	/s/ Axel Roehlig
	Authorized Signatory

AMERICAS WIND ENERGY INC.

Per:	/s/ H.C. Dickout
	Authorized Signatory
	H.C. Dickout

DIGITAL PREDICTIVE SYSTEMS

Per:	/s/ Shashi Dewan
	Authorized Signatory
	Shashi Dewan

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SIGNED, SEALED and DELIVERED by HAROLD DICKOUT in the presence of:


Signature /s/ Shashi Dewan
Shashi Dewan                                                 
Print Name
18 King George’s Road                                  
Address
Toronto, ON M8X 1K7                                

Prof. Engineer                                                 
Occupation )
)
)
)
)
)
)
)
)
)
)
)
)




/s/ Harold Dickout                                          
HAROLD DICKOUT

SIGNED, SEALED and DELIVERED by FRANK PICKERSGILL in the presence of:


Signature /s/ Shashi Dewan
Shashi Dewan                                                 
Print Name
18 King George’s Road                                  
Address
Toronto, ON M8X 1K7                                

Prof. Engineer                                                 
Occupation )
)
)
)
)
)
)
)
)
)
)
)
)




/s/ Frank Pickersgill                                        
FRANK PICKERSGILL

SIGNED, SEALED and DELIVERED by ROBERT EDWARDS in the presence of:


Signature /s/ John Sabourin
John Sabourin                                                 
Print Name
321 Green Hedge Cr.                                      
Address
London, ON N6H 4Z6                                  

Financial Planner                                             
Occupation )
)
)
)
)
)
)
)
)
)
)
)
)




/s/ Robert Edwards                                          
ROBERT EDWARDS

SCHEDULE"A"

LIST OF SHAREHOLDERS OF AMERICAS WIND ENERGY INC.

Name	No. of Shares
Harold Dickout	82,800
Frank Pickersgill	27,200
Robert Edwards	8,000
Digital Predictive Systems	12,000
Total	130,000

Agreements between Shareholders
1.	Robert Edwards has an option to purchase from Frank Pickersgill 1,333 common shares in the capital of Americas Wind Energy Inc. The option expires November 30, 2007.
2.	Frank Pickersgill has an option to purchase from Hal Dickout 6,000 common shares in the capital of Americas Wind Energy Inc. The option expires July 31, 2007.

SCHEDULE"B"

SPECIAL RIGHTS AND RESTRICTIONS ATTACHED TO

CLASS "A" PREFERENCE SHARES WITHOUT PAR VALUE

1. DEFINITIONS

For the purposes of Schedule “B” the following terms shall have the following meanings:

(a) “Northwest” means Northwest Passage Ventures Ltd., a Nevada corporation;

(b) “Northwest Share” means one share of common stock of Northwest;

(c) “Reorganization” means a capital reorganization of Northwest, or a consolidation, arrangement, amalgamation or merger of Northwest with or into any other body corporate, trust, partnership or other entity, or a sale or conveyance of the property and assets of Northwest as an entirety or substantially as an entirety to any other body corporate, trust, partnership or other entity;

(d) “Northwest Share Equivalent” means the number of shares or other units which are equivalent to one Northwest Share as at the date of issue of any Class “A” Preference Shares, determined as follows:

(i) at any time prior to Reorganization, one Northwest Share or unit for each Class “A” Preference Share;

(ii) at any time after a Reorganization, the number of shares or other securities or property of Northwest or of the body corporate, trust, partnership or other entity resulting from any merger, amalgamation, arrangement, or consolidation, or to which any sale or conveyance forming part of a Reorganization may be made, as the case may be, that a holder of Class “A” Preference Shares would have been entitled to receive on the Reorganization, if, on the record date or the effective date thereof, as the case may be, such holder had been the registered holder of the number of Northwest Shares receivable upon the redemption of a Class “A” Preference Shares;

(e) “Redemption Event” means the earlier of:

(i) the liquidation, bankruptcy or winding up of the Corporation or Northwest, either voluntary or involuntary, or other distribution of the assets and funds of the Corporation or Northwest for the purposes of winding up its affairs;

(ii) the date that the shareholders of Northwest approve a resolution authorizing Northwest to consolidate or merge with or into, amalgamate with or enter into a statutory arrangement with any other person;

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(f) “Northwest Call Right” means any right granted to Northwest by any holder of Class “A” Preference Shares wherein, in accordance with the terms thereof, Northwest can compel such holders to exchange their Class “A” Preference Shares for Northwest Shares.

2. RETRACTION AND REDEMPTION

(a) Right to Retraction

A holder of Class “A” Preference Shares shall be entitled at any time, subject to the exercise of the Northwest Call Right, and upon compliance with the provisions of this Article, to require the Corporation to redeem any or all of the Class “A” Preference Shares registered in the name of the holder by delivering to such holder Northwest Shares equal in number to the then Northwest Share Equivalent for each Class “A” Preference Share to be so redeemed as at the date the written notice of retraction is received by the Corporation.

(b) Right to Redemption

(i) Subject to applicable law and subject to the exercise of the Northwest Call Right, the Corporation shall, upon the occurrence of a Redemption Event, redeem all of the then outstanding Class “A” Preference Shares by delivering to the holders thereof Northwest Shares equal in number to the then Northwest Share Equivalent as at the date of the Redemption Event for each Class “A” Preference Share held, provided that, in circumstances where a redemption occurs hereunder as a result of the occurrence of an event described in subparagraph (ii) of the definition of Redemption Event in Part 1, such redemption shall not be effective if the consolidation, merger, amalgamation or statutory arrangement is not proceeded with.

(ii) Subject to applicable law and subject to the exercise of the Northwest Call Right, the Corporation may at any time prior to the occurrence of a Redemption Event, redeem any issued Class “A” Preference Share at a price equal to the amount of the consideration for which such share was issued.

(c) Mechanics of Retraction

Before any holder of Class “A” Preference Shares shall be entitled to exercise the rights set out in Part 2(a)  in respect of any Class “A” Preference Shares, such holder shall surrender the certificate or certificates therefor, duly endorsed, at the Registered Office of the Corporation and shall give written notice to the Corporation at its Registered Office of the election to convert the same and shall state therein the name or names in which the certificate or certificates for Northwest are to be issued. The Corporation shall, as soon as practicable thereafter, deliver to such holder of Class “A” Preference Shares, or to the nominee or nominees of such holder, a certificate or certificates for the number of Northwest Shares to which such holder shall be entitled.

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(d) Mechanics of Redemption

(iii) Each holder of Class “A” Preference Shares to be redeemed in accordance with Part 2(b) shall, upon receipt of notice in writing from the Corporation as to the occurrence of a Redemption Event surrender the certificate or certificates therefor, duly endorsed, at the Registered Office of the Corporation and thereupon the Corporation shall, as soon as practicable thereafter, deliver to such holder, or to the nominee or nominees of such holder, a certificate or certificates for the number of Northwest Shares to which such holder shall be entitled, provided that, notwithstanding the surrender of the certificates, the Class “A” Preference Shares shall be deemed to be redeemed effective as at the date of a Redemption Event and from and after such date, but subject to the provisions of Part 2(b), all rights of the holders of Class “A” Preference Shares as such holders shall cease (except for the right to receive Northwest Shares equal in number to the then Northwest Share Equivalent for each such Class “A” Preference Share upon surrender of their certificate or certificates therefor) and such shares shall not thereafter be transferred on the books of the Corporation or be deemed to be outstanding for any purpose whatsoever.

(iv) Each holder of a Class “A” Preference Share to be redeemed in accordance with 2(b)(ii) shall, upon receipt of notice in writing from the Corporation of the shares to be redeemed, surrender the certificate or certificates therefor, duly endorsed at the Registered Office of the Corporation and thereupon the Corporation shall pay to such holder the redemption price payable in accordance with the provisions of 2(b)(ii).

(e) Status of Retracted or Redeemed Shares

In the event any Class “A” Preference Shares shall be retracted or redeemed pursuant to Part 2(a) or 2(b) hereof, as the case may be, the shares so retracted or redeemed shall be cancelled and shall not be re-issuable by the Corporation.

1

SCHEDULE"C"

CALL OPTION AGREEMENT

THIS CALL OPTION AGREEMENT is made effective as of ______________________, 2006 (the “Agreement”)

BETWEEN:

__________________, _____________________________

(the “Shareholder”)

OF THE FIRST PART

AND:

NORTHWEST PASSAGE VENTURES LTD., of 509 – 207 West Hastings Street, Vancouver, British Columbia, V6B 1H7, a corporation incorporated under the laws of Nevada

(“Northwest”)

OF THE SECOND PART

WHEREAS

A.Pursuant to a Share Exchange Agreement between Northwest, 6544797 Canada Ltd. (the “Purchaser”), Americas Wind Energy Inc. (the “Target”) and the shareholders of the Target;

B.In connection with the reorganizationof the Target it is proposed that all of the shareholders of the Target will exchange all of the common shares (the “Common Shares”) of the Target held by them for class A preference shares (the “Preferred Shares”) in the capital of the Purchaser, which Preferred Shares will be entitled and subject to the rights and restrictions as detailed in the articles of the Purchaser (the “Rights and Restrictions”);

C.The Shareholder is the sole legal and beneficial owner of the Common Shares, which shares are to be exchanged for the Preferred Shares;

D.The Parties wish to record an agreement in relation to an option for the sale and purchase of the Preferred Shares in the circumstances described herein;

NOW THIS AGREEMENT WITNESSES as follows:

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1. INTERPRETATION

1.1 In this Agreement, unless the context or subject matter otherwise requires:

(a) “Agreement” and “this Agreement” means the agreement between the Parties hereby constituted;

(b) “Common Shares” means common shares in the capital of the Target registered in the name of the Shareholder;

(c) “Current Market Price” means in respect of a Northwest Common Share on any date, the closing sale price of Northwest Common Shares on such date, or if no trades occurred on such day, the last trading day prior thereto, on such stock exchange or automated quotation system as the Northwest Common Shares then trade;

(d) “Northwest” means Northwest Passage Ventures Ltd., a Nevada corporation;

(e) “NorthwestCommon Shares” means common shares in the capital of Northwest;

(f) “NorthwestVoting Shares” means special voting shares of Northwest, each such share entitling the holder thereof to one vote at duly called meetings of shareholders of Northwest, but having no other rights of participation;

(g) “Notice” means a notice of exercise of the Option in the form attached as Exhibit 1 hereto;

(h) “Option” means the option to purchase the Preferred Shares provided for herein;

(i) “Party” means a party to this Agreement and “Parties” has a corresponding meaning;

(j) “PreferredShares” means the class A preference shares in the capital of the Purchaser to be acquired by the Shareholders in exchange for the Common Shares;

(k) “Purchaser” means 6544797 Canada Ltd., a Canada corporation and a wholly owned subsidiary of Northwest;

(l) “Purchase Price” means, in respect of any Notice given by Northwest to the Shareholder, an amount per Preferred Share equal to the then Current Market Price times the number of Preferred Shares to be purchased by Northwest from the Shareholder; and

(m) “Target” means Americas Wind Energy Inc., an Ontario corporation.

- 3 -

Any reference to currency is to the currency of the United States of America unless otherwise indicated.

2. OPTION

2.1 The Shareholder hereby grants to Northwest an option to acquire the Shares from the Shareholder on the terms set out in this Agreement.

2.2 As consideration for the granting of the Option, Northwest hereby agrees to issue to the Shareholder _______________________ Northwest Voting Shares upon the creation of same in accordance with the terms of that Share Exchange Agreement between the Target, Northwest, the Purchaser and the Shareholder dated for reference the __________________, __________________________.

2.3 This Option shall expire and be of no further force and effect as of the first business day following the earlier of:

(a) the liquidation, bankruptcy or winding up of the Purchaser or Northwest, either voluntary or involuntary, or other distribution of the assets and funds of the Purchaser or Northwest for the purposes of winding up its affairs;

(b) the date that the shareholders of Northwest approve a resolution authorizing Northwest to consolidate or merge with or into, amalgamate with or enter into a statutory arrangement with any other person; and

(c) the date upon which the last of the Preferred Shares have been retracted or redeemed in accordance with their terms,

(the “Option Period”)

provided that, in circumstances where Northwest has not otherwise exercised the Option at such time as the Option would have expired in accordance with Section 2.3(a), 2.3(b) or 2.3(c) hereof, Northwest shall be deemed to have exercised the Option in full immediately prior to such time.

