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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps">As
filed with the Securities and Exchange Commission on January 7, 2013</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt"><B>UNITED
STATES</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt"><B>SECURITIES
AND EXCHANGE COMMISSION</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Washington, DC 20549</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Form S-1</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>REGISTRATION STATEMENT UNDER</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>THE SECURITIES ACT OF 1933</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B><U>Aurora
Gold Corporation</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Exact name of registrant as specified in
its charter)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 30%; border-bottom: black 1pt solid; font-weight: bold; text-align: center">Delaware</TD>
    <TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 30%; border-bottom: black 1pt solid; font-weight: bold; text-align: center">1040</TD>
    <TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 30%; border-bottom: black 1pt solid; font-weight: bold; text-align: center">13-3945947</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center">(State or Other Jurisdiction of incorporation or organization</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">(Primary Standard Industrial Classification Code Number)</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">(IRS Employer Identification Number)</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 45%">&nbsp;</TD>
    <TD STYLE="width: 10%">&nbsp;</TD>
    <TD STYLE="width: 45%; text-align: center">Lars Pearl</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">C/- Coresco AG</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Level 3</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Gotthardstrasse 20</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">6304 Zug</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Switzerland</P></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">C/- Coresco AG</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Level 3</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Gotthardstrasse 20</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">6304 Zug</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Switzerland</P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Telephone: (+41) 7887-96966</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Facsimile: (+41) 44 274 2818</P></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Telephone: (+41) 7887-96966</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Facsimile: (+41) 44 274 2818</P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Address, including zip code and telephone
        number,</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">including area code, of registrant&rsquo;s
        principal</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">executive offices)</P></TD>
    <TD>&nbsp;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Address, including zip code and telephone
        number,</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">including area code, of agent for service)</P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Copies of all communications and notices
to:</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Joseph Sierchio, Esq.</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Elishama Rudolph, Esq.</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Sierchio &amp; Company, LLP</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>430 Park Avenue</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>7th Floor</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>New York, New York 10022</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Telephone: (212) 246-3030</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Facsimile: (212) 246-3039</B></P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Approximate date of commencement of proposed sale to the
public:</B> As soon as practicable after this Registration Statement becomes effective.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">If any of the securities being registered on this Form are to
be offered on a delayed or continuous basis pursuant to Rule 415 of the Securities Act of 1933, as amended, check here:<FONT STYLE="font-family: Wingdings">
x</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">If this Form is filed to register additional securities for
an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same offering.<FONT STYLE="font-family: Wingdings 2">
&pound;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">If this Form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering.<FONT STYLE="font-family: Wingdings 2"> &pound;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">If this Form is a post-effective amendment filed pursuant to
Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering.<FONT STYLE="font-family: Wingdings 2"> &pound;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of &ldquo;large accelerated
filer,&rdquo; &ldquo;accelerated filer&rdquo; and &ldquo;smaller reporting company&rdquo; in Rule 12b-2 of the Exchange Act. (<B>Check
one):</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 49%; font-size: 10pt"><FONT STYLE="color: black">Large Accelerated Filer<FONT STYLE="font-family: Wingdings 2"> &pound;</FONT></FONT></TD>
    <TD STYLE="width: 8%; font: 10pt Wingdings 2">&nbsp;</TD>
    <TD STYLE="width: 43%; font-size: 10pt"><FONT STYLE="color: black">Accelerated Filer<FONT STYLE="font-family: Wingdings 2"> &pound;</FONT></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font: 10pt Wingdings 2">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Non-accelerated Filer&nbsp;&nbsp;&nbsp;<FONT STYLE="font-family: Wingdings 2">
        &pound;</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(Do not check if a smaller reporting company)</P></TD>
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt"><FONT STYLE="color: black">Smaller reporting company<FONT STYLE="font-family: Wingdings 2"> </FONT><FONT STYLE="font-family: Wingdings">x</FONT></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B><U>Calculation of Registration Fee</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-weight: bold; border-bottom: Black 1pt solid">Securities&nbsp;to&nbsp;be&nbsp;Registered</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Number&nbsp;of <BR>Shares <BR>Registered</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Proposed</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Maximum</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Offering</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Price&nbsp;Per</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Share&nbsp;</B><SUP>(1)</SUP></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Proposed</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Maximum</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Offering&nbsp;Price&nbsp;</B><SUP>(1)</SUP></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Registration&nbsp;Fee</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 40%; padding-bottom: 1pt">Common Stock Par Value $0.001</TD><TD STYLE="width: 1%; color: black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; color: black; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; border-bottom: Black 1pt solid; color: black; text-align: right">135,000,000</TD><TD STYLE="width: 1%; padding-bottom: 1pt; color: black; text-align: left"><SUP>(2)</SUP></TD><TD STYLE="width: 1%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 12%; border-bottom: Black 1pt solid; text-align: right">0.04</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 12%; border-bottom: Black 1pt solid; text-align: right">5,400,000</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 12%; border-bottom: Black 1pt solid; text-align: right">736.56</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">Total</TD><TD STYLE="color: black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; color: black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; color: black; text-align: right">135,000,000</TD><TD STYLE="padding-bottom: 2.5pt; color: black; text-align: left"><SUP>(3)</SUP></TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">5,400,000</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="color: black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; color: black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; color: black; text-align: right">736.56</TD><TD STYLE="padding-bottom: 2.5pt; color: black; text-align: left"><SUP>(4)</SUP></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR>
    <TD STYLE="text-align: left; width: 3%; vertical-align: top"><SUP>(1)</SUP></TD>
    <TD STYLE="vertical-align: top; width: 97%">Estimated solely for the purpose of computing the registration fee pursuant to
    Rule 457(c) under the Securities Act of 1933, as amended; the closing sale price of our stock on January 2, 2013, as quoted
    on the OTC Markets Group Inc. QB tier was $0.04 per share.</TD></TR>
<TR>
    <TD STYLE="text-align: left; vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD></TR>
<TR>
    <TD STYLE="text-align: left; vertical-align: top"><SUP>(2)</SUP></TD>
    <TD STYLE="vertical-align: top">Represents 135,000,000 shares of our common stock, par value $0.001 per share, purchased by Alltech Capital Limited pursuant to a subscription agreement dated September 21, 2012, which we have agreed to register for resale on its behalf.</TD></TR>
<TR>
    <TD STYLE="text-align: left; vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD></TR>
<TR>
    <TD STYLE="text-align: left; vertical-align: top"><SUP>(3)</SUP></TD>
    <TD STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">This registration statement includes an indeterminate number of additional shares of common stock issuable for no additional consideration pursuant to any stock dividend, stock split, recapitalization or other similar transaction effected without the receipt of consideration, which results in an increase in the number of outstanding shares of our common stock. In the event of a stock split, stock dividend or similar transaction involving our common stock, in order to prevent dilution, the number of shares registered shall be automatically increased to cover the additional shares in accordance with Rule 416(a) under the Securities Act.</FONT></TD></TR>
<TR>
    <TD STYLE="text-align: left; vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD></TR>
<TR>
    <TD STYLE="text-align: left; vertical-align: top"><SUP>(4)</SUP></TD>
    <TD STYLE="vertical-align: top">Paid herewith.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Registrant hereby amends this registration statement on such
date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically
states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act,
or until the registration statement shall become effective on such date as the commission, acting under said section 8(a), may
determine.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Subject to Completion, Dated
January 7, 2013</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>The information in this Prospectus is not complete and may
be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission
is effective. This Prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities
in any state where the offer or sales is not permitted.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt; font-variant: small-caps"><B>Prospectus</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><img src="tlogo.jpg"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt; font-variant: small-caps"><B>Aurora
Gold Corporation</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>135,000,000 <FONT STYLE="font-variant: small-caps">Shares
of Common Stock</FONT></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">This prospectus <FONT STYLE="color: black">(the
&ldquo;<B>Prospectus</B>&rdquo;) </FONT>relates to the resale by Alltech Capital Limited (the &ldquo;<B>Selling Stockholder</B>&rdquo;
or &ldquo;<B>Alltech</B>&rdquo;) of up to 135,000,000 shares of our common stock, which the Selling Stockholder purchased pursuant
to a subscription agreement dated as of September 21, 2012. The shares were purchased pursuant to an exemption from the from the
registration requirements of the Securities Act of 1933, as amended (the &ldquo;<B>Securities</B> <B>Act</B>&rdquo;), including,
Regulation S as the Selling Stockholder is not a U.S. Person (as that term is defined in Regulation S of the Securities Act) and
the Selling Stockholder purchased the shares in a transaction outside of the United States. The certificate representing the shares
bears a restrictive legend in accordance with Regulation S. In addition, we and the Selling Stockholder have complied or will comply
with the following requirements of Regulation S:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
offer or sale was made in an offshore transaction;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;we
did not make any directed selling efforts in the United States;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;no
offer or sale was made to a U.S. person or for the account or benefit of a U.S. person;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
Selling Stockholder certified that it was not a U.S. person and was not acquiring the securities for the account or benefit of
any U.S. person;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
Selling Stockholder agreed to resell such securities only in accordance with the provisions of Regulation S, pursuant to registration
under the Securities Act, or pursuant to an available exemption from registration; and agreed not to engage in hedging transactions
with regard to such securities unless in compliance with the Securities Act; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;we
are required to refuse to register any transfer of the securities not made in accordance with the provisions of Regulation S pursuant
to registration under the Securities Act, or pursuant to an available exemption from registration.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Although we will pay substantially all the
expenses incident to the registration of the shares, we will not receive any proceeds from the sales by the Selling Stockholder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Selling Stockholder and any underwriter,
broker-dealer or agent that participates in the sale of the shares or interests therein may be deemed &ldquo;underwriters&rdquo;
within the meaning of Section 2(11) of the Securities Act. Any discounts, commissions, concessions, profit or other compensation
any of them earns on any sale or resale of the shares, directly or indirectly, may be underwriting discounts and commissions under
the Securities Act. If the Selling Stockholder is considered to be an &ldquo;underwriter&rdquo; within the meaning of Section 2(11)
of the Securities Act, it will be subject to the prospectus delivery requirements of the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Purchase of our shares of common stock is
highly speculative and involves a high degree of risk. You should carefully consider the risks and uncertainties described under
the heading &ldquo;<B>Risk Factors</B>&rdquo; beginning on page 6 of this Prospectus before making a decision to purchase any of
the Securities offered pursuant to this Prospectus.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>NEITHER THE SECURITIES AND EXCHANGE COMMISSION
NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>The
Date Of This Prospectus Is January 7, 2013</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Table
of Contents</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 91%">&nbsp;</TD>
    <TD STYLE="width: 9%; border-bottom: windowtext 1pt solid; font-variant: small-caps; font-weight: bold; text-align: center">Page #</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Prospectus Summary</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">3</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-variant: small-caps; font-weight: bold">The Offering</TD>
    <TD STYLE="font-variant: small-caps; text-align: center">4</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Risk Factors</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">6</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold"><FONT STYLE="font-size: 10pt"><B>N<FONT STYLE="font-variant: small-caps">ote Regarding <FONT STYLE="text-underline-style: none; color: windowtext">Forward-Looking Statements</FONT></FONT></B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">13</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Use of Proceeds</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">13</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Determination Of Offering Price</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">14</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Market Price of and Dividends On Our Common Stock and Related Stockholder Matters</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">14</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Management&rsquo;s Discussion and Analysis Of Financial Condition and Results of Operations</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">16</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Description of Our Business and Properties</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">31</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Directors, Executive Officers and Control Persons</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">37</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Executive Compensation</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">43</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Security Ownership of Certain Beneficial Owners and Management</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">47</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Transactions With Related Persons, Promoters and Certain Control Persons</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">48</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Description of Our Securities</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">50</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold">The Selling Stockholder</TD>
    <TD STYLE="font-variant: small-caps; text-align: center">52</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Plan of Distribution</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">53</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold">Limitation of Liability and Indemnification of Officers and Directors; Insurance</TD>
    <TD STYLE="font-variant: small-caps; text-align: center">54</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-variant: small-caps; font-weight: bold">Disclosure of Commission Position On Indemnification for Securities Act Liabilities</TD>
    <TD STYLE="font-variant: small-caps; text-align: center">55</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Legal Matters</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">55</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Experts</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">56</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold"><FONT STYLE="font-size: 10pt; font-variant: small-caps"><B>Where to Find <FONT STYLE="text-underline-style: none; color: windowtext">Additional Information</FONT></B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">56</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-variant: small-caps; font-weight: bold; text-decoration: none"><FONT STYLE="font-size: 10pt; font-variant: small-caps; text-underline-style: none; color: windowtext"><B>Index to Consolidated Financial Statements</B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">56</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-variant: small-caps; font-weight: bold"><FONT STYLE="font-size: 10pt; font-variant: small-caps"><B>Consolidated <FONT STYLE="text-underline-style: none; color: windowtext">Financial Statements</FONT></B></FONT></TD>
    <TD STYLE="font-variant: small-caps; text-align: center">56</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>You should rely only on the information contained in this
Prospectus. We have not authorized any other person to provide you with different information. If anyone provides you with different
or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction
where an offer or sale is not permitted. You should assume that the information appearing in this Prospectus is accurate only as
of the date on the front cover of this Prospectus. Our business, financial condition, results of operations and prospects may have
changed since that date.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt; font-variant: small-caps"><B>Prospectus
Summary</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><I>This summary contains material information
about us and the offering which is described in detail elsewhere in the Prospectus. Since it may not include all of the information
you may consider important or relevant to your investment decision, you should read the entire Prospectus carefully, including
the more detailed information regarding our company, the risks of purchasing our common stock discussed under &ldquo;<B>Risk Factors</B>&rdquo;
on page 6, and our financial statements and the accompanying notes.</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><I>Unless the context otherwise requires,
the terms &ldquo;we,&rdquo; &ldquo;our,&rdquo; &ldquo;us,&rdquo; the &ldquo;Company&rdquo; and &ldquo;Aurora Gold&rdquo; refer
to Aurora Gold Corporation, a Delaware corporation.</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our Business</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We were incorporated under the laws of the
State of Delaware on October 10, 1995, under the name &ldquo;<B>Chefs Acquisition Corp</B>.&rdquo; Initially formed for the purpose
of engaging in the food preparation business, we redirected our business efforts in late 1995 following a change of control, which
occurred on October 30, 1995, to the acquisition, exploration and, if warranted, the development of mineral mineralized material
properties. We changed our name to &ldquo;<B>Aurora Gold Corporation</B>&rdquo; on August 20, 1996, to more fully reflect our mineralized
material exploration business activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our general business strategy is to acquire
mineral properties either directly or through the acquisition of operating entities. Our continued operations and the recoverability
of mineral property costs is dependent upon the existence of economically recoverable mineral reserves, confirmation of our interest
in the underlying properties, our ability to obtain necessary financing to complete the development and upon future profitable
production.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Since 1996 we have acquired and disposed
of a number of properties. We have not established reserves on any of the properties that we owned or in which we have or have
had an interest.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently have interest in a strategic
land package of nine (9) properties none of which contain any reserves. The exploration license areas are divided into 2 groups,
the S&#259;o Domingos and the Sao Joao areas. Please refer to &ldquo;<B>Description of Our Business and Properties</B>.&rdquo;
We have no revenues, have sustained losses since inception, have been issued a going concern opinion by our auditors and rely upon
the sale of our securities to fund operations. We will not generate revenues even if any of our exploration programs indicate that
a mineral deposit may exist on our properties. Accordingly, we will be dependent on future financings in order to maintain our
operations and continue our exploration activities. <B>Please refer to</B> &ldquo;<B>Risk Factors</B>.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">Our principal
and technical office, from which we conduct our exploration and property acquisition activities, is located at </FONT>C/- Coresco
AG, Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland. <FONT STYLE="color: black">The telephone number is (+41) 7887-96966.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Risk Associated With Our Business</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The search for valuable minerals as a business
is extremely risky. We can provide investors with no assurance that the exploration of any of the properties in which we have or
may acquire an interest will uncover commercially exploitable mineral reserves. It is likely that such properties will not contain
any reserves and, in all likelihood, any funds spent on exploration will probably be lost. In addition, problems such as unusual
or unexpected geological formations or other variable conditions are involved in exploration and, often result in unsuccessful
exploration efforts.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In addition, due to our limited capital
and mineralized materials, we are limited in the amount of exploration work we can do. As a result, our already low probability
of successfully locating mineral reserves will be reduced significantly further. Therefore, we may not find a commercial mineable
ore deposit prior to exhausting our funds. Furthermore, exploration costs may be higher than anticipated, in which case, the risk
of utilizing all of our funds prior to locating any ore deposits shall be greatly increased. Factors that could cause exploration
costs to increase are: adverse conditions, difficult terrain and shortages of qualified personnel.<B> Please refer to</B> &ldquo;<B>Risk
Factors</B>.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt; font-variant: small-caps"><B>The
Offering</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 32%; font-style: italic; font-weight: bold">Securities Being Offered:</TD>
    <TD STYLE="width: 2%; font-style: italic; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 66%"><FONT STYLE="font-size: 10pt">A total of up to 135,000,000 shares of our common stock.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-style: italic; font-weight: bold">Offering Price Per Share:</TD>
    <TD STYLE="font-style: italic; font-weight: bold">&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">The Selling Stockholder will determine at what price it may sell the offered shares, and such sales may be made at prevailing market prices, or at privately negotiated prices.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-style: italic; font-weight: bold">Selling Stockholder:</TD>
    <TD STYLE="font-style: italic; font-weight: bold">&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">The Selling Stockholder purchased the shares pursuant to a subscription agreement dated September 21, 2012. Please refer to the section entitled &ldquo;<B>The</B> <B>Selling Stockholder</B>&rdquo; of this Prospectus.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-style: italic; font-weight: bold">Authorized Capital Stock:</TD>
    <TD STYLE="font-style: italic; font-weight: bold">&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">300,000,000 shares of common stock, each with a par value of $0.001.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-style: italic; font-weight: bold">Shares Outstanding Prior to Completion of the Offering:</TD>
    <TD STYLE="font-style: italic; font-weight: bold">&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">249,144,706, without giving effect to the shares eligible for issuance upon exercise of outstanding options.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-style: italic; font-weight: bold">Shares Outstanding upon Closing of the Offering:</TD>
    <TD STYLE="font-style: italic; font-weight: bold">&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">249,144,706, without giving effect to the shares eligible for issuance upon exercise of outstanding options.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-style: italic; font-weight: bold">Transfer Agent:</TD>
    <TD STYLE="font-style: italic; font-weight: bold">&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt; color: black">Worldwide Stock Transfer, LLC, 433 Hackensack Avenue, Level L, Hackensack, New Jersey 07601.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-style: italic; font-weight: bold">Risk Factors:</TD>
    <TD STYLE="font-style: italic; font-weight: bold">&nbsp;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The search for valuable minerals as a business is extremely
        risky. We can provide investors with no assurance that the exploration of any of the properties in which we have or may acquire
        an interest will uncover commercially exploitable mineral reserves. It is likely that such properties will not contain any reserves
        and, in all likelihood, any funds spent on exploration will probably be lost. In addition, problems such as unusual or unexpected
        geological formations or other variable conditions are involved in exploration and, often result in unsuccessful exploration efforts.</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In addition, due to our limited capital and mineralized materials,
        we are limited in the amount of exploration work we can do. As a result, our already low probability of successfully locating mineral
        reserves will be reduced significantly further. Therefore, we may not find a commercial mineable ore deposit prior to exhausting
        our funds. Furthermore, exploration costs may be higher than anticipated, in which case, the risk of utilizing all of our funds
        prior to locating any ore deposits shall be greatly increased. Factors that could cause exploration costs to increase are: adverse
        conditions, difficult terrain and shortages of qualified personnel.<B> Please refer to</B> &ldquo;<B>Risk Factors</B>.&rdquo;</P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-style: italic; font-weight: bold">Use of Proceeds:</TD>
    <TD STYLE="font-style: italic; font-weight: bold">&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">Although we will pay substantially all the expenses incident to the registration of the shares, we will not receive any proceeds from the sales by the Selling Stockholder. See &ldquo;<B>Use of Proceeds</B>.&rdquo;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B><I>&nbsp;</I></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Selected Financial Data</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have not generated any operating revenues
to date. Our plans, funding requirements, sources and alternatives relating thereto are presented and discussed in &ldquo;<B>Management&rsquo;s
Discussion and Analysis of Financial Condition and Results of Operations</B>.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table sets forth, for the
nine month periods ended September 30, 2012 and 2011, and for the fiscal years ended December 31, 2011 and 2010, certain selected
consolidated financial data. This information should be read in conjunction with our Audited Consolidated Financial Statements
and Notes thereto for the period ended December 31, 2011, and &ldquo;<B>Management&rsquo;s Discussion and Analysis of Financial
Condition and Results of Operations</B>&rdquo; included elsewhere herein.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The selected financial data provided below
are not necessarily indicative of our future results of operations or financial performance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1pt solid">Consolidated&nbsp;Statements <BR>of&nbsp;Operations&nbsp;Data:</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">For&nbsp;the&nbsp;Nine <BR>Months&nbsp;Ended <BR>September&nbsp;30, <BR>2012 <BR>(Unaudited)</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">For&nbsp;the&nbsp;Nine <BR>Months&nbsp;Ended <BR>September&nbsp;30, <BR>2011 <BR>(Unaudited)</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">For&nbsp;the&nbsp;Year <BR>Ended&nbsp;December <BR>31,&nbsp;2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">For&nbsp;the&nbsp;Year <BR>Ended&nbsp;December&nbsp;31, <BR>2010</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 40%">Revenue</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">0</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">0</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">0</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">0</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Operating loss</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(661,204</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(1,025,177</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(1,869,827</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(2,302,083</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Net loss available to common stockholders</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(566,344</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(3,782,688</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(4,627,338</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(2,302,083</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Basic and diluted net loss per share</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(0.01</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(0.04</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(0.05</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(0.03</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Weighted average number of common shares outstanding used in basic and diluted net loss per share calculation</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">112,726,318</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">89,036,372</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">90,537,439</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">81,069,047</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1pt solid">Consolidated&nbsp;Balance&nbsp;Sheet&nbsp;Data:</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">September&nbsp;30,&nbsp;2012 <BR>(Unaudited)</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,&nbsp;2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December&nbsp;31,&nbsp;2010</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 55%; text-align: left">Cash and cash equivalents</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">1,241</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">237,426</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">579,191</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Working Capital</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(576,152</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(300,218</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">227,326</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Total assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">1,241</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">237,426</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">3,532,696</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Total liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">577,393</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">537,644</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">372,019</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Total stockholders&rsquo; equity (deficiency)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(576,152</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(300,218</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">3,160,667</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt; font-variant: small-caps"><B>Risk
Factors</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>You should carefully consider the risks described below
before purchasing any shares. Our most significant risks and uncertainties are described below; if any of the following risks actually
occur, our business, financial condition, or results of operations could be materially adversely affected, the trading of our common
stock could decline, and you may lose all or part of your investment therein. You should acquire the Shares only if you can afford
to lose your entire investment. Our filings with the Securities and Exchange Commission (the &ldquo;SEC&rdquo;) also contain forward-looking
statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking
statements as a result of certain factors, including the risks we have described below. Please refer to</I> &ldquo;<I>Note Regarding
Forward-Looking Statements</I>&rdquo;<I> on page 13 of this Prospectus</I>.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B><U>Risks Related to Our Business, Property
and Industry</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>We are an exploration stage company
and have incurred substantial losses since inception.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have never earned any revenues. In addition,
we have incurred net losses of $22,966,943 for the period from our inception (October 10, 1995) through September 30, 2012, and,
based upon our current plan of operation, we expect that we will incur losses for the foreseeable future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Potential investors should be aware of the
difficulties normally encountered by mineral exploration companies and the high rate of failure of such companies. We are subject
to all of the risks inherent to an exploration stage business enterprise, such as limited capital, mineralized materials, lack
of manpower, and possible cost overruns associated with our exploration programs. Potential investors must also weigh the likelihood
of success in light of any problems, complications, and delays that may be encountered with the exploration of our properties.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Because we are small and do not have much
capital, we must limit our exploration activity. As such we may not be able to complete an exploration program that is as thorough
as we would like. In that event, an existing ore body may go undiscovered. Without an ore body, we cannot generate revenues and
you will lose your investment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Our independent registered public
accounting firm has expressed substantial doubt about our ability to continue as a going concern, which may hinder our ability
to obtain future financing.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our independent registered public accounting
firm has issued its report, which includes an explanatory paragraph for going concern uncertainty on our consolidated financial
statements as of and for the year ended December 31, 2011. Because we have not yet generated revenues from our operations our ability
to continue as a going concern is currently heavily dependent upon our ability to obtain additional financing to sustain our operations.
Such financing may take the form of the issuance of common or preferred stock or debt securities, or may involve bank financing.
Although we have completed several equity financings, the fact that our auditors have issued a &ldquo;going concern&rdquo; opinion
may hinder our ability to obtain additional financing in the future. Currently, we have no commitments to obtain any additional
financing, and there can be no assurance that financing will be available in amounts or on terms acceptable to us, if at all.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>We cannot assure you that our common
stock will be re-listed, or that once re-listed, it will remain listed.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As a result of the delay in filing our periodic
reports with the SEC, we were unable to comply with the listing standards of OTCBB and our common stock was removed from the OTCBB
effective May 20, 2009. Our common stock was again listed on the OTCBB on August 5, 2010. We are currently listed on the OTC Markets
Group Inc. QB tier (the &ldquo;<B>OTCQB</B>&rdquo;), an interdealer quotation system that is, in almost all respects, comparable
to the OTCBB and which requires that we timely file periodic reports with the SEC. If we were to become delinquent in our filings,
our common stock may be de-listed from the OTCQB. If it is de-listed again in the future, the price of our common stock will likely
be adversely affected and there may be a decrease in the liquidity of our common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Because we do not have any revenues,
we expect to incur operating losses for the foreseeable future.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have never generated revenues and we
have never been profitable. Prior to completing exploration on our mineral properties, we anticipate that we will incur increased
operating expenses without realizing any revenues. We therefore expect to incur significant losses into the foreseeable future.
If we are unable to generate financing to continue the exploration of our properties, we will fail and you will lose your entire
investment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>None of the properties in which we
have an interest or the right to earn an interest have any known reserves.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently have interest in a strategic
land package of nine (9) properties none of which contain any reserves. Based on our exploration activities through the date of
this Prospectus, we do not have sufficient information upon which to assess the ultimate success of our exploration efforts. If
we do not establish reserves we may be required to curtail or suspend our operations, in which case the market value of our common
stock may decline and you may lose all or a portion of your investment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have only completed the initial stages
of exploration of our properties, and thus have no way to evaluate whether we will be able to operate our business successfully.
To date, we have been involved primarily in organizational activities, acquiring interests in properties and in conducting preliminary
exploration of properties. We have not earned any revenues and have not achieved profitability as of the date of this Prospectus.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>We are subject to all the risks inherent
to mineral exploration, which may have an adverse affect on our business operations.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Potential investors should be aware of the
difficulties normally encountered by mineral exploration companies and the high rate of failure of such enterprises. The likelihood
of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection
with the exploration of the mineral properties that we plan to undertake. These potential problems include, but are not limited
to, unanticipated problems relating to exploration and additional costs and expenses that may exceed current estimates. If we are
unsuccessful in addressing these risks, our business will likely fail and you will lose your entire investment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">We are subject to the numerous risks and
hazards inherent to the mining industry and resource exploration including, without limitation, the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>interruptions caused by adverse weather conditions; and</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>unforeseen limited sources of supplies resulting in shortages of materials, equipment and availability of experienced manpower.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The prices and availability of such equipment,
facilities, supplies and manpower may change and have an adverse effect on our operations, causing us to suspend operations or
cease our activities completely.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>It is possible that our title for
the properties in which we have an interest will be challenged by third parties.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have not obtained title insurance for
our properties. It is possible that the title to the properties in which we have our interest will be challenged or impugned. If
such claims are successful, we may lose our interest in such properties. For more information please refer to &ldquo;<B>Management&rsquo;s
Discussion and Analysis of Financial Condition and Results of Operations</B>.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Our failure to compete with our competitors
in mineral exploration for financing, acquiring mining claims, and for qualified managerial and technical employees will cause
our business operations to slow down or be suspended.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our competition includes large established
mineral exploration companies with substantial capabilities and with greater financial and technical mineralized materials than
we have. As a result of this competition, we may be unable to acquire additional attractive mining claims or financing on terms
we consider acceptable. We may also compete with other mineral exploration companies in the recruitment and retention of qualified
managerial and technical employees. If we are unable to successfully compete for financing or for qualified employees, our exploration
programs may be slowed down or suspended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Compliance with environmental regulations
applicable to our operations may adversely affect our capital liquidity.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mining is subject to potential risks and
liabilities associated with pollution of the environment and the disposal of waste products occurring as a result of mineral exploration
and production. All phases of our operations in Brazil, where our properties are located, will be subject to environmental regulations.
Environmental legislation in Brazil is evolving in a manner which will require stricter standards and enforcement, increased fines
and penalties for non-compliance, more stringent environmental assessments of proposed projects and a heightened degree of responsibility
for companies and their officers, directors and employees. It is possible that future changes in environmental regulation will
adversely affect our operations as compliance will be more burdensome and costly.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Because we have not allocated any money
for reclamation of any of our mining claims, we may be subject to fines if a mining claim is not restored to its original condition
upon termination of our activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Our directors may face conflicts of
interest in connection with our participation in certain ventures because they are directors of other mineral mineralized material
companies.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our directors may also be a director of
other companies (including mineralized material exploration companies) and, if those other companies participate in ventures in
which we may participate, our directors may have a conflict of interest in negotiating and concluding terms respecting the extent
of such participation. It is possible that due to our directors&rsquo; conflicting interests, we may be precluded from participating
in certain projects that we might otherwise have participated in, or we may obtain less favorable terms on certain projects than
we might have obtained if our directors were not also directors of other participating mineral mineralized materials companies.
In an effort to balance their conflicting interests, our directors may approve terms equally favorable to all of their companies
as opposed to negotiating terms more favorable to us but adverse to their other companies. Additionally, it is possible that we
may not be afforded certain opportunities to participate in particular projects because those projects are assigned to our directors&rsquo;
other companies for which the directors may deem the projects to have a greater benefit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Our future performance is dependent
on our ability to retain key personnel, loss of which would adversely affect our success and growth.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our performance is substantially dependent
on performance of our senior management. In particular, our success depends on the continued efforts of Mr. Pearl, our President
and Chief Executive Officer. The loss of his services could have a material adverse effect on our business, results of operations
and financial condition as our potential future revenues would most likely dramatically decline and our costs of operations would
rise. We do not have employment agreements in place with any of our officers or our key employees, nor do we have key person insurance
covering our employees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B><U>Risks Related To Our Common Stock</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Our failure to timely file certain
periodic reports with the SEC poses significant risks to our business, each of which could materially and adversely affect our
financial condition and results of operations.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We did not timely file with the SEC our
Annual Report on Form 10-K for the fiscal year ended December 31, 2008, and our Quarterly Report on Form 10-Q for the quarterly
periods ended March 31, June 30, and September 30, 2009. Consequently, we were not compliant with the periodic reporting requirements
under the Securities Exchange Act of 1934, as amended. As a result of our failure to have timely filed our periodic reports with
the SEC, our stock was removed from trading on the OTC Bulletin Board (the &ldquo;<B>OTCBB</B>&rdquo;) and began trading on the
&ldquo;Pink Sheets.&rdquo; Our common stock was again listed on the OTCBB on August 5, 2010. In addition, our failure to timely
file those and possibly future periodic reports with the SEC could subject us to enforcement action by the SEC and shareholder
lawsuits. Any of these events could materially and adversely affect our financial condition and results of operations and our ability
to register with the SEC public offerings of our securities for our benefit or the benefit of our security holders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>There currently is a limited market
for our common stock on the OTCQB.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our common stock is quoted on the OTCQB.
Trading in our common stock has been very limited, which could affect the price of our stock. We have no plans, proposals, arrangements
or understandings with any person with regard to the development of an active trading market for our common stock and no assurance
can be given that an active trading market will develop.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>We may conduct further offerings in
the future in which case our current stockholders&rsquo; shareholdings will be diluted.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Since our inception, we have relied on equity
sales of our common stock to fund our operations. We may conduct further equity offerings in the future to finance our current
projects or to finance subsequent projects that we decide to undertake. If common stock is issued in return for additional funds,
the price per share could be lower than that paid by our current stockholders. We anticipate continuing to rely on equity sales
of our common stock in order to fund our business operations. If we issue additional stock, our current stockholders&rsquo; percentage
interest in us will be diluted. The result of this could reduce the value of their stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>We have the ability to issue additional
shares of our common stock without asking for stockholder approval, which could cause our stockholders&rsquo; investment to be
diluted.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Articles of Incorporation authorize
our Board of Directors (the &ldquo;<B>Board</B>&rdquo;) to issue up to 300,000,000 shares of common stock. The power of the Board
to issue shares of common stock or warrants or options to purchase shares of common stock is generally not subject to stockholder
approval. Accordingly, any time the Board determines that it is in the best interests of the corporation to issue shares of its
common stock, your investment will be diluted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>We have issued nearly all of our authorized
shares of common stock and will likely have to either increase the number of shares we are authorized to issue, or conduct a reverse
stock split.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Articles of Incorporation authorize
out Board to issue up to 300,000,000 shares of our common stock. As of December 15, 2012, there are 249,144,706 shares of our common
stock issued and outstanding. Accordingly, in order to conduct any future equity financings we will likely have to either increase
the number of shares we are authorized to issue, or conduct a reverse stock split.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>The value and transferability of our
shares may be adversely impacted by the limited trading market for our stock on the OTCQB, which is a quotation system, not an
issuer listing service, market or exchange. Because buying and selling stock on the OTCQB is not as efficient as buying and selling
stock through an exchange, it may be difficult for our stockholders to sell their shares or you may not be able to sell their shares
for an optimum trading price.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The OTCQB is a regulated quotation service
that displays real-time quotes, last sale prices and volume limitations in over-the-counter securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">When fewer shares of a security are being
traded on the OTCQB, volatility of prices may increase and price movement may outpace the ability to deliver accurate quote information.
Lower trading volumes in a security may result in a lower likelihood of an individual&rsquo;s orders being executed and current
prices may differ significantly from the price one was quoted by the OTCQB at the time of the order entry. The dealer&rsquo;s spread
(the difference between the bid and ask prices) may be large and may result in substantial losses to the seller of securities on
the OTCQB if the common stock or other security must be sold immediately.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Our stock price historically has been
volatile and may continue to be volatile.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The market price of our common stock has
been, and is expected to continue to be, highly volatile. Factors, many of which are beyond our control, include, in addition to
other risk factors described in this section, the announcements of technological innovations by us or other companies, regulatory
matters, new or existing products or procedures, concerns about our financial position, operating results, litigation, government
regulation, developments or disputes relating to agreements, patents or proprietary rights, general economic, industry and market
conditions may have a significant impact on the market price of our stock. In addition, the future sales of shares of common stock
by our stockholders and the holders of our then outstanding warrants and options could have an adverse effect on the market price
of our outstanding shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The trading price of our common stock has,
from time to time, fluctuated widely and in the future may be subject to similar fluctuations. The trading price may be affected
by a number of factors including the risk factors set forth herein, as well as our operating results, financial condition, general
economic conditions, market demand for our common stock, and various other events or factors both in and out of our control. In
recent years, broad stock market indices, in general, and smaller capitalization companies, in particular, have experienced substantial
price fluctuations. In a volatile market, we may experience wide fluctuations in the market price of our common stock. These fluctuations
may have a negative effect on the market price of our common stock. To the extent our stock price fluctuates and/or remains low,
it could cause our stockholders to lose some or all of their investment and impair our ability to raise capital through the offering
of additional equity securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Future sales of our common stock could
adversely affect its price and our future capital-raising activities could involve the issuance of equity securities, which would
dilute your investment and could result in a decline in the trading price, if any, of our common stock.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We may sell securities in the public or
private equity markets if and when conditions are favorable, even if we do not have an immediate need for additional capital at
that time. Sales of substantial amounts of our common stock, or the perception that such sales could occur, could adversely affect
the prevailing market price of our common stock and our ability to raise capital. We may issue additional common stock in future
financing transactions or as incentive compensation for our executive management and other key personnel, consultants and advisors.
Issuing any equity securities would be dilutive to the equity interests represented by our then-outstanding shares of common stock.
The market price, if any, for our common stock could decrease as the market takes into account the dilutive effect of any of these
issuances. Furthermore, we may enter into financing transactions at prices that represent a substantial discount to the market
price of our common stock. A negative reaction by investors and securities analysts to any discounted sale of our equity securities
could result in a decline in the trading price of our common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Alltech Capital Limited, a private
corporation, owns approximately 54% of our issued and outstanding stock. This ownership interest may preclude you from influencing
significant corporate decisions.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As of December 15, 2012, Alltech owned 135,000,000
shares, or approximately 54%, of our outstanding common stock. As a result, Alltech may be able to exercise significant influence
over matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions,
and will have significant control over our management and policies. Alltech&rsquo;s interests may be different from yours. For
example, it may support proposals and actions with which you may disagree or which are not in your interest. This concentration
of ownership could delay or prevent a change in control of our company or otherwise discourage a potential acquirer from attempting
to obtain control of our company, which in turn could reduce the price of our common stock. In addition, Alltech could use its
voting influence to maintain our existing management and directors in office, or support or reject other management and board proposals
that are subject to stockholder approval, such as the adoption of employee stock plans and significant unregistered financing transactions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>There are options to purchase shares
of our common stock currently outstanding.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As of December 15, 2012, we have granted
options to purchase shares of our common stock to various persons and entities, under which we could be obligated to issue up to
9,650,000 shares. The exercise prices of these options range from $0.05 to $0.12 per share. If issued, the shares underlying these
options would increase the number of shares of our common stock currently outstanding and dilute the holdings and voting rights
of our then-existing stockholders.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>There are warrants to purchase shares
of our common stock currently outstanding.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As of December 15, 2012, there were 8,000,000
warrants outstanding to purchase an equal number of shares of our common stock at an exercise price of $0.08 per share through
June 20, 2013. If issued, the shares underlying these warrants would increase the number of shares of our common stock currently
outstanding and dilute the holdings and voting rights of our then-existing stockholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>We do not intend to pay dividends
for the foreseeable future.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently intend to retain future earnings,
if any, to support the development and expansion of our business and do not anticipate paying cash dividends in the foreseeable
future. Our payment of any future dividends will be at the discretion of our Board after taking into account various factors, including
but not limited to our financial condition, operating results, cash needs, growth plans and the terms of any credit agreements
that we may be a party to at the time. Accordingly, investors must rely on sales of their common stock after price appreciation,
which may never occur, as the only way to realize their investment. Investors seeking cash dividends should not purchase our securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Our common stock is a &ldquo;penny
stock,&rdquo; and because &ldquo;penny stock&rdquo; rules will apply, our stockholders may find it difficult to sell the shares
of our common stock they currently own.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our common stock is a &ldquo;penny stock&rdquo;
as that term is defined under Rule 3a51-1 of the Exchange Act. Generally, a &ldquo;penny stock&rdquo; is a common stock that is
not listed on a securities exchange and trades for less than $5.00 a share. Prices often are not available to buyers and sellers
and the market may be very limited. Penny stocks in start-up companies are among the riskiest equity investments. Broker-dealers
who sell penny stocks must provide purchasers of these stocks with a standardized risk-disclosure document prepared by the SEC.
