x |
QUARTERLY
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
o |
TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Oregon
|
91-1580146
|
(State
or Other Jurisdiction of
|
(I.R.S.
Employer
|
incorporation
or organization)
|
Identification
No)
|
(1)
|
Yes
|
x
|
No
|
(2)
|
Yes
|
x
|
No
|
Large
accelerated filer o
|
Accelerated
filer o
|
Non-accelerated
filer o
|
Smaller
reporting company x
|
As
at
31
October
2008
(Unaudited)
|
As
at
30
April
2008
(Audited)
|
|||||||
$
|
$
|
|||||||
Assets
|
||||||||
Current
|
||||||||
Cash
|
6,002 | 7,645 | ||||||
Prepaid
expenses
|
2,774 | 872 | ||||||
8,776 | 8,517 | |||||||
Liabilities
|
||||||||
Current
|
||||||||
Bank
indebtedness
|
- | 2,347 | ||||||
Accounts
payable and accrued liabilities
|
180,161 | 124,592 | ||||||
Due
to related parties (Note 3)
|
441,446 | 151,434 | ||||||
621,607 | 278,373 | |||||||
Stockholders’
deficiency
|
||||||||
Capital stock (Note
4)
|
||||||||
Authorized
|
||||||||
100,000,000
common shares, without par value
|
||||||||
Issued
and outstanding
|
||||||||
31
October 2008 – 27,949,824 common shares, without par value
|
||||||||
30
April 2008 – 27,926,824 common shares, without par value
|
6,856,694 | 6,834,547 | ||||||
Additional
paid-in capital
|
2,550,350 | 2,326,784 | ||||||
Donated capital (Note
3)
|
1,072,500 | 997,500 | ||||||
Deficit,
accumulated during the development stage
|
(11,092,375 | ) | (10,428,687 | ) | ||||
(612,831 | ) | (269,856 | ) | |||||
8,776 | 8,517 |
For
the period from the date of inception on 27 July 1992 to
31
October
2008
|
For
the
three
month period ended
31
October
2008
|
For
the
three
month period ended 31 October 2007
|
For
the
six
month
period
ended
31
October
2008
|
For
the
six
month period ended 31 October 2007
|
||||||||||||||||
$
|
$
|
$
|
$
|
$
|
||||||||||||||||
Expenses
|
||||||||||||||||||||
Amortization
|
130,533 | - | - | - | - | |||||||||||||||
General
and administrative
|
5,941,690 | 197,075 | 293,041 | 381,332 | 603,397 | |||||||||||||||
Stock-based
compensation
|
988,944 | 6,010 | 3,184 | 223,566 | 220,740 | |||||||||||||||
Impairment
loss
|
72,823 | - | - | - | - | |||||||||||||||
Research
and development
|
4,148,036 | 29,185 | 17,997 | 58,790 | 59,975 | |||||||||||||||
Net
loss before other item
|
(11,282,026 | ) | (232,270 | ) | (314,222 | ) | (663,688 | ) | (884,112 | ) | ||||||||||
Other
item
|
||||||||||||||||||||
Write-off
of accounts payable (Note 6)
|
189,651 | - | - | - | - | |||||||||||||||
Comprehensive
loss for the period
|
(11,092,375 | ) | (232,270 | ) | (314,222 | ) | (663,688 | ) | (884,112 | ) | ||||||||||
Basic
and diluted loss per common share
|
(0.01 | ) | (0.01 | ) | (0.02 | ) | (0.03 | ) | ||||||||||||
Weighted
average number of common shares used in per share
calculations
|
27,940,000 | 27,611,000 | 27,935,000 | 27,308,000 | ||||||||||||||||
For
the period from the date of inception on 27 July 1992 to
31
October
2008
|
For
the three
month
period ended
31
October
2008
|
For
the three
month
period ended
31
October
2007
|
For
the six
month
period ended
31
October
2008
|
For
the six
month
period ended
31
October
2007
|
||||||||||||||||
$
|
$
|
$
|
$
|
$
|
||||||||||||||||
Cash
flows used in operating activities
|
||||||||||||||||||||
Loss
for the period
|
(11,092,375 | ) | (232,270 | ) | (314,222 | ) | (663,688 | ) | (884,112 | ) | ||||||||||
Adjustments
to reconcile loss to net cash used by operating activities
|
||||||||||||||||||||
Write-off
of accounts payable
|
(189,651 | ) | - | - | - | - | ||||||||||||||
Amortization
|
130,533 | - | - | - | - | |||||||||||||||
Impairment
loss
|
72,823 | - | - | - | - | |||||||||||||||