3. EXERCISE OF OPTION

3.1 The Option may only be exercised in circumstances where the Shareholder has exercised, or is deemed to have exercised the right of retraction in respect of the Shares as set out in the Rights and Restrictions, provided that it is acknowledged that the entitlement of Northwest to exercise the Option shall take precedence to the right of the Shareholder to exercise the above referenced right of retraction.

3.2 The Option may be exercised during the Option Period by Northwest delivering Notice to the Shareholder.

3.3 Upon receipt of a Notice the Shareholder shall forthwith deliver certificates representing the Preferred Shares which are the subject of the Notice to Northwest.

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3.4 Within seven days of receipt of the certificates referred to in section 3.3 above, Northwest shall deliver the Purchase Price to the Shareholder which Purchase Price shall be satisfied by delivering to the Shareholder such number of Northwest Common Shares as is equal to the number of Preferred Shares to be purchased.

4. EXEMPTION REQUIREMENTS

4.1 It is understood and agreed by the parties hereto that, in the absence of an effective registration statement covering the Northwest Common Shares or an available exemption from registration, the Northwest Common Shares must be held for a one year period. Further, Canadian residents may require further exemptions to resell their Northwest Common Shares.

5. NORTHWEST VOTING SHARES

5.1 Upon exercise of the Option by Northwest as provided for herein, or exercise of the rights of retraction or redemption in respect of the Preferred Shares as provided for in the articles of the Purchaser, the Shareholder shall concurrently surrender to Northwest such number of Northwest Voting Shares issued to the Shareholder, if any, as are equal to the number of Preferred Shares disposed of by the Shareholder as a result of the exercise of the Option or the right of retraction or redemption, as the case may be.

6. WARRANTIES

6.1 The Shareholder represents and warrants to Northwest that the Shareholder is the sole legal and beneficial owner of the Common Shares and that Northwest will, following the exchange of such Common Shares for the Preferred Shares, be the sole legal and beneficial owner of the Common Shares, free and clear of all liens charges and encumbrances.

7. NOTICE

7.1 Any notice or other document required or permitted to be given hereunder will be considered well and sufficiently given by hand delivery or by prepaid first class mail if addressed to applicable party at the address set out above, or such other address as either party may from time to time appoint by notice in writing to the other in accordance with this clause. Any notice delivered by hand addressed as aforesaid will be deemed to have been delivered on the day of delivery, and any notice mailed by first class prepaid mail addressed as aforesaid will be deemed to have been received three (3) business days after the mailing thereof; but if at the time of mailing or between the time of mailing and the third business day thereafter, there is a strike, lock-out or labour disturbance affecting postal service, then such notice will not be effectively given until actually received.

8. GOVERNING LAW

8.1 This Agreement shall be governed by the laws of the Province of British Columbia.

- 5 -

9. COUNTERPARTS

9.1 This Agreement may be executed in one or more counterparts which, when so executed by facsimile signature or otherwise, shall be read together and be construed as one agreement.

IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day and year first above written.

NORTHWEST PASSAGE VENTURES LTD.


Per:  _______________________________
           Authorized Signatory o


Per:    ___________________________
            Authorized Signatory

- 6 -

EXHIBIT 1

to the CALL OPTION AGREEMENT

NOTICE OF EXERCISE

TO: _________________________

Northwest Passage Ventures Ltd. HEREBY exercises its option to purchase ____________ Class A Preference Shares of 6544797 Canada Ltd. owned by you at a deemed price of US$_____________ per share.

Dated _____________________, ___________________.

NORTHWEST PASSAGE VENTURES LTD.

Per:
	Authorized Signatory

7

SCHEDULE"D"

FINANCIAL STATEMENTS OF AMERICAS WIND ENERGY INC.

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

FINANCIAL STATEMENTS

JULY 31, 2005 AND 2004

(EXPRESSED IN U.S. DOLLARS)

CONTENTS

Report of Independent Registered Public Accounting Firm	1
Balance Sheets	2
Statements of Operations	3
Statements of Stockholders' Deficit	4
Statements of Cash Flows	5
Notes to Financial Statements	6 - 16

8

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Americas Wind Energy Inc.

We have audited the accompanying balance sheets of Americas Wind Energy Inc. as of July 31, 2005, and 2004, and the related statements of operations, stockholders' deficit, and cash flows the years ended July 31, 2005 and 2004 and cumulative from inception (July 29, 2002) through July 31, 2005. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Americas Wind Energy Inc. as of July 31, 2005, and 2004, and the results of its operations and its cash flows for the years ended July 31, 2005 and 2004 and cumulative from inception (July 29, 2002) through July 31, 2005, in conformity with accounting principles generally accepted in the United States.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in note 1 to the financial statements, the Company is in the development stage, has been experiencing recurring losses, and has insufficient working capital to meet its planned business operations. These and other factors raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

	"SF PARTNERSHIP, LLP"
CHARTERED ACCOUNTANTS

Toronto, Canada

May 29, 2006

9

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Balance Sheets

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

		2005		2004
ASSETS
Current Assets
Cash	$	35,179	$	6,603
Accounts receivable and other		33		101,182
Goods and Services Tax receivable		20,018		4,880
Total Current Assets		55,230		112,665
Investment in Emergya Wind Technologies B.V. (note 3)		737,916		-
Advances to Emergya Wind Technologies B.V. (note 3)		-		748,092
Equipment, Net (note 4)		7,479		9,838
Intangible Asset (note 5)		1,780,385		1,639,375
Total Assets	$	2,581,010	$	2,509,970
LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities	$	146,707	$	100,093
Due to stockholders(note 6)		108,692		32,299
Current portion of long-term loan (note 7)		1,179,787		-
Total Current Liabilities		1,435,186		132,392
Long-Term Debt, Less Current Portion
Due to Emergya Wind Technologies B.V. (note 7)		359,855		1,623,838
Due to Digital Predictive Systems Inc. (note 8)		1,421,552		1,165,975
Total Long-Term Debt		1,781,407		2,789,813
Total Liabilities		3,216,593		2,922,205
Commitments and Contingencies (note 12)
STOCKHOLDERS' DEFICIT
Capital Stock (note 9)		65		64
Accumulated Other Comprehensive Income		59,464		39,063
Accumulated Deficit During the Development Stage		(695,112)		(451,362)
Total Stockholders' Deficit		(635,583)		(412,235)
Total Liabilities and Stockholders' Deficit	$	2,581,010	$	2,509,970

(The accompanying notes are an integral part of these financial statements)

10

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Statements of Operations

For the Years Ended July 31, 2005, and 2004, and Cumulative

from Inception (July 29, 2002) through July 31, 2005

(Expressed in U.S. Dollars)

					Cumulative
					from Inception
					(July 29, 2002)
					through July 31,
		2005		2004	2005
Revenue	$	-	$	640,840	$	640,840
Cost of Sales		-		891,975		891,975
Gross Loss		-		(251,135)		(251,135)
Expenses
General and administrative		141,894		130,492		286,003
Professional fees		-		-		3,334
Consulting fees		-		-		1,563
Telephone and internet		-		-		856
Bank charges		-		-		53
Depreciation		3,160		1,725		4,885
Total Expenses		145,054		132,217		296,694
Loss from Operations		(145,054)		(383,352)		(547,829)
Other Income (Expense)
Other income		37,396		26,218		63,614
Interest expense		(136,092)		(74,805)		(210,897)
Total Other Expenses		(98,696)		(48,587)		(147,283)
Net Loss		(243,750)		(431,939)		(695,112)
Foreign currency translation adjustment		20,401		40,306		59,464
Total Comprehensive Loss	$	(223,349)	$	(391,633)	$	(635,648)
Loss Per Share:
Loss per Share - Basic and Diluted	$	2.39	$	4.32
Weighted Average Number of Shares
Outstanding During the Periods -
Basic and Diluted		101,836		100,000

(The accompanying notes are an integral part of these financial statements)

11

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Statements of Stockholders' Deficit

From Inception (July 29, 2002) Through July 31, 2005

(Expressed in U.S. Dollars)

				Accumulated
				Other				Total
	Common Stock			Comprehensive		Accumulated		Stockholders'
	Shares	Par Value		Income		Deficit		Deficit
Stock issued at inception at July 29,
2002 $0.001 per share	100,000	$	64	$	-	$	-	$	64
Foreign currency translation
adjustment	-		-		(1,243)		-		(1,243)
Net loss for the year	-		-		-		(19,423)		(19,423)
Balance, July 31, 2003	100,000	$	64	$	(1,243)	$	(19,423)	$	(20,602)
Foreign currency translation
adjustment	-		-		40,306		-		40,306
Net loss for the year	-		-		-		(431,939)		(431,939)
Balance, July 31, 2004	100,000	$	64	$	39,063	$	(451,362)	$	(412,235)
Shares issued for cash on August 2004
- $0.0005 per share	2,000		1		-		-		1
Foreign currency translation
adjustment	-		-		20,401		-		20,401
Net loss for the year	-		-		-		(243,750)		(243,750)
Balance, July 31, 2005	102,000	$	65	$	59,464	$	(695,112)	$	(635,583)

(The accompanying notes are an integral part of these financial statements)

12

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Statements of Cash Flows

For the Years Ended July 31, 2005, 2004 and Cumulative

from Inception (July 29, 2002) Through July 31, 2005

Expressed in U.S. Dollars

					Cumulative
					from Inception
					(July 29, 2002)
					Through July 31,
		2005		2004	2005
Cash Flows from Operation
Net loss	$	(243,750)	$	(431,939)	$	(695,112)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Depreciation		3,160		1,725		4,885
Accrued interest		98,902		48,899		147,801
Changes in operating assets and liabilities
Accounts receivable and other		101,149		(101,111)		(33)
Work in progress		-		69,369		-
GST receivable		(15,138)		(4,880)		(20,018)
Due to stockholders		67,024		32,300		99,324
Net cash (used in) provided by operating activities		11,347		(385,637)		(463,153)
Cash Flows from Investing Activities
Purchase of capital assets		(1,007)		(11,563)		(12,570)
Net cash used in investing activities		(1,007)		(11,563)		(12,570)
Cash Flows from Financing Activities
Advances to Emergya Wind Technologies B.V.		(19,761)		(737,239)		(757,000)
Repayment to Emergya Wind Technologies B.V.		(55,760)		-		(55,760)
Advances from Digital Predictive Systems Inc.		26,753		1,090,690		1,117,443
Accounts payable and accrued liabilities		46,602		(123,909)		146,693
Issuance of common stock		1		-		65
Net cash provided by (used in) financing activities		(2,165)		229,542		451,441
Effect of Exchange Rate Change on Cash		20,401		40,306		59,461
Net Increase in Cash		28,576		127,352		35,179
Cash - beginning of year		6,603		133,955		-
Cash - end of year	$	35,179	$	6,603	$	35,179
Supplemental Disclosures of Cash Flow Information
The Company had cash flows arising from interest
and income taxes paid as follows:
Cash paid for interest	$	-	$	-	$	-
Cash paid for income taxes	$	-	$	-	$	-

Supplemental Information (note 11)

(The accompanying notes are an integral part of these financial statements)

13

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

1. Organization, Development Stage Activities, and Going Concern

Organization

Americas Wind Energy Inc. (the "Company") was incorporated under the Ontario Business Corporations Act on July 29, 2002. The Company distributes wind power turbines to wind farm developers throughout North America.

Development Stage Activities

The Company's business activity is the distribution of wind power turbines to wind farm developers in North America. The Company has researched and developed wind turbines to be efficient in the North American market. The Company has also commenced discussions with strategic market partners to seek equity financing through a private placement of common stock.