The document provides information about penny stocks and the nature and level of risks involved in investing in the penny stock
market. A broker must also give a purchaser, orally or in writing, bid and offer quotations and information regarding broker and
salesperson compensation, make a written determination that the penny stock is a suitable investment for the purchaser and obtain
the purchaser&rsquo;s written agreement to the purchase. Many brokers choose not to participate in penny stock transactions. Because
of the penny stock rules, there is less trading activity in penny stocks and our stockholders are likely to have difficulty selling
their shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>FINRA sales practice requirements
may also limit a stockholder&rsquo;s ability to buy and sell our common stock.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In addition to the &ldquo;penny stock&rdquo;
rules described above, FINRA 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&rsquo;s financial status, tax status, investment objectives and other information. Under interpretations of these
rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least
some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common
stock, which may limit our stockholders&rsquo; ability to buy and sell our common stock and have an adverse effect on the market
for our shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>Cost of compliance
with changing regulation of corporate governance and public disclosure has and will continue to result in additional expense.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Keeping abreast of,
and in compliance with, changing laws, regulations and standards relating to corporate governance and public disclosure, including
the Sarbanes-Oxley Act of 2002, new SEC regulations and, in the event we ever apply and are approved for listing on NASDAQ or another
registered stock exchange, NASDAQ and stock exchange rules, has required and will in the future require an increased amount of
management attention and external resources. We intend to continue to invest all reasonably necessary resources to comply with
evolving standards, which may result in increased general and administrative expenses and a diversion of management time and attention
from revenue-generating activities to compliance activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt; font-variant: small-caps"><B>Note
Regarding Forward-Looking Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">This Prospectus contains forward-looking
statements which involve assumptions and describe our future plans, strategies, and expectations, are generally identifiable by
use of the words &ldquo;<B>may</B>,&rdquo; &ldquo;<B>will</B>,&rdquo; &ldquo;<B>should</B>,&rdquo; &ldquo;<B>expect</B>,&rdquo;
&ldquo;<B>anticipate</B>,&rdquo; &ldquo;<B>estimate</B>,&rdquo; &ldquo;<B>believe</B>,&rdquo; &ldquo;<B>intend</B>,&rdquo; or &ldquo;<B>project</B>&rdquo;
or the negative of these words or other variations on these words or comparable terminology. These statements are expressed in
good faith and based upon our current assumptions, expectations and projections, but there can be no assurance that these expectations
will be achieved or accomplished.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Such forward-looking statements include
statements regarding, among other things, (a) the potential for us to locate any reserves, our potential profitability, and cash
flows, (b) our growth strategies, (c) expectations from our exploration activities, (d) our future financing plans, and (e) our
anticipated needs for working capital.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Although forward-looking statements in this
report reflect the good faith judgment of our management, forward-looking statements are inherently subject to known and unknown
risks and uncertainties. Actual events or results may differ materially from those discussed in forward-looking statements as a
result of various factors, including, without limitation, the risks outlined under &ldquo;<B>Risk Factors</B>&rdquo; and matters
described in this Prospectus generally. In light of these risks and uncertainties, there can be no assurance that the forward-looking
statements contained in this filing will in fact occur. Readers are urged not to place undue reliance on these forward-looking
statements, which speak only as of the date of this Prospectus. We assume no obligation to update any forward-looking statements
in order to reflect any event or circumstance that may arise after the date of this Prospectus, other than as may be required by
applicable law or regulation.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>We have little likelihood of long-term
success unless we are able to continue to raise capital from the sale of our securities or financing from other sources until,
if ever, we generate positive cash flow from operations.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt; font-variant: small-caps"><B>Use
Of Proceeds</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Although we will pay substantially all the
expenses incident to the registration of the shares, we will not receive any proceeds from the sales by the Selling Stockholder.
We received a total of $5,000,000 from the sale of the shares to the Selling Stockholder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><SUP>&nbsp;</SUP></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><SUP>&nbsp;</SUP></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt; font-variant: small-caps"><B>Determination
Of Offering Price</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Selling Stockholder will determine at
what price it may sell the offered shares, and such sales may be made at prevailing market prices, or at privately negotiated prices.<B>
Please refer to &ldquo;Plan of Distribution.&rdquo;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt; font-variant: small-caps"><B>Market
Price of and Dividends On Our Common Stock and Related Stockholder Matters</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our common stock is currently quoted on
the OTCQB. Our common stock was removed from the OTCBB effective May 20, 2009, and relisted on the OTCBB on August 5, 2010. <B>Please
refer to &ldquo;Risk Factors.&rdquo;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table sets forth the high
and low bid prices for shares of our common stock for the calendar quarters indicated as reported by the various listing services
for the last two years. These prices represent quotations between dealers without adjustment for retail mark-up, markdown or commission
and may not represent actual transactions. Our stock is also quoted on the Stuttgart Exchange under the symbol <B>A4G.SG</B> and
the Frankfurt Exchange under the symbols &ldquo;<B>A4G.F</B>,&rdquo; and &ldquo;<B>XE7RA.A4G.DE</B>&rdquo; and on the Berlin-Bremen
Exchange under the symbol &ldquo;<B>A4G.BER</B>.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-weight: bold; text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">First Quarter</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Second Quarter</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Third Quarter</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="color: black; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="color: Black; font-weight: normal; text-align: center; border-bottom: Black 1pt solid; font-style: normal"><FONT STYLE="font-size: 10pt; color: black"><B>Fourth
Quarter</B> </FONT><SUP></SUP></TD><TD NOWRAP STYLE="padding-bottom: 1pt; color: black; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 40%">2012 &ndash; High</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">0.12</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">0.09</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">0.05</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">0.06</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>2012 &ndash; Low</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.04</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.04</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.04</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.04</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>2011 &ndash; High</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.40</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.32</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.18</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.10</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>2011 &ndash; Low</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.24</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.12</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="color: black">&nbsp;</TD>
    <TD STYLE="color: black; text-align: left">$</TD><TD STYLE="color: black; text-align: right">0.09</TD><TD STYLE="color: black; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.10</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The closing price of our common stock on January
2, 2013<FONT STYLE="font: 10pt Times New Roman, Times, Serif">, was $0.04</FONT>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As of December 15, 2012, there were approximately
743 holders of record of our common stock. <FONT STYLE="color: black">We have not paid any cash dividends. <B>Please refer to &ldquo;Dividend
Policy&rdquo; below.</B></FONT> <FONT STYLE="color: black">We do not have securities authorized for issuance under an equity compensation
plan.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">As of </FONT>December
<FONT STYLE="color: black">15, 2012, there were </FONT>9,650,000 stock options outstanding under our incentive stock option plan.
The stock options are exercisable at prices ranging from $0.05 to $0.12 per share, with expiration dates ranging from October 10,
2016 to April 19, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As of December 15, 2012, there were 8,000,000
warrants outstanding to purchase an equal number of shares of our common stock at an exercise price of $0.08 per share through
June 20, 2013. If the holders were to acquire all 8,000,000 shares issuable upon the exercise of outstanding warrants, we would
receive an additional <FONT STYLE="color: black">$640,000.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">We did not make
any repurchases of our securities during the fiscal year ended December 31, 2011, or the subsequent period through </FONT>December
<FONT STYLE="color: black">15, 2012.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Transfer Agent</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The transfer agent of our common stock is
Worldwide Stock Transfer, LLC, having an office at 433 Hackensack Avenue, Level L, Hackensack, NJ, USA 07601.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Penny Stock</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The SEC has adopted rules that regulate
broker-dealer practices in connection with transactions in penny stocks. Our stock is currently a &ldquo;penny stock.&rdquo; Penny
stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities
exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such
securities is provided by the exchange or system. The penny stock rules require a broker-dealer, prior to a transaction in a penny
stock not otherwise exempt from those rules, deliver a standardized risk disclosure document prepared by the Commission, which:
(a) contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary
trading; (b) contains a description of the broker&rsquo;s or dealer&rsquo;s duties to the customer and of the rights and remedies
available to the customer with respect to a violation to such duties or other requirements of Securities&rsquo; laws; (c) contains
a brief, clear, narrative description of a dealer market, including bid and ask prices for penny stocks and significance of the
spread between the bid and ask price; (d) contains a toll-free telephone number for inquiries on disciplinary actions; (e) defines
significant terms in the disclosure document or in the conduct of trading in penny stocks; and (f) contains such other information
and is in such form as the Commission shall require by rule or regulation. The broker-dealer also must provide to the customer,
prior to effecting any transaction in a penny stock, (a) bid and offer quotations for the penny stock; (b) the compensation of
the broker-dealer and its salesperson in the transaction; (c) the number of shares to which such bid and ask prices apply, or other
comparable information relating to the depth and liquidity of the market for such stock; and (d) monthly account statements showing
the market value of each penny stock held in the customer&rsquo;s account. In addition, the penny stock rules require that prior
to a transaction in a penny stock not otherwise exempt from those 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&rsquo;s written acknowledgment of the
receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy
of a written suitably statement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">These disclosure requirements may have the
effect of reducing the trading activity in the secondary market for our stock if it becomes subject to these penny stock rules.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Rule 144</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">At December 15,
2012, there were </FONT>249,144,706 <FONT STYLE="color: black">shares of our common stock issued and outstanding, of which 159,990,838
shares are deemed &ldquo;restricted securities,&rdquo; within the meaning of Rule 144. Absent registration under the Securities
Act, the sale of such shares is subject to Rule 144, as promulgated under the Securities Act.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In general, under Rule 144, subject to the
satisfaction of certain other conditions, a person deemed to be one of our affiliates, who has beneficially owned restricted shares
of our common stock for at least one year is permitted to sell in a brokerage transaction, within any three-month period, a number
of shares that does not exceed the greater of 1% of the total number of outstanding shares of the same class, or, if our common
stock is quoted on a stock exchange, the average weekly trading volume during the four calendar weeks preceding the sale, if greater.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Rule 144 also permits a person who presently
is not and who has not been an affiliate of ours for at least three months immediately preceding the sale and who has beneficially
owned the shares of common stock for at least nine months to sell such shares without restriction other than the requirement that
there be current public information as set forth in Rule 144. To the extent that Rule 144 is otherwise available, this provision
is currently applicable to all of the restricted shares. If a non-affiliate has held the shares for more than one year, such person
may make unlimited sales pursuant to Rule 144 without restriction.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The possibility that substantial amounts
of our common stock may be sold under Rule 144 into the public market may adversely affect prevailing market prices for the common
stock and could impair our ability to raise capital in the future through the sale of equity securities. Please refer to &ldquo;<B>Risk
Factors</B>.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Dividend Policy</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have never paid cash dividends on our
capital stock and do not anticipate paying any cash dividends in the foreseeable future, but intend to retain our capital mineralized
materials for reinvestment in our business. Any future determination to pay cash dividends will be at the discretion of our Board
of and will be dependent upon our financial condition, results of operations, capital requirements and other factors as the Board
deems relevant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt; font-variant: small-caps"><B>Management&rsquo;s
Discussion And Analysis Of Financial Condition</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt; font-variant: small-caps"><B>And
Results Of Operations</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following information should be read
in conjunction with our audited consolidated financial statements and related notes thereto for the years ended December 31, 2011
and 2010, included elsewhere in this Prospectus. We also urge you to review and consider our disclosures describing various risks
that may affect our business, which are set forth under the heading &ldquo;<B>Risk Factors</B>.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>General</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">We are a mineral
exploration company engaged in the exploration of base, precious metals and industrial minerals worldwide. We were incorporated
under the laws of the State of Delaware on October 10, 1995, under the name &ldquo;Chefs Acquisition Corp.&rdquo; We conduct our
exploration and property acquisition activities through our head office which is located at is located at </FONT>C/- Coresco AG,
Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland. <FONT STYLE="color: black">The telephone number is (+41) 7887-96966. We also
maintain an office in Brazil </FONT>at Av. Jornalista Ricardo Marinho, 360, sala 113, Ed. Cosmopolitan, Barra da Tijuca, Rio de
Janeiro, CEP 22631-350.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We had no revenues during the fiscal years
ended December 31, 2011 and 2010. Funds raised in fiscal 2012 and 2011 were used for exploration of our properties and general
administration. We have sustained losses since inception, have been issued a going concern opinion by our auditors and rely upon
the sale of our securities to fund operations. We will not generate revenues even if any of our exploration programs indicate that
a mineral deposit may exist on our properties. Accordingly, we will be dependent on future financings in order to maintain our
operations and continue our exploration activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On June 15, 2010, pursuant to the Asset
Purchase Agreement between Global Minerals Ltd. (&ldquo;<B>GML</B>&rdquo;) and Mount Royale Ventures, LLC (&ldquo;<B>MRV</B>&rdquo;),
as Sellers, us and AGC Resources LLC, our wholly-owned subsidiary(&ldquo;<B>AGC</B>&rdquo;), as Buyers, AGC acquired 50% interest
in the Front Range Gold Project joint venture (&ldquo;<B>JV</B>&rdquo;), and title to the Gold Hill Mill, and became a joint venture
partner with Gold Reef Mining Company, Mi Vida Enterprises, Inc., Gold Hill Mines, Inc. and Southern Cross Prospecting Company
(&ldquo;<B>Property Owners</B>&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On March 10, 2011,
Mi Vida Enterprises, Inc., Gold Hill Mines, Inc. and Southern Cross Prospecting Company intervened in a preexisting lawsuit commenced
by MRV against Gold Reef Mining Company in Boulder County District Court (the &ldquo;<B>Action</B>&rdquo;). Among other things,
they have alleged that GML was in material default of the JV agreement prior to the assignment by GML of its rights in the JV to
AGC in June of 2010, that GML wrongfully assigned its rights in the JV without permission of the Property Owners, and have asked
the court to declare the JV terminated. The Property Owners also alleged that the transfer of title to the Gold Hill Mill was subject
to a right of first refusal in favor of Gold Hill Mines, Inc., and that MRV conveyed its title to the Gold Hill Mill to AGC without
giving proper notice to Gold Hill Mines Inc. and in violation of a right of first refusal in favor of Gold Hill Mines, Inc., and
requested the court to enter an order granting Gold Hill Mines Inc. an option to purchase the Gold Hill Mill for $10,000, the amount
set in the right of first refusal.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">A court decision in
favor of the Property Owners may have a material adverse effect on our ability to collect the purchase price, plus royalty from
the sale of AGC to Devtec Management Ltd. since an unfavorable court decision may result in AGC losing its 50% interest in the
JV as well as its interest in and to the Gold Hill Mill.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On June 14, 2011, we
entered into an Asset Purchase Agreement with Devtec Management Ltd. (&ldquo;<B>Devtec</B>&rdquo;), pursuant to which we sold our
subsidiary, AGC Resources LLC, which owns certain properties in Boulder, Colorado, to Devtec for a total of $2 million, plus royalty.
Devtec will pay us $1 million upon production of the cumulative total of 1,000 ounces of gold and/or silver, and a further $1 million
on the nine month anniversary of the payment of the first $1 million. Additionally, Devtec will pay us a 5% royalty from the start
of production.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Effective as of October
11, 2011, our <FONT STYLE="color: black">Board </FONT>granted 4,200,000 stock purchase options pursuant to our 2007 Stock Option
Plan (the &ldquo;<B>Plan</B>&rdquo;). Each of the options has an issue date, effective date and vesting date of October 11, 2011,
with an exercise price of $0.12 per share. The term of these options is five years. The options are exercisable at any time from
the grant date up to and including the October 10, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Effective as of November
24, 2011, our <FONT STYLE="color: black">Board </FONT>granted 3,650,000 stock purchase options pursuant to our Stock Option Plan.
Each of the options has an issue date, effective date and vesting date of November 24, 2011, with an exercise price of $0.05 per
share. The term of these options is five years. The options are exercisable at any time from the grant date up to and including
the November 24, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Effective as of December
15, 2011, we entered into debt settlement agreements with four creditors pursuant to which we issued 10,937,721 shares of our common
stock and the creditors agreed to forgive and release us from paying an aggregate of $218,754.42 owed to the creditors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Effective as of December 20, 2011, we entered
into subscription agreements pursuant to which we sold an aggregate of 8,000,000 units of our securities at a purchase price of
$0.04 per unit, for a gross aggregate price of $320,000, to six investors in reliance upon an exemption from securities registration
afforded by, but not limited to, the provisions of Regulation S of the Securities Act of 1933. Each unit consisted of one share
of our common stock, $0.001 par value per share and one Series A Stock Purchase Warrant (the &ldquo;<B>Series A Warrants</B>&rdquo;).
Each full Series A Warrant entitles the holder to purchase an additional share of our common stock at an exercise price of $0.08
per share for a period of eighteen months commencing on December 20, 2011 and expiring on June 20, 2013.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Significant developments during the nine month period ended
September 30, 2012 and Subsequent Events to December</B> <B>15, 2012</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">From January 1, 2012 through December 15,
2012, we have been evaluating our property holdings in order to determine whether to implement exploration programs on our existing
properties or to acquire interests in new properties.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For the nine month
periods ended September 30, 2012 and 2011, we recorded exploration expenses of $131,724 compared to $261,304, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On September 21, 2012, we entered into a
subscription agreement with Alltech pursuant to which we agreed to sell to Alltech 135,000,000 shares of our common stock, representing
approximately 54% of our issued and outstanding shares of common stock, for a purchase price of $5,000,000. The closing of the
transaction occurred on October 5, 2012. As a result of the sale a change in control of the Company occurred. As a condition to
the closing of the transaction, we agreed to increase the size of our board of directors to five (5) members and to appointed two
board members selected by Alltech. The board of directors appointed each of Messrs. Vladimir Bernshtein and Andrey Ratsko to serve
as directors of the Company. Additionally, Mr. Bernshtein has been named as the Company&rsquo;s Chief Business Development Director.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Exploration Activities</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are a junior mineral exploration company
and conducts principal and technical activities from Coresco AG, Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland. The telephone
number is (+41) 41 711 0281. These offices are provided to the Company on a month-to-month basis. We believe these offices are
adequate for the business requirements during the next 12 months; we do not own any real property.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Management and the board reviewed and clarified
our strategic objectives to concentrate efforts on existing operations where infrastructure already exists, properties presently
being developed or in advanced stages of exploration that have potential for additional discoveries and grass-roots exploration
opportunities. We are currently concentrating on property exploration activities in Brazil.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The properties are in the exploration stage
only and without a known body of mineral reserves. Development of the properties will follow only if satisfactory exploration results
are obtained. Mineral exploration and development involves a high degree of risk and few properties that are explored are ultimately
developed into producing mines. There is no assurance that the mineral exploration and development activities will result in any
discoveries of commercially viable bodies of mineralization. The long-term profitability of the operations will be, in part, directly
related to the cost and success of the exploration programs, which may be affected by a number of factors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently have an interest in a strategic
land package of nine (9) properties none of which contain any reserves. The exploration license areas are divided into 2 groups,
the S&#259;o Domingos and the Sao Joao areas.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Three and nine months ended September
30, 2012 (Fiscal 2012) versus three and nine months ended September 30, 2011 (Fiscal 2011)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Revenues and Net Loss</B> &ndash; The
Company has yet to generate any revenues or establish any history of profitable operations. The Company recorded a net loss of
$(566,344) for the nine months ended September 30, 2012 (September 30, 2011: net loss $3,782,688) and $(70,112) for the three months
ended September 30, 2012 (September 30, 2011: net loss $446,985) or $(0.00) (September 30, 2011: $(0.00)) and $(0.01) [September
30, 2011: $(0.04)] per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Expenses </B>&ndash; The general and
administrative expenses consist primarily of personnel costs, legal costs, investor relations costs, stock based compensation costs,
accounting costs and other professional and administrative costs. General and Administrative expenses were $218,587 for the nine
months ended September 30, 2012 (September 30, 2011: $139,250) and $27,995 for the three months ended September 30, 2012 (September
30, 2011: $54,095). The decrease quarter on quarter costs reflects further cash conservation initiatives implemented my management.
Included in expenses are professional accounting and legal fees of $80,450 for the nine months ended September 30, 2012 (September
30, 2011: $189,198) and $47,674 for the three months ended September 30, 2012 (September 30, 2011: $25,219) which represents further
initiatives by management to settle long outstanding financial liabilities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Exploration expenditures</B> &ndash;
Exploration expenses are charged to operations as they are incurred. The Company recorded exploration expenses of $131,724 for
the nine months ended September 30, 2012 (September 30, 2011: $261,304) and $7,772 for the three months ended September 30, 2012
(September 30, 2011: $23,055) the majority relating to maintenance activities at the Brazilian properties during the current quarter
and Colorado and Brazil mine in prior quarter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Depreciation expense </B>&ndash; Depreciation
expenses charged to operations were nil for the nine months ended September 30, 2012 and nil for the three months ended September
30, 2012. (Nine months ended September 30, 2011: $22,001 and three months ended September 30, 2011: $6,538).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Gain on extinguishment of liabilities</B>
&ndash; During the three and nine months ended September 30, 2012, the Company recorded gain on extinguishment of liabilities of
$94,860, which represents further initiatives by management to settle long outstanding financial liabilities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Liquidity and Capital Resources</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>September 30, 2012 versus December 31,
2011:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Recent developments in capital markets have
restricted access to debt and equity financing for many companies. Our exploration properties are in the exploration stage and
have not commenced commercial production. Consequently, we have no history of earnings or cash flow from our operations. As a result,
we are reviewing our 2012 fiscal exploration and capital spending requirements in light of the current and anticipated global economic
environment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently finance our activities primarily
by the private placement of securities. There is no assurance that equity funding will be accessible to us at the times and in
the amounts required to fund our activities. There are many conditions beyond our control, which have a direct bearing on the level
of investor interest in the purchase of our securities. We may also attempt to generate additional working capital through the
operation, development, sale or possible joint venture development of our properties; however, there is no assurance that any such
activity will generate funds that will be available for operations. Debt financing has been used to fund our property acquisitions
and exploration activities. We do not have &ldquo;standby&rdquo; credit facilities, or off-balance sheet arrangements and it does
not use hedges or other financial derivatives. We have no agreements or understandings with any person as to additional financing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On September 21, 2012, we entered into a
subscription agreement with Alltech pursuant to which we agreed to sell to Alltech 135,000,000 shares of our common stock, representing
approximately 54% of our issued and outstanding shares of common stock, for a purchase price of $5,000,000. The closing of the
transaction occurred on October 5, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In October 2011, we filed a Registration
Statement on Form S-1 offering up to a maximum of 50,000,000 units of our securities at an offering price of $0.10 per Unit in
a direct public offering, without any involvement of underwriters or broker-dealers. Each Unit consists of one (1) share of common
stock at a $0.001 par value per share and one (1) Stock Purchase Warrant. Each full Warrant entitles the holder to purchase one
additional share of common stock at a price of $0.20 for a period of two years commencing November 1, 2011 through October 31,
2013. The Units will be sold by the Chief Executive Officer and Chief Financial Officer. A Notice of Effectiveness was issued April
25, 2012. The offer will expire January 20, 2013. To date, no funds have been obtained from this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At September 30, 2012, we had cash of $1,241
(December 31, 2011: $237,426) and a working capital deficiency of $(576,152) and $(300,218) as at December 31, 2011. Total liabilities
as of September 30, 2012, were $577,393 (December 31, 2011: $537,644).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During April 2012, we entered into a debt
settlement agreement for $18,000 in accounts payable which was settled for 300,000 shares of common stock at an issue price of
$0.06 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During March 2012, we entered into debt
settlement agreements for advances received from an individual and a company during fiscal 2011, as well as $14,454 of amounts
in accounts paable and accrued expenses. $119,454 was settled for 1,990,900 shares of common stock at an issue price of $0.06 per
share. Further details are provided under the common stock notes to these financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our general business strategy is to acquire
mineral properties either directly or through the acquisition of operating entities. Our consolidated financial statements have
been prepared in accordance with generally accepted accounting principles in the United States of America and applicable to a going
concern which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of
business. As discussed in note 1 to the consolidated financial statements, we have incurred recurring operating losses since inception,
have not generated any operating revenues to date and have used cash of $381,481 from operating activities in 2012 through September
30. We require additional funds to meet our obligations and maintain our operations. We do not have sufficient working capital
to (i) pay our administrative and general operating expenses through June 30, 2013 and (ii) to conduct our preliminary exploration
programs. Without cash flow from operations, we may need to obtain additional funds (presumably through equity offerings and/or
debt borrowing) in order, if warranted, to implement additional exploration programs on our properties. While we may attempt to
generate additional working capital through the operation, development, sale or possible joint venture development of our properties,
there is no assurance that any such activity will generate funds that will be available for operations. Failure to obtain such
additional financing may result in a reduction of our interest in certain properties or an actual foreclosure of our interest.
We have no agreements or understandings with any person as to such additional financing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our exploration properties have not commenced
commercial production and we have no history of earnings or cash flow from our operations. While we may attempt to generate additional
working capital through the operation, development, sale or possible joint venture development of our property, there is no assurance
that any such activity will generate funds that will be available for operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Cash Flow</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Nine months ended September 30, 2012
versus nine months ended September 30, 2011:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Operating activities:</B> We used cash
of $381,481 (September 30, 2011: $986,424). Changes in prepaid expenses and other assets resulted were nil during the period (September
30, 2011: increase of $7,016) and changes in accounts payable and accrued expenses (including related party) resulted in an increase
in cash of $224,063 (September 30, 2011: decrease in cash of $732).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Investing Activities: </B>There were
no investing activities during the period (September 30, 2011: $80,000 financial warranty from Colorado Mined Land Reclamation
bonds returned).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Financing Activities:</B> We intend to
finance activities by raising capital through the equity markets. In October 2011, we filed a Registration Statement on Form S-1
offering up to a maximum of 50,000,000 units of the Company's securities at an offering price of $0.10 per Unit in a direct public
offering, without any involvement of underwriters or broker-dealers. Each Unit consists of one (1) share of common stock at a $0.001
par value per share and one (1) Stock Purchase Warrant. Each full Warrant entitles the holder to purchase one additional share
of common stock at a price of $0.20 for a period of two years commencing November 1, 2011 through October 31, 2013. The Units will
be sold by the Chief Executive Officer and Chief Financial Officer. A Notice of Effectiveness was issued April 25, 2012. The offer
will expire January 20, 2013. To date, no funds have been obtained from this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On September 21, 2012, we entered into a
subscription agreement with Alltech pursuant towhich we agreed to sell to Alltech 135,000,000 shares of our common stock, representing
approximately 54% of our issued and outstanding shares of common stock, for a purchase price of $5,000,000. The closing of the
transaction occurred on October 5, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In August 2012 we received an advance of
$50,000 from a director and officer of the Company. The advance is non-interest bearing and is due on successful capital raising.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On April 16, 2012, we entered into subscription
agreements for 1,316,000 shares of common stock at a purchase price of $0.06 per share for a gross aggregate price of $78,960.
Pursuant to the subscription agreements, each of the Investors has represented that they are not a U.S. person; as such term is
defined in Regulation S. In connection with the offering, we agreed to pay a cash commission equal to 8% of all funds received
or an aggregate of up $48,000 on the total maximum $600,000 subscription.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During April 2012, we entered into a debt
settlement agreement for $18,000 in accounts payable which was settled for 300,000 shares of common stock at an issue price of
$0.06 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During March 2012, we entered into debt
settlement agreements for advances received from a director of the Company and a company during fiscal 2011 as well as $14,454
of amounts in accounts payable and accrued expenses. $119,454 was settled for 1,990,900 shares of common stock at an issue price
of $0.06 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In March 2012, we entered into subscription
agreements for 625,217 shares of common stock at a purchase price of $0.06 per share for a gross aggregate price of $37,513. Share
certificates were not issued as at March 31, 2012 and they were treated as an Advance for Stock Subscriptions. The share certificates
were issued in April 2012. Pursuant to the subscription agreements, each of the Investors has represented that they are not a U.S.
person; as such term is defined in Regulation S. In connection with the offering, the Company has agreed to pay a cash commission
equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum $600,000 subscription that is being offered.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On December 20, 2011, we entered into subscription
agreements for 8,000,000 shares of common stock at a purchase price of $0.04 per share for a gross aggregate price of $320,000.
Attached to each unit of common stock is one (1) series A stock purchase warrant. Each full Series A warrant entitles the holder
to purchase an additional share of the Company&rsquo;s common stock at an exercise price of $0.08 per share for a period of eighteen
months commencing on December 20, 2011 and expiring on June 20, 2013. Pursuant to the subscription agreements, each of the Investors
has represented that they are not a U.S. person; as such term is defined in Regulation S. In connection with the offering, we agreed
to pay a cash commission equal to 8% of all funds received or an aggregate of up $25,600. The actual total amount was $8,800.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On December 15, 2011, we entered into debt
settlement agreements with creditors and related parties in consideration for the issue of our common stock at a per share price
of $0.02 per share. $218,754 was settled for 10,937,721 shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During the fiscal year 2011 the Company
received funds from advances from individuals and a company, totalling $257,000 that were non-interest bearing, were due on demand
and were unsecured. As at the end of the fiscal year this total amount was reduced to $137,000 due to $120,000 of this advance
being converted to common stock for settlement of this indebtedness in December 2011 at $0.04 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In September 2011, we issued 1,671,000 shares
to an individual for cash at $0.10 per share. In September 2011, we issued 150,000 shares to a company for services rendered at
$0.16 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In April 2011, as an incentive to assist
with future private placements, we authorized the payment of a non-cash finder&rsquo;s fee of 450,000 shares of common stock in
connection with the private placement completed in April 2010. The shares were issued in May 2011. All shares issued were to individuals
and companies who reside outside the United States of America. The issuance of the shares was exempt from the registration requirements
of Securities Act by virtue of Section 4(2) thereof as well as the exemption from registration requirements afforded by Regulation
S.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Year Ended December 31, 2011 (Fiscal 2011) versus Year Ended
December 31, 2010 (Fiscal 2010)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Revenues and Net Loss </B>&ndash; We
have yet to generate any revenues or establish any history of profitable operations. For the year ended December 31, 2011, we recorded
a net loss of $4,627,338 (2010: net loss $2,302,083) or $(0.05) [2010: $(0.03)] per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Expenses</B> &ndash; General and administrative
expenses consist primarily of personnel, legal, investor relations, stock based compensation, accounting and other professional
and administrative costs. For the year ended December 31, 2011 we recorded General and Administrative expenses of $550,655 (2010:
$397,848). Professional fees for accounting of $129,353 (2010: $120,220) and legal $111,772 (2010: $308,323) were also incurred.
The majority of the legal costs incurred during fiscal 2010 relate to the Global Asset Purchase Agreement on June 14, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Exploration expenditures</B> &ndash;
Exploration expenses are charged to operations as they are incurred. For the year ended December 31, 2011, we recorded exploration
expenses of $307,613 (2010: $644,313).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Depreciation expenses</B> &ndash; Depreciation
expenses charged to operations for the year ended December 31, 2011, were $27,897 (2010: $17,738).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>AGC Resources LLC </B>&ndash;<B> (Boulder, Colorado Property
Disposed June 14, 2011)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On June 14, 2011, we entered into an Asset
Purchase Agreement with Devtec, pursuant to which the Company sold its subsidiary, AGC, which owns certain properties in Boulder,
Colorado (see Note 3(c) of our 2011 consolidated financial statements for a discussion of the specific assets purchased by AGC
in June 2010), to Devtec for a total of $2 million, plus royalty. Under the terms of the agreement, Devtec will pay us $1 million
upon production of the cumulative total of 1,000 ounces of gold and/or silver, and a further $1 million on the nine month anniversary
of the payment of the first $1 million. Additionally, Devtec will pay us a 5% royalty from the start of production.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are unable to reasonably estimate the
amount of minerals the properties will produce, if any, and thus there is uncertainty as to whether the purchase price will be
collected. Further, the collection of any purchase price is also contingent on the outcome of the court case described in Note
3 of our 2011 consolidated financial statements. Given these factors, collection of the purchase price is not considered reasonably
possible at the time of this report given the current uncertain status of exploration work on the Boulder, Colorado properties
and the uncertainties of the related legal action and thus no purchase price has been recorded as of September 30, 2012. Once collection
of the purchase price becomes assured and the aforementioned uncertainties resolved, the purchase price will be recorded in the
Consolidated Statements of Operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Accordingly, we have recognized a loss on
the sale of our subsidiary of $2,757,511 for the year ended December 31, 2011, which represents the net book value of the assets
transferred to Devtec on June 14, 2011 (no liabilities were assumed by Devtec) as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 85%; text-align: left">Reclamation bonds</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: right">245,221</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Buildings and equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">753,605</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Participating interest in mineral property</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,758,685</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">Total</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,757,511</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Liquidity and Capital Resources</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>December 31, 2011 versus December 31, 2010:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Recent developments in capital markets have
restricted access to debt and equity financing for many companies. Our exploration properties are in the exploration stage and
have not commenced commercial production. Consequently, we have no history of earnings or cash flow from its operations. As a result,
we are reviewing its 2012 exploration and capital spending requirements in light of the current and anticipated, global economic
environment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently finance our activities primarily
by the private placement of securities. There is no assurance that equity funding will be accessible to us at the times and in
the amounts required to fund our activities. There are many conditions beyond our control which have a direct bearing on the level
of investor interest in the purchase of our securities. We may also attempt to generate additional working capital through the
operation, development, sale or possible joint venture development of its properties; however, there is no assurance that any such
activity will generate funds that will be available for operations. Debt financing has been used to fund our property acquisitions
and exploration activities. We do not have &ldquo;standby&rdquo; credit facilities, or off-balance sheet arrangements and it does
not use hedges or other financial derivatives. We have no agreements or understandings with any person or entity as to additional
financing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At December 31, 2011, we had cash of $237,426
(2010: $579,191) and working capital deficiency of $(300,218) (2010 working capital of $227,326). Total liabilities as of December
31, 2011 were $537,644 (2010: $372,019).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On December 20, 2011, we entered into subscription
agreements for 8,000,000 shares of common stock at a purchase price of $0.04 per share for a gross aggregate price of $320,000.
Attached to each unit of common stock wass one (1) series A stock purchase warrant. Each full Series A warrant entitles the holder
to purchase an additional share of our common stock at an exercise price of $0.08 per share for a period of eighteen months commencing
on December 20, 2011 and expiring on June 20, 2013. Pursuant to the subscription agreements, each of the Investors has represented
that they are not a U.S. person; as such term is defined in Regulation S. In connection with the offering, we agreed to pay a cash
commission equal to 8% of all funds received or an aggregate of up $25,600.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On December 15, 2011,
we entered into debt settlement agreements with creditors and related parties in consideration for the issue of our common stock
at a per share price of $0.02 per share. $218,754 was settled for 10,937,721 shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the 2011 we
received funds from advances from individuals and a company, totaling $257,000, that were non-interest bearing, were due on demand
and were unsecured. As at the end of the year this total amount was reduced to $137,000 due to $120,000 of this advance being converted
to common stock for settlement of this indebtedness in December 2011 at $0.04 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In September 2011,
we issued 1,671,000 shares to an individual for cash at $0.10 per share. In September 2011, we issued 150,000 shares to a company
for services rendered at $0.16 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In April 2011, as an
incentive to assist with future private placements, we authorized the payment of a non cash finder&rsquo;s fee of 450,000 shares
of our common stock in connection with the private placement completed in April 2010. The shares were issued in May 2011. All shares
issued were to individuals and companies who reside outside the United States of America. The issuance of the shares was exempt
from the registration requirements of Securities Act by virtue of Section 4(2) thereof as well as the exemption from registration
requirements afforded by Regulation S.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the period January
1 to December 31, 2010, we received cash of $3,895,000 from a private placement of 12,983,335 common shares at $0.30 per share,
paid non cash finder&rsquo;s fees of 1,126,111 shares in connection with the private placement, issued 685,900 shares in settlement
of indebtedness and expenses amounting to $205,770 and paid a non cash finder&rsquo;s fee of 500,000 shares in connection with
a property acquisition valued at $0.30 per share. The shares were issued to individuals and companies who reside outside the USA.
The issuance of the shares were exempt from the registration requirements of Securities Act by virtue of Section 4(2) thereof as
well as the exemption from registration requirements afforded by Regulation S. Furthermore during 2010, two loans payable were
repaid at $250,000 each and two advances payable received during the year ended December 31, 2009 were repaid at $50,000 each.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our general business strategy is to acquire
mineral properties, or the rights to such properties, either directly or through the acquisition of operating entities. The consolidated
financial statements have been prepared in accordance with generally accepted accounting principles in the USA and applicable to
a going concern concept which contemplates the realization of assets and the satisfaction of liabilities and commitments during
the normal course of business. We have incurred recurring operating losses since inception, have not generated any operating revenues
to date and during 2011 operating activities used cash of $1,062,075 (2010: $2,423,112). We require additional funds to meet our
obligations and maintain the operations. We do not have sufficient working capital to (i) pay administrative and general operating
expenses through December 31, 2012 and (ii) to conduct preliminary exploration programs. Without cash flow from operations, we
may need to obtain additional funds (presumably through equity offerings and/or debt borrowing) in order, if warranted, to implement
additional exploration programs on the properties. While we may attempt to generate additional working capital through the operation,
development, sale or possible joint venture development of the properties, there is no assurance that any such activity will generate
funds that will be available for operations. Failure to obtain such additional financing may result in a reduction of interest
in certain properties or an actual foreclosure of interest. We have no agreements or understandings with any person as to such
additional financing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our exploration properties
have not commenced commercial production and we have no history of earnings or cash flow from operations. While we may attempt
to generate additional working capital through the operation, development, sale or possible joint venture development of property,
there is no assurance that any such activity will generate funds that will be available for operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Cash Flow</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Operating activities:</B> During the
year ended December 31, 2011, our operating activities used cash of $1,062,075 (2010: $2,423,112). The following is a breakdown
of cash used for operating activities: Depreciation and amortization of $27,897 (2010: $17,738). Changes in prepaid expenses and
other assets resulted in an increase in cash of $20,344 (2010: $54,449). Changes in accounts payable and accrued expenses (including
related party) resulted in an increase in cash of $55,343 (2010: decrease $403,216).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Investing Activities:</B> During the
year ended December 31, 2011, $80,000 of the financial warranty with respect to the Colorado Mined Land Reclamation bonds was returned
to us. During the year ended December 31, 2010, we spent $500,000 acquiring the Front Range Gold joint venture property and related
buildings and equipment in Boulder, Colorado, USA, $17,800 on equipment and $325,221 was spent on Mined Land Reclamation Bonds
with the State of Colorado and the Front Range Project joint venture.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Financing Activities:</B> We intend to
finance activities by raising capital through the equity markets.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Dividends</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have neither declared nor paid any dividends
on our common stock. We intend to retain our earnings to finance growth and expand our operations and do not anticipate paying
any dividends on our common stock in the foreseeable future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Asset-Backed Commercial Paper</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have no asset-backed commercial paper.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Fair Value of Financial Instruments and Risks</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">Fair value estimates
of financial instruments are made at a specific point in time, based on relevant </FONT>information<FONT STYLE="color: black">
about financial markets and specific financial instruments. As these estimates are subjective in nature, involving uncertainties
and matters of significant judgment, they cannot be determined with precision. Changes in assumptions can significantly affect
estimated fair value.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The carrying value of cash, accounts payable
and accrued expenses, accounts payable and accrued expenses &ndash; related parties, advances payable and advances payable &ndash;
related party, and loans payable approximate their fair value because of the short-term nature of these instruments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Management is of the opinion that we are
not exposed to significant interest or credit risks arising from these financial instruments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We operate outside of the United States
of America (primarily in Brazil) and are exposed to foreign currency risk due to the fluctuation between the currency in which
we operate in and the U.S. dollar.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Share Capital</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">At December 15, 2012,
we had:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>Authorized share capital of 300,000,000 common shares with par value of $0.001 each.</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>249,144,706 common shares were issued and outstanding (December 31, 2011 &ndash; 109,912,589).</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD><FONT STYLE="color: black">9,650,</FONT>000<FONT STYLE="color: black"> (December 31, 2011: 9,050,000) stock options were outstanding
under the incentive stock option plan. The stock options are exercisable at prices ranging from $0.05 to $0.12 per share, with
expiration dates ranging from October 10, 2016 to April 9, 2017. If the holders were to acquire all 9,650,000 (December 31, 2011:
9,050,000) shares issuable </FONT>upon<FONT STYLE="color: black"> the exercise of all incentive stock options outstanding, we would
receive an additional $779,500 (December 31, 2011: $1,206,500).</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD><FONT STYLE="color: black">8,000,000 warrants outstanding ( December 31, 2011: 8,000,000).</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Market Risk Disclosures</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have not entered into derivative contracts
either to hedge existing risks or for speculative purposes during the nine months ended September 30, 2012, and the subsequent
period to December 15, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Off-balance Sheet Arrangements and Contractual Obligations</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We do not have any off-balance sheet arrangements
or contractual obligations at September 30, 2012, and the subsequent period to December 15, 2012, that are likely to have or are
reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues
or expenses, results of operations, liquidity, capital expenditures or capital resources that have not been disclosed in our consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Application of Critical Accounting Policies</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The accounting policies and methods we utilize
in the preparation of our consolidated financial statements determine how we report our financial condition and results of operations
and may require our management to make estimates or rely on assumptions about matters that are inherently uncertain. Our accounting
policies are described in Note 2 to our December 31, 2011, consolidated financial statements. Our accounting policies relating
to mineral property and exploration costs and depreciation and amortization of property, plant and equipment are critical accounting
policies that are subject to estimates and assumptions regarding future activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Buildings and Equipment</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Buildings and equipment are carried at cost
(including development and preproduction costs, capitalized interest, other financing costs and all direct administrative support
costs incurred during the construction period, net of cost recoveries and incidental revenues), less accumulated depletion and
depreciation including write-downs. Following the construction period, interest, other financing costs and administrative costs
are expensed as incurred.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On the commencement of commercial production,
depletion of each mining property is provided on the unit-of-production basis, using estimated proven and probable reserves as
the depletion basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Buildings and equipment utilized directly
in commercial mining activities are depreciated, following the commencement of commercial production, over their expected economic
lives using either the unit-of-production method or the straight-line method.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Depreciation for non-mining equipment is
provided over the following useful lives:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Vehicles: 10 years;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Office equipment, furniture and fixtures:
2 to 10 years.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We review the carrying values of its buildings
and equipment whenever events or changes in circumstances indicate that their carrying values may not be recoverable. An impairment
is considered to exist if total estimated future cash flows, or probability-weighted cash flows on an undiscounted basis, are less
than the carrying value of the assets. An impairment loss is measured and recorded based on discounted estimated future cash flows
associated with values beyond proven and probable reserves and resources. In estimating future cash flows, assets are grouped at
the lowest level for which there is identifiable future cash flows that are largely independent of cash flows from other asset
groups. Generally, in estimating future cash flows, all assets are grouped at a particular property for which there is identifiable
cash flows. Buildings and equipment utilized directly in commercial mining activities are depreciated, following the commencement
of commercial production, over their expected economic lives using either the unit-of-production method or the straight-line method.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Mineral Properties and Exploration Expenses</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We account for our mineral properties on
a cost basis whereby all direct costs, net of pre-production revenue, relative to the acquisition of the properties are capitalized.