Stock-based
compensation (Note 4)
|
988,944 | 6,010 | 3,184 | 223,566 | 220,740 | |||||||||||||||
Amortization
of deferred compensation
|
373,795 | - | - | - | - | |||||||||||||||
Donated
services (Note 3)
|
1,072,500 | 37,500 | 37,500 | 75,000 | 75,000 | |||||||||||||||
Write-off
of intellectual property
|
578,509 | - | - | - | - | |||||||||||||||
Shares
issued for services (Note 4)
|
98,100 | 8,850 | 18,350 | 14,700 | 24,200 | |||||||||||||||
Changes
in operating assets and liabilities
|
||||||||||||||||||||
Increase
in accounts receivable
|
(3,000 | ) | - | - | - | - | ||||||||||||||
(Increase)
decrease in prepaid expenses
|
(2,774 | ) | (2,251 | ) | 2,676 | (1,902 | ) | 24,915 | ||||||||||||
Increase
in accounts payable and accrued liabilities
|
377,968 | 58,926 | 15,830 | 55,569 | 41,088 | |||||||||||||||
(7,594,628 | ) | (123,235 | ) | (236,682 | ) | (296,755 | ) | (498,169 | ) | |||||||||||
Cash
flows used in investing activities
|
||||||||||||||||||||
Patent
protection costs
|
(38,197 | ) | - | - | - | - | ||||||||||||||
Purchase
of equipment
|
(198,419 | ) | - | - | - | - | ||||||||||||||
(236,616 | ) | - | - | - | - | |||||||||||||||
Cash
flows from financing activities
|
||||||||||||||||||||
Advances
from (repayments to) related parties
|
764,393 | 126,713 | 38,529 | 301,712 | (81,209 | ) | ||||||||||||||
Bank
indebtedness
|
- | (2,124 | ) | - | - | - | ||||||||||||||
Proceeds
from convertible debentures
|
5,000 | - | - | - | - | |||||||||||||||
Proceeds
from common shares issued for cash
|
7,170,387 | - | 41,999 | - | 436,297 | |||||||||||||||
Share
issuance costs
|
(102,534 | ) | (4,253 | ) | (9,291 | ) | (4,253 | ) | (41,288 | ) | ||||||||||
Subscriptions
received
|
- | - | 31,000 | - | 31,000 | |||||||||||||||
7,837,246 | 120,336 | 102,237 | 297,459 | 344,800 | ||||||||||||||||
Increase
(decrease) in cash and cash equivalents
|
6,002 | (2,899 | ) | (134,445 | ) | 704 | (153,369 | ) | ||||||||||||
Cash
and cash equivalents, beginning of period
|
- | 8,901 | 144,985 | 5,298 | 163,909 | |||||||||||||||
Cash
and cash equivalents, end of period
|
6,002 | 6,002 | 10,540 | 6,002 | 10,540 |
Supplemental
Disclosures
|
||||||||||||||||||||
Interest
paid
|
- | - | - | - | - | |||||||||||||||
Income
tax paid
|
- | - | - | - | - |
Deficit
|
||||||||||||||||||||||||||||||||
Accumulated
|
Total
|
|||||||||||||||||||||||||||||||
Additional
|
Common
|
During
the
|
Stockholders’
|
|||||||||||||||||||||||||||||
Paid-in
|
Stock
|
Donated
|
Deferred
|
Development
|
Equity
|
|||||||||||||||||||||||||||
Shares
|
Amount
|
Capital
|
Subscribed
|
Capital
|
Compensation
|
Stage
|
(Deficiency)
|
|||||||||||||||||||||||||
# | $ |
$
|
$
|
$
|
$ | $ | $ | |||||||||||||||||||||||||
Balance
– 27 July 1992 (date of inception)
|
– | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Stock
issued for intellectual property at $0.001 per share
|
5,700,000 | 57,000 | – | – | – | – | – | 57,000 | ||||||||||||||||||||||||
Stock
issued for cash
|
300,000 | 3,000 | – | – | – | – | – | 3,000 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (23,492 | ) | (23,492 | ) | ||||||||||||||||||||||
Balance
– 30 April 1993
|
6,000,000 | 60,000 | – | – | – | – | (23,492 | ) | 36,508 | |||||||||||||||||||||||
Stock
issued for cash pursuant to a public offering
|
500,000 | 500,000 | – | – | – | – | – | 500,000 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (394,263 | ) | (394,263 | ) | ||||||||||||||||||||||
Balance
– 30 April 1994
|
6,500,000 | 560,000 | – | – | – | – | (417,755 | ) | 142,245 | |||||||||||||||||||||||
Stock
issued for cash pursuant to:
|