Going Concern

The Company's financial statements are presented on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has experienced recurring losses from operations that raise substantial doubt as to its ability to continue as a going concern. For the years ended July 31, 2005, and 2004, the Company experienced net losses of $243,750 and $431,939, respectively. As of July 31, 2005, the Company had an accumulated deficit during the development stage of $695,112.

The Company's continuance as a going concern is dependent on the success of the efforts of its directors and principal shareholders in providing financial support in the short term, the success of the Company in raising additional long-term equity or debt financing either from its own resources or from third parties, the commercialization of one or more of the Company's research projects and the Company achieving profitable operations. In the event that such resources are not secured, the assets may not be realized or liabilities discharged at their carrying amounts, and difference from the carrying amounts reported in these financial statements could be material.

The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the inability of the Company to continue as a going concern.

14

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies

The accounting policies of the Company are in accordance with accounting principles generally accepted in the United States, and their basis of application is consistent with that of the previous year. Set forth below are the Company's significant accounting policies:

a) Basis of Presentation

The accompanying financial statements were prepared from the accounts of the Company under the accrual basis of accounting in United States dollars.

b) Equipment

Equipment is recorded at cost. Depreciation, based on the estimated useful lives of the assets, is provided as follows:

Computer equipment 30% declining balances

c) Cash

Cash consists of cash on account with major financial institutions.

d) Research and Development

Research and development costs are expensed as incurred. Research and development expenses consist primarily of consulting fees and materials.

Costs incurred in obtaining license rights to technology in the research and development stage, and that have no alternative future uses are expensed as incurred.

Research and development costs have been included in the cost of sales category of the accompanying statements of operations since the Company is unable to separate the actual cost of sales from the research and development component.

e) Investments

Investments in shares are classified as long term, are available for sale and are stated at fair market value. The net excess of fair market value over cost is included in accumulated other comprehensive income (loss) on the statement of stockholders' deficit.

15

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies (cont'd)

f) Revenue Recognition

The Company recognizes revenues on a completed contract basis. Under this method, the revenue and costs related thereto are deferred until such time as the project is completed, the customer takes ownership and assumes risks of loss, collection is probable, persuasive evidence of an arrangement exists, and the sales price is fixed or determinable. The amount of any excess accumulated costs over related billings will be described as "Costs of uncompleted contracts in excess of related billings" and will be a current asset. The amount of any excess accumulated billings over related costs will be described as "Billings on uncompleted Contracts in excess of related costs" and will be a current liability.

g) Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These estimates are based on management's best knowledge of current events and actions the Company may undertake in the future. Actual results may ultimately differ from those estimates. These estimates are reviewed on an ongoing basis and as adjustments become necessary, they are reported in earnings in the period in which they become known.

h) Income Taxes

The Company accounts for income taxes pursuant to Statement of Financial Accounting Standards ("SFAS") No. 109, "Accounting for Income Taxes". Deferred tax assets and liabilities are recorded for differences between the financial statement and tax basis of the assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is recorded for the amount of income tax payable or refundable for the period, increased or decreased by the change in deferred tax assets and liabilities during the period.

16

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies (cont'd)

i) Foreign Currency Translation

The Company accounts for foreign currency translation pursuant to SFAS No.52, "Foreign Currency Translation". The Company's functional currency is the Canadian dollar. All assets and liabilities are translated into United States dollars using the rates prevailing at the end of the year. Revenues and expenses are translated using the average exchange rates prevailing throughout the year.

Unrealized foreign exchange amounts resulting from translations at different rates according to their nature are included in accumulated other comprehensive income or loss.

Realized foreign currency transaction gains and losses are recognized as income or expense when they arise.

j) Comprehensive Income or Loss

The Company applies the provisions of Financial Accounting Standards Board’s (FASB) SFAS No. 130 “Reporting Comprehensive Income.” Unrealized gains and losses from foreign exchange translation are reported in the accompanying statements as comprehensive income (loss).

k) Earnings or Loss Per Share

The Company accounts for earnings or loss per share pursuant to SFAS No. 128, "Earnings per Share", which requires disclosure on the financial statements of "basic" and "diluted" earnings (loss) per share. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the year. Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding plus potentially dilutive securities outstanding for each year. Potentially dilutive securities include stock options and warrants, and shares of common stock issuable upon conversion of the Company's convertible notes.

l) Impairment of Long-Lived Assets

In accordance with SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets", long-lived assets to be held and used are analysed for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. The Company evaluates at each balance sheet date whether events and circumstances have occurred that indicate possible impairment. If there are indications of impairment, the Company uses future undiscounted cash flows of the related asset or asset grouping over the remaining life in measuring whether the assets are recoverable. In the event such cash flows are not expected to be sufficient to recover the recorded asset values, the related asset or asset grouping are written down to their estimated fair value. Long-lived assets to be disposed of are reported at the lower of the carrying amount or the fair value of the asset less cost to sell.

17

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies (cont'd)

m) Financial Instruments

Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from the financial instruments. The carrying amounts reported in the accompanying financial statements for current assets and current liabilities approximates fair value because of the short-term maturity of these financial instruments.

SFAS No. 105, "Disclosure +of Information About Financial Instruments with Off-Balance Sheet Risk and Financial Instruments with Concentration of Credit Risk", requires disclosure of any significant off-balance sheet risk and credit risk concentration. The Company does not have significant off-balance sheet risk or credit concentration. The Company maintains cash with major financial institutions. Management does not consider this to be a significant credit risk as these banks and financial institutions are well-known.

The long-term debt due to Emergya Wind Technologies B.V. was received and is payable in Euros, resulting in a currency risk.

n) Recent Accounting Pronouncements

In December 2004, the FASB issued SFAS No. 153, "Exchanges of Non-monetary Assets, an amendment of APB Opinion No. 29". SFAS No. 153 replaces the exception from fair value measurement in APB Opinion No. 29 for non-monetary exchanges of similar productive assets with a general exception from fair value measurement for exchanges of non-monetary assets that do not have commercial substance. A non-monetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange. SFAS No. 153 is to be applied prospectively, and is effective for non-monetary asset exchanges occurring in fiscal periods after the December 2004 issuance of SFAS No. 153. The adoption of SFAS No. 153 is not expected to have a material impact on the Company's results of operations or financial position.

In December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share Based Payment" ("SFAS No. 123R"). SFAS No. 123R requires the Company to measure the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. The cost of the employee services is recognized as compensation cost over the period that an employee provides service in exchange for the award. SFAS No. 123R is effective January 1, 2006. The adoption of this standard is not expected to have a material impact on the financial position or results of operations of the Company.

18

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies (cont'd)

n) Recent Accounting Pronouncements (cont'd)

In March 2005, the FASB issued FASB Staff Position ("FSP") No. 46(R)-5, "Implicit Variable Interests under FASB Interpretation No. ("FIN") 46 (revised December 2003), Consolidation of Variable Interest Entities" ("FSP FIN 46R-5"). FSP FIN 46R-5 provides guidance for a reporting enterprise on whether it holds an implicit variable interest in Variable Interest Entities ("VIEs") or potential VIEs when specific conditions exist. This FSP is effective in the first period beginning after March 3, 2005 in accordance with the transition provisions of FIN 46 (revised December 2003), "Consolidation of Variable Interest Entities - an Interpretation of Accounting Research Bulletin No. 51" ("FIN 46R"). The adoption of FSP FIN 46R-5 is not expected to have a material impact on the Company's results of operations or financial position.

In March 2005, the FASB issued Interpretation No. 47, "Accounting for Conditional Asset Retirement Obligations" ("FIN 47"), which will result in (1) more consistent recognition of liabilities relating to asset retirement obligations, (2) more information about expected future cash outflows associated with those obligations, and (3) more information about investments in long-lived assets because additional asset retirement costs will be recognized as part of the carrying amounts of the assets. FIN 47 clarifies that the term "conditional asset retirement obligation" as used in SFAS No. 143, "Accounting for Asset Retirement Obligations", refers to a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement are conditional on a future event that may or may not be within the control of the entity. The obligation to perform the asset retirement activity is unconditional even though uncertainty exists about the timing and/or method of settlement. Uncertainty about the timing and/or method of settlement of a conditional asset retirement obligation should be factored into the measurement of the liability when sufficient information exists. FIN 47 also clarifies when an entity would have sufficient information to reasonably estimate the fair value of an asset retirement obligation. FIN 47 is effective no later than the end of fiscal years ending after December 15, 2005. The adoption of FIN 47 is not expected to have a material impact on the financial position or results of operations of the Company.

19

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

2. Summary of Significant Accounting Policies (cont'd)

n) Recent Accounting Pronouncements (cont'd)

In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections", which replaces APB Opinion No. 20, "Accounting Changes", and SFAS No. 3, "Reporting Accounting Changes in Interim Financial Statements - An Amendment of APB Opinion No. 28". SFAS No. 154 provides guidance on the accounting for and reporting of changes in accounting principles and error corrections. SFAS No. 154 requires retrospective application to prior period financial statements of voluntary changes in accounting principle and changes required by new accounting standards when the standard does not include specific transition provisions, unless it is impracticable to do so. SFAS No. 154 also requires certain disclosures for restatements due to correction of an error. SFAS No. 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005, and is required to be adopted by the Company as of January 1, 2006. The impact that the adoption of SFAS No. 154 will have on the Company's results of operations and financial condition will depend on the nature of future accounting changes adopted by the Company and the nature of transitional guidance provided in future accounting pronouncements.

In July 2005, the FASB issued an exposure draft of a proposed interpretation, Accounting for Uncertain Tax Positions an Interpretation of FASB Statement No. 109 (“SFAS No. 109”). This interpretation would apply to all open tax positions accounted for in accordance with SFAS No. 109, including those acquired in business combinations. It is a proposed asset recognition approach to apply a dual threshold for uncertain tax positions. The interpretation would allow the recognition of a tax benefit when it is probable that it could be sustained upon audit. The interpretation defines “probable” as it is defined in SFAS No. 5, “Accounting for Contingencies.” FASB has not established an effective date for the interpretation. The Company is currently reviewing the effect, if any, the proposed guidance will have on its financial position.

3. Investment in and Advances to Emergya Wind Technologies B.V.

In fiscal 2004, the Company entered into a loan agreement with Emergya Wind Technologies B.V. ("EWT"). Pursuant to the agreement, the loan was to be converted into common shares of EWT. The loan carried an interest rate of 5% per annum, to be paid at time of conversion. On July 20, 2005, the Company converted the outstanding loan balance of $739,542 into 923 common shares of EWT, representing a 31.2% ownership interest. Accordingly, the Company recorded an investment in EWT of $737,916 at July 31, 2005. At May 29, 2006 the investment represented a 16.72% ownership interest. The $1,626 difference between the date of conversion and reporting date is the result of the exchange fluctuation.

20

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

4. Equipment, Net

			2005				2004
			Accumulated				Accumulated
		Cost	Depreciation			Cost	Depreciation
Computer equipment	$	12,570	$	5,091	$	11,563	$	1,725
Net carrying amount			$	7,479			$	9,838

The accumulated depreciation for both 2005 and 2005 include the exchange translation effects.

5. Intangible Asset

On April 23, 2004, the Company entered into a license agreement with EWT to obtain the North American intellectual property rights and know-how relating to EWT's medium capacity wind turbines, for an indefinite period of time. The license fee was EUR 1,350,000 and the license was measured at $1,601,670, the fair value at the date the licensing agreement was entered into. The asset is not amortized due to the indefinite life term of the agreement. There is no assessed impairment noted.

6. Due to Stockholders

The amounts due to stockholders bears interest at 10% annually, with no fixed repayments term.

7. Due to Emergya Wind Technologies B.V Inc.

In fiscal 2004, the Company entered into a loan agreement relating to the intangible assets described in note 5. The liability component is as follows:

		2005		2004
Due to Emergya Wind Technologies B.V. Inc.	$	1,539,641	$	1,623,838
Less: current portion		1,179,787		-
Long-term portion	$	359,854	$	1,623,838

The loan is non interest bearing with fixed repayment terms of 7% of related sales until fully paid.