All sales and option proceeds received are first credited against the costs of the related property, with any excess credited to
earnings. Once commercial production has commenced, the net costs of the applicable property will be charged to operations using
the unit-of-production method based on estimated proven and probable recoverable reserves. The net costs related to abandoned properties
are charged to operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Exploration costs are charged to operations
as incurred until such time that proven reserves are discovered. From that time forward, we will capitalize all costs to the extent
that future cash flow from mineral reserves equals or exceeds the costs deferred. The deferred costs will be amortized over the
recoverable reserves when a property reaches commercial production. As at December 31, 2011 and 2010, we did not have proven reserves.
Exploration activities conducted jointly with others are reflected at our proportionate interest in such activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We review the carrying values of its mineral
properties on a regular basis by reference to the project economics including the timing of the exploration and/or development
work, the work programs and the exploration results experienced by us and others. The review of the carrying value of any producing
property will be made by reference to the estimated future operating results and net cash flows. When the carrying value of a property
exceeds its estimated net recoverable amount, provision is made for the decline in value.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The recoverability of the amounts recorded
for mineral properties is dependent on the confirmation of economically recoverable reserves, confirmation of our interest in the
underlying mineral claims, our ability to obtain the necessary financing to successfully complete their development and the attainment
of future profitable operations or proceeds from disposition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Estimated costs related to site restoration
programs during the commercial development stage of the property are accrued over the life of the project.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;<B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Related Party Transactions</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our proposed business
raises potential conflicts of interests between certain of our officers and directors and us. Certain of our directors are directors
of other mineral resource companies and, to the extent that such other companies may participate in ventures in which we may participate,
our directors may have a conflict of interest in negotiating and concluding terms regarding the extent of such participation. In
the event that such a conflict of interest arises at a meeting of our directors, a director who has such a conflict will abstain
from voting for or against the approval of such participation or such terms. In appropriate cases, we will establish a special
committee of independent directors to review a matter in which several directors, or management, may have a conflict. From time
to time, several companies may participate in the acquisition, exploration and development of natural resource properties thereby
allowing for their participation in larger programs, involvement in a greater number of programs and reduction of the financial
exposure with respect to any one program. It may also occur that a particular company will assign all or a portion of its interest
in a particular program to another of these companies due to the financial position of the company making the assignment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In determining whether
we will participate in a particular program and the interest therein to be acquired by it, the directors will primarily consider
the potential benefits to us, the degree of risk to which we may be exposed and our financial position at that time. Other than
as indicated, we have no other procedures or mechanisms to deal with conflicts of interest. We are not aware of the existence of
any conflict of interest as described herein.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Other than as disclosed
below, during the nine month period ended September 30, 2012, none of our current directors, officers or principal shareholders,
nor any family member of the foregoing, nor, to the best of our information and belief, any of our former directors, senior officers
or principal shareholders, nor any family member of such former directors, officers or principal shareholders, has or had any material
interest, direct or indirect, in any transaction, or in any proposed transaction which has materially affected or will materially
affect us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">There have been no
transactions or proposed transactions with officers and directors during the nine months ended September 30, 2012 to which we are
a party except as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white; text-indent: 0.5in">During
the nine-month period ended September 30, 2012 consulting fees of $297,190 (September 30, 2011: $191,742) were incurred to by our
directors and officers (or companies of the officers and directors). The transactions were recorded at the exchange amount, being
the value established and agreed to by the related parties.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white; text-indent: 0.5in">Included
in accounts payable and accrued expenses and advance payable (related parties) as at September 30, 2012 and December 31, 2011 were
$322,419 and $nil respectively payable to officers and directors of the Company for consulting fees and various expenses incurred
on our behalf.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>CURRENT OUTLOOK</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>General Economic Conditions</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Current problems in credit markets and deteriorating
global economic conditions have lead to a slowdown of growth. The slowdown of growth is a major concern, as one of the biggest
risks to a full recovery for the metals industry would be a weak and/or slow demand resurgence in critical end markets. Prices
for raw materials continue to climb and/or remain near record highs. It is difficult in these conditions to forecast metal prices
and demand trends for products that we would produce if we had current mining operations. Credit market conditions have also increased
the cost of obtaining capital and limited the availability of funds. Accordingly, management is reviewing the effects of the current
conditions on our business.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">It is anticipated
that for the foreseeable future, we will rely on the equity markets to meet our </FONT>financing<FONT STYLE="color: black"> need.
We will also consider entering into joint venture arrangements to advance our projects.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Capital and Exploration Expenditures</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are reviewing our capital and exploration
spending in light of current market conditions. As a result of our review, we may curtail a portion of our capital and exploration
expenditures during 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are currently concentrating our exploration
activities in Brazil and Canada and examining data relating to the potential acquisition or joint venturing of additional mineral
properties in either the exploration or development stage.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Exploration Past, Present and Plans for Next Twelve Months</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following Plan
of Operation contains forward-looking statements that involve risks and uncertainties, as described below. The actual results could
differ materially from those anticipated in these forward-looking statements. During the next 12 months the Company intends to
raise additional funds through equity offerings and/or debt borrowing to meet the general and administrative operating expenses
and to conduct work on exploration properties. There is, of course, no assurance that we will be able to do so and the Company
does not have any agreements or arrangements with respect to any such financing. The exploration properties have not commenced
commercial production and we have no history of earnings or cash flow from operations. While we may attempt to generate additional
working capital through the operation, development, sale or possible joint venture development of properties, there is no assurance
that any such activity will generate funds that will be available for operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We intend to concentrate
exploration activities on the Brazilian Tapajos properties and examine data relating to the potential acquisition or joint venturing
of additional mineral properties in either the exploration or development stage in other South American countries. Additional contractors
and consultants may be hired on as and when the requirement occurs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The exploration work
program for the remainder of 2012 will focus on the Brazilian properties. In Brazil we intend to follow up results from previous
work on the Sao Domingo property, including the previous drilling and mapping over the Fofoca Prospect (&ldquo;<B>Fofoca</B>&rdquo;)
area. Follow up evaluation of the geophysical anomaly west of Fofoca is required to test any strike continuity of potential economic
mineralisation. This work will entail surface mapping, sampling of soils on a grid basis to delineate geochemical anomalies, stream
sediment sampling, geophysical surveying and drilling.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="color: black">We
have set up a field operations centre at the S&#259;o Domingos property and intend to continue to focus exploration activities
on anomalies associated with the S&#259;o Domingos property. We selected the S&#259;o Domingos property based on its proximity
to the other properties, and the logistics currently in place. Access to the S&#259;o Domingos property is by light aircraft to
a well-maintained strip, by road along the government maintained Trans Garimpeiro highway, and by boat along the multitude of waterways
in the Amazon Basin</FONT>. Work conducted both on a regional and prospect scale since 2006 has included mapping, rock chip sampling,
a large scale soil geochemical sampling grid, ground-based geophysical testing, partial trenching over the vein systems and sub-surface
drill testing of several prospect areas at Fofoca, Esmeril, Santa Isabel and Atacad&atilde;o.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Fofoca is the primary
area of interest that has been identified to date. Hydrothermal alternation observed at Fofoca and surrounding prospects is considered
characteristic of epithermal style mineralization systems in the region. Fofoca has been interpreted as a multiple lode gold system,
with lodes that are shear hosted in granite country rocks and strike approximately east-west dipping moderately to the south. Gold
mineralization is associated with quartz veining which hosts various sulphides, including pyrite, arsenopyrite, galena and chalcopyrite.
Fofoca has over 580 meters of potential strike with typical breccia vein widths of over one meter dipping at around 80 degrees
south. Thicknesses of approximately 20 meters of quartz stockwork have been seen in drill core in the central parts of deposit
caused by post-mineralization brittle faulting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Exploration work completed
at Fofoca in 2006 included logging of six trenches over anomalous quartz veins, followed by a 17 hole, HQ/NQ drill program (2,606
meters) to test the trenches at depth. Drilled to a maximum depth of 185 meters, with an average depth of 153 meters, the drilling
returned several high grade, thin intercepts of auriferous quartz veins.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">A second HQ/NQ drilling
campaign (FOF-18 and 19) started in mid-2007 in which we drilled two holes into Fofoca. This program targeted down dip extensions,
with drill hole 18 descending to 250 meters, but only encountered small stockwork vein systems. Generally the drill holes encountered
thin hydrothermally brecciated, vuggy, sulphidic quartz veins with alterations ranging from argillic through to potassic (possible
overprinting), which is typical for this style of mineralisation. No metallurgical test work was undertaken.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Based on mapping, sampling,
trenching and ground-based IP surveys, the Fofoca structure appears to continue to the west, being displaced by late stage faulting
to the north. This structural trend is believed to link Fofoca with the Cachoeirinha (Fofoca West) area, providing the potential
to add significantly to currently outlined resources. No drilling has been conducted on Fofoca West. We will continue to evaluate
the potential of the S&atilde;o Doming&oacute;s Project and will work to determine whether the Fofoca could evolve along strike
and link up with other noted targets further along strike. Further drilling, trenching and geophysics is planned to further assess
the S&atilde;o Doming&oacute;s Project.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Currently the system
still remains open along strike in both directions and at depth. We will continue to evaluate the potential, and are confident
that Fofoca could evolve further and link up with other noted targets further along strike.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">A recent discovery
was made on the Atacadau area and has been called Colibri. Here artisanal miners uncovered an area of stock work mineralization
that was subsequently sampled and returned some high-grade assays. Further sampling of material that was exposed by artisanal activity
around the Colibri occurrence was conducted. Whilst monitoring the artisanal activity mapping and measurements of the structures
and orientations of theoretical mineralization channels were conducted. The results showed that there are possible correlations
to the Atacadau mineralization noted from previous mapping and drilling. We intend to cut trenches across the strike of the mineralizing
structures to better understand the size both laterally and along strike. We will then test the strike extent with geophysics in
a similar manner as that conducted on the Fofoca area.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During 2012, we will
continue to follow up exploration results on the Fofoca area and plan to initiate further exploration programs on other areas of
the Sao Domingos property. It is anticipated that we will drill a series of holes within the Fofoca area for engineering and metallurgical
test work as well as to test for depth extensions of the known gold occurrences. Other exploration on the S&#259;o Domingos property
areas will involve further mapping of the outcrop geology and sampling soils and scree from shafts of previous workers in order
to confirm lithologies and structural trends noted from drilling and published government maps. Currently, five anomalous areas
on the Sao Domingos property have been identified from soil and rock chip sampling, at Atacad&atilde;o, Esmeril, Colibri, Fofoca
and Cachoeira, and we plan to conduct further investigation. Several other areas have been identified from remote sensing satellite
imagery which will also be followed up.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">By viewing spectral
wave band ratio&rsquo;s designed to indicate iron oxides and clay minerals, we were able to decipher areas of past artisanal activity
which could lead to the discovery of further hard rock targets, as demonstrated by the discovery of further extensions to potential
mineralisation at Colibri and the newly discovered, Toucano, gold occurrence.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Toucano occurrence
was a recent discovery, made during the 4th Quarter of 2011 located in the same vicinity as the Colibri gold occurrence and close
to the Fofoca resource area and the Attacadau occurrence. Toucano was found as a result of reviewing remote sensing imagery acquired
during the last quarter of 2011 and the occurrence of recent artisanal activity. Aurora conducted detailed mapping over the Toucano
occurrence and completed channel sampling across the exposed strike of potentially mineralised lithologies. As a result of the
significant channel sample results and the other high grade rock chip results taken from exposures within the Toucano system, we
intend to focus exploration delineating the potential area of mineralised material.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have completed a
revised exploration plan and budget to test the lateral and depth extent of the Toucano occurrence with bulk sampling, trenching
and drilling during the 2012 exploration season. Exploration will also focus on testing for any sub parallel mineralisation that
may be associated with a broader mineralizing envelope that may include the Colibri gold occurrence. Previous sampling of areas
within Colibri assayed up to 5.94 g/t Gold in quartz veinlets associated to stock work mineralization.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Exploration will also
focus on the extension of the Fofoca area of mineralised material to test the strike extent as follow up to significant gold assays
from trenches along strike.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We recently concluded
a first pass project wide evaluation of tailings and alluvial potential. Results showed that follow up test work is recommended
and Aurora intends to apply for a trial mining license to carry out bulk sampling of potentially economic material. Concurrently
a technical team has been assembled to continue the evaluation of both the alluvial potential and the geometry of the hard rock
mineralisation in preparation for subsurface test work.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Description
of Our Business and Properties</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">We conduct our
activities from our principal and technical office located at </FONT>Coresco AG, Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland<FONT STYLE="color: black">
The telephone number is (+41) 7887-96966. These offices are provided to us on a month to month basis. We believe that these offices
are adequate for our purposes. We do not own any real property or significant assets. Management believes that this space will
meet our needs for the next 12 months.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Mining Properties</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently have an interest in a strategic
land package of nine (9) properties none of which contain any reserves. The exploration license areas are divided into 2 groups,
the S&#259;o Domingos and the Sao Joao areas.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have calculated
a body of mineralized material to Guide 7 standards calculated in accordance with the Australasian Joint Ore Reserves Committee
(the &ldquo;<B>JORC</B>&rdquo;) code for reporting of Mineral Resources and Ore Reserves (the &ldquo;<B>JORC Code</B>&rdquo;).
The JORC resource is currently estimated at 130,000 ounces at 2.0 g/t calculated on a 0.5 g/t cut off. This mineralized material
is located on the S&#259;o Domingos property discussed below. The rest of the Brazil properties are in the preliminary exploration
stage and do not contain any known bodies of ore. We are also examining data relating to the potential acquisition of other exploration
properties in Latin America, South America.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Mineral exploration
and development involves a high degree of risk and few properties that are explored are ultimately developed into producing mines.
There is no assurance that planned production will result in a commercial success, as production is gold price and politically
sensitive. Once production has commenced the Company is able to gauge the onward commercial viability of the project. There is
no assurance that planned mineral exploration and development activities will result in any further discoveries of commercially
viable bodies of mineralization. The long-term profitability of operations will be, in part, directly related to the cost and success
of exploration programs, which may be affected by a number of factors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We currently have an
interest in nine (9) properties located in Tapajos gold province in Para State, Brazil, Colibri and Sao Domingo, and due to their
proximity to each other, the 2 properties are jointly called the Sao Domingo project. We have conducted exploration activities
on the properties and have ranked the properties in order of merit and may discontinue such activities and dispose of some of the
rights to mineral exploration on the properties if further exploration work is not warranted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The geology of the
S&#259;o Domingos property is predominantly composed of paleo-proterozoic Parauari Granites that play host to a number of gold
deposits in the Tapajos Basin. Typical Granites of the younger Maloquinha Intrusive Suite have been noticed in the vicinity of
Molly Gold Target, and basic rocks considered to be part of the mesoproterozoic Cachoeira Seca Intrusive Suite occur around the
Esmeril target area. The S&#259;o Domingos property was a previous large alluvial operation, and the property area covers numerous
areas of workings. The S&#259;o Domingos property lies in the Tapajos Province of Para State, Brazil It is situated approximately
250 km SE of Itaituba, the regional centre. Small aircraft service Itaituba daily and on occasions flights can be sourced via Manaus.
Access from Itaituba to site is by small aircraft or unsealed road of average to poor quality. The road is subject to seasonal
closures and &lsquo;wet&rsquo; season site access is granted via light aircraft utilizing the local airstrip.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our strategy is to concentrate our efforts
on: (i) existing operations where an infrastructure already exists; (ii) properties presently being developed and/or in advanced
stages of exploration which have potential for additional discoveries; and (iii) grass-roots exploration opportunities. We are
currently concentrating our property exploration activities in Brazil. We are also examining data relating to the potential acquisition
of other exploration properties in Latin America, South America.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mineral exploration and development involves
a high degree of risk and few properties that are explored are ultimately developed into producing mines. There is no assurance
that our planned production will result in a commercial success, as production is gold price and politically sensitive. Once production
has commenced we will be able to gauge the onward commercial viability of the project. There is no assurance that our planned mineral
exploration and development activities will result in any further discoveries of commercially viable bodies of mineralization.
The long-term profitability of our operations will be, in part, directly related to the cost and success of our exploration programs,
which may be affected by a number of factors. <B>Please refer to &ldquo;Risk Factors.&rdquo;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21.3pt; text-align: center"><FONT STYLE="color: black"><img src="tpg36chart.jpg"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21.3pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Figure 1.&#9;Brazil, South America-property
locality guide</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Properties</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Brazil</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>S&#259;o Domingos</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Location and access</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The S&#259;o Domingos property lies in the
Tapajos Province of Para State, Brazil It is situated approximately 250 km SE of Itaituba, the regional centre, and includes an
area of over 33,033.44 hectares (&ldquo;<B>ha</B>&rdquo;). Small aircraft service Itaituba daily and on this occasion flights were
sourced via Manaus. Access from Itaituba to site is by small aircraft or unsealed road of average to poor quality. The road is
subject to seasonal closures and as the visit was at the end of the &lsquo;wet&rsquo; season site access was granted via light
aircraft utilizing the local airstrip.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Tenure</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in; text-align: left"><B><I>a)</I></B></TD><TD STYLE="text-align: justify"><B><I>DNPM Process 850.684/06:</I></B></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have good title over the mineral rights
object of the Brazilian Department of Mines <FONT STYLE="color: black">We have good title over the mineral rights, which were granted
as </FONT>Departamento Nacional de Produ&ccedil;&#259;o Mineral (&ldquo;<B>DNPM</B>&rdquo;) <FONT STYLE="color: black">Process
number 850.684/06 and which is valid and in force, free and clear of any judicial and extrajudicial encumbrances and taxes. The
S&atilde;o Domingos mineral rights are located at the Municipality of Itaituba, State of Par&aacute;, and are registered in our
name. On September 13, 2006, we applied to the DNPM for the conversion of the Application to an Exploration Permit covering an
area of 4,914.18 hectares. No payments or royalties are due regarding DNPM Process 850.384/06.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in; text-align: left"><B><I>b)</I></B></TD><TD STYLE="text-align: justify"><B><I>DNPM </I><FONT STYLE="color: black">Process</FONT><I>
850.782/05:</I></B></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have<FONT STYLE="color: black"> good
title over the mineral rights object of the DNPM Process No. 850.782/05, which is valid and in force, free and clear of any judicial
and extrajudicial encumbrances and taxes. On November 8, 2005, it was submitted to DNPM the Exploration Claim for gold in the Municipality
of Itaituba, State of Par&aacute;. The Exploration Permit was granted on November 28, 2006, for a three-year period. The transfer
to Aurora was approved on March 24, 2009 and on September 28, 2009, it was requested the renewal of the Exploration Permit. This
area was reduced from 6,756 hectares to 5,651.98 hectares due to the overlapping with Garimpeira (alluvial) Mining properties held
by Mr Celio Paranhos. However the DNPM&acute;s general attorney in Brasilia agreed with our legal thesis and nullified all applications
filed by Mr Paranhos (about to 1,900 applications). A new Exploration Permit rectifying the previous one was granted on August
20, 2010, for a three-year period, for an area of 6,656.20 hectares. No payments or royalties are due regarding the DNPM Process
850.782/05 since it was acquired through a permutation agreement with Altoro Minera&ccedil;&atilde;o Ltda.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in; text-align: left"><B><I>c)</I></B></TD><TD STYLE="text-align: justify"><B><I>DNPM Process 850.012/06 and 850.013/06:</I></B></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The exploration claims were submitted to
DNPM on January 19, 2006, for gold covering an area of 1,128.08 hectares and 750.55 hectares respectively, in the Municipality
of Itaituba, State of Par&aacute;. According to information obtained such claims were correctly prepared and the required documents
are in place. The tenements 850.012/06 and 850.013/06 are held by Mr Antonio Oliveira Ferreira and were submitted to DNPM on January
19, 2006. The tenements are located at Itaituba, State of Par&aacute; and are valid and in force, free and clear of any judicial
and extrajudicial encumbrances and taxes, but the area was blocked since it is inside of a Garimpeira Reserve. The transfer to
us will be submitted after the Exploration Permits are granted. There are no payments or royalties related to the tenements according
to the agreement entered into with the previous owner.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in; text-align: left"><B><I>d)</I></B></TD><TD STYLE="text-align: justify"><B><I>DNPM Process 850.119/06:</I></B></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The exploration claim was submitted to DNPM
on March 7, 2006, for gold covering an area of 1,068.72 hectares, in the Municipality of Itaituba, State of Par&aacute;. Aurora
has good title over the mineral rights object of the DNPM Process No. 850.119/06, which is valid and in force, free and clear of
any judicial and extrajudicial encumbrances and taxes. We are the sole registered and beneficial holder of and own and possess
good title to the referred mineral rights. The Exploration Permit has not been granted yet. The above-mentioned area is not related
to any payments or royalties to third parties since we claimed them directly.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in; text-align: left"><B><I>e)</I></B></TD><TD STYLE="text-align: justify"><B><I>DNPM Process 859.587/95:</I></B></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The tenement, was held by Vera Lucia Lopes,
and is valid and in force, and is free and clear of any judicial and extrajudicial encumbrances and taxes. It is located at the
Municipality of Itaituba, State of Par&aacute;. On November 27, 1995, it was submitted to DNPM the Exploration Claim for gold.
The Exploration Permit was granted on September 15, 2006, for a three-year period covering an area of 5,000 hectares, and it was
valid until September 15, 2009. On July 15, 2009, it was requested the renewal of the Exploration Permit which was granted and
transferred to us and published on June 29, 2012. There are no payments or royalties related to the tenements since all payments
due under the terms of the agreement entered into with the previous owner have been already made.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>&nbsp;</I></B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.5in; text-align: left"><B><I>f)</I></B></TD><TD STYLE="text-align: justify"><FONT STYLE="color: black"><B><I>DNPM Processes 850.014/06,
850.581/06 and 850.256/07:</I></B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have the right to acquire good title
over the mineral rights object of the Tenements. The Tenements are registered in the name of Antonio Oliveira Ferreira. The exploration
claims were submitted to DNPM respectively on January 19, 2006, August 8, 2006 and April 17, 2007 for gold covering the areas of
421.45 hectares, 4276.03 hectares and 4036.00 hectares, in the Municipality of Itaituba and Jacareacanga, State of Par&aacute;.
According to information obtained such claims were correctly prepared and the required documents are in place. The tenement 850.014/06
has not been transferred to Samba yet since the Exploration Permit has not been granted so far. The Exploration Permit for the
Process 850.581/06 was granted on February 15, 2011 for a three-year period, for an area of 4273.03 hectares. The transfer to Samba
Brazil Minera&ccedil;&atilde;o Ltda has not been presented yet. The Exploration Permit for the Process 850.256/07 was granted on
November 30, 2007 for a three-year period but it was cancelled on May 21, 2008 because the holder didn&rsquo;t pay the annual fees
on time. On June 10, 2008 it was presented an appeal to have the annulment dismissed, which hasn&rsquo;t been analyzed yet. However,
if the appeal is not approved, Samba Brazil&rsquo;s rights over this tenement are guaranteed since only Samba Brazil has presented
a Bid application for this process on July 18 2008. According to the Agreement signed between Samba Brazil and Antonio Oliveira
Ferreira on June 5, 2008, a total amount of 120,000 Brazilian Real&rsquo;s has already been paid by Samba Brazil for the acquisition
of the Tenements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>S&#259;o Jo&#259;o &ndash; Samba Minerals
farm in agreement</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In May 2008 we signed an agreement with
Samba Minerals Limited (&ldquo;<B>Samba</B>&rdquo;), which was subsequently amended in August 2008, whereby Samba can earn up to
an 80% participating interest in the S&#259;o Jo&#259;o project by funding exploration expenditures to completion of a feasibility
study on the property. Upon completion of a feasibility study, we will immediately transfer an 80% participation interest in the
property to Samba and enter into a formal joint venture agreement to govern the development and production of minerals from the
property. Samba can terminate its participation by providing us 30 days&rsquo; notice in writing. Upon withdrawal from its participation,
Samba would forfeit to us all of its rights in relation to the project and would be free of any and all payment commitments yet
to be due. Samba will be the manager of the S&#259;o Jo&#259;o project. On October 17, 2011, we terminated the license and Option
Agreement by providing written notice to Samba.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>Comandante Araras Project - DNPM Processes
853.785/93 to 853.839/93 inclusive (relinquished):</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On October 17, 2011,
we terminated the license and Option Agreement by providing written notice to Samba. We are free of all and any future payment
commitments. The interest in the properties was formally relinquished in January 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>S&atilde;o Jo&atilde;o
Project - DNPM Processes 851.533/94 to 851.592/94 inclusive (relinquished):</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="color: black">On
October 17, 2011 we terminated the license and Option Agreement by providing written notice to Samba. We are free of all </FONT>and<FONT STYLE="color: black">
any future payment commitments. The interest in the properties was formally relinquished in January 2012.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><img src="tpg39chart.jpg"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Geology</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The geology of the S&#259;o Domingos property
is predominantly composed of paleo-proterozoic Parauari Granites that play host to a number of gold deposits in the Tapajos Basin.
Typical Granites of the younger Maloquinha Intrusive Suite have been noticed in the vicinity of Molly Gold Target, and basic rocks
considered to be part of the mesoproterozoic Cachoeira Seca Intrusive Suite occur around the Esmeril target area.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The S&#259;o Domingos property was a previous
large alluvial operation, and the property area covers numerous areas of workings.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Location and access</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The S&#259;o Jo&#259;o property is located
in the central portion of the Southern Tapajos basin and is accessed by light aircraft from the regional centre of Itaituba. Access
is also possible by unsealed roads linking up to the Transgarimpeiro highway and by a purpose cut heavy vehicle access track linking
Sao Joao to the exploration centre at the primary project at Sao Domingo.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Geology</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">The prime targets
for the S&#259;o Jo&#259;o property are located around and on the intersection of regional NW and NNW faults within the Pararui
Intrusive Suite and this area has been the focus of large-scale alluvial workings. The </FONT>Pararui<FONT STYLE="color: black">
Intrusive Suite has proven to host the vast majority of gold deposits elsewhere within the Tapajos Gold Province. We conducted
a rock chip program over an area currently being excavated for gold in quartz systems via shallow underground workings. The sample
results have demonstrated that the quartz vein systems are highly mineralized and considered continuous for at least 200m. We are
confident that the quartz vein systems are much more extensive and are currently planning to increase the sample density of rock
and soil sampling over, and adjacent to, the current workings to locate further mineralized vein systems, and to drill test their
depth extensions in the near future.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Previous mining activity over a number of
years focused on the alluvial deposits within its many tributaries, and has now progressed to include the saprolite host rock and
out cropping quartz veins.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B><I>British Columbia, Canada &ndash; Kumealon
Property (relinquished):</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On January 20, 2012, we relinquished our
claim over the Kumealon property located in British Columbia, Canada.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Directors,
Executive Officers and Control Persons</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table and text set forth the
names and ages of all our directors and executive officers as of December 15, 2012. All of the directors will serve until the next
annual meeting of stockholders and until their successors are elected and qualified, or until their earlier death, retirement,
resignation or removal. There are no family relationships between or among the directors, executive officers or persons nominated
or charged by our company to become directors or executive officers. Executive officers serve at the discretion of the Board, and
are appointed to serve by the Board. Also provided herein are brief descriptions of the business experience of each director and
executive officer during the past five years and an indication of directorships held by each director in other companies subject
to the reporting requirements under the Federal securities laws.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Board currently consists of five members.
Directors serve for a term of one year and stand for election at our annual meeting of stockholders. Pursuant to our Bylaws, any
vacancy occurring in the Board, including a vacancy created by an increase in the number of directors, may be filled by the stockholders
or by the affirmative vote of a majority of the remaining directors though less than a quorum of the Board. A director elected
to fill a vacancy shall hold office only until the next election of directors by the stockholders. If there are no remaining directors,
the vacancy shall be filled by the stockholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD NOWRAP STYLE="width: 28%; border-bottom: windowtext 1pt solid; font-weight: bold; text-align: center">Name&nbsp;and&nbsp;Address</TD>
    <TD NOWRAP STYLE="width: 2%; font-weight: bold; text-align: center">&nbsp;</TD>
    <TD NOWRAP STYLE="width: 10%; border-bottom: windowtext 1pt solid; font-weight: bold; text-align: center">Age</TD>
    <TD NOWRAP STYLE="width: 1%; font-weight: bold; text-align: center">&nbsp;</TD>
    <TD NOWRAP STYLE="width: 25%; border-bottom: windowtext 1pt solid; font-weight: bold; text-align: center">Current&nbsp;Position</TD>
    <TD NOWRAP STYLE="width: 2%; font-weight: bold; text-align: center">&nbsp;</TD>
    <TD NOWRAP STYLE="width: 32%; border-bottom: windowtext 1pt solid; font-weight: bold; text-align: center">Director&nbsp;or&nbsp;Officer&nbsp;Since</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Lars M. Pearl</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">C/- Coresco AG</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Level 3</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Gotthardstrasse 20</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">6304 Zug, Switzerland</P></TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">49</TD>
    <TD>&nbsp;</TD>
    <TD>President, Chief Executive Officer and Director</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">April 27, 2007</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Ross Doyle</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">C/- Coresco AG</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Level 3</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Gotthardstrasse 20</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">6304 Zug, Switzerland</P></TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">39</TD>
    <TD>&nbsp;</TD>
    <TD>Chief Financial Officer and Director</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">October 11, 2011</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Agustin Gomez de Segura <SUP>(1)</SUP></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">C/- Coresco AG</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Level 3</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Gotthardstrasse 20</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">6304 Zug, Switzerland</P></TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">56</TD>
    <TD>&nbsp;</TD>
    <TD>Director</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">November 15, 2010</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Vladimir Bernshtein <SUP>(2)</SUP></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">C/- Coresco AG</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Level 3</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Gotthardstrasse 20</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">6304 Zug, Switzerland</P></TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">35</TD>
    <TD>&nbsp;</TD>
    <TD>Chief Business Development Director and Director</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">October 5, 2012</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Andrey Ratsko <SUP>(2)</SUP></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">C/- Coresco AG</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Level 3</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Gotthardstrasse 20</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">6304 Zug, Switzerland</P></TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">57</TD>
    <TD>&nbsp;</TD>
    <TD>Director</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">October 5, 2012</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><SUP>(1)</SUP> On October 11, 2011, Mr. Gomez de Segura was
appointed as Chairman of the Board.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><SUP>(2)</SUP> Pursuant to the terms of the subscription agreement
entered into between us and Alltech, Alltech has the right to appoint two directors to our board. Each of Messrs. Bernshtein and
Ratsko were appointed on October 5, 2012, and were chosen by Alltech as their director designees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Effective as of June 17, 2011, Mr. Michael
Montgomery resigned from his position as Chief Operating Officer and a director of ours.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following is a description of the employment
history for each of our directors and officers for the last five years:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Lars Pearl</B>, 49, President, Director
and Chief Executive Officer of Cigma Metals Corporation (2004 to 2008); Mr. Pearl has been self employed as a geological consultant
from 1993 to 2004. Mr. Pearl has spent over 10 years as a geological consultant to projects in Australia, Tanzania, Russia, Kazakhstan,
Peru, Colombia and Ecuador. During the last 5 years Mr. Pearl was acting as a consultant geologist to various companies, including
Aurora Gold Corporation, Cigma Metals Corporation, Carnavale Resources Ltd and De Beira Goldfeilds in Australia, Brazil, Peru,
Ecuador and Tanzania before joining the board of Aurora Gold Corporation in April 2007. Mr. Pearl devotes approximately 80% of
his time dealing with the affairs of Aurora Gold. Mr. Pearl received a Bachelor of Applied Geology degree from the University of
Technology, Sydney Australia in 1993. Mr. Pearl&rsquo;s extensive experience, training and education as a geologist and his experience
with other resources exploration companies make him particularly qualified to serve as our director.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="color: black"><B>Ross
Doyle</B>, 39, </FONT>Ross Doyle has been employed as a strategic business analyst and CFO for the past 15 years. During this period
his time was spent working with large commodity trading firms and financial institutions. During the last 5 years Mr Doyle worked
as a CFO at the head office of Glencore International AG in their Coal division. Subsequent to departing Glencore, Mr Doyle has
advised other commodity firms in a similar capacity, before joining the board of Aurora Gold Corporation in October 2011. Mr. Doyle
received a Bachelor of Commerce from the University of Queensland, Brisbane Australia and is a Chartered Accountant. Mr. Doyle&rsquo;s
extensive experience, training and education with other resources companies makes him particularly qualified to act as our CFO
and as a director.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black"><B>Agustin Gomez
de Segura</B>, 56,</FONT><FONT STYLE="color: #333333"> was awarded a Diploma in Engineering in Physical Chemistry from the Moscow
Technological University &ldquo;MISA&rdquo; (former Moscow Institute for Steel and Alloys). Mr. Gomez de Segura also completed
4 years of a Doctorate in Metal's Physics at Moscow Technological University. Mr. Gomez de Segura has had several senior roles
in publicly listed companies. Mr. Gomez de Segura's positions both past and present include: Director for Labtam Information &amp;
Scientific Instruments (Australia) from 1983 till 1990. He was the Chairman of Advisory Board of Alina Bank (Russia) from 1994
till 1997. </FONT><FONT STYLE="color: black">Mr. de Segura&rsquo;s extensive scientific experience, training and education and
his overall business experience make him particularly qualified to serve as our director.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black"><B>Vladimir Bernshtein</B>,
35, </FONT>has been active in the mining industry with Alltech Investments Limited (AIL) since 2004 and as the Investment Director
since 2008. During this time Mr. Bernshtein has been involved in various AIL projects including Oil &amp; Gas exploration in Western
Siberia, Sakhalin Island and Kamchatka and Gold exploration in Kyrgyzstan. Mr. Bernshtein&rsquo;s extensive experience in the mining
industry make him <FONT STYLE="color: black">particularly qualified to serve as our director.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>Andrei Ratsko</B>, 57, is a geologist
with vast experience within the exploration and mining sector having worked in Africa and the Commonwealth of Independent States.
