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## (G) Capital Management 

The Corporation defines capital as the aggregate of long-term debt and shareholders' equity as follows: 

<img src='content_image/140484.jpg'>

(1) Capstone's definition excludes non-controlling interest of $138,613 (December 31, 2012 – $91,610). 

The Corporation manages its capital to achieve the following objectives: 

• Maintain a capital structure that provides financial flexibility to the Corporation to ensure access to either debt or equity capital on commercially reasonable terms, without exceeding its debt capacity; 

• Maintain financial flexibility in order to preserve its ability to meet financial obligations, including debt servicing payments and distribution payments; and 

• Deploy capital to provide an appropriate investment return to its shareholders. 

The Corporation's financial strategy is designed to maintain a capital structure consistent with the objectives stated above and to respond to changes in economic conditions. In doing so, the Corporation may issue additional shares, issue additional debt, issue debt to replace existing debt with similar or different characteristics, or adjust the amount of dividends paid to shareholders. 

The Corporation's financing and refinancing decisions are made on a specific transaction basis and depend on such things as the Corporation's needs and economic conditions at the time of the transaction. 

The Corporation is not subject to any external capital requirements and is in compliance with all debt covenants as described in note 19. 

## NOTE 22. NON-CONTROLLING INTERESTS 

## (A) Non-controlling Interests 

Non-controlling interests represent ownership interests by third parties in businesses consolidated by Capstone. Bristol Water, Amherst and Saint- Philémon non-controlling interests as at December 31, 2013 were: 

• Bristol Water is 30% owned by Agbar (Sociedad General de Aguas de Barcelona) ("Agbar"), a subsidiary of Suez Environnement and is 20% owned by I-Environment Investments Ltd., a subsidiary of ITOCHU Corporation ("ITOCHU"). 

• Amherst is 49% owned by Firelight Infrastructure Partners LP ("Firelight") 

• Saint-Philémon is 48.9% owned by Municipalité Régionale de Comté de Bellechasse and 0.1% owned by Municipalité de Saint-Philémon (the "Municipal partners") 

Capstone has agreements with each partner that govern distributions from these investments. In addition, distributions must also comply with the respective debt agreements. 

The balances and changes in non-controlling interests is as follows: 

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