||||||||||||||||||||||||||||||||
Options
exercised
|
10,000 | 1,000 | – | – | – | – | – | 1,000 | ||||||||||||||||||||||||
Private
placement
|
250,000 | 562,500 | – | – | – | – | – | 562,500 | ||||||||||||||||||||||||
Warrants
exercised
|
170,200 | 213,000 | – | – | – | – | – | 213,000 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (1,225,743 | ) | (1,225,743 | ) | ||||||||||||||||||||||
Balance
– 30 April 1995
|
6,930,200 | 1,336,500 | – | – | – | – | (1,643,498 | ) | (306,998 | ) | ||||||||||||||||||||||
Stock
issued for cash pursuant to:
|
||||||||||||||||||||||||||||||||
Options
exercised
|
232,500 | 75,800 | – | – | – | – | – | 75,800 | ||||||||||||||||||||||||
Warrants
exercised
|
132,200 | 198,300 | – | – | – | – | 198,300 | |||||||||||||||||||||||||
A
private offering
|
341,000 | 682,000 | – | – | – | – | – | 682,000 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (796,905 | ) | (796,905 | ) | ||||||||||||||||||||||
Balance
– 30 April 1996
|
7,635,900 | 2,292,600 | – | – | – | – | (2,440,403 | ) | (147,803 | ) | ||||||||||||||||||||||
Stock
issued for cash pursuant to:
|
||||||||||||||||||||||||||||||||
Options
exercised
|
137,000 | 13,700 | – | – | – | – | – | 13,700 | ||||||||||||||||||||||||
Warrants
exercised
|
185,400 | 278,100 | – | – | – | – | – | 278,100 | ||||||||||||||||||||||||
Private
placements
|
165,000 | 257,500 | – | – | – | – | – | 257,500 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (510,184 | ) | (510,184 | ) | ||||||||||||||||||||||
Balance
– 30 April 1997
|
8,123,300 | 2,841,900 | – | – | – | – | (2,950,587 | ) | (108,687 | ) | ||||||||||||||||||||||
Stock
issued for cash pursuant to:
|
||||||||||||||||||||||||||||||||
Options
exercised
|
50,000 | 5,000 | – | – | – | – | – | 5,000 | ||||||||||||||||||||||||
A
units offering
|
500,000 | 500,000 | – | – | – | – | – | 500,000 | ||||||||||||||||||||||||
Stock
issued for acquisition of AVFS rights
|
400,000 | 288,251 | – | – | – | – | – | 288,251 | ||||||||||||||||||||||||
Stock
issued for financial consulting services
|
125,000 | 170,250 | – | – | – | – | – | 170,250 | ||||||||||||||||||||||||
Stock
issued to settle an accrued liability
|
50,000 | 25,000 | – | – | – | – | – | 25,000 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (580,901 | ) | (580,901 | ) | ||||||||||||||||||||||
Balance
– 30 April 1998
|
9,248,300 | 3,830,401 | – | – | – | – | (3,531,488 | ) | 298,913 | |||||||||||||||||||||||
Stock
issued for financial consulting services
|
100,000 | 71,046 | – | – | – | – | – | 71,046 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (397,924 | ) | (397,924 | ) | ||||||||||||||||||||||
Balance
– 30 April 1999
|
9,348,300 | 3,901,447 | – | – | – | – | (3,929,412 | ) | (27,965 | ) | ||||||||||||||||||||||
Stock
issued for cash pursuant to:
|
||||||||||||||||||||||||||||||||
A
private placement
|
852,101 | 639,075 | – | – | – | – | – | 639,075 | ||||||||||||||||||||||||
Cash
commission paid
|
– | (47,607 | ) | – | – | – | – | – | (47,607 | ) | ||||||||||||||||||||||
Warrants
exercised
|
17,334 | 17,334 | – | – | – | – | – | 17,334 | ||||||||||||||||||||||||
Stock-based
compensation
|
– | – | 15,417 | – | – | – | – | 15,417 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (413,495 | ) | (413,495 | ) | ||||||||||||||||||||||
Balance
– 30 April 2000
|
10,217,735 | 4,510,249 | 15,417 | – | – | – | (4,342,907 | ) | 182,759 |
Deficit
|
||||||||||||||||||||||||||||||||
Accumulated
|
Total
|
|||||||||||||||||||||||||||||||
Additional
|
Common
|
During
the
|
Stockholders’
|
|||||||||||||||||||||||||||||
Paid-in
|
Stock
|
Donated
|
Deferred
|
Development
|
Equity