Mr. Ratsko received his M.Sc. in Geography and Geomorphology from Lomonosov State University in Moscow. Since 2008 Mr Ratsko has
been employed by Alltech Group as the Director General of CJSC TK Geo Resource, which holds licenses for precious and base metals
in the Chuy region of the Kyrgyz Republic. Before joining Alltech Group Mr. Ratsko was an Executive Director at Swencore Consulting
Inc., where he worked on various exploration projects in Tanzania. Mr. Ratsko&rsquo;s extensive experience as a geologist in the
mining industry makes him <FONT STYLE="color: black">particularly qualified to serve as our director.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There are no family relationships between
any of the directors or executive officers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Consideration of Director Nominees</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Director Qualifications</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We believe that our Board, to the extent
that our limited resources permit, should encompass a diverse range of talent, skill and expertise sufficient to provide sound
and prudent guidance with respect to our operations and interests. Each director also is expected to: exhibit high standards of
integrity, commitment and independence of thought and judgment; use his or her skills and experiences to provide independent oversight
to our business; participate in a constructive and collegial manner; be willing to devote sufficient time to carrying out their
duties and responsibilities effectively; devote the time and effort necessary to learn our business; and, represent the long-term
interests of all shareholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Board has determined that the Board
as a whole must have the right diversity, mix of characteristics and skills for the optimal functioning of the Board in its oversight
of our affairs. The Board believes it should be comprised of persons with skills in areas such as: finance; real estate; banking;
strategic planning; human resources and diversity; leadership of business organizations; and legal matters. The Board may also
consider in its assessment of the Board&rsquo;s diversity, in its broadest sense, reflecting, but not limited to, age, geography,
gender and ethnicity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In addition to the targeted skill areas,
the Board looks for a strong record of achievement in key knowledge areas that it believes are critical for directors to add value
to the Board, including:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD><B>Strategy</B>&mdash;knowledge of our business model, the formulation of corporate strategies, knowledge of key competitors
and markets;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD><B>Leadership</B>&mdash;skills in coaching and working with senior executives and the ability to assist the Chief Executive
Officer;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD><B>Organizational Issues</B>&mdash;understanding of strategy implementation, change management processes, group effectiveness
and organizational design;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD><B>Relationships</B>&mdash;understanding how to interact with investors, accountants, attorneys, management companies, analysts,
and communities in which we operate;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD><B>Functional</B>&mdash;understanding of finance matters, financial statements and auditing procedures, technical expertise,
legal issues, information technology and marketing; and</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD><B>Ethics</B>&mdash;the ability to identify and raise key ethical issues concerning our activities and those of senior management
as they affect the business community and society.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Nomination Procedures</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have no nominating committee, and all
nominating functions are handled directly by the full Board, which the Board believes is the most effective and efficient approach,
based on the size of the Board and our current and anticipated operations and needs. As outlined above in selecting a qualified
nominee, the Board considers such factors as it deems appropriate which may include: the current composition of the Board; the
range of talents of the nominee that would best complement those already represented on the Board; the extent to which the nominee
would diversify the Board; the nominee&rsquo;s standards of integrity, commitment and independence of thought and judgment; and
the need for specialized expertise.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>The Board and Board Meetings</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Board consists of five members. Directors
serve for a term of one year and stand for election at our annual meeting of stockholders. Pursuant to our Bylaws, any vacancy
occurring in the Board, including a vacancy created by an increase in the number of directors, may be filled by the stockholders
or by the affirmative vote of a majority of the remaining directors though less than a quorum of the Board. A director elected
to fill a vacancy shall hold office only until the next election of directors by the stockholders. If there are no remaining directors,
the vacancy shall be filled by the stockholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">At a meeting of stockholders,
any director or the entire Board may be removed, with or without cause, provided the notice of the meeting states that one of the
purposes of the meeting is the removal of the director. A director may be removed only if the number of votes cast to remove him
exceeds the number of votes cast against removal.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Board and management are committed to
responsible corporate governance to ensure that we are managed for the long-term benefit of its shareholders. To that end, the
Board and management periodically review and update, as appropriate, our corporate governance policies and practices. In doing
so, the Board and management review published guidelines and recommendations of institutional shareholder organizations and current
best practices of similarly situated public companies. The Board and management also regularly evaluate and, when appropriate,
will revise our corporate governance policies and practices in accordance with the requirements of the Sarbanes-Oxley Act of 2002
and the rules and listing standards issued by the SEC.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During the year ended December 31, 2011,
the Board held a total of four (4) meetings. All members of the Board attended all meetings of the Board.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Committees</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have no committees of the Board.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Legal Proceedings</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During the past five years none of our directors,
executive officers, promoters or control persons has been:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>the subject of 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;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>convicted in a criminal proceeding or is subject to a pending criminal proceeding (excluding traffic violations and other minor
offenses);</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>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;</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.25in">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission
to have violated a federal or state securities or commodities law;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>the subject of any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed,
suspended or vacated, relating to an alleged violation of:</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Times New Roman, Times, Serif">o</FONT></TD><TD>Any Federal or State securities or commodities law or regulation; or</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Times New Roman, Times, Serif">o</FONT></TD><TD>Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or
permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order,
or removal or prohibition order; or</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Times New Roman, Times, Serif">o</FONT></TD><TD>Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity.</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Times New Roman, Times, Serif">o</FONT></TD><TD>any federal or state judicial or administrative proceedings based on violations of federal or state securities, commodities,
banking or insurance laws and regulations, or any settlement to such actions (excluding settlements between private parties); and</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Times New Roman, Times, Serif">o</FONT></TD><TD>any disciplinary sanctions or orders imposed by a stock, commodities or derivatives exchange or other self-regulatory organization.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>CODE OF ETHICS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have adopted a Code of Ethics that applies
to all of our officers, directors and employees, including its Chief Financial Officer and Chief Executive Officer, which complies
with the requirements of the Sarbanes-Oxley Act of 2002 and applicable FINRA listing standards. Accordingly, the Code of Ethics
is designed to deter wrongdoing, and to promote, among other things, honest and ethical conduct, full, timely, accurate and clear
public disclosures, compliance with all applicable laws, rules and regulations, the prompt internal reporting of violations of
the Code of Ethics, and accountability.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>CORPORATE GOVERNANCE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have adopted Corporate Governance Guidelines
applicable to our Board, which can be viewed on our website at http://aurora-gold.com/corporate-governance/.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Board Leadership Structure</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently have five directors, three
of whom are also executive officers. Our Board has reviewed our current Board leadership structure &mdash; which consists of a
Chief Executive Officer a Chief Financial Officer and a Chairman of the Board&mdash; in light of the composition of the Board,
our size, the nature of our business, the regulatory framework under which we operates our stockholder base, our peer group and
other relevant factors, and has determined that this structure is currently the most appropriate Board leadership structure for
our company. Nevertheless, the Board intends to carefully evaluate from time to time whether our Chief Executive Officer and Chairman
positions should be combined based on what the Board believes is best for us and our stockholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Board Role in Risk Oversight</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Risk is inherent in every business, and
how well a business manages risk can ultimately determine its success. We face a number of risks, including strategic risks, enterprise
risks, financial risks, and regulatory risks. While our management is responsible for day to day management of various risks we
face, the Board, as a whole, is responsible for evaluating our exposure to risk and to satisfy itself that the risk management
processes designed and implemented by management are adequate and functioning as designed. The Board reviews and discusses policies
with respect to risk assessment and risk management. The Board also has oversight responsibility with respect to the integrity
of our financial reporting process and systems of internal control regarding finance and accounting, as well as its financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Director Independence</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our securities are not listed on a U.S.
securities exchange and, therefore, we are not subject to the corporate governance requirements of any such exchange, including
those related to the independence of directors. However, at this time, after considering all of the relevant facts and circumstances,
our Board has determined that only Mr. Gomez de Segura is independent from our management and qualifies as &ldquo;independent director&rdquo;
under the standards of independence under the applicable FINRA listing standards. Upon our listing on any national securities exchange
or any inter-dealer quotation system, it will elect such independent directors as is necessary under the rules of any such securities
exchange.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Certain Relationships</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There are no family relationships among
or between any of our officers and directors. Our proposed business raises potential conflicts of interests between certain of
our officers and directors and us. Certain of our directors are directors of other mineral resource companies and, to the extent
that such other companies may participate in ventures in which we may participate, our directors may have a conflict of interest
in negotiating and concluding terms regarding the extent of such participation. In the event that such a conflict of interest arises
at a meeting of our directors, a director who has such a conflict will abstain from voting for or against the approval of such
participation or such terms. In appropriate cases, we will establish a special committee of independent directors to review a matter
in which several directors, or management, may have a conflict. From time to time, several companies may participate in the acquisition,
exploration and development of natural resource properties thereby allowing for their participation in larger programs, involvement
in a greater number of programs and reduction of the financial exposure with respect to any one program. It may also occur that
a particular company will assign all or a portion of its interest in a particular program to another of these companies due to
the financial position of the company making the assignment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In determining whether we will participate
in a particular program and the interest therein to be acquired by it, the directors will primarily consider the potential benefits
to us, the degree of risk to which we may be exposed and its financial position at that time. Other than as indicated, we have
no other procedures or mechanisms to deal with conflicts of interest. We are not aware of the existence of any conflict of interest
as described herein.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Compensation of Directors</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Board determines the non-employee directors&rsquo;
compensation for serving on the Board and its committees. In establishing director compensation, the Board is guided by the following
goals:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>compensation should consist of a combination of cash and equity awards that are designed to fairly pay the directors for work
required for a company of our size and scope;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>compensation should align the directors&rsquo; interests with the long-term interests of stockholders; and</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>compensation should assist with attracting and retaining qualified directors.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Standard Arrangements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We do not pay a fee to our outside, non-officer
directors. We reimburse our directors for reasonable expenses incurred by them in attending meetings of the Board. During the years
ended December 31, 2010 and in 2011 through December 15, 2012, we paid non-officer directors, $0, $0 and $0, respectively, in consulting
fees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Executive
Compensation</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The responsibility
for establishing, administering and interpreting our policies governing the compensation and benefits for our executive officers
lies with our Board. In this connection the Board has not retained the services of any compensation consultants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The goals of our executive compensation
program are to attract, motivate and retain individuals with the skills and qualities necessary to support and develop our business
within the framework of our small size and available resources. In 2012, we designed our executive compensation program to achieve
the following objectives:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 54pt"></TD><TD STYLE="width: 13.5pt"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>attract and retain executives experienced in the resource exploration industry;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 54pt"></TD><TD STYLE="width: 13.5pt"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>motivate and reward executives whose experience and skills are necessary to our ultimate success;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 54pt"></TD><TD STYLE="width: 13.5pt"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>reward performance as warranted; and</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 54pt"></TD><TD STYLE="width: 13.5pt"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>align the interests of our executive officers and stockholders by motivating executive officers to increase stockholder value.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Summary Compensation Table</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table summarizes the compensation
earned by the Named Executive Officers during the fiscal years ended December 31, 2011, and 2010:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 7pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; font-size: 7pt">
    <TD NOWRAP STYLE="font-weight: bold; border-bottom: Black 1pt solid; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">Name
    and <BR>principal <BR>position <BR>(a)</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid; font-size: 7pt"><FONT STYLE="font-size: 7pt">Year
    <BR>December 31, <BR>(b)</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid; font-size: 7pt"><FONT STYLE="font-size: 7pt">Salary
    <BR>($) <BR>(c)</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid; font-size: 7pt"><FONT STYLE="font-size: 7pt">Bonus
    <BR>($) <BR>(d)</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid; font-size: 7pt"><FONT STYLE="font-size: 7pt">Stock
    <BR>awards <BR>($) <BR>(e)</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid; font-size: 7pt"><FONT STYLE="font-size: 7pt">Option
    <BR>awards <BR>($) <BR>(f)</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid; font-size: 7pt"><FONT STYLE="font-size: 7pt">Non-equity
    <BR>incentive <BR>plan <BR>compensation <BR>($) <BR>(g)</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid; font-size: 7pt"><FONT STYLE="font-size: 7pt">Non-qualified
    <BR>deferred <BR>compensation <BR>earnings <BR>($) <BR>(h)</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid; font-size: 7pt"><FONT STYLE="font-size: 7pt">All
    other <BR>compensation <BR>($) <BR>(i)</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid; font-size: 7pt"><FONT STYLE="font-size: 7pt">Total
    <BR>($) <BR>(j)</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="width: 19%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">Lars M. Pearl <BR></FONT></TD><TD STYLE="width: 1%; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 8%; text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">2011</FONT></TD><TD STYLE="width: 1%; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">135,529</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">103,480</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">239,009</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt; color: black; text-align: left"><FONT STYLE="font-size: 7pt; color: black">President, CEO and Director
    <SUP>(2)</SUP></FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">2010</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">181,850</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">181,850</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">Ross Doyle <BR></FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">2011</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">31,980</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">99,631</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">131,611</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt; color: black; text-align: left"><FONT STYLE="font-size: 7pt; color: black">CFO and Director <SUP>(2)</SUP></FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">2010</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">Michael Montgomery <BR></FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">2011</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt; color: black; text-align: left"><FONT STYLE="font-size: 7pt; color: black">Former COO and Director
    <SUP>(2)</SUP></FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font-size: 7pt"><FONT STYLE="font-size: 7pt">2010</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">157,741</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">-0-</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 7pt"><FONT STYLE="font-size: 7pt">157,741</FONT></TD><TD STYLE="text-align: left; font-size: 7pt"><FONT STYLE="font-size: 7pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><SUP>(1)</SUP> Effective as October 1,
2012, each of Messrs. Pearl and Doyle agreed to reduce their salary to $6,000 per month.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="color: black"><SUP>(2)</SUP>
</FONT>Effective as of June 17, 2011, Mr. Michael Montgomery resigned as our COO and a director.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On October 11, 2011, we entered into a services
agreement with Global Strategic Synergies Gmbh (&ldquo;<B>Global Strategic</B>&rdquo;) pursuant to which Mr. Ross Doyle serves
as our Chief Financial Officer. Pursuant to the terms of the services agreement, Global Strategic is paid a monthly consulting
fee of 10,000 Swiss Francs. The services agreement may be terminated by either party upon advanced written notice to the other
party of 20 business days. Mr. Doyle is an equal shareholder in Global Strategic with his wife.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">None of our officers
or directors is a party to an employment agreement with us. Our entire Board sets the current year compensation levels of each
of the above named Executive Officers. </FONT>Effective January 1, 2010, Mr. Pearls&rsquo; annual salary was $191,945 payable in
monthly installments of approximately $15,995. During the fourth quarter of 2010, Mr. Pearl&rsquo;s annual salary was revised to
$152,868 payable in monthly installments of approximately $12,739. Effective March 1, 2010, Mr. Montgomery&rsquo;s annual salary
was $184,248 payable in monthly installments of approximately $15,774.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Options/SAR Grants Table</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In 2007, our Board approved the Plan which
was subsequently approved by our shareholders in July 2007, to offer an incentive to obtain services of key employees, directors
and consultants of ours. The Plan provides for the reservation for awards of an aggregate of 10% of the total shares of Common
Stock outstanding from time to time. No Plan participant may receive stock options exercisable for more than 1,000,000 shares of
common stock in any one calendar year. Under the Plan, the exercise price of an incentive stock option must be at least equal to
100% of the fair market value of the common stock on the date of grant (110% of fair market value in the case of options granted
to employees who hold more than 10% of our capital stock on the date of grant). The term of stock options granted under the Plan
is not to exceed ten years and the stock options vest immediately upon granting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On January 20, 2012, we awarded 1,600,000
stock purchase options to directors and officer, with an exercise price of $0.05 per share. The term of these options is five years.
The options are exercisable at any time from the grant date up to and including November 20, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On November 24, 2011, we awarded 3,650,000
stock purchase options to directors, officers, consultants and employees with an exercise price of $0.05 per share. The term of
these options is five years. The options are exercisable at any time from the grant date up to and including November 24, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On October 11, 2011, we awarded 4,200,000
stock purchase options to directors, officers, consultants and employees with an exercise price of $0.12 per share. The term of
these options is five years. The options are exercisable at any time from the grant date up to and including October 10, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We awarded no stock purchase options, or
any other rights, to any of our directors or officers during the years ended December 31, 2010 and 2009.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On August 6, 2007, we awarded 2,300,000
stock purchase options to directors, officers and employees with an exercise price of $0.26 per share. The term of these options
is five years. The options were exercisable at any time from the grant date up to and including August 6, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following is a
summary of stock option activity for the year ended December 31, 2011 and the status of stock options outstanding and exercisable
at December 31, 2011:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="text-align: center">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Stock&nbsp;Options&nbsp;#</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Exercise&nbsp;Price</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ranges&nbsp;$</B></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 76%; text-align: left">Outstanding and exercisable at December 31, 2010</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,700,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">0.26</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Forfeited during year</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">500,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Granted during year</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">7,850,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">0.12 - 0.05</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Outstanding and exercisable at December 31, 2011</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,050,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following is a summary of stock option
granted and the status of stock options outstanding and exercisable at December 31, 2011 (we do not have any Stock Awards outstanding
as of December 31, 2011):</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="19" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Option&nbsp;Awards</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Name</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Number&nbsp;of&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Securities&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Underlying&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Unexercised&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Options&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Exercisable&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(#)</B></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Number&nbsp;of</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Securities</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Underlying</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Unexercised</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Options</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Unexercisable</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(#)</B></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Number&nbsp;of</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Securities</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Underlying</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Unexercised</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Unearned</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Options</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(#)</B></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Option</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Exercise</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Price&nbsp;per</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Share&nbsp;($)</B></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Option</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Expiration&nbsp;Date</B></P></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 40%; text-align: left; vertical-align: top">Lars Pearl</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,000,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 1%; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-weight: bold; text-align: right">-</TD><TD STYLE="width: 1%; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 1%; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-weight: bold; text-align: right">-</TD><TD STYLE="width: 1%; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">0.26</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD NOWRAP STYLE="width: 11%; text-align: right">August 6, 2012</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; vertical-align: top">Cameron Richardson</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">200,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.26</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD NOWRAP STYLE="text-align: right">August 6, 2012</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; vertical-align: top">Lars Pearl</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,000,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.12</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD NOWRAP STYLE="text-align: right">October 10, 2016</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; vertical-align: top">Agustin Gomez de Segura</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,000,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.12</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD NOWRAP STYLE="text-align: right">October 10, 2016</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; vertical-align: top">Ross Doyle</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,000,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.12</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD NOWRAP STYLE="text-align: right">October 10, 2016</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; vertical-align: top">Joseph Sierchio</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">200,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.12</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD NOWRAP STYLE="text-align: right">October 10, 2016</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; vertical-align: top">Coresco AG</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,000,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.12</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD NOWRAP STYLE="text-align: right">October 10, 2016</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; vertical-align: top">Lars Pearl</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,250,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.05</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD NOWRAP STYLE="text-align: right">November 23, 2016</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; vertical-align: top">Agustin Gomez de Segura</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,100,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.05</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD NOWRAP STYLE="text-align: right">November 23, 2016</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; vertical-align: top">Ross Doyle</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,100,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">-</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">0.05</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD NOWRAP STYLE="text-align: right">November 23, 2016</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-decoration: none; text-align: left; padding-bottom: 1pt; vertical-align: top">Luis Mauricio</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">200,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-weight: bold; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">0.05</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="text-decoration: none; padding-bottom: 1pt">&nbsp;</TD>
    <TD NOWRAP STYLE="text-decoration: none; text-align: right; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">November 23,
    2016</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; vertical-align: top">Total</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,050,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: right">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><B>Aggregated Option/SAR Exercises and Fiscal Year-End Option/SAR
Value Table</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">At December 31,
2011, we had 9,050,000 (December 31, 2010 - 1,700,000) stock purchase options outstanding. As of </FONT>December <FONT STYLE="color: black">15,
2012, we had 9,650,000 stock purchase options outstanding</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At no time during the last completed fiscal
year did we, while a reporting company pursuant to Section 13(a) of 15(d) of the Exchange Act, adjust or amend the exercise price
of the stock options or SARs previously awarded to any of the named executive officers, whether through amendment, cancellation
or replacement grants, or any other means.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Long-Term Incentive Plans</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">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. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Compensation of Directors</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We reimburse our directors for reasonable
travel and other out-of-pocket expenses incurred in connection with attendance at meetings of our Board. Our Board may award special
remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director.
For the year ended December 31, 20111, we compensated Mr. Agustin Gomez de Segura, a non-employee director, $40,000 for his services
as a member of our Board. No director received and/or accrued any compensation for their services as a director, including committee
participation and/or special assignments, or incurred in connection with attending board meetings in the year ended December 31,
2010. Effective as of October 1, 2012, we have agreed to compensate each of our directors $6,000 per month for their services,
other than Mr. de Segura, who is compensated at a rate of $3,000 per month for his services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Employment Contracts</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On October 11, 2011, we entered into a services
agreement with Global Strategic pursuant to which Mr. Ross Doyle serves as our Chief Financial Officer. Pursuant to the terms of
the services agreement, Global Strategic is paid a monthly consulting fee of 10,000 Swiss Francs. The services agreement may be
terminated by either party upon advanced written notice to the other party of 20 business days.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During the year ended December 31, 2011,
consulting fees of $295,701 (year ended December 31, 2010 - $339,591) were paid to directors and officers of ours and its subsidiary.
The transactions were recorded at the exchange amount, being the value established and agreed to by the related parties.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There are no arrangements or plans in which
we provide pension, retirement or similar benefits for directors or executive officers. Our directors and executive officers may
receive stock options at the discretion of our Board. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Security
Ownership of Certain Beneficial</B></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Owners
and Management</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">The following
table sets forth certain information regarding the beneficial ownership of our common stock as of </FONT>December <FONT STYLE="color: black">15,
2012, by (i) each person who is known by us to own beneficially more than five percent (5%) of our outstanding common stock; (ii)
each of the our directors and officers; and (iii) all of our directors and officers as a group. At </FONT>December <FONT STYLE="color: black">15,
2012, there were 249,144,706 shares of our common stock issued and outstanding.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Name&nbsp;and&nbsp;Address&nbsp;of&nbsp;Beneficial&nbsp;Owner</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Amount&nbsp;and&nbsp;Nature&nbsp;of</B></FONT></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>Beneficial&nbsp;Owner&nbsp;<SUP>(1)</SUP></B></FONT></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Percentage
    <BR>of&nbsp;Class</FONT></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; text-align: justify"><FONT STYLE="font-size: 10pt">5% Owners</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 64%; text-align: justify; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Alltech Capital Limited <BR>c/o
    Kaiser Partner Trust Services Anstalt <BR>Pflugstrasse 10/12, Postfach 538 <BR>9490, Vaduz <BR>Liechtenstein</FONT></TD><TD STYLE="width: 1%; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 15%; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">135,000,000</FONT></TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 15%; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">54.2</FONT></TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: justify"><FONT STYLE="font-size: 10pt">Officers and Directors</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Lars M. Pearl <BR>C/- Coresco AG <BR>Level 3 <BR>Gotthardstrasse
    20 <BR>6304 Zug, Switzerland</FONT></TD><TD STYLE="color: black"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="color: black; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="color: black; text-align: right"><FONT STYLE="font-size: 10pt; color: black">6,017,628</FONT></TD><TD STYLE="color: black; text-align: left"><FONT STYLE="font-size: 10pt"><SUP>(2)</SUP></FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2.4</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Ross Doyle <BR>C/- Coresco AG <BR>Level 3 <BR>Gotthardstrasse
    20 <BR>6304 Zug, Switzerland</FONT></TD><TD STYLE="color: black"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="color: black; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="color: black; text-align: right"><FONT STYLE="font-size: 10pt; color: black">5,205,545</FONT></TD><TD STYLE="color: black; text-align: left"><FONT STYLE="font-size: 10pt"><SUP>(3)</SUP></FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2.1</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">Agustin Gomez de Segura <BR>C/- Coresco AG <BR>Level 3 <BR>Gotthardstrasse
    20 <BR>6304 Zug, Switzerland</FONT></TD><TD STYLE="color: black"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="color: black; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="color: black; text-align: right"><FONT STYLE="font-size: 10pt; color: black">5,428,896</FONT></TD><TD STYLE="color: black; text-align: left"><FONT STYLE="font-size: 10pt"><SUP>(4)</SUP></FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2.2</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">Vladimir Bernshtein <BR>C/- Coresco AG <BR>Level 3 <BR>Gotthardstrasse
    20 <BR>6304 Zug, Switzerland</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">0</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">0</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Andrey Ratsko <BR>C/- Coresco AG <BR>Level
    3 <BR>Gotthardstrasse 20 <BR>6304 Zug, Switzerland</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">0</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">0</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 9.9pt"><FONT STYLE="font-size: 10pt">Officers and directors
    (5 persons)</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">16,652,069</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">6.7</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">* less than 1%.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><SUP>(1)</SUP> Calculated pursuant to rule 13d-3(d)
of the Exchange Act. Beneficial ownership is calculated based on 249,144,706 shares of common stock issued and outstanding on
a fully diluted basis as of December 15, 2012. Under Rule 13d-3(d) shares not outstanding which are subject to options, warrants,
rights or conversion privileges exercisable within 60 days are deemed outstanding for the purpose of calculating the number and
percentage owned by such person, but are not deemed outstanding for the purpose of calculating the percentage owned by each other
person listed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><SUP>(2)</SUP> Includes: (a) 1,488,533 shares of our common
stock owned by Mr. Pearl; (b) 25% of the 4,916,379 shares of our common stock owned by Coresco AG, a consulting group of which
Mr. Pearl is a 25% owner; (c) 1,000,000 stock purchase options awarded on October 11, 2011, the stock purchase options are exercisable
at $0.12 per share and have a term of five years. The options are exercisable at any time from the grant date up to and including
the October 10, 2016; (d) 250,000 of the 1,000,000 stock purchase options awarded on October 11, 2011, to Coresco AG, a consulting
group of which Mr. Pearl is a 25% owner, the stock purchase options are exercisable at $0.12 per share and have a term of five
years. The options are exercisable at any time from the grant date up to and including October 10, 2016; (e) 1,250,000 stock purchase
options awarded on November 24, 2011, the stock purchase options are exercisable at $0.05 per share and have a term of five years.
The options are exercisable at any time from the grant date up to and including November 23, 2016; and (f) 800,000 stock purchase
options awarded on January 13, 2012, the stock purchase options are exercisable at $0.05 per share and have a term of five years.
The options are exercisable at any time from the grant date up to and including January12, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><SUP>(3)</SUP> Includes: (a) 1,626,450 shares of our common
stock owned by Mr. Doyle; (b) 25% of the 4,916,379 shares of our common stock owned by Coresco AG, a consulting group of which
Mr. Doyle is a 25% owner; (c) 1,000,000 stock purchase options awarded on October 11, 2011, the stock purchase options are exercisable
at $0.12 per share and have a term of five years. The options are exercisable at any time from the grant date up to and including
October 10, 2016; (d) 250,000 of the 1,000,000 stock purchase options awarded on October 11, 2011, to Coresco AG, a consulting
group of which Mr. Doyle is a 25% owner, the stock purchase options are exercisable at $0.12 per share and have a term of five
years. The options are exercisable at any time from the grant date up to and including October 10, 2016; (e) 1,100,000 stock purchase
options awarded on November 24, 2011, the stock purchase options are exercisable at $0.05 per share and have a term of five years.
The options are exercisable at any time from the grant date up to and including November 23, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><SUP>(4)</SUP> Includes (a) 3,328,896 shares of our common stock
owned by Mr. de Segura; (b) 1,000,000 stock purchase options awarded on October 11, 2011, the stock purchase options are exercisable
at $0.12 per share and have a term of five years. The options are exercisable at any time from the grant date up to and including
October 10, 2016; and (c) 1,100,000 stock purchase options awarded on November 24, 2011, the stock purchase options are exercisable
at $0.05 per share and have a term of five years. The options are exercisable at any time from the grant date up to and including
November 23, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Changes in Control</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On September 21, 2012, we entered into a
subscription agreement with Alltech pursuant to which we agreed to sell to Alltech 135,000,000 shares of our common stock, representing
approximately 54% of our issued and outstanding shares of common stock, for a purchase price of $5,000,000. The closing of the
transaction occurred on October 5, 2012. As a result of the sale a change in control of the Company occurred.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Transactions
With Related Persons, Promoters</B></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>and
Certain Control Persons</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our proposed business raises potential conflicts
of interests between certain of our officers and directors and us. Certain of our directors are directors of other mineral resource
companies and, to the extent that such other companies may participate in ventures in which we may participate, our directors may
have a conflict of interest in negotiating and concluding terms regarding the extent of such participation. In the event that such
a conflict of interest arises at a meeting of our directors, a director who has such a conflict will abstain from voting for or
against the approval of such participation or such terms. In appropriate cases, we will establish a special committee of independent
directors to review a matter in which several directors, or management, may have a conflict. From time to time, several companies
may participate in the acquisition, exploration and development of natural resource properties thereby allowing for their participation
in larger programs, involvement in a greater number of programs and reduction of the financial exposure with respect to any one
program. It may also occur that a particular company will assign all or a portion of its interest in a particular program to another
of these companies due to the financial position of the company making the assignment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In determining whether we will participate
in a particular program and the interest therein to be acquired by it, the directors will primarily consider the potential benefits
to us, the degree of risk to which we may be exposed and its financial position at that time. Other than as indicated, we have
no other procedures or mechanisms to deal with conflicts of interest. We are not aware of the existence of any conflict of interest
as described herein.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Transactions with Related Persons</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Other than as disclosed below, during the
fiscal year ended December 31, 2011 and through December 15, 2012, none of our current directors, officers or principal shareholders,
nor any family member of the foregoing, nor, to the best of our information and belief, any of our former directors, senior officers
or principal shareholders, nor any family member of such former directors, officers or principal shareholders, has or had any material
interest, direct or indirect, in any transaction, or in any proposed transaction which has materially affected or will materially
affect us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There have been no transactions or proposed
transactions with officers and directors during the last two years to which we are a party except as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During the nine-month period ended September
30, 2012, we incurred consulting fees of $297,190 (September 30, 2011: $191,742) to our directors and officers (or companies of
the officers and directors). The transactions were recorded at the exchange amount, being the value established and agreed to by
the related parties. Included in accounts payable and accrued expenses and advances payable (related parties) at September 30,
2012 and December 31, 2011 were $322,419 and $Nil respectively payable to our officers and directors for consulting fees and various
expenses incurred on our behalf.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On December 15, 2011, we entered into debt
settlement agreement with Mr. Ross Doyle pursuant to which we issued Mr. Doyle 1,626,450 shares of our common stock in exchange
for a release from paying $32,529 we owed to Mr. Doyle.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On December 15, 2011, we entered into debt
settlement agreement with Mr. Agustin Gomez de Segura pursuant to which we issued Mr. Gomez de Segura 2,328,896 shares of our common
stock in exchange for a release from paying $46,577.92 we owed to Mr. Gomez de Segura.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On December 15, 2011, we entered into debt
settlement agreement with Global Strategic pursuant to which we issued Global Strategic 2,065,996shares of our common stock in
exchange for a release from paying $41,319.92 we owed to Global Strategic. Mr Doyle, our Chief Financial Officer, is an equal shareholder
in Global Strategic with his wife.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On December 15, 2011, we entered into debt
settlement agreement with Coresco AG pursuant to which we issued Coresco AG 4,916,379 shares of our common stock in exchange for
a release from paying $98,327.58 we owed to Coresco AG. <FONT STYLE="color: black">Messrs. Lars Pearl and Ross Doyle each own 25%
of Coresco AG.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On November 24, 2011, we granted Mr. Lars
Pearl, our Chief Executive Officer, 1,250,000 stock purchase options. The stock purchase options are exercisable at $0.05 per share
and have a term of five years. The options are exercisable at any time from the grant date up to and including November 24, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On November 24, 2011, we granted Mr. Agustin
Gomez de Segura, a director, 1,100,000 stock purchase options. The stock purchase options are exercisable at $0.05 per share and
have a term of five years. The options are exercisable at any time from the grant date up to and including November 24, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On November 24, 2011, we granted Mr. Ross
Doyle, our Chief Financial Officer, 1,100,000 stock purchase options. The stock purchase options are exercisable at $0.05 per share
and have a term of five years. The options are exercisable at any time from the grant date up to and including November 24, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On October 11, 2011, we granted Mr. Lars
Pearl, our Chief Executive Officer, 1,000,000 stock purchase options. The stock purchase options are exercisable at $0.12 per share
and have a term of five years. The options are exercisable at any time from the grant date up to and including October 10, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On October 11, 2011, we entered into a consulting
agreement with Global Strategic pursuant to which Mr. Ross Doyle serves as our Chief Financial Officer. Pursuant to the terms of
the consulting agreement, Global Strategic is paid a monthly consulting fee of 10,000 Swiss Francs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On October 11, 2011, we granted Mr. Ross
Doyle 1,000,000 stock purchase options. The stock purchase options are exercisable at $0.12 per share and have a term of five years.
The options are exercisable at any time from the grant date up to and including October 10, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On October 11, 2011, we granted Mr. Agustine
Gomez de Segura 1,000,000 stock purchase options. The stock purchase options are exercisable at $0.12 per share and have a term
of five years. The options are exercisable at any time from the grant date up to and including the October 10, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On October 11, 2011, we granted Coresco
AG 1,000,000 stock purchase. The stock purchase options are exercisable at $0.12 per share and have a term of five years. The options
are exercisable at any time from the grant date up to and including October 10, 2016. Messrs. Lars Pearl and Ross Doyle each own
25% of Coresco AG.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Description
of Our Securities</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">Our authorized
capital stock consists of 300,000,000 shares of common stock, par value $0.001 per share. As of </FONT>December <FONT STYLE="color: black">15,
2012, we had 249,144,706 shares of common stock outstanding.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Common Stock</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Holders of our common stock are entitled
to one vote for each share held on all matters submitted to a vote of stockholders and do not have cumulative voting rights. Accordingly,
holders of a majority of the shares of our common stock entitled to vote in any election of directors may elect all of the directors
standing for election. Holders of our common stock are entitled to receive dividends ratably, if any, as may be declared from time
to time by our Board out of funds legally available therefor. Upon our liquidation, dissolution or winding up, the holders of our
common stock are entitled to receive ratably, our net assets available after the payment of all liabilities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Holders of our common stock have no preemptive,
subscription, redemption or conversion rights, and there are no redemption or sinking fund provisions applicable to the common
stock. The outstanding shares of our common stock are, and the shares offered in this offering will be, when issued and paid for,
duly authorized, validly issued, fully paid and non-assessable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Dividends</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have not declared any cash dividends
to date. We have no present intention of paying any cash dividends on our common stock in the foreseeable future, as we intend
to use earnings, if any, to generate growth. The payment of dividends, if any, in the future, rests within the discretion of our
Board and will depend, among other things, upon our earnings, capital requirements and our financial condition, as well as other
relevant factors. There are no restrictions in our Certificate of Incorporation or By-laws that restrict us from declaring dividends.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Shares Eligible for Future Sale</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Future sales of a substantial number of
shares of our common stock in the public market could adversely affect market prices prevailing from time to time. Under the terms
of this offering, the Shares offered may be resold without restriction or further registration under the Securities Act of 1933,
except that any shares purchased by our &ldquo;affiliates,&rdquo; as that term is defined under the Securities Act, may generally
only be sold in compliance with Rule 144 under the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Sale of Restricted Shares</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Certain shares of our outstanding common
stock were issued and sold by us in private transactions in reliance upon exemptions from registration under the Securities Act
and have not been registered for resale. Additional shares may be issued pursuant to outstanding warrants and options. Such shares
may be sold only pursuant to an effective registration statement filed by us or an applicable exemption, including the exemption
contained in Rule 144 promulgated under the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">Of the 249,144,706
shares of common stock outstanding as of </FONT>December <FONT STYLE="color: black">15, 2012, 89,153,868 are freely tradable by
persons other than our affiliates, without restriction under the Securities Act; and 159,990,838 shares are restricted securities
within the meaning of Rule 144 under the Securities Act and may not be sold unless an exemption from the registration requirements
of the Securities Act is available (including 144).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Sales Pursuant to Rule 144 by Non-Affiliates</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Under Rule 144, a person who is not deemed
to have been one of our affiliates at the time of or at any time during the three months preceding a sale, and who has beneficially
owned the restricted ordinary shares proposed to be sold for at least six (6) months, including the holding period of any prior
owner other than an affiliate, is entitled to sell their shares without complying with the manner of sale and volume limitation
or notice provisions of Rule 144. We must be current in our public reporting if the non-affiliate is seeking to sell under Rule
144 after holding his shares between 6 months and one year. After one year, non-affiliates do not have to comply with any other
Rule 144 requirements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Sales under Rule 144 by Affiliates</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Persons who have beneficially owned restricted
shares of our common stock for at least six months but who are our affiliates at the time of, or at any time during the three months
preceding, a sale, would be subject to additional restrictions, by which such person would be entitled to sell within any three-month
period only a number of securities that does not exceed the greater of either of the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>1% of the number of shares of common stock then outstanding; or</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>the average weekly trading volume of the common stock during the four calendar weeks preceding the filing of a notice on Form
144 with respect to the sale, provided that the common stock is listed on a national securities exchange or on The NASDAQ Stock
Market.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Sales under Rule 144 by our affiliates are
further limited under Rule 144, including the provisions thereof relating to the manner of sale, notice requirements and availability
of current public information about us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Legal Proceedings</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Although from time to time, we may become
involved in various lawsuits and legal proceedings which arise in the ordinary course of business, we are currently not aware of
any other legal proceedings or claims that we believe will have, individually, or in the aggregate, a material adverse affect on
our business, financial condition or operating results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>The
Selling Stockholder</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">The Selling Stockholder,
Alltech Limited Capital, is a corporation organized under the laws of Gibraltar. The Selling Stockholder purchased its shares of
our common stock pursuant to a subscription agreement dated as of September 21, 2012. Pursuant to the terms of the subscription
agreement, we have agreed to register for resale all 135,000,000 shares of our common stock purchased by the Selling Shareholder.
Although we </FONT>will pay substantially all the expenses incident to the registration of the shares, we will not receive any
proceeds from the sales by the Selling Stockholder; we did, however, receive $5,000,000 from the Selling Stockholder for the sale
of our shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt"><B>Name&nbsp;of&nbsp;Selling&nbsp;Stockholders&nbsp;<SUP>(1)</SUP></B></FONT></TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>No.&nbsp;of&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Shares&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Beneficially&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Owned&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Prior&nbsp;to&nbsp;the&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Offering</B></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>%&nbsp;of&nbsp;Issued&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>and&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Outstanding&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Shares&nbsp;Owned&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Prior&nbsp;to&nbsp;the&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Offering</B></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Number&nbsp;of&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Shares&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Registered&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Under&nbsp;This&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Offering</B></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>%&nbsp;of&nbsp;Issued&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>and&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Outstanding&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Shares&nbsp;Owned&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>After&nbsp;This&nbsp;</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Offering</B>&nbsp;<SUP>(2)</SUP></P></TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 52%; text-align: left"><FONT STYLE="font-size: 10pt">Alltech Capital Limited <SUP>(3)</SUP></FONT></TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">135,000,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">54.2</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">135,000,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">0</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps"><SUP>(1)</SUP> </FONT>Calculated
pursuant to Rule 13d-3(d) of the Exchange Act. Beneficial ownership is calculated based on 249,144,706 shares of common stock issued
and outstanding on a fully diluted basis as of December 15, 2012. The Selling Stockholder has sole voting and investment power
with respect to all such shares. Under Rule 13d-3(d) of the Exchange Act, shares not outstanding which are subject to options,
warrants, rights or conversion privileges exercisable within 60 days are deemed outstanding for the purpose of calculating the
number and percentage owned by such person, but are not deemed outstanding for the purpose of calculating the percentage owned
by each other person listed. To the best of our knowledge, the Selling Stockholder has not had a short position in our common stock;
is not a broker-dealer or an affiliate of a broker-dealer (a broker-dealer may be a record holder); has not held any position or
office, or has had any material relationship with us or any of our affiliates within the past three years. The Selling Stockholder
and any broker-dealers or agents that are involved in selling these shares are deemed to be underwriters within the meaning of
the Securities Act for such sales. An underwriter is a person who has purchased shares from an issuer with a view towards distributing
the shares to the public. In such event, any commissions received by such broker-dealers or agents and any profit on the resale
of the shares purchased by them may be considered to be underwriting commissions or discounts under the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><SUP>(2)</SUP> The Selling Stockholder may sell some, all or
none of its shares. We do not know how long the Selling Stockholder will hold the shares offered hereunder before selling them.
We currently have no agreements, arrangements or understandings with the Selling Stockholder regarding the sale of any of the shares
by it.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><SUP>(3)</SUP> Alltech Capital Limited is a subsidiary of Alltech
Group, a Russian based private direct investment company established in 1993 by graduates from Moscow State Technical University.
The strategy of Alltech Group is to invest in high-risk and high-yielding projects using bot its own and raised capital. Alltech
Group is active in various industries, including oil and gas; coal and anthracite and development of residential and commercial
real estate.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>P<FONT STYLE="font-variant: small-caps">lan
of Distribution</FONT></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Selling Stockholder of our common stock
and any of its pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their shares of common
stock on the OTCQB or any other stock exchange, market or trading facility on which the shares are traded or in private transactions.
These sales may be at fixed or negotiated prices. The Selling Stockholder may use any one or more of the following methods when
selling shares:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the
block as principal to facilitate the transaction;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>purchases by a broker-dealer as principal and resale by the broker-dealer for its account;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>an exchange distribution in accordance with the rules of the applicable exchange;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>privately negotiated transactions;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>settlement of short sales entered into after the effective date of the registration statement of which this Prospectus is a
part;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>an agreement with a broker-dealers to sell a specified number of such shares at a stipulated price per share;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>a combination of any such methods of sale; or</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>any other method permitted pursuant to applicable law.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Selling Stockholder may also sell shares
under Rule 144, if available, rather than under this Prospectus.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Broker-dealers engaged by the Selling Stockholder
may arrange for other broker-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the Selling
Stockholder (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated,
but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in excess of a customary
brokerage commission in compliance with FINRA NASD Rule 2440; and in the case of a principal transaction a markup or markdown in
compliance with NASD IM-2440.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In connection with the sale of the common
stock or interests therein, the Selling Stockholder may enter into hedging transactions with broker-dealers or other financial
institutions, which may in turn engage in short sales of the common stock in the course of hedging the positions they assume. The
Selling Stockholder may also sell shares of the common stock short and deliver these securities to close out their short positions,
or loan or pledge the common stock to broker-dealers that in turn may sell these securities. The Selling Stockholder may also enter
into option or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative
securities which require the delivery to such broker-dealer or other financial institution of shares offered by this Prospectus,
which shares such broker-dealer or other financial institution may resell pursuant to this Prospectus (as supplemented or amended
to reflect such transaction).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Selling Stockholder and any broker-dealers
or agents that are involved in selling the shares may be deemed to be &ldquo;underwriters&rdquo; within the meaning of the Securities
Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Act. In no event shall
any broker-dealer receive fees, commissions and markups which, in the aggregate, would exceed eight percent (8%).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are required to pay certain fees and
expenses incurred by us incident to the registration of the shares. We have agreed to indemnify the Selling Stockholder against
certain losses, claims, damages and liabilities, including liabilities under the Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Because the Selling Stockholder may be deemed
to be an &ldquo;underwriter&rdquo; within the meaning of the Act, it will be subject to the prospectus delivery requirements of
the Securities Act including Rule 172 thereunder. In addition, any securities covered by this Prospectus which qualify for sale
pursuant to Rule 144 may be sold under Rule 144 rather than under this Prospectus. There is no underwriter or coordinating broker
acting in connection with the proposed sale of the resale shares by the Selling Stockholder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We agreed to keep this Prospectus effective
until the date on which the shares may be resold by the Selling Stockholder without registration and without regard to any volume
limitations by reason of Rule 144 or any other rule of similar effect. The resale shares will be sold only through registered or
licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states, the resale shares
may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration
or qualification requirement is available and is complied with.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Under applicable rules and regulations under
the Exchange Act, any person engaged in the distribution of the resale shares may not simultaneously engage in market making activities
with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to the commencement of
the distribution. In addition, the Selling Stockholder will be subject to applicable provisions of the Exchange Act and the rules
and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of shares of the common stock
by the Selling Stockholder or any other person. We will make copies of this Prospectus available to the Selling Stockholder and
have informed them of the need to deliver a copy of this Prospectus to each purchaser at or prior to the time of the sale (including
by compliance with Rule 172 under the Securities Act).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Limitation
Of Liability and Indemnification of Officers and </B></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Directors;
Insurance</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our Articles of Incorporation
limit the liability of directors to the maximum extent permitted by Delaware law. Delaware law provides that directors of a corporation
will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except liability for:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>any breach of their duty of loyalty to the corporation or its stockholders;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">acts or omissions not in good faith or which involve intentional misconduct or a knowing violation
of law;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">unlawful payments of dividends or unlawful stock repurchases or redemptions; or</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">any transaction from which the director derived an improper personal benefit.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our Bylaws provide
that we will indemnify our directors, officers, employees and other agents to the fullest extent permitted by law. We believe that
indemnification under our Bylaws covers at least negligence and gross negligence on the part of indemnified parties. Our Bylaws
also permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of
his or her actions in connection with their services to us, regardless of whether our Bylaws permit such indemnification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">There is no pending
litigation or proceeding involving any of our directors or officers as to which indemnification is required or permitted, and we
are not aware of any threatened litigation or proceedings that may result in a claim for indemnification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="color: black">Insofar
as an indemnification for liabilities arising under the </FONT>Securities<FONT STYLE="color: black"> Act may be permitted for directors,
officers or persons controlling us pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC each
indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Disclosure
of Commission Position On Indemnification</B></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>for
Securities Act Liabilities</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our directors and officers
are indemnified by our bylaws against amounts actually and necessarily incurred by them in connection with the defense of any action,
suit or proceeding in which they are a party by reason of being or having been our directors or officers or of our subsidiaries.