Subsequent to fiscal 2005, the Company amended the agreement that $1,179,787 would be paid in the current year and the following $359,854 would be paid in the 2007 fiscal year.

21

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

8. Due to Digital Predictive Systems Inc.

The amount due to Digital Predictive Systems Inc. has a three-year term which matures October 12, 2006. Interest is charged at 10%, compounded monthly. Repayment is to be made in full, including interest, at maturity. The loan is secured by a general security agreement over the Company's assets and all license agreement rights.

9. Capital Stock

Authorized

Unlimited	common shares
Unlimited	class "A" special shares
Unlimited	class "B" special shares
Unlimited	class "C" special shares
Unlimited	class "D" special shares

		2005		2004
Issued and Outstanding
102,000  (2004: 100,000) shares of common
stock, which hold no par value.	$	65	$	64

During the year, the Company issued 2,000 shares for proceeds of $1.

10. Income Taxes

The provision for income taxes has been computed as follows:

		2005		2004
Expected income tax recovery at the statutory rate of 18%	$	(43,875)	$	(77,749)
Less: valuation allowance		43,875		77,749
Provision for income taxes	$	-	$	-

22

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

10. Income Taxes (cont'd)

The components of future income taxes are as follows:

		2005		2004
Net operating loss carryforwards:
Scientific research and development expense	$	-	$	314,560
Net operating loss carry forward		76,457		30,236
Less - Valuation allowance		(76,457)		(344,796)
Deferred income taxes	$	-	$	-

The Company has net operating loss carryforwards available to be applied against future years income. Due to the losses incurred in the current year and expected future operating results, it is more likely than not that the deferred tax asset resulting from the tax losses available for carry forward will not be realized through the reduction of future income tax payments. Accordingly a 100% valuation allowance has been recorded for deferred income tax assets.

As of July 31, 2005, and 2004, the Company had approximately $430,506 and $18,053, respectively, of federal and state net operating loss carryforwards available to offset future taxable income, such carryovers expire in various years through 2012.

11. Supplemental Information

Non-cash financing and investing activities:

		2005		2004
Investment in Emergya Wind Technologies B.V.	$	737,916	$	-
Advance to Emergya Wind Technologies B.V.		(737,916)		-
Purchase of Intangible assets		-		(1,639,375)
Due to Emergya Wind Technologies B.V.		-		1,639,375
	$	-	$	-

23

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Financial Statements

July 31, 2005, and 2004

(Expressed in U.S. Dollars)

12. Commitments and Contingencies

The Company has committed under a license agreement to pay to EWT a royalty of 3% of related sales and 40% of any royalties received by the Company from its sub-licensees.

13. Subsequent Events

On May 11, 2005, the Company entered into a license agreement with GE Power Technology LLC ("GEPT") to obtain certain licenses under GEPT's patents. The Company has agreed under this license agreement to pay GEPT a royalty equal to $32,500 per megawatt for each sale or shipment of portion thereof of a licensed product.

29

AMERICAS WIND ENERGY INC.

INTERIM FINANCIAL STATEMENTS

THREE MONTH AND NINE MONTH PERIOD ENDED APRIL 30, 2006 AND 2005

30

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

INTERIM FINANCIAL STATEMENTS

THREE MONTH AND NINE MONTH PERIOD ENDED APRIL 30, 2006 AND 2005

CONTENTS

Interim Balance Sheet	1
Interim Statements of Operations	2
Interim Statements of Cash Flows	3
Notes to Interim Financial Statements	4 - 11

1

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Interim Balance Sheets

April 30, 2006 and July 31, 2005

(Expressed in United States Dollars)

(Unaudited)

		2006
ASSETS
Current
Cash	$	95,167
Loan receivable		45,584
GST Receivable		18,744
Total Current Assets		159,495
Investment in Emergya Wind Technologies B.V. (note 3)		809,006
Equipment, Net (note 4)		137,711
Intangible Asset (note 5)		1,951,906
Total Assets	$	3,058,118
LIABILITIES
Current
Accounts payable	$	210,883
Billings on uncompleted contracts in excess of related costs		317,769
Due to stockholders (note 6)		208,971
Due to Emergya Wind Technologies (note 7)		1,263,607
Due to Northwest Passage Ventures Ltd. (note 8)		252,382
Due to Digital Predictive Systems Inc. (note 9)		1,678,567
Total Current Liabilities		3,932,179
Total Liabilities		3,932,179
Commitments and Contingencies (note 12)
STOCKHOLDERS' DEFICIT
Capital Stock (note 10)		90
Accumulated Other Comprehensive Income		83,615
Deficit Accumulated during the development stage		(957,766)
Total Stockholder's Equity (Deficit)		(874,061)
Total Liabilities and Stockholders' Equity	$	3,058,118

(The accompanying notes are an integral part of these interim financial statements)

2

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Interim Statement of Operations

Three Months and Nine Months Ended April 30, 2006 and 2005

(Expressed in United States Dollars)

(Unaudited)

									July 29,
									2002 (Date of
	Three		Three		Nine		Nine		Inception)
	Months		Months		Months		Months		through
	Ended		Ended		Ended		Ended		April 30,
	2006		2005		2006		2005		2006
Revenue	$	-	$	-	$	-	$	-	$	640,840
Cost of Sales		-		-		-		-		891,975
Gross Profit		-		-		-		-		(251,135)
Expenses
General and administrative		93,242		37,454		143,160		76,549		434,969
Depreciation		5,185		797		13,407		2,369		18,292
Total Expenses		98,427		38,251		156,567		(78,918)		(453,261)
Loss from Operations		(98,427)		(38,251)		(156,567)		78,918		(704,396)
Other income		-		-		2,378		-		65,992
Recovery of expenses		22,100		-		34,598		-		34,598
Finance fee		(16,402)		-		(16,146)		-		(16,146)
Interest expense		(41,803)		(32,391)		(126,917)		(63,888)		(337,814)
Total Other Income (Expenses)		(36,105)		(32,391)		(106,087)		(63,888)		(253,370)
Provision for income taxes		-		-		-		-		-
Net Loss		134,532		70,642		262,654		142,806		957,766
Foreign currency translation		8,050		(4,027)		24,151		(12,081)		83,615
Comprehensive Loss	$	126,482	$	74,669	$	238,503	$	154,887	$	874,151
Loss per Share – Basic
and Diluted	$	1.09	$	0.69	$	2.39	$	1.40
Weighted average number of
shares outstanding during the
periods - basic and diluted		123,156		102,000		110,073		101,788

(The accompanying notes are an integral part of these interim financial statements)

3

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Interim Statement of Cash Flows

Nine Months Ended April 30, 2006 and 2005

(Expressed in United States Dollars)

(Unaudited)

					For the period
					from July 29,
					2002 (Inception)
	2006		2005		to April 30, 2006
Cash Flows from Operating Activities
Net (loss)	$	(262,654)	$	(142,806)	$	(957,766)
Adjustments for:
Depreciation		13,407		3,160		18,292
Accrued Interest		114,758		63,888		147,801
		(134,489)		(75,758)		(791,673)
Changes in non-cash working capital
Loan receivable		(45,551)		(7,430)		(45,584)
Investment in EWT		(71,090)		(838,206)		(71,090)
GST receivable		1,274		(9,334)		(18,744)
Due to stockholders		100,278		45,934		199,602
Billings on uncompleted contract in excess of
related cost		317,769		81,129		317,769
Net Cash Flows from Operating Activities		168,191		(803,665)		(409,720)
Cash Flows from Financing Activities
Issuance of common stock		25		-		90
Repayments to Emergya Wind Technologies B.V.		(447,555)		-		(503,315)
Advances from Northwest Passage Ventures Ltd.		252,382		-		252,382
Advances from Digital Predictive Systems Inc.		142,257		(4,167)		1,374,458
Advances to Emergya Wind Technologies B.V.		-		748,092		(757,000)
Accounts payable and accrued liabilities		64,176		43,697		210,869
Net Cash Flows from Financing Activities		11,285		787,622		577,484
Cash Flows from Investing Activities
Acquisition of equipment		(143,639)		(1,386)		(156,209)
Net Cash Flows from Investing Activities		(143,639)		(1,386)		(156,209)
Effect of Exchange Rate Change on Cash		24,151		(12,081)		83,612
Change in Cash		59,988		(29,510)		95,167
Cash – beginning of period		35,179		6,603		-
Cash - end of period	$	95,167	$	(22,907)	$	95,167
Supplemental disclosures of cash flow information:
The Company had cash flows arising from interest
and income taxes paid as follows:
Income taxes	$	-	$	-	$	-
Interest	$	-	$	-	$	-

(The accompanying notes are an integral part of these interim financial statements)

4

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

1. Operations, Development Stage Activities, and Going Concern

Americas Wind Energy Inc. (the "Company"), was incorporated under the Ontario Business Corporations Act on July 29, 2002. The Company distributes wind power turbines to wind farm developers throughout North America.

Development Stage Activities

The Company business activity is the distribution of wind power turbines to wind farm developers in North America. The Company has researched and developed wind turbines to be efficient in the North American market. The Company has also commenced discussions with strategic market partners to seek equity financing through a private placement of common stock.

Going Concern Assumption

The Company's financial statements are presented on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has experienced recurring losses from operations that raise substantial doubt as to its ability to continue as a going concern. For the nine month period ended April 30, 2006, and the year ended July 31, 2005, the Company experienced net losses of $262,654 and $243,750 respectively. As of April 2005, the Company had an accumulated deficit during the development stage of $957,766.

The Company's ability to continue as a going concern is contingent upon its ability to secure debt and equity financing, and attain profitable operations.

The Company continuance as a going concern is dependent on the success of the efforts of its directors and principal shareholders in providing financial support in the short term, the success of the Company in raising additional long-term equity or debt financing either from its own resources or from third parties, the commercialization of one or more of the Company's research projects and the Company achieving profitable operations. In the event that such resources are not secured, the assets may not be realized or liabilities discharged at their carrying amounts, and difference from the carrying amounts reported in these financial statements could be material.

The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the inability of the Company to continue as a going concern.

5

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

2. Summary of Significant Accounting Policies

a) Basis of Financial Statement Presentation

The accompanying unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the requirements of item 310 (b) of Regulation S-B. Accordingly, certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to the rules and regulations of Securities and Exchange Commission. The financial statements reflect all adjustments (consisting on of normal recurring adjustments), which, in the opinion of management, are necessary for a fair presentation of the results for the periods presented. There have been no significant changes of accounting policy since July 31, 2005. The results from operations for the interim periods are not indicative of the results expected for the full fiscal year or any future period. These financial statements should be read in conjunction with the audited financial statements and notes thereto for the fiscal year ended July 31, 2005 as filed with the Securities and Exchange Commission.

b) Recent Accounting Pronouncements

In December 2004, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 153, "Exchanges of Non-monetary Assets, an amendment of Accounting Principles Board ("APB") Opinion No. 29". SFAS No. 153 replaces the exception from fair value measurement in APB Opinion No. 29 for non-monetary exchanges of similar productive assets with a general exception from fair value measurement for exchanges of non-monetary assets that do not have commercial substance. A non-monetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange. SFAS No. 153 is to be applied prospectively, and is effective for non-monetary asset exchanges occurring in fiscal periods after the December 2004 issuance of SFAS No. 153. The adoption of SFAS No. 153 is not expected to have a material impact on the Company's results of operations or financial position.

In December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share Based Payment" ("SFAS No. 123R"). SFAS No. 123R requires the Company to measure the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. The cost of the employee services is recognized as compensation cost over the period that an employee provides service in exchange for the award. SFAS No. 123R is effective January 1, 2006. The adoption of this standard is not expected to have a material impact on the financial position or results of operations of the Company.