|
|||||||||||||||||||||||||||
Shares
|
Amount
|
Capital
|
Subscribed
|
Capital
|
Compensation
|
Stage
|
(Deficiency)
|
|||||||||||||||||||||||||
# |
$
|
$
|
$
|
$
|
$
|
$
|
$
|
|||||||||||||||||||||||||
Balance
– 30 April 2000
|
10,217,735 | 4,510,249 | 15,417 | – | – | – | (4,342,907 | ) | 182,759 | |||||||||||||||||||||||
Stock
issued for cash pursuant to warrants exercised
|
4,000 | 2,000 | – | – | – | – | – | 2,000 | ||||||||||||||||||||||||
Stock-based
compensation
|
– | – | 18,500 | – | – | – | – | 18,500 | ||||||||||||||||||||||||
Stock
to be issued
|
– | – | – | 72,000 | – | – | – | 72,000 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (808,681 | ) | (808,681 | ) | ||||||||||||||||||||||
Balance
– 30 April 2001
|
10,221,735 | 4,512,249 | 33,917 | 72,000 | – | – | (5,151,588 | ) | (533,422 | ) | ||||||||||||||||||||||
Stock
issued for cash pursuant to a private placement
|
1,066,200 | 266,550 | – | (72,000 | ) | – | – | – | 194,550 | |||||||||||||||||||||||
Amount
receivable
|
– | (3,000 | ) | – | – | – | – | – | (3,000 | ) | ||||||||||||||||||||||
Stock-based
compensation
|
– | – | 3,083 | – | – | – | – | 3,083 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (156,090 | ) | (156,090 | ) | ||||||||||||||||||||||
Balance
– 30 April 2002
|
11,287,935 | 4,775,799 | 37,000 | – | – | – | (5,307,678 | ) | (494,879 | ) | ||||||||||||||||||||||
Stock
issued to settle debt
|
6,100,000 | 305,000 | – | – | – | – | – | 305,000 | ||||||||||||||||||||||||
Stock
issued for services
|
250,000 | 16,500 | – | – | – | – | – | 16,500 | ||||||||||||||||||||||||
Stock
issued for convertible debenture
|
50,000 | 5,000 | – | – | – | – | – | 5,000 | ||||||||||||||||||||||||
Stock
to be issued
|
– | – | – | 25,968 | – | – | – | 25,968 | ||||||||||||||||||||||||
Donated
consulting services
|
– | – | – | – | 187,500 | – | – | 187,500 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (220,972 | ) | (220,972 | ) | ||||||||||||||||||||||
Balance
– 30 April 2003
|
17,687,935 | 5,102,299 | 37,000 | 25,968 | 187,500 | – | (5,528,650 | ) | (175,883 | ) | ||||||||||||||||||||||
Donated
consulting services
|
– | – | – | – | 210,000 | – | – | 210,000 | ||||||||||||||||||||||||
Stock
issued for cash pursuant to a private placement
|
173,120 | 25,968 | – | (25,968 | ) | – | – | – | – | |||||||||||||||||||||||
Stock
issued for cash pursuant to:
|
||||||||||||||||||||||||||||||||
Warrants
exercised
|
550,000 | 86,000 | – | – | – | – | – | 86,000 | ||||||||||||||||||||||||
Stock
options exercised
|
100,000 | 20,000 | – | – | – | – | – | 20,000 | ||||||||||||||||||||||||
Stock-based
compensation
|
– | – | 78,184 | – | – | (78,184 | ) | – | – | |||||||||||||||||||||||
Stock
issued for services
|
400,000 | 92,000 | – | – | – | (92,000 | ) | – | – | |||||||||||||||||||||||
Stock
issued to settle debt
|
3,320,000 | 166,000 | – | – | – | – | – | 166,000 | ||||||||||||||||||||||||
Deferred
compensation
|
– | – | – | – | – | 142,355 | – | 142,355 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (609,913 | ) | (609,913 | ) | ||||||||||||||||||||||
Balance
– 30 April 2004
|
22,231,055 | 5,492,267 | 115,184 | – | 397,500 | (27,829 | ) | (6,138,563 | ) | (161,441 | ) | |||||||||||||||||||||
Stock
issued for services
|
150,000 | 24,000 | – | – | – | (24,000 | ) | – | – | |||||||||||||||||||||||
Stock
issued for cash pursuant to:
|
||||||||||||||||||||||||||||||||
Options
exercised
|
133,750 | 29,750 | – | – | – | – | – | 29,750 | ||||||||||||||||||||||||
Warrants
exercised
|
173,120 | 34,624 | – | – | – | – | – | 34,624 | ||||||||||||||||||||||||
Private
placement
|