Our articles of incorporation provide that none of our directors or officers shall be personally liable for damages for breach
of any fiduciary duty as a director or officer involving any act or omission of any such director or officer. Insofar as indemnification
for liabilities arising under the Securities Act may be permitted to such directors, officers and controlling persons pursuant
to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against
public policy as expressed in the Securities Act and is, therefore, unenforceable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="color: black">In
the event that a claim for indemnification against such liabilities, other than the payment by us of expenses incurred or paid
by such director, officer or controlling person in the successful defense of any action, suit or proceeding, is asserted by such
director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of counsel
the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the </FONT>Securities<FONT STYLE="color: black"> Act and will be governed by the
final adjudication of such issue.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="color: black">Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling
persons pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification
is against public policy as expressed in the </FONT>Securities<FONT STYLE="color: black"> Act and is, therefore, unenforceable.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In the event that a
claim for indemnification against such liabilities (other than our payment of expenses incurred or paid by a director, officer
or controlling person in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled
by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against
public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>L<FONT STYLE="font-variant: small-caps">egal
Matters</FONT></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The validity of the Shares offered hereby
will be passed upon for us by Sierchio &amp; Company, LLP, 430 Park Avenue, 7th Floor, New York, New York 10022. Joseph Sierchio,
the managing partner of Sierchio &amp; Company, LLP, is the beneficial owner of 200,000 stock options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>E<FONT STYLE="font-variant: small-caps">xperts</FONT></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our consolidated financial statements at
December 31, 2011 and 2010, and for the years then ended, appearing herein have been audited by Peterson Sullivan, LLP, an independent
registered public accounting firm, as set forth in its report thereon appearing elsewhere herein, and are included in reliance
upon such report given on the authority of such firm as experts in accounting and auditing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Where
You Can Find Additional Information</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We file current, quarterly and annual reports
with the SEC on forms 8-K, 10-Q and 10-K. Our filings may be inspected and copied at the Public Reference Room maintained by the
SEC at 100 F Street, N.E., Washington, D.C. 20549. You can obtain information about operation of the Public Reference Room by calling
the SEC at 1-800-SEC-0330. The SEC also maintains an Internet site that contains reports, proxy and information statements, and
other information regarding issuers that file electronically with the SEC at http://www.sec.gov. Copies of such material can be
obtained from the public reference section of the SEC at prescribed rates. For further information with respect to us and the securities
being offered hereby, reference is hereby made to the registration statement, including the exhibits thereto and the financial
statements, notes, and schedules filed as a part thereto.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-variant: small-caps"><B>Index
to Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR>
    <TD STYLE="vertical-align: top; width: 92%">&nbsp;</TD>
    <TD STYLE="vertical-align: top; width: 1%; font-weight: bold">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 7%; font-weight: bold; text-align: center">Page #</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top; font-variant: small-caps; font-weight: bold">September 30, 2012 and 2011 (Unaudited)</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Consolidated Balance Sheets September 30, 2012 (unaudited) and December 31, 2011</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">F-1</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Consolidated Statements of Comprehensive Income (Loss) (unaudited) Three and Nine months ended September 30, 2012 and 2011; and for the period from October 10, 1995 (Inception) to September 30, 2012</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">F-2</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">Consolidated Statements of Cash Flows (unaudited) Nine months ended September 30, 2012 and <FONT STYLE="color: black">2011</FONT> and for <FONT STYLE="color: black">the</FONT> period from October 10, 1995 (Inception) to September 30, 2012</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">F-3</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top">Consolidated Statements of Stockholders&rsquo; Equity (Deficiency) for the Period from October 10, 1995 (Inception) to September 30, 2012</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">F-4</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">Notes to Consolidated Financial Statements (unaudited) Nine Months Ended September 30, 2012 and 2011</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">F-14</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top; font-variant: small-caps; font-weight: bold">December 31, 2011 and 2010 (Audited)</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&nbsp;</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">Report of Independent Registered Public Accounting Firm</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">F-25</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top">Consolidated Balance Sheets as of December 31, 2011 and 2010</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">F-26</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">Consolidated Statements of Operations from October 10, 1995 (inception) to December 31, 2011 and for the years ended December 31, 2011 and 2010</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">F-27</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top">Consolidated Statements of Stockholders&rsquo; Equity (Deficiency) and Comprehensive Income (Loss) for the period from October 10, 1995 (inception) to December 31, 2011</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">F-28</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt; color: black">Consolidated Statements of Cash Flows for the period from October 10, 1995 (inception) to December 31, 2011 and for the years ended December 31, 2011 and 2010</FONT></TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">F-32</TD></TR>
<TR STYLE="background-color: rgb(204,255,204)">
    <TD STYLE="vertical-align: top">Notes to Consolidated Financial Statements Years Ended December 31, 2011 and 2010</TD>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">F-34</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Aurora Gold Corporation</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(An Exploration Stage Enterprise)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Financial Statements (Expressed
in U.S. Dollars)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Quarterly Report for the Period Ended September
30, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Unaudited)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Balance Sheets</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>AURORA GOLD CORPORATION</TD><TD NOWRAP STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: right">&nbsp;</TD><TD NOWRAP STYLE="font-weight: bold">&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">&nbsp;</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>(An exploration stage enterprise)</TD><TD NOWRAP STYLE="color: black">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="color: black; text-align: right">As&nbsp;at</TD><TD NOWRAP STYLE="color: black">&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">As&nbsp;at</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>Consolidated Balance Sheets</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">September&nbsp;30</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">December&nbsp;31</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">2012&nbsp;(Unaudited)</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">2011</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="padding-bottom: 1pt">(Expressed in U.S. Dollars)</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right; border-bottom: Black 1pt solid">$</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right; border-bottom: Black 1pt solid">$</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-indent: -0.1in; padding-left: 0.1in">ASSETS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -0.1in; padding-left: 0.1in">Current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 74%; padding-bottom: 1pt; text-indent: -0.1in; padding-left: 16.2pt">Cash</TD><TD STYLE="width: 1%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; border-bottom: Black 1pt solid; text-align: right">1,241</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; border-bottom: Black 1pt solid; text-align: right">237,426</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -0.1in; padding-left: 0.1in">Total current assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,241</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">237,426</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="color: black; text-align: left; padding-bottom: 1pt; text-indent: -0.1in; padding-left: 0.1in"><FONT STYLE="color: black">Total<B> </B>assets (all current)</FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,241</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">237,426</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.1in; padding-left: 0.1in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -0.1in; padding-left: 0.1in">LIABILITIES AND STOCKHOLDERS&rsquo; EQUITY (DEFICIENCY)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -0.1in; padding-left: 0.1in">Current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; text-indent: -0.1in; padding-left: 16.2pt">Accounts payable and accrued expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">254,974</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">400,644</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.1in; padding-left: 16.2pt">Advances payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">45,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; text-indent: -0.1in; padding-left: 16.2pt">Accounts payable &ndash; related party</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">240,419</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -0.1in; padding-left: 16.2pt">Advances payable &ndash; related party</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">82,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">92,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; text-indent: -0.1in; padding-left: 0.1in">Total current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">577,393</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">537,644</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-indent: -0.1in; padding-left: 0.1in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -0.1in; padding-left: 0.1in">Stockholders&rsquo; Equity (Deficiency)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.1in; padding-left: 0.1in">Common stock</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-indent: -0.1in; padding-left: 16.2pt">Authorized: 300,000,000 (December 31, 2011: 300,000,000) common shares with par value of $0.001 each</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.1in; padding-left: 16.2pt">Issued and outstanding:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-indent: -0.1in; padding-left: 0.35in">114,144,706 <FONT STYLE="color: black">(December 31, 2011: 109,912,589) common shares</FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">114,145</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">109,913</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.1in; padding-left: 0.35in">Advances for stock subscriptions</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; text-indent: -0.1in; padding-left: 0.1in">Additional paid-in capital</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22,346,349</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22,040,994</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.1in; padding-left: 0.1in">Accumulated deficit during the exploration stage</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(22,966,943</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(22,400,600</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -0.1in; padding-left: 0.1in">Accumulated other comprehensive income (loss)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(69,703</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(70,525</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -0.1in; padding-left: 0.1in">Stockholder&rsquo; equity (deficiency)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(576,152</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(300,218</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -0.1in; padding-left: 0.1in">Total liabilities and stockholders&rsquo; equity (deficiency)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,241</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">237,426</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(The accompanying notes are an integral
part of these consolidated financial statements.)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: left"></P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Aurora Gold Corporation</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(An Exploration Stage Enterprise)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Financial Statements (Expressed
in U.S. Dollars)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Quarterly Report for the Period Ended September
30, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Unaudited)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Statements of Comprehensive
Income (Loss)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="text-align: justify">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Cumulative<BR> October&nbsp;19,<BR> 1995<BR> (inception)&nbsp;to<BR> September&nbsp;30,&nbsp;<BR> 2012 <BR>
$</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">For&nbsp;the<BR>
 Three<BR>
 Months<BR>
 Ended <BR>
September <BR>
30,&nbsp;2012 <BR>
$</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">For&nbsp;the<BR>
 Three <BR>
Months <BR>
Ended <BR>
September <BR>
30,&nbsp;2011<BR>
 $</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">For&nbsp;the<BR>
 Nine <BR>
Months <BR>
Ended <BR>
September 30,&nbsp;<BR>
2012 <BR>
$</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">For&nbsp;the <BR>Nine <BR>Months <BR>Ended <BR>September <BR>30,&nbsp;2011 <BR>$</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Operating Expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 35%; text-align: left">General and administrative</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">2,555,501</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">27,995</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">54,095</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">218,587</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">139,250</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Depreciation and amortization</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">145,126</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,538</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22,001</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Imputed interest on loan payable &ndash; related party</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,560</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Interest and bank charges</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">395,430</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">584</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,461</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,173</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,540</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Foreign exchange loss (gain)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(13,756</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(3,702</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,563</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">486</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Professional fees &ndash; accounting and legal</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,888,486</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">47,674</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25,219</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">80,450</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">189,198</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Property search and negotiation</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">479,695</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Salaries, management and consulting fees</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,698,880</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">80,947</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">95,098</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">227,707</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">406,398</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Exploration expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,863,063</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,772</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,055</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">131,724</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">261,304</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 1pt">Write-off of equipment</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">240,338</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">19,254,323</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">164,972</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">201,764</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">661,204</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,025,177</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Other income (loss)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Gain (loss) on disposition of subsidiary</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,541,037</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(245,221</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,757,511</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Interest income</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22,353</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Gain on sale of rights to Matupa agreement (net)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">80,237</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Loss on investments</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(37,971</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Loss on spun-off operations</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(316,598</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Gain (loss) on extinguishment of liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(919,605</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">94,860</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">94,860</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(3,712,621</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">94,860</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(245,221</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">94,860</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(2,757,511</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Net Loss</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(22,966,944</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(70,112</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(446,985</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(566,344</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(3,782,688</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Other comprehensive income (loss)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Foreign currency translation adjustments</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(2,875</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">591</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">822</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,510</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Comprehensive income (loss)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(72,987</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(446,394</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(565,522</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(3,780,178</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Net Loss Per Share &ndash; Basic and Diluted</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">*</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(0.00</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(0.01</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(0.04</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Weighted Average Shares Outstanding &ndash; Basic and Diluted</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">114,144,706</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">89,540,183</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">112,726,318</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">89,036,372</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">* amount is less than $(0.01) per share</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" HSPACE="0" VSPACE="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; padding-right: 9pt; padding-left: 9pt">(The accompanying notes are an integral part of these consolidated financial statements.)</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 61; Value: 1 -->
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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Aurora Gold Corporation</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(An Exploration Stage Enterprise)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Financial Statements (Expressed
in U.S. Dollars)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Quarterly Report for the Period Ended September
30, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Statements of Cash Flows</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; text-decoration: none">
    <TD NOWRAP STYLE="text-align: justify; text-decoration: none">&nbsp;</TD><TD NOWRAP STYLE="color: black; padding-bottom: 1pt; text-decoration: none">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="color: black; text-align: center; border-bottom: Black 1pt solid; text-decoration: none"><FONT STYLE="color: black">Cumulative
    <BR>
October&nbsp;19,&nbsp;1995 <BR>
(inception)<BR>
 to&nbsp;September&nbsp;30<BR>
 2012<BR>
 $</FONT></TD><TD NOWRAP STYLE="padding-bottom: 1pt; color: black; text-decoration: none">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt; text-decoration: none">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid; text-decoration: none">For&nbsp;the&nbsp;Nine<BR>
Months<BR>
Ended<BR>
September<BR>
30,&nbsp;2012<BR>
 $</TD><TD NOWRAP STYLE="padding-bottom: 1pt; text-decoration: none">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt; text-decoration: none">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid; text-decoration: none">For&nbsp;the Nine <BR>Months <BR>Ended <BR>September <BR>30,&nbsp;2011 <BR>$</TD><TD NOWRAP STYLE="padding-bottom: 1pt; text-decoration: none">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 61%; font-weight: bold; text-align: left">Net loss for the period</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">(22,966,944</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">(566,344</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">(3,782,688</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left">Adjustments to reconcile net loss to cash used in operating activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Depreciation and amortization</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">145,126</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22,001</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Stock compensation expense on stock option grants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,624,012</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">55,660</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Expenses satisfied with issuance of common stock</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,202,054</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">24,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Expenses satisfied with transfer of marketable securities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">33,903</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Imputed interest on loan payable - related parties</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,560</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Write-off of mineral property assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">240,338</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Adjustment for spin-off of Aurora Metals (BVI) Limited</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">316,498</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Loss on disposal of subsidiary</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,757,511</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,757,511</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Realized loss on investments</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">37,971</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Gain on sale of rights to Matupa agreement (net)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(80,237</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">(Gain) loss on extinguishment of liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">919,605</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(94,860</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Foreign exchange (gain) loss related to notes payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(24,534</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Change in operating assets and liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Decrease (Increase) in receivables and other assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(206,978</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">(Increase) decrease in prepaid expenses and other assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(20,459</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(7,016</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Increase (decrease) in accounts payable and accrued expenses (including related party)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,331,114</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">224,063</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(732</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1pt">Net Cash Used in Operating Activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(14,689,460</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(381,481</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(986,424</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left">Cash Flows From Investing Activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-left: 9pt">Purchase of equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(205,348</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Proceeds on disposal of equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">16,761</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Payment for mineral property Reclamation Bonds</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(245,221</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">80,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Proceeds from disposition of marketable securities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">32,850</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Acquisition of mineral property costs and related equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(672,981</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Payment for incorporation cost</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(11,511</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1pt">Net Cash Provided by (Used in) Investing Activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(1,085,450</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">80,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left">Cash Flows From Financing Activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Proceeds from common stock less issuance costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">14,140,912</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">96,473</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">167,100</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Loan proceeds from related party</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">289,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-left: 9pt">Net proceeds from (payments on) convertible notes and loans</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">969,252</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 9pt">Net proceeds from (payments on) advances payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">45,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">257,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 9pt">Net proceeds from (payments on) advances payable &ndash; related parties</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">142,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">50,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1pt">Net Cash Provided by Financing Activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">15,586,164</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">146,473</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">424,100</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; text-align: left">Effect of Exchange Rate Changes on Cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">189,987</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,177</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(3,565</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left">(Decrease) Increase in Cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,241</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(236,185</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(485,889</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-weight: bold; padding-bottom: 1pt">Cash at Beginning of Period</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">237,426</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">579,191</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 1pt">Cash at End of Period</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,241</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,241</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">93,302</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" HSPACE="0" VSPACE="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center; padding-right: 9pt; padding-left: 9pt">(The accompanying notes are an integral part of these consolidated financial statements.)</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<!-- Field: Page; Sequence: 62; Value: 1 -->
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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Aurora Gold Corporation</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(An Exploration Stage Enterprise)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Financial Statements (Expressed
in U.S. Dollars)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Quarterly Report for the Period Ended September
30, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Statements of Stockholders&rsquo;
Equity (Deficiency)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; font-size: 8pt">
    <TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Common Stock Shares<BR>
    Amount</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Additional<BR>
    paid-in<BR>
    capital</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Advances for <BR>
    Stock<BR>
    Subscriptions</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated <BR>
    (deficit) <BR>
    during <BR>
    Exploration<BR>
    Stage</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated<BR>
    other <BR>
    comprehensive <BR>
    income (loss)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Total <BR>
    stockholders' <BR>
    equity<BR>
    (deficiency)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">#</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">Balance, October 10, 1995</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="width: 17%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Issuance of common stock for settlement
    of indebtedness</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">11,461,153</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">11,461</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">11,461</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Net (loss) for the period</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">Balance December 31, 1995</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">11,461,153</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">11,461</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">11,461</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Adjustment for reverse stock split</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(7,640,766</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(7,641</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(7,641</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Issuance of common stock for - cash at $0.001 per
    share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">5,800,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">5,800</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">341,761</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">347,561</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- resource property</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">300,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">300</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">2,700</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">3,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Net (loss) for the period</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(361,208</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(361,208</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">Balance December 31, 1996</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">9,920,387</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">9,920</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">344,461</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(361,208</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(6,827</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Issuance of common stock for - cash in March 1997
    at $1.00 per share (less issue costs of $4,842)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">750,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">750</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">744,408</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">745,158</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Net (loss) for the period</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(615,880</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(615,880</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">Balance December 31, 1997</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">10,670,387</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">10,670</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">1,088,869</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(977,088</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">122,451</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Issuance of common stock for:</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">- settlement of indebtedness</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">96,105</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">96</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">68,601</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">68,697</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
</TABLE>

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<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Common Stock Shares<BR>
    Amount</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Additional<BR>
    paid-in<BR>
    capital</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Advances for <BR>
    Stock<BR>
    Subscriptions</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated <BR>
    (deficit) <BR>
    during <BR>
    Exploration<BR>
    Stage</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated<BR>
    other <BR>
    comprehensive <BR>
    income (loss)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Total <BR>
    stockholders' <BR>
    equity<BR>
    (deficiency)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">#</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 17%"><FONT STYLE="font-size: 8pt">- cash in May 1998 at $1.25 per share</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">200,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">200</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">249,800</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 8pt">250,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">- cash in November 1998 at $0.75 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">71,667</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">72</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">53,678</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">53,750</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">- cash in December 1998 at $0.75 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">143,333</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">143</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">107,357</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">107,500</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Grant of options to employees and directors</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">518,900</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">518,900</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Grant of options to consultants</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">172,100</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">172,100</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Net (loss) for the period</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(1,151,604</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(1,151,604</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">Balance December 31, 1998</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">11,181,492</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">11,181</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">2,259,304</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(2,128,692</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">141,794</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Issuance of common stock for:</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">- settlement of indebtedness</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">231,286</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">231</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">160,151</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">160,382</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">- cash in March 1999 at $0.656 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">22,871</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">23</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">14,977</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">15,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">- finder's fee in February 1999&nbsp;at $0.81 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">25,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">25</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">20,287</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">20,312</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Grant of options to consultants</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">29,500</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">29,500</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Cash advanced on stock subscriptions</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">425,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">425,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Net (loss) for the period</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(855,391</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(855,391</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">Balance December 31, 1999</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">11,460,649</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">11,461</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">2,484,219</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">425,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(2,984,083</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(63,403</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Issuance of common stock for:</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">- settlement of indebtedness</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">199,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">199</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">99,301</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">99,500</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 64; Value: 1 -->
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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

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<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Common Stock Shares<BR>
    Amount</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Additional<BR>
    paid-in<BR>
    capital</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Advances for <BR>
    Stock<BR>
    Subscriptions</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated <BR>
    (deficit) <BR>
    during <BR>
    Exploration<BR>
    Stage</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated<BR>
    other <BR>
    comprehensive <BR>
    income (loss)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Total <BR>
    stockholders' <BR>
    equity<BR>
    (deficiency)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">#</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 17%"><FONT STYLE="font-size: 8pt">- cash in March 2000 at $0.50 per share</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">350,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">350</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">174,650</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 8pt">(175,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">- cash in March 2000 at $0.455 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">550,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">550</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">249,450</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(250,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">Cancellation of shares in April 2000</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(90,706</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(91</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(56,600</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(56,691</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">Exercise of options in June 2000</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">405,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">405</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,645</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">4,050</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Spin-off of Aurora Metals (BVI) Limited</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">316,498</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">316,498</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Net (loss) for the period</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(677,705</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(677,705</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">Balance December 31, 2000</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">12,873,943</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">12,874</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,271,163</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(3,661,788</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(377,751</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Net income for the period</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">128,545</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">128,545</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Unrealized holding losses on available-for-sale securities</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(141,928</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(141,928</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">Balance December 31, 2001</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">12,873,943</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">12,874</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,271,163</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(3,533,243</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(141,928</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(391,134</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Issuance of common stock for:</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">- settlement of indebtedness</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,708,038</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,708</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">351,492</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">355,200</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Net loss for the period</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(137,329</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(137,329</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Unrealized holding losses on available-for-sale securities</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">141,928</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">141,928</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">Balance, December 31, 2002</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">16,581,981</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">16,582</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,622,655</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(3,670,572</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(31,335</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Issuance of common stock for:</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">- settlement of indebtedness</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">2,752,450</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">2,752</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">114,806</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">117,558</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 65; Value: 1 -->
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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Common Stock Shares<BR>
    Amount</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Additional<BR>
    paid-in<BR>
    capital</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Advances for <BR>
    Stock<BR>
    Subscriptions</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated <BR>
    (deficit) <BR>
    during <BR>
    Exploration<BR>
    Stage</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated<BR>
    other <BR>
    comprehensive <BR>
    income (loss)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Total <BR>
    stockholders' <BR>
    equity<BR>
    (deficiency)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">#</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 17%"><FONT STYLE="font-size: 8pt">- cash in&nbsp;&nbsp;December 2003 at $0.25 per share</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">100,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">100</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">24,900</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 8pt">25,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Net loss for the period</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(96,404</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(96,404</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Unrealized holding losses&nbsp;on available-for-sale securities</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">Balance, December 31, 2003</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">19,434,431</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">19,434</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,762,361</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(3,766,976</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">14,819</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Issuance of common stock for:</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- cash in January 2004 at $0.25 per share,&nbsp;less issuance costs</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">100,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">100</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">22,400</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">22,500</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Imputed interest</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">1,560</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">1,560</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Net loss for the period</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(223,763</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(223,763</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Unrealized holding losses on available-for-sale securities</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">Balance, December 31, 2004</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">19,534,431</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">19,534</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,786,321</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(3,990,739</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(184,884</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Issuance of common stock for:</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">- cash in July 2005 at $0.05 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">13,000,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">13,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">637,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">650,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">- settlement of indebtedness</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,684,091</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,684</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">158,816</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">162,500</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Net (loss) for the period</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(457,271</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(457,271</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Unrealized holding losses on available-for-sale securities</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(4,614</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(4,614</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 66; Value: 1 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-bottom: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">F-<!-- Field: Sequence; Type: Arabic; Name: PageNo -->7<!-- Field: /Sequence --></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Common Stock Shares<BR>
    Amount</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Additional<BR>
    paid-in<BR>
    capital</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Advances for <BR>
    Stock<BR>
    Subscriptions</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated <BR>
    (deficit) <BR>
    during <BR>
    Exploration<BR>
    Stage</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated<BR>
    other <BR>
    comprehensive <BR>
    income (loss)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Total <BR>
    stockholders' <BR>
    equity<BR>
    (deficiency)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">#</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 17%"><FONT STYLE="font-size: 8pt">Balance, December 31, 2005</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">36,218,522</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">36,218</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">4,582,137</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 8pt">(4,448,010</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 8pt">(4,614</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 8pt">165,731</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Issuance of common stock for - cash in February 2006 at $0.50 per
    share less issuance costs of $110,000:</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">8,000,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">8,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,882,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,890,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- non cash finder's fee in December 200&nbsp;at $0.70 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">250,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">250</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">174,750</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">175,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">- cash in December 2006 at $0.50 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">1,000,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">1,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">499,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">500,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Net (loss) for the period</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(5,463,855</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(5,463,855</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Foreign currency translation adjustments</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(3,692</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(3,692</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Reclassification adjustment for losses on available-for-sale securities
    included in net loss</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">4,614</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">4,614</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">Balance, December 31, 2006</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">45,468,522</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">45,468</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">9,137,887</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(9,911,865</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(3,692</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(732,202</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Issuance of common stock for:</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">- cash in March 2007 at $0.50 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">500,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">500</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">249,500</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">250,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">- cash in July 2007 at $0.25 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">5,000,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">5,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">1,245,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">1,250,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">- settlement of indebtedness in August 2007 at $0.20 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">250,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">250</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">49,750</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">50,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 67; Value: 1 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-bottom: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">F-<!-- Field: Sequence; Type: Arabic; Name: PageNo -->8<!-- Field: /Sequence --></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Common Stock Shares<BR>
    Amount</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Additional<BR>
    paid-in<BR>
    capital</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Advances for <BR>
    Stock<BR>
    Subscriptions</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated <BR>
    (deficit) <BR>
    during <BR>
    Exploration<BR>
    Stage</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated<BR>
    other <BR>
    comprehensive <BR>
    income (loss)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Total <BR>
    stockholders' <BR>
    equity<BR>
    (deficiency)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">#</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 17%"><FONT STYLE="font-size: 8pt">- cash in September 2007 at $0.20 per share</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">4,000,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">4,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 8pt">796,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 8pt">800,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Stock option compensation expense</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">454,295</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">454,295</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Net (loss) for the period</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(3,259,732</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(3,259,732</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Foreign currency translation adjustments</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(65,255</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(65,255</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">Balance, December 31, 2007</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">55,218,522</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">55,218</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">11,932,432</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(13,171,597</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(68,947</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(1,252,894</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Issuance of common stock for - non cash finder's fee in July 2008&nbsp;at
    $0.10 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">250,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">250</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">24,750</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">25,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD><FONT STYLE="font-size: 8pt">- settlement of indebtedness in December2008 at $0.06 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">2,603,333</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">2,603</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">153,597</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">156,200</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Net (loss) for the period</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(520,105</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(520,105</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Foreign currency translation adjustments</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">36,259</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">36,259</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font-size: 8pt">Balance, December 31, 2008</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">58,071,855</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">58,071</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">12,110,779</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(13,691,702</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(32,688</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(1,555,540</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- Issuance of common stock for - settlement of indebtedness in September&nbsp;2009
    at $0.15 per share</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">5,000,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">5,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">1,748,616</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">1,753,616</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">- cash in September 2009 at $0.10 per share&nbsp;less finder's fee</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,000,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">255,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">258,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 68; Value: 1 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-bottom: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">F-<!-- Field: Sequence; Type: Arabic; Name: PageNo -->9<!-- Field: /Sequence --></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; font-size: 8pt">
    <TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Common Stock Shares<BR>
    Amount</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Additional<BR>
    paid-in<BR>
    capital</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Advances for <BR>
    Stock<BR>
    Subscriptions</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated <BR>
    (deficit) <BR>
    during <BR>
    Exploration<BR>
    Stage</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated<BR>
    other <BR>
    comprehensive <BR>
    income (loss)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Total <BR>
    stockholders' <BR>
    equity<BR>
    (deficiency)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">#</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="width: 17%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- non cash finder's fee September 2009
    at $0.10 per share</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">420,000</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">420</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">41,580</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">42,000</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">- settlement of indebtedness in November&nbsp;2009 at $0.18 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">100,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">100</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">17,899</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">17,999</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">-&nbsp;settlement of indebtedness in November&nbsp;2009 at $0.24 per
    share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">150,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">150</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">35,611</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">35,761</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">- cash in December 2009 at $0.30 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">1,666,667</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">1,667</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">498,333</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">500,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- Net (loss) for the period</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(1,779,477</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(1,779,477</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- Foreign currency translation adjustments</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(60,171</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(60,171</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">Balance, December 31, 2009</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">68,408,522</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">68,408</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">14,707,818</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(15,471,179</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(92,859</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(787,812</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- Issuance of common stock for cash in April 2010
    at $0.30 per share less finder's fee (paid with 1,126,111 shares&nbsp;included herein)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">14,109,446</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">14,110</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">3,880,890</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">3,895,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- non cash property acquisition&nbsp;in June 2010&nbsp;at
    $0.40 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">5,000,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">5,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">1,995,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">2,000,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">- settlement of indebtedness in September 2010 at $0.30 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">160,500</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">161</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">47,989</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">48,150</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">- settlement of indebtedness in September 2010 at $0.30 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">325,400</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">325</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">97,295</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">97,620</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 69; Value: 1 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-bottom: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">F-<!-- Field: Sequence; Type: Arabic; Name: PageNo -->10<!-- Field: /Sequence --></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Common Stock Shares<BR>
    Amount</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Additional<BR>
    paid-in<BR>
    capital</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Advances for <BR>
    Stock<BR>
    Subscriptions</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated <BR>
    (deficit) <BR>
    during <BR>
    Exploration<BR>
    Stage</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated<BR>
    other <BR>
    comprehensive <BR>
    income (loss)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Total <BR>
    stockholders' <BR>
    equity<BR>
    (deficiency)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">#</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="width: 17%; font-size: 8pt"><FONT STYLE="font-size: 8pt">- payment of expenses in September&nbsp;2010 at $0.30 per share</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">200,000</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">200</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">59,800</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">60,000</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- non cash finder's fee in September 2010&nbsp;related to the June
    2010 property acquisition&nbsp;at $0.30 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">500,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">500</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">149,500</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">150,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- Net (loss) for the period</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(2,302,083</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(2,302,083</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- Foreign currency translation adjustments</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(198</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(198</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">Balance, December 31, 2010</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">88,703,868</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">88,704</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">20,938,292</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(17,773,262</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(93,057</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">3,160,677</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">-Issuance of common stock for non cash finder&rsquo;s fee in May
    2011 at $0.042 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">450,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">450</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(450</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">-Issuance of common stock for cash in September 2011 at $0.10 per
    share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">1,671,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">1,671</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">165,429</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">167,100</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">-Issuance of common stock for settlement of indebtedness in September
    2011 at $0.16 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">150,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">150</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">24,350</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">24,500</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">-Issuance of common stock for settlement of indebtedness in December
    2011 at $0.02 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">10,937,721</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">10,938</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">207,816</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">218,754</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; font-size: 8pt">
    <TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Common Stock Shares<BR>
    Amount</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Additional<BR>
    paid-in<BR>
    capital</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Advances for <BR>
    Stock<BR>
    Subscriptions</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated <BR>
    (deficit) <BR>
    during <BR>
    Exploration<BR>
    Stage</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated<BR>
    other <BR>
    comprehensive <BR>
    income (loss)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Total <BR>
    stockholders' <BR>
    equity<BR>
    (deficiency)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">#</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="width: 17%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">-Issuance of common stock for cash in
    December 2011 at $0.04 per share</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">8,000,000</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">8,000</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">312,000</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">320,000</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">-Issuance of common stock for cash in December 2011
    at $0.04 per share - oversubscribed</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">20,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">20,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">-Stock option compensation expense</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">393,557</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">393,557</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- Net (loss) for the period</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(4,627,338</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(4,627,338</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- Foreign currency translation adjustments</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">22,532</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">22,532</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">Balance, December 31, 2011</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">109,912,589</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">109,913</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">22,040,994</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">20,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(22,400,600</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(70,525</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(300,218</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Issuance of common stock for settlement of indebtedness
    in March 2012 at $0.06 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">1,990,900</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">1,991</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">117,463</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">119,454</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Issuance of common stock for cash in March 2012
    at $0.06 per share &ndash; shares not issued until April 2012</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">17,513</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">17,513</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Issuance of common stock for cash in April 2012
    at $0.06 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">1,316,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">1,316</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">77,644</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">78,960</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Issuance of common stock for settlement of indebtedness
    in April 2012 at $0.06 per share</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">300,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">300</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">17,700</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">18,000</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 71; Value: 1 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-bottom: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">F-<!-- Field: Sequence; Type: Arabic; Name: PageNo -->12<!-- Field: /Sequence --></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; font-size: 8pt">
    <TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Common Stock Shares<BR>
    Amount</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Additional<BR>
    paid-in<BR>
    capital</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Advances for <BR>
    Stock<BR>
    Subscriptions</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated <BR>
    (deficit) <BR>
    during <BR>
    Exploration<BR>
    Stage</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Accumulated<BR>
    other <BR>
    comprehensive <BR>
    income (loss)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 8pt"><FONT STYLE="font-size: 8pt">Total <BR>
    stockholders' <BR>
    equity<BR>
    (deficiency)</FONT></TD><TD NOWRAP STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">#</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; padding-bottom: 1pt; border-bottom: Black 1pt solid; font-size: 8pt"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD NOWRAP STYLE="text-align: center; padding-bottom: 1pt; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="width: 17%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Issuance of common stock in April 2012
    for Advances for Stock Subscriptions</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">625,217</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">625</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">36,888</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(37,513</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="width: 1%; text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">Stock option compensation expense</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">55,660</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">55,660</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- Net (loss) for the period</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(566,344</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(566,344</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 8pt">
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">- Foreign currency translation adjustments</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">822</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">822</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 8pt">
    <TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">Balance, September 30, 2012</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">114,144,706</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">114,145</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">22,346,349</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">-</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(22,966,944</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(69,703</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD><TD STYLE="font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; font-size: 8pt"><FONT STYLE="font-size: 8pt">(576,153</FONT></TD><TD STYLE="text-align: left; font-size: 8pt"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(The accompanying notes are an integral
part of these consolidated financial statements.)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Aurora Gold Corporation</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(An Exploration Stage Enterprise)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Financial Statements (Expressed
in U.S. Dollars)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Quarterly Report for the Period Ended September
30, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Notes to Consolidated Financial Statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>1.</B></TD><TD><B>Organization, Nature of Business, Going Concern and Management&rsquo;s Plans</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Aurora Gold Corporation (&ldquo;the Company&rdquo;)
was formed on October 10, 1995 under the laws of the State of Delaware and is in the business of location, acquisition, exploration
and, if warranted, development of mineral properties. The Company&rsquo;s focus is on the exploration and development of its exploration
properties located in the Tapajos Gold Province, State of Par&aacute;, Brazil (see Note 3). The Company has not yet determined
whether its properties contain mineral reserves that may be economically recoverable and has not generated any operating revenues
to date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">These interim consolidated financial statements
have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates
the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The general business
strategy of the Company is to acquire mineral properties either directly or through the acquisition of operating entities. The
Company has incurred recurring operating losses since inception, has not generated any operating revenues to date and during the
period ended September 30, 2012, operating activities used cash of $381,481 (September 30, 2011: $986,424). The Company requires
additional funds to meet its obligations and maintain its operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">These conditions raise substantial doubt
about the Company's ability to continue as a going concern. Management's plans in this regard are to raise equity financing through
private or public equity investment in order to support existing operations and expand its business. The Company currently has
a Prospectus out on offer and these details are included in further detail in these notes. There is however no assurance that such
additional funding will be available to the Company when required, or on terms acceptable to the Company. In the event that the
Company cannot obtain additional funds, on a timely basis, or the operations do not generate sufficient cash flow, the Company
may be forced to curtail development or cease activities. These consolidated financial statements do not include any adjustments
that might result from this uncertainty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>2.</B></TD><TD><B>Summary of Significant Accounting Policies</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">a.</TD><TD STYLE="text-align: justify">Basis of Preparation</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company follows accounting standards
set by the Financial Accounting Standards Board (FASB). The FASB sets accounting principles generally accepted (GAAP) in the United
States that the Company follows to ensure they consistently report their financial condition, results of operations, and cash flows.
References to GAAP issued by the FASB in these footnotes are to the FASB Accounting Standards Codification (ASC) or also referred
to as Codification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">These interim consolidated financial statements
have been prepared in accordance with GAAP and include the accounts of the Company and its wholly owned subsidiaries, Aurora Gold
Minera&ccedil;&atilde;o Ltda (&ldquo;Aurora Gold Minera&ccedil;&atilde;o&rdquo;) and AGC Resources LLC (&ldquo;AGC&rdquo;) (through
to date of disposition of AGC, June 14, 2011) Collectively, they are referred to herein as &ldquo;the Company.&rdquo; Significant
inter-company accounts and transactions have been eliminated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Certain information and footnote disclosures
normally included in consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant
to such Securities and Exchange Commission (SEC) rules and regulations. The interim period consolidated financial statements should
be read together with the audited consolidated financial statements and accompanying notes included in the Company&rsquo;s audited
consolidated financial statements for the year ended December 31, 2011. In the opinion of the management of the Company, the unaudited
consolidated financial statements contained herein contain all adjustments (consisting of a normal recurring nature) necessary
to present a fair statement of the results of the interim periods presented.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">b.</TD><TD STYLE="text-align: justify">Use of Estimates</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The preparation of financial statements
in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from those estimates and assumptions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">c.</TD><TD STYLE="text-align: justify">Cash Equivalents</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="color: black">Cash equivalents
comprise certain highly liquid instruments with a maturity date of three months or less when purchased. The Company has cash equivalents
of $1,241 and $93,302 at September 30, 2012 and 2011 respectively. </FONT>Amounts paid for income taxes during the periods ended
September 30, 2012 and 2011 were nil; and for interest paid nil respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">d.</TD><TD STYLE="text-align: justify">Buildings and Equipment</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Buildings and equipment are carried at
cost (including development and preproduction costs, capitalized interest, other financing costs and all direct administrative
support costs incurred during the construction period, net of cost recoveries and incidental revenues), less accumulated depletion
and depreciation including write-downs. Following the construction period, interest, other financing costs and administrative costs
are expensed as incurred. On the commencement of commercial production, depletion of each mining property is provided on the unit-of-production
basis, using estimated proven and probable reserves as the depletion basis. Buildings and equipment utilized directly in commercial
mining activities are depreciated, following the commencement of commercial production, over their expected economic lives using
either the unit-of-production method or the straight-line method. Depreciation for non-mining equipment is provided over the following
useful lives:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 90%; border-collapse: collapse; margin-left: 0.5in">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; text-align: left">Vehicles</TD>
    <TD STYLE="width: 50%; text-align: left">10 years</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: left">Office equipment, furniture and fixtures</TD>
    <TD STYLE="text-align: left">2 to 10 years</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company reviews the carrying values
of its buildings and equipment whenever events or changes in circumstances indicate that their carrying values may not be recoverable.