6

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

2. Summary of Significant Accounting Policies (cont'd)

b) Recent Accounting Pronouncements (cont'd)

In March 2005, the FASB issued FASB Staff Position ("FSP") No. 46(R)-5, "Implicit Variable Interests under FASB Interpretation No. ("FIN") 46 (revised December 2003), Consolidation of Variable Interest Entities" ("FSP FIN 46R-5"). FSP FIN 46R-5 provides guidance for a reporting enterprise on whether it holds an implicit variable interest in Variable Interest Entities ("VIEs") or potential VIEs when specific conditions exist. This FSP is effective in the first period beginning after March 3, 2005 in accordance with the transition provisions of FIN 46 (revised December 2003), "Consolidation of Variable Interest Entities - an Interpretation of Accounting Research Bulletin No. 51" ("FIN 46R"). The adoption of FSP FIN 46R-5 is not expected to have a material impact on the Company's results of operations or financial position.

In March 2005, the FASB issued Interpretation No. 47, "Accounting for Conditional Asset Retirement Obligations" ("FIN 47"), which will result in (1) more consistent recognition of liabilities relating to asset retirement obligations, (2) more information about expected future cash outflows associated with those obligations, and (3) more information about investments in long-lived assets because additional asset retirement costs will be recognized as part of the carrying amounts of the assets. FIN 47 clarifies that the term "conditional asset retirement obligation" as used in SFAS No. 143, "Accounting for Asset Retirement Obligations", refers to a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement are conditional on a future event that may or may not be within the control of the entity. The obligation to perform the asset retirement activity is unconditional even though uncertainty exists about the timing and/or method of settlement. Uncertainty about the timing and/or method of settlement of a conditional asset retirement obligation should be factored into the measurement of the liability when sufficient information exists. FIN 47 also clarifies when an entity would have sufficient information to reasonably estimate the fair value of an asset retirement obligation. FIN 47 is effective no later than the end of fiscal years ending after December 15, 2005. The adoption of FIN 47 is not expected to have a material impact on the financial position or results of operations of the Company.

7

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

2. Summary of Significant Accounting Policies (cont'd)

b) Recent Accounting Pronouncements (cont'd)

In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections", which replaces APB Opinion No. 20, "Accounting Changes", and SFAS No. 3, "Reporting Accounting Changes in Interim Financial Statements - An Amendment of APB Opinion No. 28". SFAS No. 154 provides guidance on the accounting for and reporting of changes in accounting principles and error corrections. SFAS No. 154 requires retrospective application to prior period financial statements of voluntary changes in accounting principle and changes required by new accounting standards when the standard does not include specific transition provisions, unless it is impracticable to do so. SFAS No. 154 also requires certain disclosures for restatements due to correction of an error. SFAS No. 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005, and is required to be adopted by the Company as of January 1, 2006. The impact that the adoption of SFAS No. 154 will have on the Company's results of operations and financial condition will depend on the nature of future accounting changes adopted by the Company and the nature of transitional guidance provided in future accounting pronouncements.

In July 2005, the FASB issued an exposure draft of a proposed interpretation, Accounting for Uncertain Tax Positions an Interpretation of FASB Statement No. 109 (“SFAS No. 109”). This interpretation would apply to all open tax positions accounted for in accordance with SFAS No. 109, including those acquired in business combinations. It is a proposed asset recognition approach to apply a dual threshold for uncertain tax positions. The interpretation would allow the recognition of a tax benefit when it is probable that it could be sustained upon audit. The interpretation defines “probable” as it is defined in SFAS No. 5, “Accounting for Contingencies.” FASB has not established an effective date for the interpretation. The Company is currently reviewing the effect, if any, the proposed guidance will have on its financial position.

8

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

3. Investment in and Advances to Emergya Wind Technologies B.V.

In fiscal 2004, the Company entered into a loan agreement with Emergya Wind Technologies B.V. ("EWT"). Pursuant to the agreement, the loan was to be converted into common shares of EWT. The loan carried an interest rate of 5% per annum, to be paid at time of conversion. On July 20, 2005, the Company converted the outstanding loan balance of $739,542 into 923 common shares of EWT, representing a 31.2% ownership interest. Accordingly, the Company recorded an investment in EWT of $809,006 at April 30, 2006. At July 12, 2006 the investment represented a 16.72% ownership interest. The $71,091 difference between the date of conversion and reporting date is the result of the exchange fluctuations.

4. Equipment, Net

Equipment is comprised as follows:

				2006
				Accumulated
		Cost		Depreciation
Computer Equipment	$	13,781	$	7,427
Computer Software		4,720		1,770
Manufacturing Equipment		138,818		10,411
Total Capital Assets	$	157,319	$	19,608
Net carrying amount			$	137,711

5. Intangible Asset

On April 23, 2004, the Company entered into a license agreement with EWT to obtain the North American intellectual property rights and know-how relating to EWT's medium capacity wind turbines, for an indefinite period of time. The license fee was EUR 1,350,000 and the license was measured at the fair value at the date the licensing agreement was entered into. At April 30, the license was $1,951,906. The asset is not amortized due to the indefinite life term of the agreement.

9

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

6. Due to Stockholders

The amounts due to shareholders bears interest at 10% annually with no fixed repayments term.

7. Due to Emergya Wind Technologies B.V. Inc.

In fiscal 2004, the Company entered into a loan agreement relating to the intangible assets described in note 5. The liability component is as follows:

		2006
Due to Emergya Wind Technologies B.V. Inc.	$	1,263,607
Less: current portion		1,263,607
Long-term portion	$	-

The Company amended the license agreement terms of payment and accordingly, the balance is due within the next 12 months.

8. Due to Northwest Passage Ventures Ltd.

The amount due to Northwest Passage Ventures Ltd. matures at the earlier of March 17, 2007, or within ten days of the closing of the Formal Agreement entered into by Northwest and the Company. The amount bears interest at 7%, compounded annually and is payable at the maturity date.

9. Due to Digital Predictive Systems Inc.

The amount due to Digital Predictive Systems Inc. has a three-year term which matures October 12, 2006. Interest is charged at 10%, compounded monthly. Repayment is to be made in full, including interest, at maturity. The loan is secured by a general security agreement over the Company's assets and all license agreement rights.

10

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

10. Capital Stock

Authorized

Unlimited number of common shares

Unlimited number of Class "A" special shares

Unlimited number of Class "B" special shares

Unlimited number of Class "C" special shares

Unlimited number of Class "D" special shares

		2006
Issued and Outstanding
130,000 (2005: 102,000) shares of common stock, which hold no par value	$	90

During the period, the Company issued 28,000 shares for proceeds of $25.

11. Income Taxes

The Company's current income taxes are as follows:

		2006		2005
Expected income tax recovery at the statutory rates
of 18% (2005 - 18%)	$	47,278	$	43,875
Valuation allowance		(47,278)		(43,875)
Provision for income taxes	$	-	$	-

The Company has deferred income tax assets as follows:

		2006
Deferred Income Tax Assets
Loss carry-forwards	$	124,768
Valuation allowance for deferred income tax assets		(124,768)
Deferred income taxes	$	-

11

AMERICAS WIND ENERGY INC.

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements

April 30, 2006 and 2005

(Unaudited)

11. Income Taxes (cont'd)

The Company has net operating loss carryforwards available to be applied against future years income. Due to the losses incurred in the current year and expected future operating results, it is more likely than not that the deferred tax asset resulting from the tax losses available for carry forward will not be realized through the reduction of future income tax payments. Accordingly a 100% valuation allowance has been recorded for deferred income tax assets.

As of April 30, 2006 and July 31, 2005, the Company had approximately $693,160 and $430,506 respectively, of federal and state net operating loss carryforwards available to offset future taxable income, such carryovers expire in various years through 2013.

12. Commitments and Contingencies

The Company has committed under a license agreement to pay to EWT a royalty of 3% of related sales and 40% of any royalties received by the Company from its sub-licensees.

13. Subsequent Events

On May 11, 2005, the Company entered into a license agreement with GE Power Technology LLC ("GEPT") to obtain certain licenses under GEPT's patents. The Company has agreed under this license agreement to pay GEPT a royalty equal to $32,500 per megawatt for each sale or shipment of portion thereof of a licensed product.

14. Comparative Figures

Certain figures for the prior year have been reclassified to conform with the current year's financial statement presentation.

SCHEDULE"E"

LIST OF ASSETS OF AMERICAS WIND ENERGY INC.

				2005		2004
ASSETS (audited)
Current Assets
Cash			$	35,179	$	6,603
Accounts receivable and other				33		101,182
Goods and Services Tax receivable				20,018		4,880
Total Current Assets				55,230		112,665
Investment in Emergya Wind Technologies B.V. (note 3)				737,916		-
Advances to Emergya Wind Technologies B.V. (note 3)				-		748,092
Equipment, Net (note 4)				7,479		9,838
Intangible Asset (note 5)				1,780,385		1,639,375
Total Assets			$	2,581,010	$	2,509,970
	3.	Investment in and Advances to Emergya Wind Technologies B.V.

In fiscal 2004, the Company entered into a loan agreement with Emergya Wind Technologies B.V. ("EWT"). Pursuant to the agreement, the loan was to be converted into common shares of EWT. The loan carried an interest rate of 5% per annum, to be paid at time of conversion. On July 20, 2005, the Company converted the outstanding loan balance of $739,542 into 923 common shares of EWT, representing a 31.2% ownership interest. Accordingly, the Company recorded an investment in EWT of $737,916 at July 31, 2005. At May 29, 2006 the investment represented a 16.72% ownership interest. The $1,626 difference between the date of conversion and reporting date is the result of the exchange fluctuation.

4. Equipment, Net

		2005 Accumulated Cost Depreciation				2004 Accumulated Cost Depreciation
Computer equipment	$	12,570	$	5,091	$	11,563	$	1,725
Net carrying amount			$	7,479			$	9,838

The accumulated depreciation for both 2005 and 2005 include the exchange translation effects.

Page 1 of 3

5. Intangible Asset

On April 23, 2004, the Company entered into a license agreement with EWT to obtain the North American intellectual property rights and know-how relating to EWT's medium capacity wind turbines, for an indefinite period of time. The license fee was EUR 1,350,000 and the license was measured at $1,601,670, the fair value at the date the licensing agreement was entered into. The asset is not amortized due to the indefinite life term of the agreement. There is no assessed impairment noted.

AWE Assets

9 months 2006 (unaudited)

(period ending April 30, 2006)

Current Assets
Cash	$	95,167
Loan receivable		45,584
GST Receivable		18,744
Total Current Assets		159,495
Investment in Emergya Wind Technologies B.V. (note 3)		809,006
Equipment, Net (note 4)		137,711
Intangible Asset (note 5)		1,951,906
Total Assets	$	3,058,118

3. Investment in and Advances to Emergya Wind Technologies B.V.

In fiscal 2004, the Company entered into a loan agreement with Emergya Wind Technologies B.V. ("EWT"). Pursuant to the agreement, the loan was to be converted into common shares of EWT. The loan carried an interest rate of 5% per annum, to be paid at time of conversion. On July 20, 2005, the Company converted the outstanding loan balance of $739,542 into 923 common shares of EWT, representing a 31.2% ownership interest. Accordingly, the Company recorded an investment in EWT of $809,006 at April 30, 2006. At July 12, 2006 the investment represented a 16.72% ownership interest. The $71,091 difference between the date of conversion and reporting date is the result of the exchange fluctuations.

Page 2 of 3

4. Equipment, Net

Equipment is comprised as follows:

				2006 Accumulated Cost Depreciation
Computer Equipment			$	13,781	$	7,427
Computer Software				4,720		1,770
Manufacturing Equipment				138,818		10,411
Total Capital Assets			$	157,319	$	19,608
Net carrying amount					$	137,711
	5.	Intangible Asset

On April 23, 2004, the Company entered into a license agreement with EWT to obtain the North American intellectual property rights and know-how relating to EWT's medium capacity wind turbines, for an indefinite period of time. The license fee was EUR 1,350,000 and the license was measured at the fair value at the date the licensing agreement was entered into. At April 30, the license was $1,951,906. The asset is not amortized due to the indefinite life term of the agreement.

Page 3 of 3

SCHEDULE"F"

CONTINUING CONTRACTUAL OBLIGATIONS OF

AMERICAS WIND ENERGY INC.