1,032,800 | 258,200 | – | – | – | – | – | 258,200 | ||||||||||||||||||||||||
Stock-based
compensation
|
– | – | 23,304 | – | – | – | – | 23,304 | ||||||||||||||||||||||||
Donated
consulting services
|
– | – | – | – | 150,000 | – | – | 150,000 | ||||||||||||||||||||||||
Deferred
compensation
|
– | – | – | – | – | 38,829 | – | 38,829 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (584,889 | ) | (584,889 | ) | ||||||||||||||||||||||
Balance
– 30 April 2005
|
23,720,725 | 5,838,841 | 138,488 | – | 547,500 | (13,000 | ) | (6,723,452 | ) | (211,623 | ) | |||||||||||||||||||||
Re-class
deferred compensation to additional paid in capital
|
– | – | (13,000 | ) | – | – | 13,000 | – | – | |||||||||||||||||||||||
Stock
issued for cash pursuant to:
|
||||||||||||||||||||||||||||||||
Options
exercised
|
212,000 | 53,313 | – | – | – | – | – | 53,313 | ||||||||||||||||||||||||
Warrants
exercised
|
406,400 | 142,240 | – | – | – | – | – | 142,240 | ||||||||||||||||||||||||
Private
placement
|
1,500,000 | 881,088 | – | – | – | – | – | 881,088 | ||||||||||||||||||||||||
Common
stock subscribed
|
– | – | – | 3,750 | – | – | – | 3,750 | ||||||||||||||||||||||||
Stock-based
compensation
|
– | – | 124,793 | – | – | – | – | 124,793 | ||||||||||||||||||||||||
Deferred
compensation
|
– | – | 12,000 | – | – | – | – | 12,000 | ||||||||||||||||||||||||
Donated
consulting services
|
– | – | – | – | 150,000 | – | – | 150,000 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (1,055,358 | ) | (1,055,358 | ) | ||||||||||||||||||||||
Balance
– 30 April 2006
|
25,839,125 | 6,915,482 | 262,281 | 3,750 | 697,500 | – | (7,778,810 | ) | 100,203 |
Deficit
|
||||||||||||||||||||||||||||||||
Accumulated
|
Total
|
|||||||||||||||||||||||||||||||
Additional
|
Common
|
During
the
|
Stockholders’
|
|||||||||||||||||||||||||||||
Paid-in
|
Stock
|
Donated
|
Deferred
|
Development
|
Equity
|
|||||||||||||||||||||||||||
Shares
|
Amount
|
Capital
|
Subscribed
|
Capital
|
Compensation
|
Stage
|
(Deficiency)
|
|||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Balance
– 30 April 2006
|
25,839,125 | 6,915,482 | 262,281 | 3,750 | 697,500 | – | (7,778,810 | ) | 100,203 | |||||||||||||||||||||||
Stock
issued for cash pursuant to:
|
||||||||||||||||||||||||||||||||
Options exercised
|
662,250 | 143,938 | – | (3,750 | ) | – | – | – | 140,188 | |||||||||||||||||||||||
Warrants exercised
|
268,833 | 217,666 | – | – | – | – | – | 217,666 | ||||||||||||||||||||||||
Private placement
|
120,000 | 120,000 | – | – | – | – | – | 120,000 | ||||||||||||||||||||||||
Private placement costs
|
– | (3,504 | ) | – | (13,673 | ) | – | – | – | (17,177 | ) | |||||||||||||||||||||
Common stock subscribed
|
– | – | – | 272,700 | – | – | – | 272,700 | ||||||||||||||||||||||||
Stock
issued for services
|
29,000 | 60,000 | – | – | – | – | – | 60,000 | ||||||||||||||||||||||||
Warrants
issued for equity line of credit
|
– | (1,561,406 | ) | 1,561,406 | – | – | – | – | – | |||||||||||||||||||||||
Stock-based
compensation
|
– | – | 260,569 | – | – | – | – | 260,569 | ||||||||||||||||||||||||
Deferred
compensation
|
– | – | 1,000 | – | – | – | – | 1,000 | ||||||||||||||||||||||||
Donated
consulting services
|
– | – | – | – | 150,000 | – | – | 150,000 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (1,413,294 | ) | (1,413,294 | ) | ||||||||||||||||||||||
Balance
– 30 April 2007
|
26,919,208 | 5,892,176 | 2,085,256 | 259,027 | 847,500 | – | (9,192,104 | ) | (108,145 | ) | ||||||||||||||||||||||
Stock
issued for cash pursuant to:
|
||||||||||||||||||||||||||||||||
Options
exercised
|
38,500 | 12,125 | – | – | – | – | – | 12,125 | ||||||||||||||||||||||||