An impairment is considered to exist if total estimated future cash flows, or probability-weighted cash flows on an undiscounted
basis, are less than the carrying value of the assets. An impairment loss is measured and recorded based on discounted estimated
future cash flows associated with values beyond proven and probable reserves and resources. In estimating future cash flows, assets
are grouped at the lowest level for which there is identifiable future cash flows that are largely independent of cash flows from
other asset groups. Generally, in estimating future cash flows, all assets are grouped at a particular property for which there
are identifiable cash flows. Buildings and equipment utilized directly in commercial mining activities are depreciated, following
the commencement of commercial production, over their expected economic lives using either the unit-of-production method or the
straight-line method.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">e.</TD><TD STYLE="text-align: justify">Mineral Property Reclamation Bonds and Other Related Refundable Costs</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Costs paid for the purchase of reclamation
bonds and other related costs that are refundable are capitalized. If amounts paid are not to be refunded then they will be expensed
when it is determined they will not be refunded.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">f.</TD><TD STYLE="text-align: justify">Mineral Properties and Exploration Expenses</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company accounts for its mineral properties
on a cost basis whereby all direct costs, net of pre-production revenue, relative to the acquisition of the properties are capitalized.
All sales and option proceeds received are first credited against the costs of the related property, with any excess credited to
earnings. Once commercial production has commenced, the net costs of the applicable property will be charged to operations using
the unit-of-production method based on estimated proven and probable recoverable reserves. The net costs related to abandoned properties
are charged to operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Exploration costs are charged to operations
as incurred until such time that proven reserves are discovered. From that time forward, the Company will capitalize all costs
to the extent that future cash flow from mineral reserves equals or exceeds the costs deferred. The deferred costs will be amortized
over the recoverable reserves when a property reaches commercial production. As at September 30, 2012 and 2011, the Company does
not have proven reserves. Exploration activities conducted jointly with others are reflected at the Company's proportionate interest
in such activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company reviews the carrying values
of its mineral properties on a regular basis by reference to the project economics including the timing of the exploration or development
work, the program of works and the exploration results experienced by the Company and others. The review of the carrying value
of any producing property will be made by reference to the estimated future operating results and net cash flows. When the carrying
value of a property exceeds its estimated net recoverable amount, provision is made for the decline in value.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The recoverability of the amounts recorded
for mineral properties is dependent on the confirmation of economically recoverable reserves, confirmation of the Company&rsquo;s
interest in the underlying mineral claims, the ability of the Company to obtain the necessary financing to successfully complete
their development and the attainment of future profitable operations or proceeds from disposal.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Estimated costs related to site restoration
programs during the commercial development stage of the property are accrued over the life of the project.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">g.</TD><TD STYLE="text-align: justify">Stock-Based Compensation</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company accounts for share-based payments
under the fair value method of accounting for stock-based compensation consistent with GAAP. Under the fair value method, stock-based
compensation cost is measured at the grant date based on the fair value of the award using the Black-Sholes option pricing model
and is recognized to expense on a straight-line basis over the requisite service period, which is generally the vesting period.
Where upon grant the options vest immediately the stock-based costs are expensed immediately.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">h.</TD><TD STYLE="text-align: justify">Interest Expense</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Interest expense for the periods ended
September 30, 2012 and 2011 were nil.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">i.</TD><TD STYLE="text-align: justify">Foreign Currency Translation and Transactions</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company's reporting currency is the
United States Dollar (USD). Aurora Gold Minera&ccedil;&atilde;o Ltda is a foreign operation and its functional currency is the
Brazilian Real (Real). Certain contractual obligations in these consolidated financial statements are stated in Brazilian Real&rsquo;s.
At the periods ended September 30, 2012 and 2011 the Brazilian Real exchange rate to the USD was $0.49290 to 1 Real (September
30, 2011: USD $0.55330 to 1 Real).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.25in; text-align: justify; text-indent: -0.25in"><FONT STYLE="font-weight: normal">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company translates foreign assets and
liabilities of its subsidiaries, other than those denominated in USD, at the rate of exchange at the balance sheet date. Income
and expenses of these subsidiaries are translated at the average rate of exchange throughout the reporting period. Gains or losses
from these translations are reported as a separate component of other comprehensive income (loss) until all or a part of the investment
in the subsidiaries is sold or liquidated. The translation adjustments do not recognize the effect of income tax because the Company
expects to reinvest the amounts indefinitely in operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Transaction gains and losses that arise
from exchange rate fluctuations on transactions denominated in a currency other than the local functional currency are included
in foreign exchange (gain) loss in the consolidated statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">j.</TD><TD STYLE="text-align: justify">Concentration of Credit Risk</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Financial instruments that subject the
Company to concentrations of credit risk consist primarily of cash and cash equivalents. The Company places its cash with high
credit quality financial institutions in Brazil and Canada. The Company occasionally has cash deposits in excess of federally insured
limits. The Company had funds deposited in banks beyond the insured limits as of September 30, 2012 and 2011 respectively. The
Company has not experienced any losses related to these balances, and management believes the credit risk to be minimal.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">k.</TD><TD STYLE="text-align: justify">Fair Value of Financial Instruments and Risks</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Fair value estimates of financial instruments
are made at a specific point in time, based on relevant information about financial markets and specific financial instruments.
As these estimates are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined
with precision. Changes in assumptions can significantly affect estimated fair value. The carrying value of cash, accounts payable,
accrued expenses and advances payable (including related parties) approximate their fair value because of the short-term nature
of these instruments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Management is of the opinion that the Company
is not exposed to significant interest or credit risks arising from these financial instruments. The Company operates outside of
the United States of America (primarily in Brazil) and is exposed to foreign currency risk due to the fluctuation between the currency
in which the Company operates in and the USD.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">l.</TD><TD STYLE="text-align: justify">Income Taxes</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has adopted ASC 740, <I>Accounting
for Income Taxes</I>, which requires the Company to recognize deferred tax liabilities and assets for the expected future tax consequences
of events that have been recognized in the Company's financial statements or tax returns using the liability method. Under this
method, deferred tax liabilities and assets are determined based on the differences between the financial statement carrying amounts
and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to
reverse. In July 2006, the FASB issued an interpretation, which clarifies the accounting for uncertainty in income taxes recognized
in a company&rsquo;s financial statements in accordance with GAAP. This interpretation prescribes a recognition threshold and measurement
attribute for the financial statement recognition and measurement of a tax position taken in a tax return. It also provides guidance
on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Estimated interest
and penalties related to recording uncertain tax positions when recorded are included as a component of income tax expense on the
consolidated statement of operations. The Company has not recorded any liabilities for uncertain tax positions or any related interest
and penalties. The Company&rsquo;s tax returns are open to audit for the years ending December 31, 2008 to 2011 respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">m.</TD><TD STYLE="text-align: justify">Basic and Diluted Net Income (Loss) Per Share</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Earnings (loss) per share is computed by
dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during
the reporting period including common stock issued effective the date committed. Common stock issuable is considered outstanding
as of the original approval date for the purposes of earnings per share computations. Diluted earnings (loss) per common share
is computed by dividing net earnings (loss) by the sum of (a) the basic weighted average number of shares of common stock outstanding
during the period and (b) additional shares that would have been issued and potentially dilutive securities. During the nine months
ended September 30, 2012 and 2011 the diluted earnings (loss) per share was equivalent to the basic earnings (loss) per share because
all potentially dilutive securities were anti-dilutive due to the net losses incurred. Potentially dilutive securities consist
of stock options and warrants outstanding at the end of the reporting period. Stock options outstanding as at September 30, 2012
were 9,650,000 (September 30, 2011:1,200,000). Warrants outstanding as at September 30, 2012 were 8,000,000 (September 30, 2011:
Nil).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">n.</TD><TD STYLE="text-align: justify">Interim Financial Statements</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In the opinion of management, the accompanying
unaudited condensed financial statements contain all adjustments which include only normal recurring adjustments, necessary to
present fairly the Company&rsquo;s financial position, results of operations and cash flows for the periods shown. The results
of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The unaudited financial statements should
be read in conjunction with the Company&rsquo;s audited financial statements and notes for the year ended December 31, 2011, which
are included in the Company&rsquo;s Annual Report on Form 10-K.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">o.</TD><TD STYLE="text-align: justify">Recent Accounting Pronouncements</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company considers the effects of new
accounting pronouncements on the accounting, presentation and disclosure of its consolidated financial statements, as such pronouncements
become known. In June 2011, the FASB issued Accounting Standards Update (&ldquo;ASU&rdquo;) No. 2011-05, Comprehensive Income or
ASU 2011-05. The guidance in ASU 2011-05 revises the manner in which entities present comprehensive income in their financial statements.
An entity is required to report the components of comprehensive income in either one or two consecutive financial statements:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-bottom: 0pt; margin-top: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">A single, continuous statement must present the components of net
income and total net income, the components of other comprehensive income and total other comprehensive income, and a total for
comprehensive income.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-bottom: 0pt; margin-top: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">In a two-statement approach, an entity must present the components
of net income and total net income in the first statement. That statement must be immediately followed by a financial statement
that presents the components of other comprehensive income, a total for other comprehensive income, and a total for comprehensive
income.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">ASU 2011-05 does not change the items that
must be reported in other comprehensive income. The amendments in ASU 2011-05 are effective for fiscal years beginning after December
15, 2011 and the Company adopted this guidance effective January 1, 2012. In the consolidated statements of comprehensive income
(loss) the Company has presented comprehensive income in a single continuous statement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">At present, there are no other such pronouncements
not yet effective that the Company expects will have a material impact on these consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>3.</B></TD><TD><B>Mineral Properties and Exploration Expenses</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 36pt"></TD><TD STYLE="width: 34.9pt"><B>(a)</B></TD><TD STYLE="text-align: justify"><B>S&atilde;o Domingos Project in the Municipality of Itaituba, in the Tapajos gold province of
the State of Para, Brazil, Department of National Production Minerals (DNPM) Processes 850.684/06 and 850.782/05:</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 56.7pt"></TD><TD STYLE="width: 15.3pt">i.</TD><TD STYLE="text-align: justify">DNPM Processes 850.684/06:</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Aurora has good title over the mineral rights, which were granted
as DNPM Process number 850.684/06 and which is valid and in force, free and clear of any judicial and extrajudicial encumbrances
and taxes. The S&atilde;o Domingos mineral rights are located at the Municipality of Itaituba, State of Par&aacute;, and are registered
in the name of Aurora. On September 13, 2006 the Company applied to the DNPM for the conversion of the Application to an Exploration
Permit covering an area of 4,914.18 hectares. No payments or royalties are due regarding DNPM Process 850.384/06.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 56.7pt"></TD><TD STYLE="width: 15.3pt">ii.</TD><TD STYLE="text-align: justify">DNPM Processes 850.782/05:</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Aurora has good title over the mineral rights object of the
DNPM Process No. 850.782/05, which is valid and in force, free and clear of any judicial and extrajudicial encumbrances and taxes.
On November 8, 2005 it was submitted to DNPM the Exploration Claim for gold in the Municipality of Itaituba, State of Par&aacute;.
The Exploration Permit was granted on November 28, 2006 for a three-year period. The transfer to Aurora was approved on March 24,
2009 and on September 28, 2009 it was requested the renewal of the Exploration Permit. This area was reduced from 6,756 hectares
to 5,651.98 hectares due to the overlapping with Garimpeira (alluvial) Mining properties held by Mr Celio Paranhos. However the
DNPM&acute;s general attorney in Brasilia agreed with Aurora&rsquo;s legal thesis and nullified all applications filed by Mr Paranhos
(about to 1,900 applications). A new Exploration Permit rectifying the previous one was granted on August 20, 2010 for a three-year
period, for an area of 6,656.20 hectares. No payments or royalties are due regarding the DNPM Process 850.782/05 since it was acquired
through a permutation agreement with Altoro Minera&ccedil;&atilde;o Ltda.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 56.7pt"></TD><TD STYLE="width: 15.3pt">iii.</TD><TD STYLE="text-align: justify">DNPM Processes 850.012/06 and 850.013/06:</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The exploration claims were submitted to DNPM on January 19,
2006, for gold covering an area of 1,128.08 hectares and 750.55 hectares respectively, in the Municipality of Itaituba, State of
Par&aacute;. According to information obtained such claims were correctly prepared and the required documents are in place. The
tenements 850.012/06 and 850.013/06 are held by Mr Antonio Oliveira Ferreira and were submitted to DNPM on January 19, 2006. The
tenements are located at Itaituba, State of Par&aacute; and are valid and in force, free and clear of any judicial and extrajudicial
encumbrances and taxes, but the area was blocked since it is inside of a Garimpeira Reserve. The transfer to Aurora will be submitted
after the Exploration Permits are granted. There are no payments or royalties related to the tenements according to the agreement
entered into with the previous owner.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 56.7pt"></TD><TD STYLE="width: 15.3pt">iv.</TD><TD STYLE="text-align: justify">DNPM Process 850.119/06:</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The exploration claim was submitted to DNPM on March 7, 2006,
for gold covering an area of 1,068.72 hectares, in the Municipality of Itaituba, State of Par&aacute;. Aurora has good title over
the mineral rights object of the DNPM Process No. 850.119/06, which is valid and in force, free and clear of any judicial and extrajudicial
encumbrances and taxes. Aurora is the sole registered and beneficial holder of and owns and possesses good title to the referred
mineral rights. The Exploration Permit has not been granted yet. The above-mentioned area is not related to any payments or royalties
to third parties since Aurora claimed them directly.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 56.7pt"></TD><TD STYLE="width: 15.3pt">v.</TD><TD STYLE="text-align: justify">DNPM Process 859.587/95:</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The tenement, was held by Vera Lucia Lopes, and is valid and
in force, and is free and clear of any judicial and extrajudicial encumbrances and taxes. It is located at the Municipality of
Itaituba, State of Par&aacute;. On November 27, 1995, it was submitted to DNPM the Exploration Claim for gold. The Exploration
Permit was granted on September 15, 2006, for a three-year period covering an area of 5,000 hectares, and it was valid until September
15, 2009. On July 15, 2009, it was requested the renewal of the Exploration Permit which was granted and transferred to Aurora
and published on June 29, 2012. There are no payments or royalties related to the tenements since all payments due under the terms
of the agreement entered into with the previous owner have been already made.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 36pt"></TD><TD STYLE="width: 34.9pt"><B>(b)</B></TD><TD STYLE="text-align: justify"><B>Gold properties in the Municipality of Itaituba, in the Tapajos gold province of the State of
Para, Brazil, Department of National Production Minerals (DNPM) Processes</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 56.7pt"></TD><TD STYLE="width: 15.3pt">vi.</TD><TD STYLE="text-align: justify">Comandante Araras Project - DNPM Processes 853.785/93 to 853.839/93 inclusive (relinquished):</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On October 17, 2011 the Company terminated
this licence and Option Agreement by providing written notice to Samba. The Company is free of all and any future payment commitments.
The interest in the properties was formally relinquished in January 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 56.7pt"></TD><TD STYLE="width: 15.3pt">vii.</TD><TD STYLE="text-align: justify">S&atilde;o Jo&atilde;o Project - DNPM Processes 851.533/94 to 851.592/94 inclusive (relinquished):</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On October 17, 2011 the Company terminated
this licence and Option Agreement by providing written notice to Samba. The Company is free of all and any future payment commitments.
The interest in the properties was formally relinquished in January 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.75in"></TD><TD STYLE="width: 0.25in">viii.</TD><TD STYLE="text-align: justify">DNPM Processes 850.014/06, 850.581/06 and 850.256/07:</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has the right to acquire good
title over the mineral rights object of the Tenements. The Tenements are registered in the name of Antonio Oliveira Ferreira. The
exploration claims were submitted to DNPM respectively on January 19, 2006, August 8, 2006 and April 17, 2007 for gold covering
the areas of 421.45 hectares, 4276.03 hectares and 4036.00 hectares, in the Municipality of Itaituba and Jacareacanga, State of
Par&aacute;. According to information obtained such claims were correctly prepared and the required documents are in place. The
tenement 850.014/06 has not been transferred to Samba yet since the Exploration Permit has not been granted so far. The Exploration
Permit for the Process 850.581/06 was granted on February 15, 2011 for a three-year period, for an area of 4273.03 hectares. The
transfer to Samba Brazil Minera&ccedil;&atilde;o Ltda has not been presented yet. The Exploration Permit for the Process 850.256/07
was granted on November 30, 2007 for a three-year period but it was cancelled on May 21, 2008 because the holder didn&rsquo;t pay
the annual fees on time. On June 10, 2008 it was presented an appeal to have the annulment dismissed, which hasn&rsquo;t been analyzed
yet. However, if the appeal is not approved, Samba Brazil&rsquo;s rights over this tenement are guaranteed since only Samba Brazil
has presented a Bid application for this process on July 18 2008. According to the Agreement signed between Samba Brazil and Antonio
Oliveira Ferreira on June 5, 2008, a total amount of 120,000 Brazilian Real&rsquo;s has already been paid by Samba Brazil for the
acquisition of the Tenements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 36pt"></TD><TD STYLE="width: 34.9pt"><B>(c)</B></TD><TD STYLE="text-align: justify"><B>British Columbia, Canada &ndash; Kumealon Property (relinquished)</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On January 20, 2012 the Company&rsquo;s Kumealon claim over
the property was relinquished.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 36pt"></TD><TD STYLE="width: 34.9pt"><B>(d)</B></TD><TD STYLE="text-align: justify"><B>Sale of AGC Resources</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On June 14, 2011, the Company, entered into an Asset Purchase
Agreement with Devtec Management Ltd. (&ldquo;Devtec&rdquo;), pursuant to which the Company sold its subsidiary, AGC, which owns
certain properties in Boulder, Colorado (see note 3(b) for a discussion of the specific assets purchased by AGC in June 2010),
to Devtec for a total of $2 million, plus royalty. Under the terms of the agreement, Devtec will pay the Company $1 million upon
production of the cumulative total of 1,000 ounces of gold and/or silver, and a further $1 million on the six-month anniversary
of the payment of the first $ 1 million. Additionally, Devtec will pay the Company a 5% royalty from the start of production.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company was unable to reasonably estimate the amount of
minerals the properties will produce, if any, and thus there was uncertainty as to whether the purchase price will be collected.
Given this, collection of the purchase price is not considered reasonably possible at the time of these consolidated financial
statements given the current uncertain status of exploration work on the Boulder, Colorado properties and thus no purchase price
has been recorded as of September 30, 2012. Therefore, the Company recognized a loss on the sale of its subsidiary of $2,757,511
for the nine months ended September 30, 2011, which represented the net book value of the assets transferred to Devtec on June
14, 2011 (no liabilities were assumed by Devtec) as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 88%; text-align: justify">Reclamation bonds</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">245,221</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify">Buildings and equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">753,605</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: justify; padding-bottom: 1pt">Participating interest in mineral property</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,758,685</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,757,511</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Subsequent to the sale of AGC, the Company
determined it would not retain ownership to the reclamation bonds asset associated with the properties. A loss of $245,221, the
carrying value of the bonds, was recorded during the three months ended September 30, 2011. The disclosed total loss from the sale
of AGC was adjusted to include the loss on the disposition of the reclamation bonds.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>4.</B></TD><TD><B>Advances Payable</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During March 2012, the Company entered
into debt settlement agreements for $105,000 of advances received from a director of the Company and a company during fiscal 2011.
During August 2012, the Company received $50,000 from a director and officer as an advance, which is non-interest bearing and due
on successful capital raising. As at September 30, 2012 advances payable were $82,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>5.</B></TD><TD><B>Common Stock</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On September 21, 2012, Aurora Gold Corporation
(the &ldquo;Company&rdquo;), entered into a subscription agreement (the &ldquo;Subscription Agreement &rdquo;) with Alltech Capital
Limited (&ldquo;Investor&rdquo;), pursuant to which the Company agreed to sell, and the Investor agreed to purchase, 135,000,000
shares of the Company&rsquo;s common stock for a purchase price of $5,000,000. The closing of the transaction contemplated by the
Subscription Agreement occurred in October, 2012 (see Note 9), subject to each of the Company and Investor satisfactorily meeting
or waiving the closing conditions contained in the Subscription Agreement. A copy of the Subscription Agreement was lodged with
the SEC on September 27, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company intends to finance activities
by raising capital through the equity markets. In October 2011 the Company filed a Registration Statement on Form S-1 offering
up to a maximum of 50,000,000 units of the Company's securities at an offering price of $0.10 per Unit in a direct public offering,
without any involvement of underwriters or broker-dealers. Each Unit consists of one (1) share of common stock at a $0.001 par
value per share and one (1) Stock Purchase Warrant. Each full Warrant entitles the holder to purchase one additional share of common
stock at a price of $0.20 for a period of two years commencing November 1, 2011 through October 31, 2013. The Units will be sold
by the Chief Executive Officer and Chief Financial Officer. A Notice of Effectiveness was issued April 25, 2012. The offer will
expire January 20, 2013. To date, no funds have been obtained from this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">On April 16, 2012,
the Company entered into subscription agreements for 1,316,000 shares of common stock at a purchase price of $0.06 per share for
a gross aggregate price of $78,960. Pursuant to the subscription agreements, each of the Investors has represented that they are
not a U.S. person; as such term is defined in Regulation S. In connection with the offering, the Company has agreed to pay a cash
commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum $600,000 subscription.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="color: black">During April
2012, the Company entered into a debt settlement agreement for $18,000 in accounts payable which was settled for 300,000</FONT>
<FONT STYLE="color: black">shares of common stock at an issue price of $0.06 per share.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="color: black">During March
2012, the Company entered into debt settlement agreements for advances received from a director of the Company and a company during
fiscal 2011 as well as $14,454 of amounts in accounts payable and accrued expenses. $119,454 was settled for 1,990,900</FONT> <FONT STYLE="color: black">shares
of common stock at an issue price of $0.06 per share. As at March 31, 2012 advances on stock subscriptions were $37,513 and received
during that quarter.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In March 2012, the Company entered into
subscription agreements for 625,217 shares of common stock at a purchase price of $0.06 per share for a gross aggregate price of
$37,513. Share certificates were not issued as at March 31, 2012 and they were treated as an Advance for Stock Subscriptions. The
share certificates were issued in April 2012. Pursuant to the subscription agreements, each of the Investors has represented that
they are not a U.S. person; as such term is defined in Regulation S. In connection with the offering, the Company has agreed to
pay a cash commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum $600,000 subscription
that is being offered.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On December 20, 2011, the Company entered
into subscription agreements for 8,000,000 shares of common stock at a purchase price of $0.04 per share for a gross aggregate
price of $320,000. Attached to each unit of common stock is one (1) series A stock purchase warrant. Each full Series A warrant
entitles the holder to purchase an additional share of the Company&rsquo;s common stock at an exercise price of $0.08 per share
for a period of eighteen months commencing on December 20, 2011 and expiring on June 20, 2013. Pursuant to the subscription agreements,
each of the Investors has represented that they are not a U.S. person; as such term is defined in Regulation S. In connection with
the offering, the Company has agreed to pay a cash commission equal to 8% of all funds received or an aggregate of up $25,600.
The actual amount included in creditors for the period ended March 31, 2012 was $8,800. It is anticipated this will be the total
amount of commission paid.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On December 15, 2011, the Company entered
into debt settlement agreements with creditors and related parties in consideration for the issue of the Company&rsquo;s common
stock at a per share price of $0.02 per share. $218,754 was settled for 10,937,721 shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In September 2011, 1,671,000 shares were
issued to an individual for cash at $0.10 per share. In September 2011, 150,000 shares were issued to a company for services rendered
at $0.16 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In April 2011, as an incentive to assist
with future private placements, the Company authorized the payment of a non-cash finder&rsquo;s fee of 450,000 shares of common
stock of the Company in connection with the private placement completed in April 2010. The shares were issued in May 2011. All
shares issued were to individuals and companies who reside outside the United States of America. The issuance of the shares was
exempt from the registration requirements of Securities Act by virtue of Section 4(2) thereof as well as the exemption from registration
requirements afforded by Regulation S.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>6.</B></TD><TD><B>Stock <FONT STYLE="color: black">Options</FONT></B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In 2007, the Company's Board of Directors
approved the 2007 Stock Option Plan (amended September 29, 2008) (&ldquo;the Plan&rdquo;) to offer an incentive to obtain services
of key employees, directors and consultants of the Company. The Plan provides for the reservation for awards of an aggregate of
10% of the total shares of Common Stock outstanding from time to time. No Plan participant may receive stock options exercisable
for more than 2,500,000 shares of Common Stock in any one calendar year. Under the Plan, the exercise price of an incentive stock
option must be at least equal to 100% of the fair market value of the common stock on the date of grant (110% of fair market value
in the case of options granted to employees who hold more than 10% of the Company's capital stock on the date of grant). The term
of stock options granted under the Plan is not to exceed ten years and the stock options vest immediately upon granting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The following is a summary of stock option
activity and the status of stock options outstanding and exercisable at September 30, 2012:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="text-align: center">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Stock<BR> Options<BR> #</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Weighted&nbsp;<BR> Average&nbsp;<BR> Exercise&nbsp;Price<BR> $</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Remaining<BR> Contractual<BR> Life&nbsp;(years)<BR> As&nbsp;At</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Aggregate<BR> Intrinsic&nbsp;value<BR> As&nbsp;At</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 52%; text-align: left; padding-bottom: 1pt">Outstanding and exercisable at December&nbsp;31, 2011</TD><TD STYLE="width: 1%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; text-align: right">9,050,000</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; text-align: right">0.110</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; text-align: right">4.28</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; text-align: right">36,500</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Forfeited during quarter March 31, 2012</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(200,000</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.260</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="padding-bottom: 1pt">Granted during quarter March 31, 2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,600,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">0.050</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Outstanding and exercisable at March, 31, 2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">10,450,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">0.090</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">4.21</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">42,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>Granted during quarter June 30, 2012</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">200,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.065</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Outstanding and exercisable at June, 30, 2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">10,650,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">0.097</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">3.97</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">34,125</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>Forfeited during quarter September 30, 2012</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,000,000</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.260</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Granted during quarter September 30, 2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Outstanding and exercisable at September, 30, 2012</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">9,650,000</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">0.080</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">3.74</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">52,500</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The aggregate
intrinsic value in the table above represents the total pre-tax intrinsic value for all &ldquo;in-the-money&rdquo; options (i.e.
the difference between the Company&rsquo;s closing stock price on the last trading day of the fiscal year and the exercise price,
multiplied by the number of shares) that would have been received by the option holders had all option holders exercised their
options on September 30, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">During the quarter
ended September 30, 2012, Lars Pearl&rsquo;s 1,000,000 options lapsed on August 6, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><FONT STYLE="color: black">Effective
April 10, 2012, the Company&rsquo;s board of directors granted 200,000 stock purchase options pursuant to the Company&rsquo;s 2007
Stock Option Plan. Each of the Options has an issue date, effective date and vesting date of April 10, 2012, with an exercise price
of $0.065 per share. The term of these Options are five years. The Options are exercisable at any tim</FONT>e from the grant date
up to and including April 9, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">During the quarter
ended March 31, 2012, Cameron Richardson departed the Company, an exercise notice for the 200,000 options held was not lodged and
consequently the options lapsed during the quarter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">Effective January
13, 2012, the Company&rsquo;s board of directors granted 1,600,000 stock purchase options pursuant to the Company&rsquo;s 2007
Stock Option Plan. Each of the Options has an issue date, effective date and vesting date of January 13, 2012, with an exercise
price of $0.05 per share. The term of these Options are five years. The Options are exercisable at any time from the grant date
up to and including January 12, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><FONT STYLE="color: black">Effective
November 24, 2011, the Company&rsquo;s board of directors granted 3,650,000 stock purchase options pursuant to the Company&rsquo;s
2007 Stock Option Plan. Each of the Options has an issue date, effective date and vesting date of November 24, 2011, with an exercise
price of $0.05 per share. The term of these Options are five years. The Options are exercisable at any tim</FONT>e from the grant
date up to and including November 23, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">Effective October
11, 2011, the Company&rsquo;s board of directors granted 4,200,000 stock purchase options pursuant to the Company&rsquo;s 2007
Stock Option Plan. Each of the Options has an issue date, effective date and vesting date of October 11, 2011, with an exercise
price of $0.12 per share. The term of these Options are five years. The Options are exercisable at any time from the grant date
up to and including October 10, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">On June 15, 2011
Michael Montgomery resigned from the board of directors, an exercise notice for the 500,000 options held was not lodged and consequently
the options lapsed on July 15, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The total fair
value of options granted during the three months ended June 30, 2012 was $11,979 (June 30, 2011: nil) and expensed in full as options
were vested in full on grant. The fair value of options are determined using the Black Scholes option pricing model that takes
into account the exercise price, the expected life of the option, the share price at grant date (April 10, 2012) and expected price
volatility of the underlying share, the expected dividend yield (nil assumed) and the risk free interest rate (4.50% used) for
the term of the option. Management determined 2.50 years to be the average expected likely life of the options and utilized the
simplified method due to the fact that the Company has not had significant options granted to develop historical data to provide
a reasonable basis to estimate option lives. Volatility rates were calculated at the grant date of the option tranche and a rate
of 161.04% was used.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The total fair
value of options granted for the three months ended March 31, 2012 was $43,681 (March 31, 2011: nil) and expensed in full as options
were vested in full on grant. The fair value of options are determined using the Black Scholes option pricing model that takes
into account the exercise price, the expected life of the option, the share price at grant date (January 13, 2012) and expected
price volatility of the underlying share, the expected dividend yield (nil assumed) and the risk free interest rate (4.50% used)
for the term of the option. Management determined 2.50 years to be the average expected likely life of the options and utilized
the simplified method due to the fact that the Company has not had significant options granted to develop historical data to provide
a reasonable basis to estimate option lives. Volatility rates were calculated at the grant date of the option tranche and a rate
of 120.89% was used.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">As of September
30, 2012, there are outstanding Warrants to purchase 8,000,000 shares of common stock with an exercise price of $0.08 expiring
June 20, 2013.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>7.</B></TD><TD><B>Related Party</B> <B>Transactions</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Related party transactions not disclosed elsewhere in these
consolidated financial statements include:</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">During the nine-month period ended September 30, 2012 consulting fees of $297,190 (September 30,
2011: $191,742) were incurred to directors and officers (or companies of the officers and directors) of the Company. The transactions
were recorded at the exchange amount, being the value established and agreed to by the related parties.</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Included in accounts payable and accrued expenses and advances payable (related parties) at September
30, 2012 and December 31, 2011 were $322,419 and $Nil respectively payable to officers and directors of the Company for consulting
fees and various expenses incurred on behalf of the Company.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>8.</B></TD><TD><B>Non-Cash Investing and Financing Activities</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In September 2011, 150,000 shares were issued to a company for
services rendered at $0.16 per share. The shares were issued to a company who resides outside the United States of America.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In April 2011, as an incentive to assist with future private
placements, the Company authorized the payment of a non-cash finder&rsquo;s fee of 450,000 shares of common stock of the Company
in connection with the private placement completed in April 2010. The shares were issued in May 2011. The issuance of these shares
had no net effect on total shareholders' equity or results of operations as they related to fees associated with issuance of shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>9.</B></TD><TD><B>Subsequent Events</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On September 21, 2012, Aurora Gold Corporation
(the &ldquo;Company&rdquo;), entered into a subscription agreement (the &ldquo;Subscription Agreement &rdquo;) with Alltech Capital
Limited (&ldquo;Investor&rdquo;), pursuant to which the Company agreed to sell, and the Investor agreed to purchase, 135,000,000
shares of the Company&rsquo;s common stock for a purchase price of $5,000,000. The closing of the transaction contemplated by the
Subscription Agreement occurred in October 2012, subject to each of the Company and Investor satisfactorily meeting or waiving
the closing conditions contained in the Subscription Agreement. A copy of the Subscription Agreement was lodged with the SEC on
September 27, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">On October 5,
2012, the Company, completed the sale of 135,000,000 shares of the Company&rsquo;s common stock for a purchase price of $5,000,000,
to Alltech Capital Limited pursuant to the terms of a subscription agreement entered into between the Company and the Alltech Capital
Limited dated September 21, 2012. As a result of the sale of 135,000,000 shares of the Company&rsquo;s common stock of approximately
54%, a change in control of the Company has occurred. As a condition to the closing of the transaction, the Company agreed to increase
the size of its board of directors to five (5) members and to appoint two board members selected by the Investor. The board of
directors appointed each of Messrs. Vladimir Bernshtein and Andrey Ratsko to serve as directors of the Company. Additionally, Mr.