1.	On April 23, 2004, Americas Wind Energy Inc. (“AWE”) entered into a license agreement with Emergya Wind Technologies B.V. (“EWT”), wherby AWE agreed to obtain the North American intellectual property rights and know-how relating to EWT’s medium capacity wind turbines, for an indefinite period of time, in consideration of a license fee equal to EUR 1,350,000.
2.	On May 11, 2005, Americas Wind Energy Inc. (“AWE”) entered into a license agreement with GE Power Technology LLC (“GEPT”), whereby AWE agreed to obtain certain licenses under GEPT’s patents in consideration of a royalty equal to $32,500 per megawatt for each sale or shipment or portion thereof of a licensed product.
3.	On September 19, 2005, Americas Wind Energy Inc. (“AWE”) entered into a consulting agreement with Equitis, whereby AWE agreed to obtain certain consulting services in connection with a financing (the “Financing”) of the transaction with Northwest Passage Ventures Ltd. in consideration of (i) the payment of 6.5% of net proceeds of the Financing upon receipt of funds, and (ii) an option to acquire shares in AWE equal to 10% of the shares issued pursuant to the Financing on the same terms as the Financing.
4.	Loan from Digital Predictive Systems Inc. maturing on October 12, 2006.

SCHEDULE"G"

NORTHWEST PASSAGE VENTURES LTD. – OUTSTANDING LITIGATION

None.

SCHEDULE"H"

OUTSTANDING RIGHTS TO ACQUIRE SHARES OF

NORTHWEST PASSAGE VENTURES LTD.

None.

SCHEDULE"I"

FINANCIAL STATEMENTS OF NORTHWEST PASSAGE VENTURES LTD.

NORTHWEST PASSAGE VENTURES, LTD.

(Development Stage Company)

BALANCE SHEETS

March 31, 2006 and June 30, 2005

		(Unaudited)
		Mar 31, 2006		Jun 30, 2005
ASSETS
CURRENT ASSETS
Cash	$	336	$	6,024
Total Current Assets	$	336	$	6,024
LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES
Accounts payable-related party loan	$	766	$	-
Total Current Liabilities	$	766	$	-
STOCKHOLDERS' EQUITY
Common stock
100,000,000 shares authorized at $.0001 par value; 57,545,143 shares issued and outstanding		5,754		9,668
Capital in excess of par value		98,996		95,082
Deficit accumulated during development stage		(105,180)		(98,726)
Total Stockholders' Equity		(430)		6,024
	$	336	$	6,024

The accompanying notes are an integral part of these financial statements.

- 1 –

NORTHWEST PASSAGE VENTURES, LTD.

(Development Stage Company)

STATEMENTS OF OPERATIONS - (unaudited)

For the Three and Nine Months Ended March 31, 2006, and 2005,

and the Period August 22, 2003, (date of inception) to March 31, 2006

	Three Months				Nine Months
		Mar 31, 2006		Mar 31, 2005		Mar 31, 2006		Mar 31, 2005		Aug 22, 2003 to Mar 31, 2006
REVENUES	$	-	$	-	$	-	$	-	$	-
EXPENSES
Administrative		536		2,430		6,454		83,406		105,180
NET OPERATING LOSS	$	(536)	$	(2,430)	$	(6,454)	$	(83,406)	$	(105,180)
LOSS PER COMMON SHARE
Basic and diluted	$	-	$	-	$	-	$	-	$	-
AVERAGE OUTSTANDING SHARES – stated in 1,000’s
Basic		57,545		57,545		57,545		57,545

The accompanying notes are an integral part of these financial statements.

- 2 –

NORTHWEST PASSAGE VENTURES LTD.

(Development Stage Company)

STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

Period August 22, 2003, (date of inception) to March 31, 2006

	Common Stock				Capital in Excess of Par Value		Accumulated Deficit
	Shares		Amount
Balance August 22, 2003 (date of inception)	-	$	-	$	-	$	-
Issuance of common stock for cash – August 22, 2003	76,680,000		7,668		(7,268)		-
Issuance of common stock for cash – June, 2004	20,003,895		2,000		102,350		-
Net operating loss for the period August 22, 2003 to June 30, 2004	-		-		-		(14,848)
Net operating loss for the period August 22, 2003 to June 30, 2005	-		-		-		(83,878)
Balance, June 30, 2005	96,683,895		9,668		95,082	$	(98,726)
Return and cancellation of Common shares	39,138,752		(3,914)		3,914		-
Net operating loss for the nine months ended March 31, 2006	-		-		-		-
Balance March 31, 2006	57,545,143	$	5,754	$	98,996	$	(105,180)

The accompanying notes are an integral part of these financial statements.

- 3 –

NORTHWEST PASSAGE VENTURES, LTD.

(Development Stage Company)

STATEMENT OF CASH FLOWS - (unaudited)

For the Nine Months Ended March 31, 2006, and 2005,

and the Period August 22, 2003, (date of inception) to March 31, 2006

	Nine Months Ended March 31					Inception to Mar 31, 2006
		2006		2005
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss		(6,454)		(83,406)		(105,180)
Adjustments to reconcile net loss to net cash provided by operating activities:
Change in accounts payable				(2,530)
Net Cash used in Operations		(6,454)		(85,936)		(105,180)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from issuance of common stock		-		-		104,750
Proceeds from related party loan		766		-		766
Increase (Decrease) in Cash		(5,688)		(85,936)		336
Cash at Beginning of Period		6,024		93,135		-
Cash at End of Period	$	336	$	7,199	$	336

The accompanying notes are an integral part of these financial statements.

- 4 –

NORTHWEST PASSAGE VENTURES, LTD.

(Development Stage Company)

Notes to Financial Statements

March 31, 2006

1. ORGANIZATION

The Company was incorporated under the laws of the State of Nevada on August 22, 2003, with authorized common stock of 100,000,000 shares at a par value of $.0001. The Company was organized for the purpose of establishing a marine adventure tourism business.

The Company has not started operations and is in the development stage.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Accounting Methods

The Company recognizes income and expenses based on the accrual method of accounting.

Dividend Policy

The Company has not yet adopted a policy regarding payment of dividends.

Earnings (Loss) Per Share

Basic net income (loss) per share amounts are computed based on the weighted average number of shares actually outstanding. Diluted net income (loss) per share amounts are computed using the weighted average number of common shares and common equivalent shares outstanding as if shares had been

issued on the exercise of any common share rights unless the exercise becomes antidilutive and then only the basic per share amounts are shown in the report.

Estimates and Assumptions

Management uses estimates and assumptions in preparing financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of the assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could vary from the estimates that were assumed in preparing these financial statements.

Financial Instruments

The carrying amounts of financial instruments, including cash and accounts payable, are considered by management to be their estimated fair values due to their short term maturities.

- 5 –

NORTHWEST PASSAGE VENTURES, LTD.

(Development Stage Company)

Notes to Financial Statements (Continued)

March 31, 2006

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Income Taxes

The Company utilizes the liability method of accounting for income taxes. Under the liability method deferred tax assets and liabilities are determined based on the differences between financial reporting and the tax bases of the assets and liabilities and are measured using the enacted tax rates and laws that will

be in effect, when the differences are expected to reverse. An allowance against deferred tax assets is recorded, when it is more likely than not, that such tax benefits will not be realized.

On March 31, 2006, the Company had a net operating loss available for carry forward of $105,180. The tax benefit of approximately $32,000 from the carry forwards have been fully offset by a valuation

reserve because the use of the future tax benefit is undeterminable since the Company has not started operations. The loss carryover will expire in 2026.

Financial and Concentrations Risk

The Company does not have any concentration or related financial credit risk.

Revenue Recognition

Revenue will be recognized on the sale and delivery of a product or the completion of a service provided.

Advertising and Market Development

The company will expense advertising and market development costs as incurred.

Recent Accounting Pronouncements

The Company does not expect that the adoption of other recent accounting pronouncements will have a material impact on its financial statements.

- 6 -

NORTHWEST PASSAGE VENTURES, LTD.

(Development Stage Company)

Notes to Financial Statements (Continued)

March 31, 2006

3. COMMON CAPITAL STOCK

On August 22, 2003, the Company completed a private placement offering of 76,680,000 post-split common shares for $400 and during June, 2004, a registered offering of 20,003,895 post-split common shares for $104,350.

On June 4, 2005, the Company completed a forward stock split of six shares for each outstanding share.

On October 14, 2005, the Company completed a forward stock split of 3.195 shares for each outstanding share as part of the return and cancellation of 39,138,752 post-split shares.

This report has been prepared showing post split shares from inception.

4. SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES

Officer's-director's have acquired 65.2% of the outstanding capital stock.

The Company was organized for the purpose of establishing a marine adventure tourism business and for this purpose has leased a 34 foot Sunseeker vessel from a related party. The terms of the lease includes a daily charter fee of $500 plus all operating and maintenance expenses. The duration of the lease is month to month and can be cancelled with a 30-day notice.

FINANCIAL STATEMENTS

The accompanying balance sheets of Northwest Passage Ventures, Ltd. at March 31, 2006, and June 30 2005, and the statements of operations for the three and nine months ended March 31, 2006 and 2005, and the cash flows for the nine months ended March 31, 2006 and 2005, have been prepared by the Company’s management and they include all information and notes to the financial statements necessary for a complete presentation of the financial position, results of operations, and cash flows in conformity with accounting principles generally accepted in the United States of America. In the opinion of management, all adjustments considered necessary for a fair presentation of the results and financial position have been included and all such adjustments are of a normal recurring nature.

Operating results for the nine months ended March 31, 2006 are not necessarily indicative of the results that can be expected for the year ending June 30, 2006.

- 7 –

SCHEDULE"J"

LIST OF ASSETS OF NORTHWEST PASSAGE VENTURES LTD.

None.

SCHEDULE"K"

CONTINUING CONTRACTUAL OBLIGATIONS OF 6544797 CANADA LTD. AND NORTHWEST PASSAGE VENTURES LTD.

None.

EX-3

EX-10

EX-10

CONFIDENTIAL

LICENSE AGREEMENT

BETWEEN

EMERGYA WIND TECHNOLOGIES B.V.

AND

AMERICAS WIND ENERGY INC.

April 2004

License Agreement EWT – AWE

CONFIDENTIAL

LICENSE AGREEMENT  

Agreement dated April 23, 2004 and signed by the parties hereto at the place(s) and on the date(s) mentioned below their signatures, entered by and among:

EMERGYA WIND TECHNOLOGIES B.V. (EWT), a private company with limited liability organised under the laws of the Netherlands, having its corporate seat at Hoofddorp, the Netherlands, hereinafter referred to as “EWT” and “Licensor”

AMERICAS WIND ENERGY INC. (AWE), a company registered under the laws of Ontario, Canada with its registered office at 24 Palace Arch Drive, Toronto, Ontario, Canada, hereinafter referred to as “AWE” and “Licensee”

EWT and AWE are collectively referred to as “Parties” and individually as “Party”.

RECITALS

A. EWT is engaged in the design, manufacture, sale, installation and maintenance of wind turbines and is the owner of intellectual property rights and know-how related to Wind Turbines.

B. AWE is an operating company with a mandate to become a major force in the manufacturing and marketing of wind turbines in the Americas;

C. Licensee and Licensor have accepted to enter into a license agreement with respect to the use of the intellectual property rights and know-how relating to Licensor’s Medium Capacity Wind Turbines in the size range of 600kW – 1MW, including all developments relating hereto in order to enable Licensee to produce these wind turbines and sell these turbines in the territories as set forth in this Agreement;

D. Licensor has agreed to grant Licensee a license under the terms and conditions as set forth in this License Agreement.

NOW THIS AGREEMENT WITNESSETH AND IT IS MUTUALLY AGREED BY AND BETWEEN THE PARTIES TO THIS AGREEMENT AS FOLLOWS:

Unless the context requires otherwise, the following terms and expressions in this License Agreement shall have the following meanings:

Article 1 - Definitions

Building Blocks:	Components and sub-assemblies used in the Goods and which will eventually be manufactured locally by or under supervision of Licensor, but which initially will be supplied by Licensor
Copyrights:	The copyrights for all countries in the world that are owned or will be owned by Licensor, which in whole or in part relate to the Goods, including but not limited to specifications, manuals, drawings, the design of the Goods, software and commercial material;
Converter	The specifications and schematic diagrams of the converter of the subject wind turbines and all Know How related thereto.