Warrants
exercised
|
99,166 | 96,666 | – | (10,000 | ) | – | – | – | 86,666 | |||||||||||||||||||||||
Private
placement
|
833,950 | 833,950 | – | (262,700 | ) | – | – | – | 571,250 | |||||||||||||||||||||||
Private
placement costs
|
– | (47,170 | ) | – | 13,673 | – | – | – | (33,497 | ) | ||||||||||||||||||||||
Options
exercised for services
|
36,000 | 46,800 | – | – | – | – | – | 46,800 | ||||||||||||||||||||||||
Stock-based
compensation
|
– | – | 241,528 | – | – | – | – | 241,528 | ||||||||||||||||||||||||
Donated
consulting services
|
– | – | – | – | 150,000 | – | – | 150,000 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (1,236,583 | ) | (1,236,583 | ) | ||||||||||||||||||||||
Balance
– 30 April 2008
|
27,926,824 | 6,834,547 | 2,326,784 | – | 997,500 | – | (10,428,687 | ) | (269,856 | ) | ||||||||||||||||||||||
Stock
issued for cash pursuant to:
|
||||||||||||||||||||||||||||||||
Options
exercised for services
|
23,000 | 26,400 | – | – | – | – | – | 26,400 | ||||||||||||||||||||||||
Private
placement costs
|
– | (4,253 | ) | – | – | – | – | – | (4,253 | ) | ||||||||||||||||||||||
Stock-based
compensation
|
– | – | 223,566 | – | – | – | – | 223,566 | ||||||||||||||||||||||||
Donated
consulting services
|
– | – | – | – | 75,000 | – | – | 75,000 | ||||||||||||||||||||||||
Net
loss
|
– | – | – | – | – | – | (663,688 | ) | (663,688 | ) | ||||||||||||||||||||||
Balance
– 31 October 2008
|
27,949,824 | 6,856,694 | 2,550,350 | – | 1,072,500 | – | (11,092,375 | ) | (612,831 | ) |
1.
|
Nature
and Continuance of Operations
|
2.
|
Significant
Accounting Policies
|
3.
|
Due
to Related Parties
|
4.
|
Capital
Stock
|
|
i)
|
Up
to 25% of the option may be exercised at any time during the term of the
option; such initial exercise is referred to as the “First
Exercise”.
|
ii)
|
The
second 25% of the option may be exercised at any time after 90 days from
the date of First Exercise; such second exercise is referred to as the
“Second Exercise”.
|
iii)
|
The
third 25% of the option may be exercised at any time after 90 days from
the date of Second Exercise; such third exercise is referred to as the
“Third Exercise”.
|
iv)
|
The
fourth and final 25% of the option may be exercised at any time after 90
days from the date of the Third
Exercise.
|
v)
|
The
options expire 60 months from the date of
grant.
|
i)
|
Up
to 25% of the option may be exercised 90 days after the grant of the
option.
|
|
ii)
|
The
second 25% of the option may be exercised at any time after 1 year and 90
days after the grant of the option.
|
iii)
|
The
third 25% of the option may be exercised at any time after 2 years and 90
days after the grant of the option.
|
iv)
|
The
fourth and final 25% of the option may be exercised at any time after 3
years and 90 days after the grant of the
option.
|
v)
|
The
options expire 60 months from the date of
grant.
|
As
at
31
October
2008
|
As
at
30
April
2008
(Audited)
|
|||||||
Risk
free interest rate
|
2.12 | % | 3.49 | % | ||||
Expected
life
|
3.0
years
|
2.5
years
|
||||||
Annualized
volatility
|
110 | % | 110 | % | ||||
Expected
dividends
|
- | - |
Number
of options
|
Weighted
average exercise price
|
|||||||
$
|
||||||||
Outstanding
at 30 April 2007
|
1,888,500 | 1.12 | ||||||
Granted
|
25,000 | 1.30 | ||||||
Exercised
|
(74,500 | ) | 0.79 | |||||
Expired
|
- | - | ||||||
Outstanding
at 30 April 2008
|
1,839,000 | 1.13 | ||||||
Weighted
average fair value of options granted during the year ended 30 April
2008
|
0.62 | |||||||
Outstanding
at 30 April 2008
|
1,839,000 | 1.13 | ||||||
Granted
|
100,000 | 0.60 | ||||||
Exercised
|
