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Monday, December 31, 2007 10:26:53 AM

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Railpower announces shareholder approval of $35 million investment by Ontario Teachers' Pension Plan
Last Update: 12/18/2007 11:37:12 AM

MONTREAL, Dec. 18, 2007 (Canada NewsWire via COMTEX) -- Railpower Technologies Corp. (P) today announced that its shareholders voted in favour of an investment of $35Â million by the Ontario Teachers' Pension Plan (OTPP), one of Canada's most prominent and well respected institutional investors. Shareholders approved all required resolutions by a show of hands at a special meeting held earlier today in Montreal with proxies received voting in excess of 97.5 per cent in favour of these resolutions. There are remaining conditions to be satisfied before the transaction closes.

"The board of directors was unanimous that this private placement was in the best interests of Railpower and recommended that shareholders approve the investment. I am happy to report that shareholders voted overwhelmingly in favour of this investment," said Norman Gish, Chairman of Railpower, adding that upon closing the company will have a strong financial partner to ensure its future growth and success.

"We appreciate the confidence that Teachers and shareholders have demonstrated by investing in our clean energy technology and its worldwide potential applications, said José Mathieu, President and Chief Executive Officer of Railpower. "We now turn to a new chapter with this investment, which will allow us to develop and market leading edge technologies that will meet and exceed North American environmental norms and satisfy customer expectations for greener technology applications."

The investment is a convertible debenture which will have a maturity date of five years from its date of issuance and will have an interest rate of 5% per annum, payable semi-annually in either cash or common shares, at the discretion of Railpower. The initial principal amount of the debenture will be convertible, at the election of the holder, in whole or in part, into either common shares or a new class of convertible restricted voting shares to be created by the Corporation, or any combination thereof, at a conversion ratio of $0.30 per share, representing up to 116,666,667 shares. The new class of convertible restricted voting shares will be convertible into common shares, at the option of the holder, on a one-for-one, share-for-share basis (subject to customary adjustments, including for subdivision or consolidation).

Following the approval by shareholders, Railpower believes to be in a position to satisfy all other closing conditions in order for a closing to occur on or about January 4, 2008.

At today's meeting, the creation of a new class of convertible restricted voting shares was also approved by the shareholders.

About Railpower

Railpower Technologies (P) develops, markets, produces and sells specialized, patented, environment-friendly technology systems for the transportation and related industries. Railpower's technologies significantly reduce fuel usage, operating and maintenance costs and emissions. While Railpower's origins are in the transportation industry, its technologies have broad potential and applications in other markets and industries. Railpower is headquartered in Brossard, Quebec. Its U.S. office is located in Erie, Pennsylvania. ( www.railpower.com )

About Ontario Teachers' Pension Plan

With $106 billion in net assets as of December 31, 2006, the Ontario Teachers' Pension Plan is the largest single-profession pension plan in Canada. An independent organization, it invests the pension fund's assets and administers the pensions of 271,000 active and retired teachers in Ontario. At year end, approximately 40 percent of the fund was invested in public equities. As a long-term investor in Canadian stocks, the Ontario Teachers' Pension Plan's public equities program features a Relationship Investing portfolio that includes large-scale strategic investments in public companies.

Caution regarding forward-looking statements

Certain statements contained in this release contain forward-looking statements. When used in this document, the words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions may be used to identify forward-looking statements. Those statements reflect our current views with respect to future events or conditions, including prospective results of operations, financial position, predictions of future actions, plans or strategies. Certain material factors and assumptions were applied in drawing our conclusions and making those forward looking statements. By their nature, those statements reflect management's current views, beliefs and assumptions and are subject to certain risks and uncertainties, known and unknown, including, without limitation, product development or manufacturing delays, changing environmental regulations, the ability to attract and retain business partners, the acceptance of our existing and new products, future levels of government funding, the need to obtain and maintain proprietary rights over our technology, competition from other technologies, the ability to access the capital required for research, product development, operations and marketing, the need to generate positive cash flow in the foreseeable future, changes in energy prices and currency levels. Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by these forward-looking statements. There can be no assurance that the Corporation will satisfy all conditions required to complete the private placement on or before January 31, 2008. Should one or more of these risks or uncertainties materialize, or should the assumptions underlying our projections or forward-looking statements prove incorrect, our actual results may vary materially from those described in this report as intended, planned, anticipated, believed, estimated, or expected. We do not intend and do not assume any obligation to update these forward-looking statements whether as a result of new information, plans, events or otherwise.

%SEDAR: 00016554EF


Mr. José Mathieu, President and CEO, Railpower Technologies Corp.,
(450)678-5277, ext. 501, Toll free: 1-866-678-5277, jmathieu@railpower.com
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