1

License Agreement EWT – AWE

CONFIDENTIAL

Database Rights:	The database rights that are owned or will be owned by Licensor, which in whole or in part relate to the Goods, including but not limited to test data;
Designs:	The design and model rights that are owned or will be owned by Licensor;
Effective Date:	Date of signature of this agreement April 23, 2004:
Exclusive Rights Territory	Canada, United States of America Mexico and territories
GE Variable Speed Wind Turbine Patent	US Patent 5,083,039, Richardson et. al. January 21, 1992, registered in Canada under patent number 2100672.
Goods:	The Medium Capacity Wind Turbines of Licensor, including but not limited to the LW50, LW52 and LW58 wind turbines and all related developments;
IPR (Intellectual Property Rights):	The Trademarks, Patents, Copyrights, Designs and Database rights relating to the Medium Capacity Wind turbines;
Know-how:	All factual knowledge and expertise which has been accumulated by and is in the possession of and is confidential to Licensor and which is related to applications developed using the IPR but which is not protected by IPR. Without limiting the foregoing “Know-how" shall include product data information consisting of technical descriptions of the Goods sufficient to allow consistent duplication of the Goods. This includes engineering drawings, bills of materials, process descriptions and any other documents that define the physical geometry, material composition, performance characteristics and assembly and acceptance procedures; technical descriptions, manufacturing process, associated tooling procurement and quality assurance requirements necessary to manufacture duplicates of the Goods in addition to the principles of operation for the Goods;
License Agreement:	This license agreement including the annexes thereto;
License Period:	The period that commences on the Effective Date and is indefinite thereafter;
Licensor Affiliated Company:	A company that is in the same business as Licensor and in which Licensor holds 50% or more of the shares.
Medium Capacity Wind Turbines:	Wind Turbines in the size range of 600 kW – 1 MW ;
Non-Exclusive Rights Territory:	Central and South America, the Caribbean;
Parties:	Licensor and Licensee;

2

License Agreement EWT – AWE

CONFIDENTIAL

Territories:	The Exclusive Rights Territory and the Non-Exclusive Rights Territory.
Trademark:	The trademarks, including applications and filings for trademarks, owned by or which will be owned by Licensor which in whole or in part relate to the Goods;

Article 2 – License granted

2.1 Licensor grants to Licensee for the duration of the License Period, starting April 23, 2004 with an indefinite period of time thereafter and under the obligation of fulfilment of the terms and conditions as set forth in the License Agreement, the exclusive right to use the IPR and Know-how in the Exclusive Rights Territory but only on or in relation to the Goods.

2.2 Licensee recognises that Licensor is the owner of the IPR and Know-how world-wide, and agrees that also in the Territories the IPR and Know-how shall remain vested solely in Licensor both during the License Period and thereafter and Licensee agrees never to challenge the ownership of the IPR and Know-how or any other intellectual property rights of Licensor or a Licensor Affiliated Company or that the use thereof by Licensee is on behalf of Licensor as a licensee.

2.3 Licensee shall not use any other intellectual property rights owned by Licensor or Licensor Affiliated Companies, unless provided for in this License Agreement or a separate license agreement.

2.4 Licensee shall not record this license or any other intellectual property rights related to the business of Licensor or its affiliates, in any register for intellectual property rights without prior written consent of Licensor, not to be unreasonably refused or delayed.

2.5 Licensor, at Licensor's discretion, shall have the right to record the existence of this license, or to enter Licensee as a registered user in the Territories at the costs of Licensor. Licensee agrees to co-operate as requested by Licensor, in arranging for such recordings and/or entries, or in varying or cancelling such recordings and/or entries in the event of amendments to, or termination of the License Agreement for any reason.

2.6 Licensee shall not use the Trademarks in any way, which materially harm the reputation of and/or the goodwill attached to the Trademarks.

2.7 If under the laws of the Territory, a registration of any trademark, trade name and/or trade symbol of Licensor is required, such registration shall be made in the name and at the expense of Licensor. Should for whichever reason Licensee have obtained a registration in its own name, Licensee shall immediately inform Licensor in writing and Licensee shall transfer that registration free of charge to Licensor at its first request, provided that Licensor shall have refunded the registration fee and the cost of transfer to Licensee.

2.8 Licensee shall under no circumstances permit the Trademarks, any other trademark, trade name and/or trade symbol, owned by Licensor or its affiliated companies, to become generic descriptions.

2.9 Licensee agrees to mark the Goods in a manner which conforms with the trademark laws applicable and practice in the countries in the Territories with respect to trademark notices or other matters relating to trademark ownership,

3

License Agreement EWT – AWE

CONFIDENTIAL

license and infringement. More specifically Licensee will mark the Goods and advertising or promotional material relating thereto with the designation:

“Made under license of EWT B.V. - all rights reserved.”

2.10. Licensee shall co-operate with Licensor and use its best endeavours to advance the Patents, of which an application is still pending, to disposition at the cost of Licensor.

2.11 Licensee agrees to mark the Goods in a manner which is in conformity with the copyright laws applicable and practice in the Territory with respect to copyright notices or other matters relating to copyright ownership, license and infringement. Licensee will mark the Goods and advertising or promotional material relating thereto with the designation:

“© [year of first publication], EWT B.V., the Netherlands / Made under license of EWT B.V.

2.12.    Licensee shall not sell or offer the Goods to agents that operate in other Territories than specified herein as Exclusive or Non-Exclusive Territories unless agreed with Licensor.

Article 3 – Know-how  

3.1 Licensor grants to Licensee for the duration of the License Period and under the obligation of fulfilment of the terms and conditions as set forth in the License Agreement, the exclusive right to use the Know-how in relation to the production and sales of the Goods in the Exclusive Rights Territory.

3.2 Licensee shall not obtain or attempt to obtain and shall ensure that its affiliates shall not obtain or attempt to obtain any protection of the Know-how or part thereof, in its own name or in the name of its affiliates pursuant to any intellectual property law or act without Licensor's prior written consent.

3.3 Licensee acknowledges that the Know-how is not in the public domain, unless proof to the contrary is provided by Licensee in accordance with Article 3.5 under (a), or (b) hereof.

3.4 Licensee agrees to keep the Know-how in confidence and not to disclose any part thereof to any third party during the License Period as well as thereafter. Licensee may disclose the Know-how or a part thereof to its employees having a need to know, provided that Licensee has imposed secrecy and non-use obligations similar to the secrecy and non-use obligations included in this License Agreement on these employees. Licensee shall use its best endeavours to prevent that its employees and former employees use the Know-how or any part thereof unless such use is allowed under the terms of this License Agreement. Furthermore Licensee may, after having obtained prior written approval from Licensor, disclose the Know-how or a part thereof to its advisors and/or agents having a need to know. A condition for granting such an approval may be that Licensor will require this advisor and/or agent to enter into a secrecy and non-use agreement.

3.5 The restriction upon disclosure of the Know-how mentioned under Article 3.4 shall not apply to any part of the information comprising the Know-how which:

(a) Licensee proves to be, or at any time to have come, into the public domain otherwise than through default on the part of Licensee;

(b) Licensee proves to have lawfully acquired from a third party with good

4

License Agreement EWT – AWE

CONFIDENTIAL

legal title thereto;

3.6 The restriction upon disclosure of the Know-how does neither apply in case Licensee is compelled to disclose Know-how or part thereof by a legally binding order of any court of law, government agency or regulatory or statutory authority, which has competent jurisdiction. In such a case, Licensee shall consult with Licensor as quickly as possible to avoid or limit such disclosure as far as reasonably possible.

3.7 Any infringement of the secrecy and/or non-use obligation by the personnel, agent and/or advisor of Licensee shall be considered as an infringement of secrecy and/or non-use obligation of Licensee and Licensee shall be liable for any damages resulting therefrom.

3.8 The provisions of Article 3 shall at all times survive any termination or other ending, of the License Agreement.

Article 4 – Maintenance, Improvements and New Products

4.1 Licensor has the obligation to upkeep and to maintain through regular updates and upgrades and improvements the Goods such that the Goods will be saleable.

4.2 If Licensee makes any improvement to the Know-how it shall promptly disclose this

improvement to Licensor. Such improvement shall be considered to form an integral part of the Know-how fully and solely owned by Licensor and such improvements shall be deemed to be included under the license as granted herein.

4.3 If Licensor makes any improvement to the Know-how it shall promptly disclose this improvement to Licensee. Such improvement shall be considered to form an integral part of the Know-how fully and solely owned by Licensor and such improvements shall be deemed to be included under the license as granted herein.

4.4 If any such improvement is patentable or can be protected through any other intellectual property law, Licensor shall have the right to apply for and obtain patent or other protection in respect thereof and Licensee shall receive a license under such patent or other intellectual property right following this License Agreement.

4.5 New products, which can be defined as Medium Capacity Wind Turbines automatically form part of the license under this Agreement. For new products developed by Licensor outside the scope of Medium Capacity Wind Turbines, Licensee has the first right to negotiate the terms and conditions for obtaining a license thereon for the Territory.

4.6 Licensee and Licensor will have to agree on a separate license for any product with a capacity of more than 1 MW. Licensee will have a right of first refusal on any new technology with a capacity of higher that 1 MW that Licensor will develop or acquire.

Article 5 – License Fee

5.1 Licensee shall pay a license fee of EUR 1,350,000 (Euro One million and three hundred fifty thousand).

5.2 The license fee is payable as follows:

• In the form of 7.00 % of Net Sales Price until the License Fee will be fully paid. Thereafter the royalty fees specified under article 6 will start.

5

License Agreement EWT – AWE

CONFIDENTIAL

5.3 Licensor will pay the balance of the License Fee by 31-12-2005 if not sufficient License Fees will have been aggregated until that date.

5.4 Any (withholding) taxes payable in the country of Licensor shall be paid by Licensor and Licensee shall receive the above mentioned license fee without any deductions in the form of tax, bank charges or otherwise.

5.5 Licensee shall pay Licensor in addition to the above mentioned license fee 40% of the license fee that Licensee receives from its sub-licensees. Such sub-license fees shall be paid to Licensor within ten days of receipt by Licensee of the sub-license fee from it’s sub-licensee.

Article 6 - Royalty  

6.1 Royalty under this Agreement shall be paid by Licensee to Licensor at the rate of 3.00% (Three percent). Royalty is payable for sales of the Goods manufactured by or on behalf of Licensee under this Agreement and shall be calculated on the sales price of the Goods. License Fees will be calculated and paid in the same way.

6.2 The royalty thus payable by Licensee shall be paid quarterly and within thirty days from the end of each quarter unless otherwise agreed between the parties.

6.3 Licensee shall pay Licensor in addition to the above mentioned royalties 40% of the royalties that Licensee receives from its sub-licensees. These sub-license royalties shall be paid to Licensor on the same terms as the main license royalties.

6.4 Licensee may temporary suspend payments of royalties if Licensor fails to provide the technical and commercial support as provided for in Article 10 of this Agreement and after giving at least 30 (thirty) days’ notice to Licensor of such intended suspension of payments. The (intended) suspension of payment shall be withdrawn immediately upon Licensor resuming technical and commercial support as provided for in this Agreement.

Article 7 - License Period, Extension and Termination

7.1 In case, as a consequence of article 5.3, Licensee will be in default of the agreed payment obligation with respect to the License Fee, Licensor shall have the right to terminate this Agreement. If for reasons beyond the control of Licensee a delay in payments will occur, this will not trigger the default situation.