(23,000 | ) | 1.15 | |||||
Expired
|
(150,000 | ) | 0.25 | |||||
Outstanding
at 31 October 2008
|
1,766,000 | 1.18 | ||||||
Weighted
average fair value of options granted during the period ended 31 October
2008
|
0.24 |
Expiry
Date
|
Exercise
price
|
Number
of options outstanding
|
Number
of options exercisable
|
Remaining
contractual
life (years)
|
||||||||||||
$
|
||||||||||||||||
2
December 2008
|
0.35 | 100,000 | 100,000 | 0.09 | ||||||||||||
10
May 2009
|
0.20 | 75,000 | 18,750 | 0.53 | ||||||||||||
30
September 2009
|
0.35 | 25,000 | 25,000 | 0.92 | ||||||||||||
27
May 2010
|
0.45 | 50,000 | 12,500 | 1.57 | ||||||||||||
21
April 2011
|
2.20 | 75,000 | 18,750 | 2.47 | ||||||||||||
29
June 2011
|
2.09 | 25,000 | 6,250 | 2.66 | ||||||||||||
1
October 2011
|
0.60 | 95,000 | 20,000 | 2.92 | ||||||||||||
1
November 2011
|
1.37 | 125,000 | 31,250 | 3.00 | ||||||||||||
30
January 2012
|
1.30 | 200,000 | 50,000 | 3.25 | ||||||||||||
12
April 2012
|
1.30 | 971,000 | 458,500 | 3.45 | ||||||||||||
7
November 2012
|
1.30 | 25,000 | 6,250 | 4.02 | ||||||||||||
Total
|
1,766,000 | 747,250 |
Number
of options
|
Weighted
average grant date fair value
|
|||||||
|
||||||||
Non-vested
at 1 May 2008
|
1,200,000 | 0.87 | ||||||
Granted
|
100,000 | 0.60 | ||||||
Modified
|
- | - | ||||||
Vested
|
(281,250 | ) | 0.79 | |||||
Non-vested
at 31 October 2008
|
1,018,750 | 0.83 |
Number
of warrants
|
Weighted
average exercise price
|
|||||||
$
|
||||||||
Outstanding
at 30 April 2007
|
2,733,167 | 1.02 | ||||||
Issued
|
873,950 | 1.29 | ||||||
Exercised
|
(99,166 | ) | 0.97 | |||||
Expired
|
(455,001 | ) | 1.00 | |||||
Outstanding
at 30 April 2008
|
3,052,950 | 1.16 | ||||||
Outstanding
at 30 April 2008
|
3,052,950 | 1.16 | ||||||
Issued
|
- | - | ||||||
Exercised
|
- | - | ||||||
Expired
|
- | - | ||||||
Outstanding
at 31 October 2008
|
3,052,950 | 1.16 | ||||||
Expiry
Date
|
Exercise
price
|
Number
of
warrants
|
||||||
$
|
||||||||
15
October 2009
|
1.50 | 40,000 | ||||||
17
November 2011
|
1.00 | 2,059,000 | ||||||
21
February 2012
|
1.50 | 120,000 | ||||||
30
July 2012
|
1.50 | 579,950 | ||||||
4
October 2012
|
1.50 | 32,000 | ||||||
7
November 2012
|
1.50 | 76,000 | ||||||
17
December 2012
|
1.50 | 95,000 | ||||||
14
February 2013
|
1.50 | 51,000 | ||||||
Warrants
Outstanding
|
3,052,950 |
e)
|
Equity
Line of Credit
|
5.
|
Commitments
|
|
a)
|
Pursuant
to a letter of understanding dated 13 December 1993 between the Company,
Rand and Reg (collectively called the grantors) and West Virginia
University Research Corporation (“WVURC”), the grantors have agreed that
WVURC shall own 5% of all patented technology with regards to RC/DC Engine
technology and will receive 5% of all net profits from sales, licences,
royalties or income derived from the patented
technology.
|
|
b)
|
Pursuant
to an agreement dated 20 August 1992, the Company acquired the U.S. rights
to the original RC/DC Engine from Rand. The Company will pay Rand and the
original owner a net profit royalty of 5% and 1%,
respectively.
|
|
c)
|
The
Company is committed to fund 50% of the further development of the RC/DC
Engine.
|
d)
|
The
Company entered into an agreement with a professional law firm (the “Law
Firm”) in which a partner of the Law Firm is an officer and director of
the Company. The Company agreed to pay a cash fee equal to 5% of any
financings with parties introduced to the Company by the Law Firm. The
Company also agreed to pay an equity fee equal to 5% of the equity issued
by the Company to parties introduced by the Law Firm, in the form of
options, warrants or common stock (Note
3).
|
6.
|
Contingencies
|
7.