Bernshtein has been named as the Company&rsquo;s Chief Business Development Director.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">Other than the
aforementioned there were no subsequent events at the date of filing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: Red">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: Red"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><img src="theader.jpg"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><U>REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">To the Board of Directors and Stockholders</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Aurora Gold Corporation</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We have audited the accompanying consolidated
balance sheets of Aurora Gold Corporation (an exploration stage company) and Subsidiary (&quot;the Company&quot;) as of December&nbsp;31,
2011 and 2010, and the related consolidated statements of operations, stockholders' equity (deficiency) and comprehensive income
(loss), and cash flows for the years then ended, and for the period from October 10, 1995 (date of inception) to December&nbsp;31,
2011. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">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 misstatement. The Company
has determined that it is not required to have, nor were we engaged to perform, an audit of its internal control over financial
reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's
internal control over financial reporting. Accordingly, we express no such opinion. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In our opinion, the consolidated financial
statements referred to above present fairly, in all material respects, the financial position of Aurora Gold Corporation (an exploration
stage company) and Subsidiary as of December&nbsp;31, 2011 and 2010, and the results of their operations and their cash flows for
the years then ended, and for the period from October 10, 1995 (date of inception) to December&nbsp;31, 2011, in conformity with
accounting principles generally accepted in the United States.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying consolidated financial
statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the consolidated
financial statements, the Company has incurred operating losses since inception, has not been able to generate any operating revenues
to date, and used cash from operations of $1,062,075 in 2011. These conditions raise substantial doubt about the Company's ability
to continue as a going concern. Management's plans regarding those matters are also described in Note 1. The consolidated financial
statements do not include any adjustments that might result from the outcome of this uncertainty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">/S/ PETERSON SULLIVAN LLP</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Seattle, Washington</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">March 23, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">AURORA GOLD CORPORATION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(An exploration stage enterprise)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Balance Sheets</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">December 31, 2011 and 2010</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Expressed in U.S. Dollars)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD>AURORA GOLD CORPORATION</TD>
    <TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>(An exploration stage enterprise)</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">As&nbsp;at</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">As&nbsp;at</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>Consolidated Balance Sheets</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">December&nbsp;31</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">December&nbsp;31</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>December 31, 2011 and 2010</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">2011</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">2010</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">(Expressed in U.S. Dollars)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: windowtext 1pt solid; text-align: right">$</TD>
    <TD STYLE="border-bottom: windowtext 1pt solid; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: windowtext 1pt solid; text-align: right">$</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="width: 76%">ASSETS</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="font-weight: bold">Current assets</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">Cash</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">237,426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">579,191</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 8.65pt">Prepaid expenses and other assets</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: windowtext 1pt solid; text-align: right">-</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: windowtext 1pt solid; text-align: right">20,154</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD>Total current assets</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">237,426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">599,345</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="font-weight: bold">Non-current assets</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">Mineral property reclamation bonds</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">325,221</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">Buildings and equipment, net</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">849,445</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt; padding-left: 8.65pt">Participating interest in mineral property (Note 3)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">-</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">1,758,685</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt">Total non-current assets</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">-</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">2,933,351</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt">Total<B> </B>assets</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">237,426</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">3,532,696</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="font-weight: bold">LIABILITIES AND STOCKHOLDERS&rsquo; EQUITY (DEFICIENCY)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="font-weight: bold">Current liabilities</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">Accounts payable and accrued expenses</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">400,644</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">354,755</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">Accounts payable and accrued expenses &ndash; related parties</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">17,264</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">Advances payable</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">45,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 8.65pt">Advances payable &ndash; related parties</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">92,000</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">-</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD>Total current liabilities</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">537,644</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">372,019</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="font-weight: bold">Stockholders&rsquo; Equity (Deficiency)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD>Common stock</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 16.2pt; text-indent: -0.1in">Authorised: 300,000,000 (2010: 300,000,000) common shares with par value of $0.001 each</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 16.2pt; text-indent: -0.1in">Issued and outstanding: 109,912,589 (2010: 88,703,868) common shares</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">109,913</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">88,704</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 0.25in">Advances for stock subscriptions</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">20,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD>Additional paid-in capital</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">22,040,994</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">20,938,292</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>Accumulated deficit during the exploration stage</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(22,400,600</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(17,773,262</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt">Accumulated other comprehensive income (loss)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="text-align: right; border-bottom: Black 1pt solid">(70,525</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="text-align: right; border-bottom: Black 1pt solid">(93,057</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt">Stockholder&rsquo; equity (deficiency)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(300,218</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">3,160,677</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt">Total liabilities and stockholders&rsquo; equity (deficiency)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">237,426</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">3,532,696</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(The accompanying notes are an integral
part of these consolidated financial statements.)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">AURORA GOLD CORPORATION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(An exploration stage enterprise)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Statements of Operations</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Expressed in U.S. Dollars)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD ROWSPAN="6">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">Cumulative</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: right">&nbsp;</TD>
    <TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">October&nbsp;10&nbsp;1995</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: right">&nbsp;</TD>
    <TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">(inception)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">Year&nbsp;Ended</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">Year&nbsp;Ended</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">to&nbsp;December&nbsp;31</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">December&nbsp;31</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">December&nbsp;31</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">2011</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">2011</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">2010</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: windowtext 1pt solid; text-align: right">$</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; text-align: right">$</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; text-align: right">$</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD>Expenses</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="width: 58%; padding-left: 9pt">Administrative and general</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 13%; text-align: right">2,336,914</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right">550,655</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right">397,848</TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 9pt">Depreciation and amortization</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">145,126</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">27,897</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">17,738</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 9pt">Imputed interest on loan payable - related party</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1,560</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 9pt">Interest and bank charges</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">394,257</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">7,867</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">26,148</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 9pt">Foreign exchange loss (gain)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(15,319</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(1,613</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">7,778</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 9pt">Professional fees - accounting and legal</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1,808,036</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">241,125</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">428,543</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 9pt">Property search and negotiation</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">479,695</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">150,000</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt; padding-left: 9pt">Salaries, management and consulting fees</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">3,471,173</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">668,926</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">629,715</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">8,621,442</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1,494,857</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1,657,770</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 9pt">Exploration expenses</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">9,731,339</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">307,613</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">644,313</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 9pt">Write-off of equipment</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">240,338</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">67,357</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">-</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">18,593,119</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1,869,827</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">2,302,083</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>Other income (loss)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 9pt">Gain / (loss) on disposition of subsidiary</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(2,541,037</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(2,757,511</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 9pt">Interest income</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">22,353</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 9pt">Gain on sale of rights to Matupa Agreement (net)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">80,237</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 9pt">Loss on investments</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(37,971</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 9pt">Loss on spun-off operations</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(316,598</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 9pt">Loss on debt extinguishment</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(1,014,465</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">-</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">-</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(3,807,481</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">-</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">-</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt">Net loss for the period</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(22,400,600</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(4,627,338</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(2,302,083</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 9pt">Loss per share</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt">- basic and diluted</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: right">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(0.05</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(0.03</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD>Weighted average number of common shares</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 9pt">Outstanding</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 9pt">- basic and diluted</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">90,537,439</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">81,069,047</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(The accompanying notes are an integral
part of these consolidated financial statements.)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">AURORA GOLD CORPORATION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(An exploration stage enterprise)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Statements of Stockholder&rsquo;s
Equity (Deficiency)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">and Comprehensive Income (Loss)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">October 10, 1995 (inception) to December
31, 2011</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Expressed in U.S. Dollars)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 7pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; font-size: 7pt">
    <TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">Accumulated</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">Total</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font-size: 7pt">
    <TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">Advances&nbsp;for</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">Accumulated</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">Other</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">stockholders'</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font-size: 7pt">
    <TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="6" NOWRAP STYLE="text-align: center; font-size: 7pt">Common&nbsp;Stock</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">Additional</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">Comprehensive</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">Stock</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">(deficit)&nbsp;during</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">comprehensive</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">equity</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font-size: 7pt">
    <TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">Shares</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">Amount</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">paid-in&nbsp;capital</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">(loss)</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">Subscriptions</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">exploration&nbsp;stage</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">income&nbsp;(loss)</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; font-size: 7pt">(deficiency)</TD><TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font-size: 7pt">
    <TD NOWRAP STYLE="font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid; font-size: 7pt">#</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid; font-size: 7pt">$</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid; font-size: 7pt">$</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid; font-size: 7pt">$</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid; font-size: 7pt">$</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid; font-size: 7pt">$</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid; font-size: 7pt">$</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid; font-size: 7pt">$</TD><TD NOWRAP STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font-size: 7pt">
    <TD STYLE="font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance, October 10, 1995</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="width: 10%; text-align: left; font-size: 7pt">Issuance of common stock for - settlement of indebtedness</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">11,461,153</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">11,461</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 9%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 9%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 9%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 9%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 9%; text-align: right; font-size: 7pt">11,461</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Net (loss) for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance December 31, 1995</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">11,461,153</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">11,461</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">11,461</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Adjustment for reverse stock split</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(7,640,766</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(7,641</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(7,641</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Issuance of common stock for - cash at $0.001 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">5,800,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">5,800</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">341,761</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">347,561</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- resource property</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">300,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">300</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">2,700</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; padding-bottom: 1pt; font-size: 7pt">Net (loss) for the period</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(361,208</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(361,208</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(361,208</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(361,208</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance December 31, 1996</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">9,920,387</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">9,920</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">344,461</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(361,208</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(6,827</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Issuance of common stock for - cash in March 1997 at $1.00 per share&nbsp;&nbsp;(less issue costs of $4,842)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">750,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">750</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">744,408</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">745,158</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; padding-bottom: 1pt; font-size: 7pt">Net (loss) for the period</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(615,880</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(615,880</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(615,880</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(615,880</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance December 31, 1997</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">10,670,387</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">10,670</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,088,869</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(977,088</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">122,451</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Issuance of common stock for:</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- settlement of indebtedness</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">96,105</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">96</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">68,601</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">68,697</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">- cash in May 1998 at $1.25 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">200,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">200</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">249,800</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">250,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- cash in November 1998 at $0.75 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">71,667</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">72</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">53,678</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">53,750</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">- cash in December 1998 at $0.75 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">143,333</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">143</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">107,357</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">107,500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Grant of options to employees and directors</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">518,900</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">518,900</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Grant of options to consultants</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">172,100</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">172,100</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; padding-bottom: 1pt; font-size: 7pt">Net (loss) for the period</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(1,151,604</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(1,151,604</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(1,151,604</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(1,151,604</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance December 31, 1998</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">11,181,492</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">11,181</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">2,259,304</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(2,128,692</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">141,794</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Issuance of common stock for:</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- settlement of indebtedness</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">231,286</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">231</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">160,151</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">160,382</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 7pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="width: 20%; font-size: 7pt">- cash in March 1999 at $0.656 per share</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">22,871</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">23</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">14,977</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">15,000</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">- finder's fee in February 1999&nbsp;at $0.81 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">25,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">25</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">20,287</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">20,312</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Grant of options to consultants</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">29,500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">29,500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Cash advanced on stock subscriptions</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">425,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">425,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; padding-bottom: 1pt; font-size: 7pt">Net (loss) for the period</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(855,391</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(855,391</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(855,391</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(855,391</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance December 31, 1999</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">11,460,649</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">11,461</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">2,484,219</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">425,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(2,984,083</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(63,403</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Issuance of common stock for:</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- settlement of indebtedness</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">199,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">199</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">99,301</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">99,500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">- cash in March 2000 at $0.50 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">350,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">350</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">174,650</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(175,000</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- cash in March 2000 at $0.455 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">550,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">550</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">249,450</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(250,000</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">Cancellation of shares in April 2000</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(90,706</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(91</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(56,600</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(56,691</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Exercise of options in June 2000</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">405,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">405</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,645</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">4,050</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Spin-off of Aurora Metals (BVI) Limited</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">316,498</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">316,498</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Net (loss) for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(677,705</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(677,705</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(677,705</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(677,705</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance December 31, 2000</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">12,873,943</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">12,874</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,271,163</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,661,788</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(377,751</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Components of comprehensive income (loss):</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Net income for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">128,545</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">128,545</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">128,545</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Unrealized holding losses on available-for-sale securities</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(141,928</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(141,928</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(141,928</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(13,383</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance December 31, 2001</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">12,873,943</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">12,874</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,271,163</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,533,243</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(141,928</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(391,134</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Issuance of common stock for:</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">- settlement of indebtedness</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,708,038</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,708</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">351,492</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">355,200</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Components of comprehensive income (loss):</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Net loss for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(137,329</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(137,329</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(137,329</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Unrealized holding losses on available-for-sale securities</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">141,928</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">141,928</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">141,928</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">4,599</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance, December 31, 2002</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">16,581,981</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">16,582</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,622,655</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,670,572</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(31,335</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Issuance of common stock for:</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- settlement of indebtedness</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">2,752,450</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">2,752</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">114,806</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">117,558</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">- cash in&nbsp;&nbsp;December 2003 at $0.25 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">100,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">100</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">24,900</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">25,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Components of comprehensive income (loss):</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Net loss for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(96,404</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(96,404</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(96,404</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Unrealized holding </TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 88; Value: 1 -->
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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 7pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="width: 20%; text-align: left; font-size: 7pt">losses&nbsp; on available-for-sale securities Total comprehensive (loss)</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">(96,404</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">)</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance, December 31, 2003</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">19,434,431</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">19,434</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,762,361</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,766,976</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">14,819</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Issuance of common stock for:</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- cash in January 2004 at $0.25 per share,&nbsp;less issuance costs</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">100,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">100</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">22,400</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">22,500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Imputed interest</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,560</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,560</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Components of comprehensive income (loss):</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Net loss for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(223,763</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(223,763</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(223,763</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Unrealized holding losses on available-for-sale securities</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(223,763</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance, December 31, 2004</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">19,534,431</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">19,534</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,786,321</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,990,739</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(184,884</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Issuance of common stock for:</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">- cash in July 2005 at $0.05 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">13,000,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">13,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">637,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">650,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- settlement of indebtedness</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,684,091</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,684</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">158,816</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">162,500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Components of comprehensive income (loss):</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Net (loss) for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(457,271</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(457,271</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(457,271</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Unrealized holding losses on available-for-sale securities</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(4,614</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(4,614</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(4,614</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(461,885</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance, December 31, 2005</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">36,218,522</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">36,218</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">4,582,137</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(4,448,010</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(4,614</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">165,731</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Issuance of common stock for - cash in February 2006 at $0.50 per share less issuance costs of $110,000:</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">8,000,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">8,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,882,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,890,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- non cash finder's fee in December 200&nbsp;at $0.70 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">250,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">250</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">174,750</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">175,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- cash in December 2006 at $0.50 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,000,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">499,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">500,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Components of comprehensive income (loss):</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">t (loss) for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(5,463,855</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(5,463,855</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(5,463,855</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Foreign currency translation adjustments</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,692</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,692</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,692</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Reclassification adjustment for losses on available-for-sale securities included in net loss</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">4,614</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">4,614</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">4,614</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(5,462,933</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance, December 31, 2006</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">45,468,522</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">45,468</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">9,137,887</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(9,911,865</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,692</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(732,202</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Issuance of common stock for:</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- cash in March 2007 at $0.50 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">500,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">249,500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">250,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 89; Value: 1 -->
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    <!-- Field: /Page -->

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<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 7pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="width: 20%; font-size: 7pt">- cash in July 2007 at $0.25 per share</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">5,000,000</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">5,000</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">1,245,000</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">1,250,000</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">- settlement of indebtedness in August 2007 at $0.20 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">250,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">250</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">49,750</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">50,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- cash in September 2007 at $0.20 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">4,000,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">4,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">796,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">800,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Stock option compensation expense</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">454,295</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">454,295</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Components of comprehensive income (loss):</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Net (loss) for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,259,732</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,259,732</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,259,732</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Foreign currency translation adjustments</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(65,255</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(65,255</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(65,255</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(3,324,987</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance, December 31, 2007</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">55,218,522</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">55,218</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">11,932,432</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(13,171,597</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(68,947</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(1,252,894</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Issuance of common stock for - non cash finder's fee in July 2008&nbsp;at $0.10 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">250,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">250</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">24,750</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">25,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- settlement of indebtedness in December2008 at $0.06 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">2,603,333</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">2,603</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">153,597</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">156,200</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Components of comprehensive income (loss):</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Net (loss) for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(520,105</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(520,105</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(520,105</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Foreign currency translation adjustments</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">36,259</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">36,259</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">36,259</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(483,846</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance, December 31, 2008</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">58,071,855</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">58,071</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">12,110,779</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(13,691,702</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(32,688</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(1,555,540</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Issuance of common stock for - settlement of indebtedness in September&nbsp;2009 at $0.15 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">5,000,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">5,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,748,616</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,753,616</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- cash in September 2009 at $0.10 per share&nbsp;less finder's fee</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,000,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">255,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">258,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- non cash finder's fee September 2009 at $0.10 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">420,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">420</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">41,580</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">42,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">- settlement of indebtedness in November&nbsp;2009 at $0.18 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">100,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">100</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">17,899</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">17,999</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">-&nbsp;settlement of indebtedness in November&nbsp;2009 at $0.24 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">150,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">150</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">35,611</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">35,761</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">- cash in December 2009 at $0.30 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,666,667</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,667</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">498,333</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">500,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Components of comprehensive income (loss):</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Net (loss) for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(1,779,477</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(1,779,477</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(1,779,477</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Foreign currency translation adjustments</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(60,171</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(60,171</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(60,171</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(1,839,648</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance, December 31, 2009</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">68,408,522</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">68,408</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">14,707,818</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(15,471,179</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(92,859</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(787,812</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 90; Value: 1 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-bottom: Black 1pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">F-<!-- Field: Sequence; Type: Arabic; Name: PageNo -->31<!-- Field: /Sequence --></TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 7pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="width: 20%; text-align: left; font-size: 7pt">- Issuance of common stock for cash in April 2010 at $0.30 per share less finder's fee (paid with 1,126,111 shares&nbsp;included herein)</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">14,109,446</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">14,110</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">3,880,890</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">-</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 1%; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="width: 7%; text-align: right; font-size: 7pt">3,895,000</TD><TD STYLE="width: 1%; text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- non cash property acquisition&nbsp;in June 2010&nbsp;at $0.40 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">5,000,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">5,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,995,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">2,000,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- settlement of indebtedness in September 2010 at $0.30 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">160,500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">161</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">47,989</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">48,150</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="font-size: 7pt">- settlement of indebtedness in September 2010 at $0.30 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">325,400</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">325</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">97,295</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">97,620</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">- payment of expenses in September&nbsp;2010 at $0.30 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">200,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">200</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">59,800</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">60,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- non cash finder's fee in September 2010&nbsp;related to the June 2010 property acquisition&nbsp;at $0.30 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">500,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">149,500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">150,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Components of comprehensive income (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Net (loss) for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(2,302,083</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(2,302,083</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(2,302,083</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; padding-bottom: 1pt; font-size: 7pt">- Foreign currency translation adjustments</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(198</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(198</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">(198</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(2,302,281</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance, December 31, 2010</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">88,703,868</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">88,704</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">20,938,292</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(17,773,262</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(93,057</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">3,160,677</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">-Issuance of common stock for non cash finder&rsquo;s fee in May 2011 at $0.042 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">450,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">450</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(450</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">-Issuance of common stock for cash in September 2011 at $0.10 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,671,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">1,671</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">165,429</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">167,100</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">-Issuance of common stock for settlement of indebtedness in September 2011 at $0.16 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">150,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">150</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">24,350</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">24,500</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">-Issuance of common stock for settlement of indebtedness in December 2011 at $0.02 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">10,937,721</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">10,938</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">207,816</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">218,754</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">-Issuance of common stock for cash in December 2011 at $0.04 per share</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">8,000,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">8,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">312,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">320,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">-Issuance of common stock for cash in December 2011 at $0.04 per share - oversubscribed</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">20,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">20,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">-Stock option compensation expense</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">393,557</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">393,557</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">-Components of comprehensive income (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">- Net (loss) for the period</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(4,627,338</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(4,627,338</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">-</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(4,627,338</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="text-align: left; padding-bottom: 1pt; font-size: 7pt">- Foreign currency translation adjustments</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">22,532</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">22,532</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; font-size: 7pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right; font-size: 7pt">22,532</TD><TD STYLE="padding-bottom: 1pt; text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font-size: 7pt">
    <TD STYLE="text-align: left; font-size: 7pt">Total comprehensive (loss)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(4,604,806</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204); font-size: 7pt">
    <TD STYLE="font-size: 7pt">Balance, December 31, 2011</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">109,912,589</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">109,913</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">22,040,994</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">20,000</TD><TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(22,400,600</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(70,525</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD><TD STYLE="font-size: 7pt">&nbsp;</TD>
    <TD STYLE="text-align: left; font-size: 7pt">&nbsp;</TD><TD STYLE="text-align: right; font-size: 7pt">(300,218</TD><TD STYLE="text-align: left; font-size: 7pt">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(The accompanying notes are an integral
part of these consolidated financial statements.)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">AURORA GOLD CORPORATION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(An exploration stage enterprise)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Statements of Cash Flows</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Expressed in U.S. Dollars)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">Cumulative</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="font-weight: bold">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">October&nbsp;10&nbsp;1995</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="font-weight: bold; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="font-weight: bold">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">(inception)</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">Year&nbsp;Ended</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">Year&nbsp;Ended</TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">to&nbsp;December&nbsp;31</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">December&nbsp;31</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">December&nbsp;31</TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">2011</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">2011</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: right">2010</TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; text-align: right">$</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; text-align: right">$</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; text-align: right">$</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="width: 58%">Net loss for the period</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 13%; text-align: right">(22,400,600</TD>
    <TD STYLE="width: 1%">)</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right">(4,627,338</TD>
    <TD STYLE="width: 1%">)</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right">(2,302,083</TD>
    <TD STYLE="width: 1%">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>Adjustments to reconcile net loss to cash used in operating activities</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">depreciation and amortization</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">145,126</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">27,897</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">17,738</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">stock compensation expense on stock option grants</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1,568,352</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">393,557</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">expenses satisfied with issuance of common stock</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1,202,054</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">243,254</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">210,000</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">expenses satisfied with transfer of marketable securities</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">33,903</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">imputed interest on loan payable - related parties</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1,560</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">write-off of mineral property assets</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">240,338</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">67,357</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">adjustment for spin-off of Aurora Metals (BVI) Limited</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">316,498</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">loss on disposal of subsidiary</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">2,757,511</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">2,757,511</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">realized loss on investments</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">37,971</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">gain on sale of rights to Matupa agreement (net)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(80,237</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">realized loss on debt extinguishment</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1,014,465</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">foreign exchange (gain) loss related to notes payable</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(24,534</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD>Change in operating assets and liabilities</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">Decrease (Increase) in receivables and other assets</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(206,978</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">(Increase) decrease in prepaid expenses and other</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(20,459</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">20,344</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">54,449</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 17.3pt">Assets</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 17.3pt; text-indent: -8.65pt">Increase (decrease) in accounts payable and accrued expenses (including related party)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">1,107,051</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">55,343</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(403,216</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt">Net Cash Used in Operating Activities</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(14,307,979</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(1,062,075</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(2,423,112</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>Cash Flows From Investing Activities</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">Purchase of equipment</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(205,348</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(17,800</TD>
    <TD>)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">Proceeds on disposal of equipment</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">16,761</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">Payment for mineral property Reclamation Bonds</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(245,221</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">80,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(325,221</TD>
    <TD>)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">Proceeds from disposition of marketable securities</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">32,850</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">Acquisition of mineral property costs and related</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(672,981</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(500,000</TD>
    <TD>)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 17.3pt">Equipment</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt">Payment for incorporation cost</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(11,511</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">-</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">-</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt">Net Cash Used in Investing Activities</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(1,085,450</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">80,000</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(843,021</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>Cash Flows From Financing Activities</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">Proceeds from common stock less issuance costs</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">14,044,439</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">507,100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">3,895,000</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">Loan proceeds from related party</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">289,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-left: 8.65pt">Net proceeds from (payments on) convertible notes and loans</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">969,252</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(500,000</TD>
    <TD>)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 8.65pt">Net proceeds from (payments on) advances payable</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">45,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">45,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(50,000</TD>
    <TD>)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt; padding-left: 8.65pt">Net proceeds from (payments on) advances payable -related parties</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">92,000</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">92,000</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(50,000</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt; padding-left: 8.65pt">Net Cash Provided by Financing Activities</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">15,439,691</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">644,100</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">3,295,000</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt">Effect of exchange rate changes on Cash</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">191,164</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(3,790</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">(6,633</TD>
    <TD STYLE="padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>(Decrease) Increase in Cash</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">237,426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">(341,765</TD>
    <TD>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">22,234</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCFFCC">
    <TD STYLE="padding-bottom: 1pt">Cash - Beginning of Period</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">-</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">579,191</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">556,957</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-bottom: 1pt">Cash - End of Period</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">237,426</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">237,426</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">579,191</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(The accompanying notes are an integral
part of these consolidated financial statements.)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">AURORA GOLD CORPORATION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Notes to the consolidated financial statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">December 31, 2011 and 2010</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>NOTES TO CONSOLIDATED FINANCIAL STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>1. Nature of Business and Going Concern</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Aurora Gold Corporation (&ldquo;the Company&rdquo;) was formed
on October 10, 1995 under the laws of the State of Delaware and is in the business of location, acquisition, exploration and, if
warranted, development of mineral properties. The Company&rsquo;s focus is on the exploration and development of its exploration
properties located in the Tapajos Gold Province, State of Par&aacute;, Brazil (see Note 3). The Company has not yet determined
whether its properties contain mineral reserves that may be economically recoverable and has not generated any operating revenues
to date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">These consolidated financial statements have been prepared in
accordance with generally accepted accounting principles applicable to a going concern which contemplates the realization of assets
and the satisfaction of liabilities and commitments in the normal course of business. The general business strategy of the Company
is to acquire mineral properties either directly or through the acquisition of operating entities. The Company has incurred recurring
operating losses since inception, has not generated any operating revenues to date and during 2011 operating activities used cash
of $1,062,075 (2010: $2,423,112). The Company requires additional funds to meet its obligations and maintain its operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">These conditions raise substantial doubt about the Company's
ability to continue as a going concern. Management's plans in this regard are to raise equity financing through private or public
equity investment in order to support existing operations and expand its business. There is no assurance that such additional funds
will be available to the Company when required or on terms acceptable to the Company. In the event that the Company cannot obtain
additional funds, on a timely basis, or the operations do not generate sufficient cash flow, the Company may be forced to curtail
development or cease activities. These consolidated financial statements do not include any adjustments that might result from
this uncertainty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>1. Significant Accounting Policies</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px">&nbsp;</TD>
    <TD STYLE="width: 47px">(a)</TD>
    <TD STYLE="text-align: justify">Principles of Consolidation</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company follows accounting standards set by the Financial
Accounting Standards Board, referred to as the &ldquo;FASB&rdquo;. The FASB sets accounting principles generally accepted in the
United States (&ldquo;GAAP&rdquo;) that the Company follows to ensure they consistently report their financial condition, results
of operations, and cash flows. References to GAAP issued by the FASB in these footnotes are to the FASB Accounting Standards Codification,
referred to as Codification or &ldquo;ASC&rdquo;.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">These consolidated financial statements have been prepared in
accordance with GAAP and include the accounts of the Company and its wholly-owned subsidiaries, Aurora Gold Minera&ccedil;&atilde;o
Ltda (&ldquo;Aurora Gold Mineracao&rdquo;) and AGC Resources LLC (&ldquo;AGC&rdquo;) (through to date of disposition of AGC, June
14, 2011, see Note 3). Collectively, they are referred to herein as &quot;the Company&quot;. Significant inter-company accounts
and transactions have been eliminated. Aurora Gold Minera&ccedil;&atilde;o was incorporated on October 27, 2005. AGC was formed
as a Limited Liability company on April 21, 2010 under the law of Colorado USA to hold the assets purchased from Global Minerals
Ltd as discussed in Note 3.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px">&nbsp;</TD>
    <TD STYLE="width: 47px">(b)</TD>
    <TD STYLE="text-align: justify">Accounting Estimates</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The preparation of consolidated financial statements in conformity
with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those estimates and assumptions</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px">&nbsp;</TD>
    <TD STYLE="width: 47px">(c)</TD>
    <TD STYLE="text-align: justify">Cash Equivalents</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Cash equivalents comprise certain highly liquid instruments
with a maturity of three months or less when purchased. The Company did not have any cash equivalents at December 31, 2011 and
2010. No amounts were paid for income taxes in 2011 or 2010 and cash paid for interest was nil in 2011 (2010: $45,065).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px">&nbsp;</TD>
    <TD STYLE="width: 47px">(d)</TD>
    <TD STYLE="text-align: justify">Buildings and equipment</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Buildings and equipment are carried at cost (including development
and preproduction costs, capitalized interest, other financing costs and all direct administrative support costs incurred during
the construction period, net of cost recoveries and incidental revenues), less accumulated depletion and depreciation including
write-downs. Following the construction period, interest, other financing costs and administrative costs are expensed as incurred.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On the commencement of commercial production, depletion of each
mining property is provided on the unit-of-production basis, using estimated proven and probable reserves as the depletion basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Buildings and equipment utilized directly in commercial mining
activities are depreciated, following the commencement of commercial production, over their expected economic lives using either
the unit-of-production method or the straight-line method.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Depreciation for non-mining equipment is provided over the following
useful lives:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 17%; text-align: justify">-</TD>
    <TD STYLE="width: 43%">Vehicles</TD>
    <TD STYLE="width: 40%">10 years</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>-</TD>
    <TD>Office equipment, furniture and fixtures</TD>
    <TD>2 to 10 years</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company reviews the carrying values of its buildings and
equipment whenever events or changes in circumstances indicate that their carrying values may not be recoverable. An impairment
is considered to exist if total estimated future cash flows, or probability-weighted cash flows on an undiscounted basis, are less
than the carrying value of the assets. An impairment loss is measured and recorded based on discounted estimated future cash flows
associated with values beyond proven and probable reserves and resources. In estimating future cash flows, assets are grouped at
the lowest level for which there is identifiable future cash flows that are largely independent of cash flows from other asset
groups. Generally, in estimating future cash flows, all assets are grouped at a particular property for which there are identifiable
cash flows. Buildings and equipment utilized directly in commercial mining activities are depreciated, following the commencement
of commercial production, over their expected economic lives using either the unit-of-production method or the straight-line method.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px; text-align: justify">&nbsp;</TD>
    <TD STYLE="width: 47px">(e)</TD>
    <TD STYLE="text-align: justify">Mineral property reclamation bonds and other related refundable costs</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Costs paid for the purchase of reclamation bonds and other related
costs that are refundable are capitalized. If amounts paid are not to be refunded then they will be expensed when it is determined
they will not be refunded.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px; text-align: justify">&nbsp;</TD>
    <TD STYLE="width: 47px">(f)</TD>
    <TD STYLE="text-align: justify">Mineral properties and exploration expenses</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company accounts for its mineral properties on a cost basis
whereby all direct costs, net of pre-production revenue, relative to the acquisition of the properties are capitalized. All sales
and option proceeds received are first credited against the costs of the related property, with any excess credited to earnings.
Once commercial production has commenced, the net costs of the applicable property will be charged to operations using the unit-of-production
method based on estimated proven and probable recoverable reserves. The net costs related to abandoned properties are charged to
operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Exploration costs are charged to operations as incurred until
such time that proven reserves are discovered. From that time forward, the Company will capitalize all costs to the extent that
future cash flow from mineral reserves equals or exceeds the costs deferred. The deferred costs will be amortized over the recoverable
reserves when a property reaches commercial production. As at December 31, 2011 and 2010, the Company does not have proven reserves.
Exploration activities conducted jointly with others are reflected at the Company's proportionate interest in such activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company reviews the carrying values of its mineral properties
on a regular basis by reference to the project economics including the timing of the exploration and/or development work, the work
programs and the exploration results experienced by the Company and others. The review of the carrying value of any producing property
will be made by reference to the estimated future operating results and net cash flows. When the carrying value of a property exceeds
its estimated net recoverable amount, provision is made for the decline in value.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The recoverability of the amounts recorded for mineral properties
is dependent on the confirmation of economically recoverable reserves, confirmation of the Company&rsquo;s interest in the underlying
mineral claims, the ability of the Company to obtain the necessary financing to successfully complete their development and the
attainment of future profitable operations or proceeds from disposition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Estimated costs related to site restoration programs during
the commercial development stage of the property are accrued over the life of the project.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px; text-align: justify">&nbsp;</TD>
    <TD STYLE="width: 47px">(g)</TD>
    <TD STYLE="text-align: justify">Stock-based compensation</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company accounts for share-based payments under the fair
value method of accounting for stock-based compensation consistent with GAAP. Under the fair value method, stock-based compensation
cost is measured at the grant date based on the fair value of the award using the Black-Sholes option pricing model and is recognized
to expense on a straight-line basis over the requisite service period, which is generally the vesting period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 48px"></TD><TD STYLE="width: 47px; text-align: left">(h)</TD><TD STYLE="text-align: justify">Interest expense</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Interest expense was $0 in 2011 (2010: $14,150).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 48px"></TD><TD STYLE="width: 47px; text-align: left">(i)</TD><TD STYLE="text-align: justify">Foreign currency translations and transactions</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company's reporting currency is the U.S. Dollar. Aurora
Gold Mineracao Ltda is a foreign operation and its functional currency is the Brazilian Real (Real). Certain contractual obligations
in these consolidated financial statements are stated in Brazilian Reals. The Brazilian Real to U.S. dollar exchange rate at December
31, 2011 was U.S. $0.5357 to 1 Real (2010: U.S. $0.5966 to 1 Real).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company translates foreign assets and liabilities of its
subsidiaries, other than those denominated in U.S. dollars, at the rate of exchange at the balance sheet date. Income and expenses
of these subsidiaries are translated at the average rate of exchange throughout the year. Gains or losses from these translations
are reported as a separate component of other comprehensive income (loss) until all or a part of the investment in the subsidiaries
is sold or liquidated. The translation adjustments do not recognize the effect of income tax because the Company expects to reinvest
the amounts indefinitely in operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Transaction gains and losses that arise from exchange rate fluctuations
on transactions denominated in a currency other than the local functional currency are included in foreign exchange (gain) loss
in the consolidated statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 48px"></TD><TD STYLE="width: 47px; text-align: left">(j)</TD><TD STYLE="text-align: justify">Concentration of credit risk</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Financial instruments that subject the Company to concentrations
of credit risk consist primarily of cash and cash equivalents. The Company places its cash with high credit quality financial institutions
in Brazil and the Canada. The Company occasionally has cash deposits in excess of federally insured limits. The Company had funds
deposited in banks beyond the insured limits as of December 31, 2011 and 2010. The Company has not experienced any losses related
to these balances, and management believes its credit risk to be minimal.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px; text-align: justify">&nbsp;</TD>
    <TD STYLE="width: 47px">(k)</TD>
    <TD STYLE="text-align: justify">Comprehensive income</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company has adopted FASB ASC 220, <I>Reporting Comprehensive
Income</I>, which establishes standards for reporting and display of comprehensive income, its components and accumulated balances.
The Company is disclosing this information on its Consolidated Statement of Stockholders&rsquo; Equity (Deficiency) and Comprehensive
Income (loss). Comprehensive income comprises equity except those resulting from investments by owners and distributions to owners.
Accumulated other comprehensive income consists entirely of foreign currency translation adjustments at December 31, 2011 and 2010.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px; text-align: justify">&nbsp;</TD>
    <TD STYLE="width: 47px">(l)</TD>
    <TD STYLE="text-align: justify">Fair value of financial instruments and risks</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Fair value estimates of financial instruments are made at a
specific point in time, based on relevant information about financial markets and specific financial instruments. As these estimates
are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined with precision.
Changes in assumptions can significantly affect estimated fair value.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The carrying value of cash, accounts payable, accrued expenses
and advances payable (including related parties) approximate their fair value because of the short-term nature of these instruments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Management is of the opinion that the Company is not exposed
to significant interest or credit risks arising from these financial instruments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company operates outside of the United States of America
(primarily in Brazil) and is exposed to foreign currency risk due to the fluctuation between the currency in which the Company
operates in and the U.S. dollar.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px">&nbsp;</TD>
    <TD STYLE="width: 47px">(m)</TD>
    <TD STYLE="text-align: justify">Income taxes</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company has adopted ASC 740, <I>Accounting for Income Taxes</I>,
which requires the Company to recognize deferred tax liabilities and assets for the expected future tax consequences of events
that have been recognized in the Company's financial statements or tax returns using the liability method. Under this method, deferred
tax liabilities and assets are determined based on the differences between the financial statement carrying amounts and tax bases
of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. In July
2006, the FASB issued an interpretation which clarifies the accounting for uncertainty in income taxes recognized in a company&rsquo;s
financial statements in accordance with GAAP. This interpretation prescribes a recognition threshold and measurement attribute
for the financial statement recognition and measurement of a tax position taken in a tax return. It also provides guidance on derecognition,
classification, interest and penalties, accounting in interim periods, disclosure and transition. Estimated interest and penalties
related to recording uncertain tax positions when recorded are included as a component of income tax expense on the consolidated
statement of operations. The Company has not recorded any liabilities for uncertain tax positions or any related interest and penalties.
The Company&rsquo;s tax returns are open to audit for the years ending December 31, 2008 to 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px; text-align: justify">&nbsp;</TD>
    <TD STYLE="width: 47px">(n)</TD>
    <TD STYLE="text-align: justify">Earnings (loss) per share</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Earnings (loss) per share is computed by dividing net income
or loss available to common stockholders by the weighted average number of common shares outstanding during the year including
common stock issued effective the date committed. Common stock issuable is considered outstanding as of the original approval date
for the purposes of earnings per share computations. Diluted loss per common share is computed by dividing net loss by the sum
of (a) the basic weighted average number of shares of common stock outstanding during the period and (b) additional shares that
would have been issued and potentially dilutive securities and is equivalent to basic loss per share for 2011 and 2010 because
potentially dilutive securities were anti-dilutive due to the net losses incurred in each year. Potentially dilutive securities
outstanding consist of stock options outstanding as at December 31, 2011 of 9,050,000 (2010:1,700,000) and warrants outstanding
at December 31, 2011 of 8,000,000 (2010: nil).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 48px; text-align: justify">&nbsp;</TD>
    <TD STYLE="width: 47px">(o)</TD>
    <TD STYLE="text-align: justify">New Accounting Pronouncements</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company considers the effects of new accounting pronouncements
on the accounting, presentation and disclosure of its consolidated financial statements as such pronouncements become known. .
In June 2011, the Financial Accounting Standards Board issued Accounting Standards Update (&quot;ASU&quot;) No. 2011-05, Comprehensive
Income or</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">ASU 2011-05. The guidance in ASU 2011-05 revises the manner
in which entities present comprehensive income in their financial statements. An entity is required to report the components of
comprehensive income in either one or two consecutive financial statements:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>A single, continuous statement must present the components of net income and total net income, the components of other comprehensive
income and total other comprehensive income, and a total for comprehensive income.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>In a two-statement approach, an entity must present the components of net income and total net income in the first statement.
That statement must be immediately followed by a financial statement that presents the components of other comprehensive income,
a total for other comprehensive income, and a total for comprehensive income.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">ASU 2011-05 does not change the items that must be reported
in other comprehensive income. The amendments in ASU 2011-05 are effective for fiscal years beginning after December 15, 2011.
The Company does not believe the adoption of ASU 2011-05 will have a material impact on the presentation of information in its
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">At present, there are no other such pronouncements that the
Company expects will have a material impact on these consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>3. Mineral Properties and Exploration Expenses</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 57px">&nbsp;</TD>
    <TD STYLE="width: 47px; font-weight: bold">(a)</TD>
    <TD STYLE="font-weight: bold; text-align: justify">S&atilde;o Domingos Project - DNPM Processes 850.684/06 and 850.782/05:</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 72px">&nbsp;</TD>
    <TD STYLE="width: 24px">i.</TD>
    <TD STYLE="text-align: justify">DNPM Processes 850.684/06:</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Aurora has good title over the mineral rights which were granted
as DNPM Process number 850.684/06 and which is valid and in force, free and clear of any judicial and extrajudicial encumbrances
and taxes. The S&atilde;o Domingos mineral rights are located at the Municipality of Itaituba, State of Par&aacute;, and are registered
in the name of Aurora. On September 13, 2006 the Company applied to the DNPM for the conversion of the Application to an Exploration
Permit covering an area of 4,914.18 hectares. No payments or royalties are due regarding DNPM Process 850.384/06.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 72px">&nbsp;</TD>
    <TD STYLE="width: 24px">ii.</TD>
    <TD STYLE="text-align: justify">DNPM Processes 850.782/05:</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Aurora has good title over the mineral rights object of the
DNPM Process No. 850.782/05, which is valid and in force, free and clear of any judicial and extrajudicial encumbrances and taxes.
On November 8, 2005 it was submitted to DNPM the Exploration Claim for gold in the Municipality of Itaituba, State of Par&aacute;.
The Exploration Permit was granted on November 28, 2006 for a 3 (three) years period. The transfer to Aurora was approved on March
24, 2009 and on September 28, 2009 it was requested the renewal of the Exploration Permit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">This area was reduced from 6,756 ha to 5,651.98 ha due to the
overlapping with Garimpeira (alluvial) Mining properties held by Mr. Celio Paranhos. However the DNPM&acute;s general attorney
in Brasilia agreed with Aurora&rsquo;s legal thesis and nullified all applications filed by Mr. Paranhos (about to 1,900 applications).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">A new Exploration Permit rectifying the previous one was granted
on August 20, 2010 for a 3 (three) years period, for an area of 6,656.20 hectares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">No payments or royalties are due regarding the DNPM Process
850.782/05 since it was acquired through a permutation agreement with Altoro Minera&ccedil;&atilde;o Ltda.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 72px"></TD><TD STYLE="width: 24px; text-align: left">iii.</TD><TD STYLE="text-align: justify">DNPM Process 850.400/07:</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On July 8, 2011 Aurora allowed the Exploration
Permit was granted on July 09<SUP>th</SUP> 2008 and covering an area of 9,832.26 ha, to lapse.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 72px"></TD><TD STYLE="width: 24px; text-align: left">iv.</TD><TD STYLE="text-align: justify">DNPM Processes 850.012/06 and 850.013/06:</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The exploration claims were submitted to
DNPM on January 19th 2006, for gold covering an area of 1,128.08 ha and 750.55 ha respectively, in the Municipality of Itaituba,
State of Par&aacute;. According to information obtained such claims were correctly prepared and the required documents are in place.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The tenements 850.012/06 and 850.013/06
are held by Mr. Antonio Oliveira Ferreira and were submitted to DNPM on January 19th 2006. The tenements are located at Itaituba,
State of Par&aacute; and are valid and in force, free and clear of any judicial and extrajudicial encumbrances and taxes, but the
area was blocked since it is inside of a Garimpeira Reserve.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The transfer to Aurora will be submitted
after the Exploration Permits are granted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">There are no payments or royalties related
to the tenements according to the agreement entered into with the previous owner.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 72px"></TD><TD STYLE="width: 24px; text-align: left">v.</TD><TD STYLE="text-align: justify">DNPM Process 850.119/06:</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The exploration claim was submitted to
DNPM on March 07th, 2006, for gold covering an area of 1,068.72 ha, in the Municipality of Itaituba, State of Par&aacute;.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Aurora has good title over the mineral
rights object of the DNPM Process No. 850.119/06, which is valid and in force, free and clear of any judicial and extrajudicial
encumbrances and taxes. Aurora is the sole registered and beneficial holder of and owns and possesses good title to the referred
mineral rights. The Exploration Permit has not been granted yet.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The above mentioned area is not related
to any payments or royalties to third parties since they were claimed by Aurora directly.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 72px"></TD><TD STYLE="width: 24px; text-align: left">vi.</TD><TD STYLE="text-align: justify">DNPM Process 859.587/95:</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The tenement, which is held by Vera Lucia
Lopes, is valid and in force, and is free and clear of any judicial and extrajudicial encumbrances and taxes. It is located at
the Municipality of Itaituba, State of Par&aacute;. On November 27, 1995, it was submitted to DNPM the Exploration Claim for gold.
The Exploration Permit was granted on September 15, 2006, for a three year period covering an area of 5,000 ha, and it was valid
until September 15, 2009. On July 15, 2009, it was requested the renewal of the Exploration Permit but it hasn&rsquo;t been analyzed
by the DNPM yet. The transfer to Aurora was submitted on November 23, 2006, but it hasn&rsquo;t been approved yet.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">There are no payments or royalties related
to the tenements since all payments due under the terms of the agreement entered into with the previous owner have been already
made.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>(b) Gold properties in the Municipality
of Itaituba, in the Tapajos gold province of the State of Para, Brazil</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 72px">&nbsp;</TD>
    <TD STYLE="width: 24px">vii.</TD>
    <TD STYLE="text-align: justify">Comandante Araras Project - DNPM Processes 853.785/93 to 853.839/93 inclusive:</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Aurora has good title over the mineral
rights object of the DNPM Processes number 853.785/93 to 853.839/93, which are valid and in force, free and clear of any judicial
and extrajudicial encumbrances and taxes. The Comandante Arara Mineral Rights are located at the Municipality of Itaituba, State
of Par&aacute;, and are registered in the name of the previous holder since it has not been granted an Exploration Permit yet.
The Comandante Arara Mineral Rights are comprised by 55 Applications for Alluvial Mine of 50 hectares each (2747.22 ha), presented
to DNPM on October 05th, 1993. The conversion to the Authorization Regime was applied on December 11st, 2008 and has not been analyzed
yet, so that the Exploration Permit will be granted only after this analysis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On October 17, 2011 the Company terminated
this licence and Option Agreement by providing written notice to Samba. The Company is free of all and any future payment commitments.
The interest in the properties will be formally relinquished in fiscal 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Comandante Araras Option Agreement
dated July 2, 2007, and amendments dated June 2, 2008, November 10, 2008, and September 18, 2009, allows the Company to perform
geological surveys and assessment work necessary to ascertain the existence of possible mineral deposits which may be economically
mined and to earn a 100% interest in the Comandante Araras property mineral rights via structured cash payments. The total option
agreement payments for the mineral rights are structured as follows: November 1, 2006 R$20,000 (paid); November 15, 2006 &ndash;
R$40,000 (paid); December 15, 2006 R$40,000 (paid); May 18, 2007 - R$15,000 (paid); May 29, 2007 &ndash; R$50,000 (paid); June
25, 2008 &ndash; USD $80,000 (paid by Samba Minerals Limited as part of the agreement with them discussed in note 3; November 30,
2008 &ndash; USD $20,000 or 100,000 shares of Samba Minerals Limited at a deemed issue price of $0.20 per Samba share (paid by
Samba Minerals Limited as part of the agreement with them discussed in note 3; November 30, 2008 &ndash; 400,000 shares of Samba
Minerals Limited at a deemed issue price of $0.20 per Samba share (to be issued by Samba when the Exploration Permit is granted
and transferred to Aurora). The vendor will have a 1.5% Net Smelter Royalty. The Royalty payment can be purchased at any time upon
written notice to the vendor and payment in Reals (Brazilian currency) of the equivalent of USD $1,000,000. The option agreement
can be terminated at any time upon written notice to the vendor and the Company will be free of any and all payment commitments
yet to be due.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in">viii. S&atilde;o Jo&atilde;o Project - DNPM Processes
851.533/94 to 851.592/94 inclusive:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On October 17, 2011 the Company terminated
this licence and Option Agreement by providing written notice to Samba. The Company is free of all and any future payment commitments.