7.2 The rights granted herein for the Non-Exclusive Rights Territory are of a temporary nature and will automatically terminate if and when Licensor enters into license or other agreements with a party or parties in the Non-Exclusive Rights Territory or part thereof, provided that Licensee shall retain the right to execute agreements already in effect at the date of termination and retain non-exclusive rights in the Non Exclusive Rights Territory under the same conditions for those parts of the Non Exclusive Territory for which Licensor has not entered into a license or other agreements with a party or parties. Parties will discuss the licenses in the Non-Exclusive Rights Territory prior to granting Exclusive Rights for that territory.

6

License Agreement EWT – AWE

CONFIDENTIAL

7.3 Licensor may, without prejudice to its right for damages, terminate the License Agreement with immediate effect by giving written notice to Licensee in the event that

(a) Licensee is in material default (which includes non-payment of royalties) or has failed to repair such default, either within 90 days for non-payment of royalties or within 45 days or other material default after Licensor has given written notice of its intention to terminate the license in writing, except in case Licensee is unable to repair such default within said 45 days or Licensee shall have informed Licensor in writing, supported with a detailed repair plan including a motivated fixed period for which the default shall be repaired. Failure to repair such default within the fixed period shall reinforce the rights of Licensor as defined herein;

7.4 Licensee may terminate the License Agreement by giving written notice to Licensor

in the event that Licensor fails to provide the technical and commercial support as provided for in Article 10 of this Agreement. Such termination notice shall be withdrawn as soon as Licensor resumes the technical and commercial support as provided for in Article 10 of this Agreement.

Article 8 – Warranties  

8.1 Licensor warrants that to the best of its knowledge the use of the IPR and the Know-how as intended through this License Agreement, does not infringe upon the rights of third parties.

8.2 Licensor warrants that to the best of its knowledge the IPR are valid, maintained and enforceable towards third parties in the Territory and that the IPR shall be properly maintained during the License Period.

8.3 Licensor warrants that the Goods will be able to produce as per the Power Curves and availability as far as determined by the design provided and specified by Licensor for each turbine if the Goods are manufactured and installed as per the relevant drawings and specifications and under strict quality control by Licensee at both the manufacturing and installation stages.

8.4 Licensor will undertake all necessary activities in relation to the certification of modifications that may be required in order to comply with safety regulations in the Exclusive Rights Territory without undue delay.

8.5 Licensee has conducted extensive due diligence on the Know How, IPR and the Goods and enters into this Agreement on the basis of such due diligence.

8.6 Licensee is aware of the GE Variable Speed Wind Turbine Patent and therefore Licensee will complete the development of a suitable converter that will not infringe on this patent. This converter will also be made available to Licensor at terms to be agreed.

8.7. Any suppliers of Building Blocks that Licensee will use as local sources will be

qualified according the guidelines issued by Licensor.

Article 9 - Liability and Product Liability

9.1 Licensee shall hold Licensor harmless against any claim by any third party related to

7

License Agreement EWT – AWE

CONFIDENTIAL

the manufacture, sale and/or delivery of the Goods by Licensee, unless and to the extent that any such claim arises from a defect in the IPR and/or Know-how for which Licensor will be liable. Any such claim shall include but is not limited to claims, costs and liabilities that are based upon or arise in connection with (i) articles 6:162 or articles 6:185-193 of the Netherlands Civil Code or (ii) any similar statutory provisions which have been enacted in a Member State of the European Union other than the Netherlands as a result of the implementation of the Council Directive of 25 July 1985 concerning liability for defective products (85/374/EEC), or (iii) any similar statutory provisions of the laws of any other jurisdiction.

Licensee will be liable for any damage Licensor suffers in relation to any such claim, including but not limited to attorney fees and all other legal costs and expenses.

9.2 Licensee shall be obliged to conclude and maintain an effective and sufficient product liability insurance for the duration of this License Agreement as normally available on the insurance market.

Article 10 – Technical and Commercial Support

10.1 Licensee undertakes to acquire all required technical and commercial skills to enable the manufacture and selling of the Goods in the Territories independently during the Training Period. To help Licensee acquire the necessary technical and commercial skills Licensor undertakes to provide Licensee technical and commercial support during the Training Period on the following terms and conditions. Licensee will start to build an appropriate organisation with Sales and Support functions immediately after the Effective Date.

10.2 Technical support will be given for the interpretation of drawings and specifications, installation, service and maintenance procedures and practices and the technical part of tenders and quotations. Licensor will provide the first thirty man-days of technical support free of charge and on a yearly basis five (5) man-days in case of improvements referred to in Article 4. Further man-days will be charged at hour rates to be agreed between the parties.

10.3 Commercial support will be given for the preparation of price lists, the commercial parts of tenders and quotations and other commercially relevant activities. Licensor will provide the first thirty man-days of commercial support free of charge and on an yearly basis five (5) man-days in case of improvements referred to in Article 4. Further man-days will be charged at hour rates to be agreed between the parties.

10.4 Licensee shall advise Licensor well in advance with regard to the type of technical and commercial support required and the location, duration and time schedule of such support in order to arrive at a mutually convenient and effective method of working.

10.5 Licensee shall pay for all travel, accommodation and other out-of-pocket expenses in relation to the technical and commercial support activities.

10.6 Licensor agrees to provide Licensee with a cold-weather specification within 6 (six) months from the Effective Date.

Article 11 – Product Certification

11.1 Licensee must obtain any product safety or other statutory certificates in

8

License Agreement EWT – AWE

CONFIDENTIAL

consultation with Licensor, who shall be informed as soon as Licensee becomes aware of any requirement for product safety and or other statutory certificates.

11.2 Licensee shall bear the cost of obtaining the necessary product safety and other statutory certificates as applicable in the Territories. Licensor shall co-ordinate such certification processes and render all necessary assistance to Licensee in this regard.

.

Article 12 – Purchase of Components and Spares

12.1 Licensor shall sell vendor supplied components and spares to Licensee during the period when the License Fee will being paid at an agreed price which shall be the cost price in the hands of Licensor and a mark-up 3.5% to cover costs incurred by Licensor in the procurement, storage and handling and QA of such components and spares.

Article 13 – Change of Ownership  

13.1 The management and shareholders of Licensee undertake not to sell a part or the whole of the ownership of Licensee’s company to a competitor of Licensor. The term “competitor” shall include a designer or manufacturer of Medium Capacity Wind Turbines.

13.2 If Licensor defaults or goes into suspension of payments or bankruptcy, Licensee will retain its’ rights under this License Agreement and will continue to pay royalty and license fees to the eventual receiver, trustee or buyer of Licensor’s Know-how, if such receiver, trustee or buyer undertakes to fulfil the obligations of Licensor herein. The Know-how will be maintained in escrow with the Notary and will be made available to Licensee if Licensor defaults, goes into bankruptcy or for any reason the eventual receiver, trustee or buyer does not make available the Know-how to Licensee for the normal conduct of Licensee’s business.

13.3 If Licensee goes into suspension of payments or bankruptcy or is sold to a party not approved by Licensor whereby such approval shall not be unreasonably withheld, all rights of Licensee or Licensee’s successor or buyer as provided herein terminate. Licensor may consider to extend such rights to a successor of Licensee approved by Licensor, provided such successor undertakes to fulfil all of Licensee’s obligations herein.

Article 14 - Business Confidence

14.1 The Parties undertake that they will not at any time disclose or use for any purpose detrimental or potentially detrimental to any of the Parties any confidential information concerning this License Agreement or any agreement resulting therefrom, or any other document provided pursuant to this License Agreement or any agreement resulting therefrom, or concerning the business and affairs of the Parties, except:

(a) to the extent required by law or any competent authority;

(b) to their professional advisers subject to a duty of confidentiality and only to

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the extent necessary for any lawful purpose; and

(c) to the extent that at the date hereof or hereafter such information is or shall become public knowledge otherwise than through improper disclosure by any person.

This Article shall survive any termination or any other ending, including but not limited to rescission, of this License Agreement.

Article 15 - Costs

15.1 Except as specifically provided otherwise herein, each Party shall bear its own costs in connection with the preparation, negotiation, signing or performance of this License Agreement.

Article 16 - Assignment/Transfer and Encumbrance

16.1 This License Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective successors, estates and, in the event of a permitted assignment or transfer, assignees or transferees.

16.2 Licensor may at any time (i) assign, transfer or encumber all or part of its rights under this Agreement, including the IPR and the Know-how, or (ii) transfer its legal relationship towards Licensee under this License Agreement, provided always that the rights of Licensee herein shall not be affected by such assignment, transfer or encumbrance by Licensor. In such an event, Licensee undertakes to execute all documentation necessary to effect the assignment, transfer or encumbrance expeditiously. The rights or legal relationship of Licensee hereunder may not be assigned, transferred or encumbered without the prior written consent of Licensor and such consent will not be unreasonably withheld.

16.3 Licensee shall not grant any sub-licenses in relation to the rights licensed under this License Agreement without the prior written consent of Licensor which consent may not be withheld on unreasonable grounds. In the event such consent is granted the text of the sub-license agreement between Licensee and its sub-licensee has to be approved by Licensor, prior to execution of such sub-license agreement. Licensee shall pay Licensor 40% of the revenue (of both license fees and royalties) received by Licensee from its sub-licensees. For the purpose of this Article, outsourcing of manufacture, not involving sub-licensing of know-how shall not be construed as the granting of a sub-license.

Article 17 - Force Majeure  

17.1 Neither Party shall be in default under the License Agreement by reason of its delay in the performance of or failure to perform any of its obligations herein if such delay or failure is caused by strikes, acts of God or the public enemy, riots, incendiaries, interference by civil or military authorities, compliance with governmental laws, rules, and regulations, delays in transit or delivery, inability to secure necessary governmental priorities for materials, or any fault beyond its control without its fault or negligence.

Article 18 - Interpretation

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18.1 Words imparting the singular shall include the plural and vice versa, where the context so requires.

18.2 References to the Parties shall include their respective successors in title, estates and, in the event of an assignment permitted under this License Agreement, assignees.

18.3 References to persons shall include natural persons and incorporated and unincorporated bodies, including associations and partnerships.

Article 19 - General

19.1 The failure of either Party hereto to enforce at any time or for any time any of its rights under the License Agreement shall not be construed to be a waiver thereof or of the right of such Party thereafter to enforce each and every provision of the License Agreement.

19.2 The License Agreement does not constitute and shall not be construed as constituting a partnership, agency, joint venture, or distribution agreement between Licensor and Licensee. Licensee shall have no right to obligate or bind Licensor in any manner whatsoever and nothing herein contained shall give or is intended to give any right of any kind to any third party.

19.3 In the event that a provision of the Agreement is invalid, not binding, or unenforceable (either in whole or in part), the remainder of the Agreement shall continue to be effective. The Parties shall make every effort to reach agreement on a new clause, which differs, as little as possible from the invalid, illegal, not binding or unenforceable provision, taking into account the substance and the purpose of the Agreement.

19.4 Licensor reserves the right to inspect at any time all documents, drawings, quality manuals and records, accounts, manufacturing facilities of Licensee or its suppliers in so far as these relate to transactions related to this License Agreement.

19.5 The titles and headings in this License Agreement are for structuring purposes and reference only.

19.6 The License Agreement constitutes and contains the entire agreement between the Parties with respect to the subject matter hereof and supersedes any prior or contemporaneous agreements, oral or written. The License Agreement may not be changed, modified, amended or supplemented, except in writing signed by the Parties.

19.7 This License Agreement has been drawn up in English. In the event of any discrepancy in this License Agreement between the English text and any translations thereof, the English language version shall prevail.

Article 20 - Governing Law / Competent Court

20.1 This License Agreement and any subsequent agreement shall be governed by and construed in accordance with the laws of the Netherlands.

20.2 Any dispute arising out of or in connection with the this License Agreement shall, if no amicable settlement can be reached through negotiations, be submitted to the competent Court in Middelburg, the Netherlands.

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IN WITNESS WHEREOF, this License Agreement has been signed and executed in two copies each of equal tenor and validity.

Emergya Wind Technologies B.V.	Americas Wind Energy
/s/ Gerry van der Sluys	/s/ Hal Dickout
Gerry van der Sluys	Hal Dickout
Director	Chief Executive Officer

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