|
Income
Taxes
|
For
the six month period
ended
31
October
2008
|
For
the six month period
ended
31
October
2007
|
|||||||
$
|
$
|
|||||||
Deferred
tax asset attributable to:
|
||||||||
Current
operations
|
232,291 | 309,439 | ||||||
Stock-based
compensation
|
(78,248 | ) | (77,259 | ) | ||||
Compensation
recognized as donated capital
|
(26,250 | ) | (26,250 | ) | ||||
Non-deductible
meals and entertainment
|
(126 | ) | - | |||||
Less:
Change in valuation allowance
|
(127,667 | ) | (205,930 | ) | ||||
Net
refundable amount
|
- | - |
As
at
31
October
2008
|
As
at
30
April 2008
(Audited)
|
|||||||
$
|
$
|
|||||||
Net
operating loss carry forward
|
8,954,000 | 8,589,000 | ||||||
Statutory
federal income tax rate
|
35 | % | 35 | % | ||||
Effective
income tax rate
|
0 | % | 0 | % | ||||
Deferred
tax asset
|
3,133,900 | 3,006,200 | ||||||
Less:
Valuation allowance
|
(3,133,900 | ) | (3,006,200 | ) | ||||
Net
deferred tax asset
|
- | - |
For
the period from the date of inception on 27 July 1992 to
31
October
2008
(Unaudited)
|
For
the six
month
period ended
31
October
2008
|
For
the six
month
period ended
31
October
2007
|
||||||||||
$
|
$
|
$
|
||||||||||
Warrants
issued for equity line of credit
|
1,561,406 | - | - | |||||||||
Shares
issued to settle debt
|
496,000 | - | - | |||||||||
Shares
issued for convertible debenture
|
5,000 | - | - | |||||||||
Shares
issued for intellectual property
|
345,251 | - | - | |||||||||
Shares
issued for services
|
122,300 | 26,400 | 11,700 | |||||||||
Consulting
services reflected as donated capital
|
1,072,500 | 75,000 | 75,000 | |||||||||
Affiliate’s
shares issued for intellectual property
|
200,000 | - | - |
9.
|
Subsequent
Event
|
|
a)
|
In
November 2008, the Company issued 3,000 shares at $1.30 per share upon the
exercise of stock options for services rendered with a fair value of
$3,900.
|
|
b)
|
In
November 2008, the Company issued 5,000 shares at $0.60 per share upon the
exercise of stock options for services rendered with a fair value of
$3,000.
|
|
c)
|
In
December 2008, the Company issued 5,000 shares at $0.60 per share upon the
exercise of stock options for services rendered with a fair value of
$3,000.
|
Six
Months Ended October 31,
|
||||||||||||
Percentage
|
||||||||||||
Increase
/ (Decrease)
|
||||||||||||
2008
|
2007
|
|||||||||||
$ | $ | % | ||||||||||
Revenue
|
Nil
|
Nil
|
N/A | |||||||||
Expenses
|
(663,688 | ) | (884,112 | ) | (24.9 | ) | ||||||
Interest
Income
|
Nil
|
Nil
|
N/A | |||||||||
Net
Income (Loss)
|
(663,688 | ) | (884,112 | ) | (24.9 | ) |
Six
Months Ended October 31,
|
||||||||||||
Percentage
|
||||||||||||
Increase
/ (Decrease)
|
||||||||||||
2008
|
2007
|
|||||||||||
$ | $ | % | ||||||||||
Amortization
|
Nil
|
Nil
|
N/A | |||||||||
Management
fees
|
Nil
|
Nil
|
N/A | |||||||||
General
and administrative:
|
381,332 | 603,397 | (36.8 | ) | ||||||||
Accounting
and legal
|
90,955 | 96,822 | (6.1 | ) | ||||||||
Consulting
fees
|
125,291 | 108,791 | 15.2 | |||||||||
Investor
relations
|
54,470 | 124,095 | (56.1 | ) | ||||||||
Other
|
33,592 | 84,480 | (60.2 | ) | ||||||||
Travel
and accommodation
|
26,979 | 89,289 | (69.8 | ) | ||||||||
Wages
and benefits
|
50,045 | 99,920 | (49.9 | ) | ||||||||
Stock-based
compensation
|
223,566 | 220,740 | 1.3 | |||||||||
Research
and development
|
58,790 | 59,975 | (2.0 | ) | ||||||||
Total
|
663,688 | 884,112 | (24.9 | ) |
Working Capital
|
||||||||
At
October 31, 2008
|
At
April 30, 2008
|
|||||||
Current
Assets
|
$ | 8,776 | $ | 8,517 | ||||
Current
Liabilities
|
(621,607 | ) | (278,373 | ) | ||||
Working
Capital (Deficit)
|
$ | (612,831 | ) | $ | (269,856 | ) |
Cash Flows
|
||||||||
Six
Months Ended October 31,
|
||||||||
2008
|
2007
|
|||||||
Cash
Flows Used In Operating Activities
|
$ | (296,755 | ) | $ | (498,169 | ) | ||
Cash
Flows Used In Investing Activities
|
Nil
|
Nil
|
||||||
Cash
Flows From Financing Activities
|
297,459 | 344,800 | ||||||
Net
Increase (Decrease) In Cash During Period
|
$ | 704 | $ | (153,369 | ) |
|
Exhibits:
|
Certification
of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
|
Certification
of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
|
Certification
of John G. Robertson, President and Chief Executive Officer (Principal
Executive Officer), pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002
|
Certification
of James Vandeberg, Chief Operating Officer and Chief Financial Officer
(Principal Financial Officer), pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002
|