The interest in the properties will be formally relinquished in fiscal 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Aurora has good title over the mineral
rights which were granted as DNPM Process numbers 851.533/94 to 851.592/94 inclusive and which are valid and in force, free and
clear of any judicial and extrajudicial encumbrances and taxes. The S&atilde;o Jo&atilde;o mineral rights are located at the Municipality
of Itaituba, State of Par&aacute;, and are registered in the name of the previous holder since an Exploration Permit has not yet
been granted. The S&atilde;o Jo&atilde;o mineral rights comprise 60 Applications for Alluvial Mine of 50 hectares each (2687.66
ha) which was presented to DNPM on May 16, 1994. On August 30, 2006 the previous holder of the Applications applied for the conversion
of the Applications to Exploration Permits. When the conversion request is approved by the Authorities, the previous holder will
be granted the Exploration Permit for an area of 3000 ha. The assignment of the S&atilde;o Jo&atilde;o mineral rights to Aurora
can only be done after the approval of the Applications and the actual granting of an Exploration Permit to the previous Holder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The S&atilde;o Jo&atilde;o Option Agreement
dated January 20, 2006 and amendments dated June 2, 2008 and December 2, 2008, allows the Company to perform geological surveys
and assessment work necessary to ascertain the existence of possible mineral deposits which may be economically mined and to earn
a 100% interest in the S&atilde;o Jo&atilde;o property mineral rights. Under the terms of the Option Agreement and amendments,
a total amount of USD $1,435,000 (one million four hundred and thirty five thousand dollars) is due by Aurora for the acquisition
of the S&atilde;o Jo&atilde;o mineral rights. The total option agreement payments for the mineral rights are structured as follows:
April 12, 2006 &ndash; USD $20,000 (paid); September 12, 2006 &ndash; USD $25,000 (paid); September 12, 2007 &ndash; USD $60,000
(paid); June 25, 2008 - $100,000 (paid by Samba Minerals Limited as part of the agreement with them discussed in note 3; December
5, 2008 &ndash; USD $40,000 (paid by Samba Minerals Limited as part of the agreement with them discussed in note 3; January 15,
2009 &ndash; USD $30,000 (paid by Samba Minerals Limited as part of the agreement with them discussed in note 3; February 15, 2009
&ndash; USD $30,000 (paid by Samba Minerals Limited as part of the agreement with them discussed in note 3; April 30, 2009 to March
30, 2011 &ndash; USD $8,333.33 per month (April 30, 2009 to December 31, 2010 paid by Samba Minerals Limited as part of the agreement
with them discussed in note 3); July 30, 2011 &ndash; USD $950,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The vendor will have a 1.5% Net Smelter
Royalty. The Royalty payment can be purchased at any time upon written notice to the vendor and payment in Reals (Brazilian currency)
of the equivalent of USD $1,000,000. The option agreement can be terminated at any time upon written notice to the vendor and the
Company will be free of any and all payment commitments yet to be due.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in">ix. DNPM Processes 850.014/06, 850.581/06 and 850.256/07:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has the right to acquire good
title over the mineral rights object of the Tenements. The Tenements are registered in the name of Antonio Oliveira Ferreira. The
exploration claims were submitted to DNPM respectively on January 19th 2006, August 8th 2006 and April 17th 2007 for gold covering
the areas of 421.45 ha, 4276.03 ha and 4036.00 ha, in the Municipality of Itaituba and Jacareacanga, State of Par&aacute;. According
to information obtained such claims were correctly prepared and the required documents are in place. The tenement 850.014/06 has
not been transferred to Samba yet since the Exploration Permit has not been granted so far.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Exploration Permit for the Process
850.581/06 was granted on February 15th, 2011 for a three years period, for an area of 4273.03 hectares. The transfer to Samba
Brasil Minera&ccedil;&atilde;o Ltda has not been presented yet.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Exploration Permit for the Process
850.256/07 was granted on November 30th 2007 for a three years period but it was cancelled on May 21st 2008 because the holder
didn&rsquo;t pay the annual fees on time. On June 10th 2008 it was presented an appeal to have the annulment dismissed which hasn&rsquo;t
been analyzed yet. However, if the appeal is not approved, Samba Brasil&rsquo;s rights over this tenement are guaranteed since
only Samba Brasil has presented a Bid application for this process on July 18th 2008.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">According to the Agreement signed between
Samba Brasil and Antonio Oliveira Ferreira on June 5th 2008, a total amount of R$ 120.000,00 (one hundred and twenty thousand reais)
has already been paid by Samba Brasil for the acquisition of the Tenements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>(c) Boulder County, Colorado, U.S.A. &ndash; Front Range
Gold Project</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On June 15, 2010, pursuant to the Asset
Purchase Agreement between Global Minerals Ltd. (&ldquo;GML&rdquo;) and Mount Royale Ventures, LLC (&ldquo;MRV&rdquo;), as Sellers,
and the Company and AGC Resources LLC, the Company&rsquo;s wholly-owned subsidiary (&ldquo;AGC&rdquo;), as Buyers, AGC acquired
50% interest in the Front Range Gold Project joint venture (&ldquo;JV&rdquo;), and title to the Gold Hill Mill and related equipment,
and became a joint venture partner with Gold Reef Mining Company, Mi Vida Enterprises, Inc., Gold Hill Mines, Inc. and Southern
Cross Prospecting Company (&ldquo;Property Owners&rdquo;). The purchase price consisted of $600,000 in cash and 5,000,000 shares
of common stock of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Of the $600,000 in cash payments, $100,000
was expensed as a non-refundable deposit in a previous period. The fair value of the 5 million shares issued was based on a market
value of $0.40 per share on the date of the purchase, or $2,000,000. Therefore, the total consideration paid for the asset purchase
was determined to be $2,500,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company allocated the consideration
paid of $2,500,000 among the assets acquired resulting in $1,758,685 being allocated to the participating interest in the mineral
property and $741,315 to depreciable mining and other equipment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On March 10, 2011, Mi Vida Enterprises,
Inc., Gold Hill Mines, Inc. and Southern Cross Prospecting Company intervened in a preexisting lawsuit commenced by MRV against
Gold Reef Mining Company in Boulder County District Court (the &ldquo;Action&rdquo;). Among other things, they have alleged that
GML was in material default of the JV agreement prior to the assignment by GML of its rights in the JV to AGC in June of 2010,
that GML wrongfully assigned its rights in the JV without permission of the Property Owners, and have asked the court to declare
the JV terminated. The Property Owners also alleged that the transfer of title to the Gold Hill Mill was subject to a right of
first refusal in favor of Gold Hill Mines, Inc., and that MRV conveyed its title to the Gold Hill Mill to AGC without giving proper
notice to Gold Hill Mines Inc. and in violation of a right of first refusal in favor of Gold Hill Mines, Inc., and requested the
court to enter an order granting Gold Hill Mines Inc. an option to purchase the Gold Hill Mill for $10,000, the amount set in the
right of first refusal.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">A court decision in favor of the Property
Owners may have a material adverse affect on the Company&rsquo;s ability to collect the purchase price, plus royalty from the sale
of AGC to Devtec Management Ltd. discussed below since an unfavorable court decision may result in AGC losing its 50% interest
in the JV as well as its interest in and to the Gold Hill Mill.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><U>Sale of AGC Resources LLC</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On June 14, 2011, the Company, entered
into an Asset Purchase Agreement with Devtec Management Ltd. (&ldquo;Devtec&rdquo;), pursuant to which the Company sold its subsidiary,
AGC, which as discussed previously owns certain properties in Boulder, Colorado (see note 3 for a discussion of the specific assets
purchased by AGC in June 2010), to Devtec for a total of $2 million, plus royalty. Under the terms of the agreement, Devtec will
pay the Company $1 million upon production of the cumulative total of 1,000 ounces of gold and/or silver, and a further $1 million
on the nine month anniversary of the payment of the first $1 million. Additionally, Devtec will pay the Company a 5% royalty from
the start of production.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company is unable to reasonably estimate the amount of minerals
the properties will produce, if any, and thus there is uncertainty as to whether the purchase price will be collected. Further,
the collection of any purchase price is also contingent on the outcome of the court case described in the notes. Given these factors,
collection of the purchase price is not considered reasonably possible at the time of these consolidated financial statements given
the current uncertain status of exploration work on the Boulder, Colorado properties and the uncertainties of the related legal
action and thus no purchase price has been recorded as of December 31, 2011. Once collection of the purchase price becomes assured
and the aforementioned uncertainties resolved, the purchase price will be recorded in the Consolidated Statements of Operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Therefore, the Company is recognizing a
loss on the sale of its subsidiary of $2,757,511 for the year ended December 31, 2011, which represents the net book value of the
assets transferred to Devtec on June 14, 2011 (no liabilities were assumed by Devtec) as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 87%; text-align: left">Reclamation bonds</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">245,221</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Buildings and equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">753,605</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Participating interest in mineral property</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,758,685</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Total</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">2,757,511</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><B>(d)</B></TD><TD><B>British Columbia, Canada &ndash; Kumealon Property</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In February 1999, the Company acquired,
by staking, a 741 acre limestone property located on the north shore of Kumealon Inlet, southeast of Prince Rupert, British Columbia,
Canada. A finder&rsquo;s fee of 25,000 shares of common stock of the Company was issued in connection with these claims.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In fiscal year 2000, there were no proven
mineral reserves discovered and the Company continuously operated with a working capital deficiency. These conditions raised substantial
doubt regarding the recovering of the capitalized acquisition cost. Pursuant to GAAP the Company wrote off the capitalized acquisition
cost of $23,630 to operations. The Company's ownership interest in this property was in good standing at December 31, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On January 20, 2012 the Company relinquished
the licence.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><B>(e)</B></TD><TD><B>Joint Venture with Samba Minerals Limited</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On October 17, 2011 the Company terminated
this Joint Venture Agreement by providing written notice to Samba. The Company is free of all and any future payment commitments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>4.</B></TD><TD><B>Buildings and Equipment, Net</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="text-align: center">&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">2011</TD><TD NOWRAP>&nbsp;</TD><TD NOWRAP>&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center">2010</TD><TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="border-bottom: Black 1pt solid">Year&nbsp;Ending&nbsp;December&nbsp;31</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">($)</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">($)</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 74%">Vehicles</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">-</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">107,589</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Office equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">66,159</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Furniture and fixtures</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">21,995</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Subtotal</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">195,743</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Accumulated depreciation</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(87,613</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">108,130</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Gold Hill mill equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">558,440</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Gold Hill buildings</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">182,875</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>Closing Value</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">849,445</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During the year ended December 31, 2011
management reviewed the net carrying values of the equipment to determine whether circumstances indicated that the net carrying
values may not be recoverable. An impairment is considered to exist if the total estimated future cash flows, or probability-weighted
cash flows on an undiscounted basis, are less than the carrying value of the assets. In estimating future cash flows, assets are
grouped at the lowest level for which there is identifiable future cash flows that are largely independent of cash flows from other
asset groups. Generally, in estimating future cash flows, all assets are grouped at a particular property for which identifiable
cash flows exist.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Management assessed the cash flows from
each asset group currently on the consolidated balance sheet in December 2011 and determined an impairment of $67,357 necessary
to reflect the carrying value of the assets as December 31, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The breakdown of the net book values of
the buildings and equipment by location as at fiscal year-end is Colorado $nil (2010: $756,055), and Brazil $nil (2010: $93,390).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>5.</B></TD><TD><B>Advances Payable</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During the year ended December 31, 2011
the Company received funds from advances from individuals and a company, totaling $257,000, that were non-interest bearing, were
due on demand and were unsecured. As at the end of the year this total amount was reduced to $137,000 (of which $92,000 is due
to a related party) due to $120,000 of this advance being converted to common stock for settlement of this indebtedness in December
2011 at $0.04 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>6.</B></TD><TD><B>Common Stock</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company intends to finance activities
by raising capital through the equity markets. In October 2011, the Company filed a Registration Statement on Form S-1 offering
up to a maximum of 50,000,000 units of the Company's securities at an offering price of $0.10 per Unit in a direct public offering,
without any involvement of underwriters or broker-dealers. Each Unit consists of one (1) share of common stock at a $0.001 par
value per share and one (1) Stock Purchase Warrant. Each full Warrant entitles the holder to purchase one additional share of common
stock at a price of $0.20 for a period of two years commencing November 1, 2011 through October 31, 2013. The Units will be sold
by the Chief Executive Officer and President. To date, no funds have been obtained from this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On December 20, 2011, the Company entered
into subscription agreements for 8,000,000 shares of common stock at a purchase price of $0.04 per share for a gross aggregate
price of $320,000. Attached to each unit of common stock is one (1) series A stock purchase warrant. Each full Series A warrant
entitles the holder to purchase an additional share of the Company&rsquo;s common stock at an exercise price of $0.08 per share
for a period of eighteen months commencing on December 20, 2011 and expiring on June 20, 2013. Pursuant to the subscription agreements,
each of the Investors has represented that they are not a U.S. person, as such term is defined in Regulation S. In connection with
the offering, the Company has agreed to pay a cash commission equal to 8% of all funds received or an aggregate of up $25,600.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On December 15, 2011, the Company entered
into debt settlement agreements with creditors and related parties in consideration for the issue of the Company&rsquo;s common
stock at a per share price of $0.02 per share. $218,754 was settled for 10,937,721 shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In September 2011, 1,671,000 shares were
issued to an individual for cash at $0.10 per share. In September 2011, 150,000 shares were issued to a company for services rendered
at $0.16 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In April 2011, as an incentive to assist
with future private placements, the Company authorized the payment of a non cash finder&rsquo;s fee of 450,000 shares of common
stock of the Company in connection with the private placement completed in April 2010. The shares were issued in May 2011. All
shares issued were to individuals and companies who reside outside the United States of America. The issuance of the shares was
exempt from the registration requirements of Securities Act by virtue of Section 4(2) thereof as well as the exemption from registration
requirements afforded by Regulation S.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During the period January 1 to December
31, 2010, the Company received cash of $3,895,000 from a private placement of 12,983,335 common shares at $0.30 per share, paid
non cash finder&rsquo;s fees of 1,126,111 shares in connection with the private placement, issued 685,900 shares in settlement
of indebtedness and expenses amounting to $205,770 and paid a non cash finder&rsquo;s fee of 500,000 shares in connection with
a property acquisition valued at $0.30 per share. The shares were issued to individuals and companies who reside outside the USA.
The issuance of the shares were exempt from the registration requirements of Securities Act by virtue of Section 4(2) thereof as
well as the exemption from registration requirements afforded by Regulation S.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>7.</B></TD><TD><B>Stock Options and Warrants</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In 2007, the Company's Board of Directors
approved the 2007 Stock Option Plan (amended September 29, 2008) (&ldquo;the Plan&rdquo;) to offer an incentive to obtain services
of key employees, directors and consultants of the Company. The Plan provides for the reservation for awards of an aggregate of
10% of the total shares of Common Stock outstanding from time to time. No Plan participant may receive stock options exercisable
for more than 2,500,000 shares of Common Stock in any one calendar year. Under the Plan, the exercise price of an incentive stock
option must be at least equal to 100% of the fair market value of the common stock on the date of grant (110% of fair market value
in the case of options granted to employees who hold more than 10% of the Company's capital stock on the date of grant). The term
of stock options granted under the Plan is not to exceed ten years and the stock options vest immediately upon granting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The following is a summary of stock option
activity for the years ended December 31, 2011 and 2010, and the status of stock options outstanding and exercisable at December
31, 2011:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="text-align: center">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Stock<BR> Options<BR> #</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Weighted<BR> Average&nbsp;Exercise<BR> Price<BR> $</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Remaining<BR> Contractual<BR> Life&nbsp;(years)<BR> 12/31/2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Aggregate<BR> Intrinsic&nbsp;value&nbsp;at&nbsp;<BR> 12/31/2011</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 48%; text-align: left">Outstanding and exercisable at December 31, 2009</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">2,200,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">0.26</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Forfeited</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(500,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">0.26</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Outstanding and exercisable at December 31, 2010</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,700,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.26</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">Forfeited during year</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(500,000</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.26</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Granted during year</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">7,850,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">0.09</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Outstanding and exercisable at December 31, 2011</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,050,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.11</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4.28</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">36,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The aggregate intrinsic value in the table
above represents the total pretax intrinsic value for all &ldquo;in-the-money&rdquo; options (i.e. the difference between the Company&rsquo;s
closing stock price on the last trading day of the fiscal year and the exercise price, multiplied by the number of shares) that
would have been received by the option holders had all option holders exercised their options on December&nbsp;31, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On June 15, 2011 Michael Montgomery resigned
from the board of directors, an exercise notice for the 500,000 options held were not lodged and consequently the options lapsed
on July 15, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Effective October 11, 2011, the Company&rsquo;s
board of directors granted 4,200,000 stock purchase options pursuant to the Company&rsquo;s 2007 Stock Option Plan. Each of the
Options has an issue date, effective date and vesting date of October 11, 2011, with an exercise price of $0.12 per share. The
term of these Options are five years. The Options are exercisable at any time from the grant date up to and including the 10<SUP>th</SUP>
day of October, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Effective November 24, 2011, the Company&rsquo;s
board of directors granted 3,650,000 stock purchase options pursuant to the Company&rsquo;s 2007 Stock Option Plan. Each of the
Options has an issue date, effective date and vesting date of November 24, 2011, with an exercise price of $0.05 per share. The
term of these Options are five years. The Options are exercisable at any time from the grant date up to and including the 23<SUP>rd</SUP>
day of November, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The total fair value of options granted
for the year ended December 31 2011 (2010: nil) was $393,557 and expensed in full as options were vested in full on grant. The
fair value of options are determined using the Black Scholes option pricing model that takes into account the exercise price, the
expected life of the option, the share price at grant date (October 11, 2011 and November 24, 2011) and expected price volatility
of the underlying share, the expected dividend yield (nil assumed) and the risk free interest rate (4.50% used) for the term of
the option. Management determined 2.50 years to be the average expected likely life of the options and utilized the simplified
method due to the fact that the Company has not had significant options granted to develop historical data to provide a reasonable
basis to estimate option lives. Volatility rates were calculated at the grant date of each option tranche and rates of 116.95%
and 120.89% respectively were used.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As of December 31, 2011, there are outstanding
Warrants to purchase 8,000,000 shares of common stock with an exercise price of $0.08 expiring June 2013.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>8.</B></TD><TD><B>Related Party Transactions</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Related party transactions not disclosed
elsewhere in these consolidated financial statements include:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">a.</TD><TD STYLE="text-align: justify">During the fiscal year 2011, consulting fees of $295,701 (2010: $339,591) were incurred to directors and officers of the Company.
The transactions were recorded at the exchange amount, being the value established and agreed to by the related parties.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">b.</TD><TD STYLE="text-align: justify">Included in accounts payable and accrued expenses (related parties) at December 31, 2011 is nil (2010: $17,264) payable to
an officer and director of the Company for consulting fees and various expenses incurred on behalf of the Company.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><B>9.</B></TD><TD><B>Non-Cash Investing and Financing Activities</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In September 2011, 150,000 shares were
issued to a company for services rendered at $0.16 per share. The shares were issued to a company who resides outside the United
States of America.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In April 2011, as an incentive to assist
with future private placements, the Company authorized the payment of a non cash finder&rsquo;s fee of 450,000 shares of common
stock of the Company in connection with the private placement completed in April 2010. The shares were issued in May 2011. The
issuance of these shares had no net effect on total shareholders' equity or results of operations as they related to fees associated
with issuance of shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In September 2010 the Company issued 685,900
shares of common stock of the Company in settlement of indebtedness amounting to $205,770; paid a non cash finder&rsquo;s fee of
1,126,111 shares of common stock of the Company in connection with the private placement of 12,983,335 shares at $0.30 per share
completed in April 2010; and paid a non cash finder&rsquo;s fee of 500,000 shares in connection with a property acquisition valued
at $0.30 per share. The shares were issued to individuals and companies who reside outside the United States of America.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In June 2010, pursuant to an Asset Purchase
Agreement, the Company issued 5 million shares of its common stock, which were authorized for issuance at $0.40 per share for the
acquisition of assets further discussed in Note 3, and acquired Global Minerals Ltd. 50% participating interest in the joint venture
agreement dated December 18, 2002 between Consolidated Global Minerals Ltd and the property owners of the Front Range Gold JV property.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in"><B>10.</B></TD><TD><B>Income Taxes</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">a.</TD><TD STYLE="text-align: justify">The Company and its subsidiary operate in several tax jurisdictions, and its income is subject to various rates of taxation.
The Company has net losses for tax purposes in the United States and Brazil totaling approximately $12,067,183 and $7,169,598,
respectively, which may be applied against future taxable income. Accordingly, there is no tax expense for the years ended December
31, 2011 and 2010. The potential tax benefits arising from these losses have not been recorded in the consolidated financial statements
as a full valuation allowance has been recorded against them. The Company evaluates its valuation allowance requirements on an
annual basis based on projected future operations. When circumstances change and this causes a change in management's judgment
about the recoverability of deferred tax assets, the impact of the change on the valuation allowance is reflected in current operations.
The right to claim the tax losses in the United States expire according to the following table:</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Fiscal&nbsp;Year&nbsp;of&nbsp;Expiry</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">Amount&nbsp;$</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 82%; text-align: left">2012</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 15%; text-align: right">564,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">2018</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">331,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">2019</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">795,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">2020</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">550,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">2022</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">138,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">2023</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">90,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">2024</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">222,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">2025</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">457,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">2026</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,094,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">2027</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">800,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">2028</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">561,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">2029</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">479,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">2030</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,065,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">2031</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">3,921,183</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12,067,183</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Tax losses carried forward in Brazil have
no expiration date and are available to offset up to 30% of annual income before tax in any year.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">b.</TD><TD>The tax effects of temporary differences that give rise to the Company's net deferred tax asset are as follows:</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP>&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">2011<BR>
$</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">2010<BR>
$</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 74%; text-align: left">Tax loss carry forwards</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">6,540,506</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">5,180,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Valuation allowance</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(6,754,903</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(5,294,000</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Stock compensation expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">214,397</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">114,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">c.</TD><TD>The reconciliation of income tax computed at the federal statutory rate to income tax expense is as follows:</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="text-align: justify">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">2011<BR>
$</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" NOWRAP STYLE="text-align: center; border-bottom: Black 1pt solid">2010<BR>
$</TD><TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 74%; text-align: justify">Tax at statutory rate</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">(1,573,295</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">(783,000</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify">Movement in deferred tax asset</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">212,349</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">743,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: justify">Change in valuation allowance for deferred tax asset</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,460,903</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">-</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Other</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(99,957</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">40,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Income tax expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in"><B>11.</B></TD><TD><B>Subsequent events</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(a)</TD><TD STYLE="text-align: justify">Effective January 13, 2012, the Company&rsquo;s board of directors granted 1,600,000 stock purchase options pursuant to the
Company&rsquo;s 2007 Stock Option Plan. Each of the Options has an issue date, effective date and vesting date of January 13, 2012,
with an exercise price of $0.05 per share. The term of these Options are five years. The Options are exercisable at any time from
the grant date up to and including the 12<SUP>th</SUP> day of January 2017.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(b)</TD><TD STYLE="text-align: justify">On 20<SUP>th</SUP> January 2012 the Company&rsquo;s Kumealon claim over the property was relinquished.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>PART II</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>INFORMATION NOT REQUIRED IN PROSPECTUS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our estimated expenses in connection with
the issuance and distribution of the securities being registered are:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 87%; text-align: justify; text-indent: -9.9pt; padding-left: 9.9pt">Securities and exchange commission filing fee</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 10%; text-align: right">650</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -9.9pt; padding-left: 9.9pt">Accounting fees and expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: justify; text-indent: -9.9pt; padding-left: 9.9pt">Legal fees and expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -9.9pt; padding-left: 9.9pt">Transfer agent and fees</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: justify; text-indent: -9.9pt; padding-left: 9.9pt">Printing and mailing expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; padding-bottom: 1pt; text-indent: -9.9pt; padding-left: 9.9pt">Miscellaneous offering expenses</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,350</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="text-align: justify; padding-bottom: 2.5pt; text-indent: -9.9pt; padding-left: 9.9pt">Total</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">23,000</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Section 145 (&ldquo;<B>Section 145</B>&rdquo;)
of the Delaware General Corporation Law, as amended (the &ldquo;<B>DGCL</B>&rdquo;), permits indemnification of directors, officers,
agents and controlling persons of a corporation under certain conditions and subject to certain limitations. Section 145 empowers
a corporation to 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, by reason of the fact that he or she is or
was a director, officer or agent of the corporation or another enterprise if serving at the request of the corporation. Depending
on the character of the proceeding, a corporation may indemnify against expenses (including attorneys&rsquo; fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred in connection with such action, suit or proceeding if the
person indemnified acted in good faith and in a manner he or she 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 or her conduct
was unlawful. In the case of an action by or in the right of the corporation, no indemnification may be made with respect to any
claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the
extent that the Court of Chancery or the court in which such action or suit was brought shall determine that despite the adjudication
of liability such person is fairly and reasonably entitled to indemnity for such expenses which the court shall deem proper. Section
145 further provides that to the extent a present or former director or officer of a corporation has been successful in the defense
of any action, suit or proceeding referred to above or in the defense of any claim, issue or matter therein, such person shall
be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by such person in connection therewith.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: black">Insofar as indemnification
for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling us pursuant
to the foregoing provisions, or otherwise, we have been advised that in the opinion of SEC, such indemnification is against public
policy as expressed in the </FONT>Securities<FONT STYLE="color: black"> Act and is, therefore, unenforceable.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the past three
years, we have offered and sold the following shares of common stock which were not registered under the Securities Act of 1933,
as amended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In September 2009, 3,000,000 common shares
were authorized for issuance at $0.10 per share for cash proceeds of $300,000. The shares were physically issued in January 2010
to individuals and companies who reside outside the United States of America (in accordance with the exemption from registration
requirements afforded by Regulation S as promulgated thereunder). The placement agent was paid a commission of 420,000 shares of
our common stock. The shares were physically issued to the agent in January 2010.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In September 2009, convertible notes payable
and related accrued interest aggregating $739,152 (AUD $850,479) were settled through the issuance of 5,000,000 shares of our common
stock. The shares were issued to a company who resides outside the United States of America (in accordance with the exemption from
registration requirements afforded by Regulation S as promulgated thereunder).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In November 2009, 100,000 shares were authorized
for issuance in connection with debt settlements at $0.18 per share. The shares were physically issued in January 2010 to a company
who resides outside the United States of America (in accordance with the exemption from registration requirements afforded by Regulation
S as promulgated thereunder).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In November 2009, 150,000 shares were authorized
for issuance in connection with debt settlements at $0.24 per share. The shares were physically issued in January 2010 to a company
who resides outside the United States of America (in accordance with the exemption from registration requirements afforded by Regulation
S as promulgated thereunder).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In December 2009, 1,666,667 common shares
were authorized for issuance at $0.30 per share for net cash proceeds of $500,000. The shares were physically issued in January
2010 to an individual who resides outside the United States of America (in accordance with the exemption from registration requirements
afforded by Regulation S as promulgated thereunder).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In April 2010, 12,983,335 common shares
were authorized for issuance at $0.30 per share for net cash proceeds of $3,895,000. The shares were physically issued in April
2010 to an individuals and companies who reside outside the United States of America (in accordance with the exemption from registration
requirements afforded by Regulation S as promulgated thereunder). A finders&rsquo; fee of 1,126,111 common shares were authorized
for issuance in connection with the private placement at $0.30 per share to a company who resides outside the United States of
America). The shares were subsequently issued in September 2010.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In June 2010, the Company issued 5 million
shares of its common stock to Global Minerals Ltd., a British Columbia (Canada) corporation with offices in British Columbia Canada,
at $0.40 per share for a cost of $2,000,000, in connection with the Asset Purchase Agreement dated June 15, 2010, pursuant to which
the Company acquired Global Minerals Ltd. 50% participating interest in the joint venture agreement dated December 18, 2002 between
Consolidated Global Minerals Ltd. and the property owners of the Front Range Gold JV property, acquired the Front Range Gold property
assets of Mount Royale Ventures, LLC., which include a permitted mill and mining equipment and acquired a 50% equity interest in
the Black Cloud Mine Claim Group, tenements located within the Front Range Gold property. The issuance of the shares was exempt
from the registration requirements of Securities Act by virtue of Section 4(2) thereof as well as the exemption from registration
requirements afforded by Regulation S. A finders&rsquo; fee of 500,000 common shares was authorized for issuance in connection
with the Asset Purchase Agreement at $0.30 per share to an individual and a company who reside outside the United States of America.
The shares were issued in September 2010.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In September 2010, 685,900 shares were issued
in connection with debt settlements and payment of expenses at $0.30 per share. The shares were issued to individuals and companies
who reside outside the United States of America (in accordance with the exemption from registration requirements afforded by Regulation
S as promulgated thereunder).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In April 2011, as an incentive to assist
with future private placements, the Company authorized the payment of a non cash finders&rsquo; fee of 450,000 shares of common
stock of the Company in connection with the private placement completed in April 2010. The shares were issued in May 2011. The
issuance of these shares had no net effect on total shareholders&rsquo; equity or results of operations as they related to fees
associated with issuance of shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In September 2011, 1,671,000 shares were
issued in connection with debt settlements at $0.10 per share. The shares were issued to an individual who resides outside the
United States of America (in accordance with the exemption from registration requirements afforded by Regulation S as promulgated
thereunder).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In December 2011, 10,937,721 shares were
issued in connection with debt settlements at $0.02 per share. The shares were issued to an individual who resides outside the
United States of America (in accordance with the exemption from registration requirements afforded by Regulation S as promulgated
thereunder).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In September 2012, 135,000,000 common shares
were authorized for issuance at $0.037 per share for net cash proceeds of $5,000,000. The shares were physically issued in October,
2012, to a corporation which resides outside the United States of America (in accordance with the exemption from registration requirements
afforded by Regulation S as promulgated thereunder).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 12%; font-weight: bold">ITEM 16.</TD>
    <TD STYLE="width: 88%; font-weight: bold; text-align: left">EXHIBITS</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-weight: bold; text-decoration: underline">EXHIBIT</TD>
    <TD STYLE="font-weight: bold; text-decoration: underline; text-align: left">DESCRIPTION OF EXHIBIT AND FILING REFERENCE NUMBER</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">3.1.1</TD>
    <TD STYLE="text-align: left">Certificate of Incorporation incorporated by reference to the registration statement on Form 10SB filed on June 4, 1998 (SEC File No. 000-24393 98720970).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">3.1.2</TD>
    <TD STYLE="text-align: left">Certificate of Amendment to the Certificate of Incorporation incorporated by reference to the registration statement on Form 10SB filed on June 4, 1998 (SEC File No. 000-24393 98720970).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">3.1.3</TD>
    <TD STYLE="text-align: left">Certificate of Restoration and Renewal of Certificate of Incorporation incorporated by reference to the registration statement on Form 10SB filed on June 4, 1998 (SEC File No. 000-24393 98720970).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">3.2.1</TD>
    <TD STYLE="text-align: left">By-laws incorporated by reference to the registration statement on Form 10SB filed on June 4, 1998 (SEC File No. 000-24393 98720970).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">3.2.2</TD>
    <TD STYLE="text-align: left">Amended and Restated By-laws incorporated by reference to the registration statement on Form 10SB filed on June 4, 1998 (SEC File No. 000-24393 98720970).</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; width: 12%">4.1</TD>
    <TD STYLE="text-align: left; width: 88%">Form of Subscription Agreement incorporated by reference to the Post-Effective registration statement on Form S-1 filed on March 16, 2011 (SEC File No. 333-171312-11692134).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">4.2</TD>
    <TD STYLE="text-align: left">Form of Series B Warrant incorporated by reference to the Post-Effective registration statement on Form S-1 filed on March 16, 2011 (SEC File No. 333-171312-11692134) (This form of warrant was previously designated Series A Warrants but has been changed to Series B Warrants).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">4.3</TD>
    <TD STYLE="text-align: left">Debt Settlement Agreement with Samba Minerals Limited incorporated by reference to the registration statement on Form S-1 filed on June 3, 2010 (SEC File No. 333-167301-10876788).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">4.4</TD>
    <TD STYLE="text-align: left">Form of Debt Settlement Agreement with Axino AG, Heroe Investments Inc, Jolanda Investments Ltd, Gemeinhardt GmbH, Lars Pearl and WS Marketing GmbH incorporated by reference to the registration statement on Form S-1 filed on June 3, 2010 (SEC File No. 333-167301-10876788).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">4.5</TD>
    <TD STYLE="text-align: left">Form of Subscription Agreement incorporated by reference to the Form 8-K filed on December 21, 2011 (SEC File No. 000-24393-111274887).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">4.6</TD>
    <TD STYLE="text-align: left">Form of Series A Warrant incorporated by reference to the Form 8-K filed on December 21, 2011 (SEC File No. 000-24393-111274887).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">4.7</TD>
    <TD STYLE="text-align: left">Form of Debt Settlement Agreement with Ross Doyle, Global Strategic Synergies Pty LTD, Coresco AG and Agustin Gomez de Segura incorporated by reference to the Form 8-K filed on December 21, 2011 (SEC File No. 000-24393-111274887).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">4.8</TD>
    <TD STYLE="text-align: left">Subscription Agreement dated September 21, 2012, between Aurora Gold Corporation and Alltech Capital Limited incorporated by reference to the Form 8-K filed on September 27, 2012 (SEC File No. 000-24393-121112568).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">5.1</TD>
    <TD STYLE="text-align: left">Opinion of Sierchio &amp; Company, LLP.*</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.1</TD>
    <TD STYLE="text-align: left">Consulting Agreement between Hans W. Biener of SupplyConsult GbR and Aurora Gold Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.2</TD>
    <TD STYLE="text-align: left">Confidentiality Agreement between Hans W. Biener of SupplyConsult GbR and Aurora Gold Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.3</TD>
    <TD STYLE="text-align: left">Assignment of Novo Porto and Santa Clara Memorandum of Understanding to Aurora Gold Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.4</TD>
    <TD STYLE="text-align: left">Novo Porto Memorandum of Understanding Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0"></P>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; width: 12%">10.5</TD>
    <TD STYLE="text-align: left; width: 88%">Declaration of Translator for translation of Porto Novo Memorandum of Understanding from Portuguese to English Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379051269300).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.6</TD>
    <TD STYLE="text-align: left">Novo Porto Option Agreement incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.7</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of Novo Porto Option Agreement from Portuguese to English Corporation incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.8</TD>
    <TD STYLE="text-align: left">Santa Clara Memorandum of Understanding incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379051269300).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.9</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of Santa Clara Memorandum of Understanding from Portuguese to English Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379051269300).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.10</TD>
    <TD STYLE="text-align: left">Assignment of Ouro Mil Memorandum of Understanding to Aurora Gold Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.11</TD>
    <TD STYLE="text-align: left">Ouro Mil Memorandum of Understanding Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.12</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of Ouro Mil Memorandum of Understanding from Portuguese to English Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.13</TD>
    <TD STYLE="text-align: left">Ouro Mil Option Agreement incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.14</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of Ouro Mil Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.15</TD>
    <TD STYLE="text-align: left">Assignment of Sao Domingos Memorandum of Understanding to Aurora Gold Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.16</TD>
    <TD STYLE="text-align: left">Sao Domingos Memorandum of Understanding Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-30379 051269300).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.17</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of Sao Domingos Memorandum of Understanding from Portuguese to English incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 12%">10.18</TD>
    <TD STYLE="width: 88%; text-align: left">S&#259;o Domingos Option Agreement incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.19</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of S&#259;o Domingos Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.20</TD>
    <TD STYLE="text-align: left">Santa Isabel Option Agreement incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.21</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of Santa Isabel Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.22</TD>
    <TD STYLE="text-align: left">S&#259;o Jo&#259;o Option Agreement incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.23</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of S&#259;o Jo&#259;o Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.24</TD>
    <TD STYLE="text-align: left">Piranhas Memorandum of Understanding incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.25</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of Piranhas Memorandum of Understanding from Portuguese to English incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.26</TD>
    <TD STYLE="text-align: left">Branca de Neve Memorandum of Understanding incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.27</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of Branca de Neve Memorandum of Understanding from Portuguese to English incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.28</TD>
    <TD STYLE="text-align: left">Bigode Memorandum of Understanding incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.29</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of Bigode Memorandum of Understanding from Portuguese to English incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.30</TD>
    <TD STYLE="text-align: left">Santa Lucia Memorandum of Understanding incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.31</TD>
    <TD STYLE="text-align: left">Declaration of Translator for translation of Santa Lucia Memorandum of Understanding from Portuguese to English incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; width: 12%">10.34</TD>
    <TD STYLE="text-align: left; width: 88%">Settlement Agreement dated as of August 9, 2007 between the Company and Luis Mauricio incorporated by reference to the Form SB-2 filed on November 13, 2007 (SEC File No. 333-147341 071238655).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.35</TD>
    <TD STYLE="text-align: left">Form of Subscription Agreement incorporated by reference to the Form SB-2 filed on November 13, 2007 (SEC File No. 333-147341 071238655).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.36</TD>
    <TD STYLE="text-align: left">Comandante Araras Memorandum of Understanding incorporated by reference to the Form 10-KSB filed on April 15, 2008 (SEC File No. 000-24393-147341 08758054).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.37</TD>
    <TD STYLE="text-align: left">2007 Stock Option Plan incorporated by reference to the Form 10-KSB filed on April 15, 2008 (SEC File No. 000-24393-147341 08758054).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.38</TD>
    <TD STYLE="text-align: left">Asset Purchase Agreement dated June 15, 2010, incorporated by reference to the registration statement on Form S-1/A filed on June 28, 2010 (SEC File No. 333-167301-10921067).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.39</TD>
    <TD STYLE="text-align: left">Asset Purchase Agreement dated June 14, 2011, incorporated by reference to the Form 8-K filed on June 23, 2011 (SEC File No. 000-24393-11927834).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">10.40</TD>
    <TD STYLE="text-align: left">Services Agreement dated October 11, 2011 between the Company and Global Strategic Synergies Gmbh incorporated by reference to the Form 8-K filed on October 13, 2011 (SEC File No. 000-24393-111139352).</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">23.1</TD>
    <TD STYLE="text-align: left">Consent of Sierchio &amp; Company, LLP (included in Exhibit 5.1).*</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-decoration: none; text-align: justify"><FONT STYLE="font-size: 10pt; text-underline-style: none; color: windowtext">23.2</FONT></TD>
    <TD STYLE="text-align: left">Consent of Peterson Sullivan LLP.*</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">24.1</TD>
    <TD STYLE="text-align: left">Power of Attorney.*</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">99.1</TD>
    <TD STYLE="text-align: left">Corporate Governance Principles incorporated by reference to the Form 10-KSB filed on March 25, 2004 (SEC File No. 000-24393-04689262).</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 28.35pt; text-align: justify; text-indent: -28.35pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 28.35pt; text-align: justify; text-indent: -28.35pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 28.35pt; text-align: justify; text-indent: -28.35pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">* Filed herewith.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 1in; text-align: left"><B>ITEM 17.</B></TD><TD STYLE="text-align: justify"><B>UNDERTAKINGS</B></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The undersigned registrant
hereby undertakes:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">(1) To file, during
any period in which offers or sales are being made, a post-effective amendment to this registration statement:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">(i) to include any
prospectus required by Section 10(a)(3) of the Securities Act of 1933, as amended;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left; text-indent: 1in">(ii) to reflect in the prospectus any facts
or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the Securities and Exchange Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set
forth in the &ldquo;Calculation of Registration Fee&rdquo; table in the effective registration statement; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">(iii) to include any
material information with respect to the plan of distribution not previously disclosed in the registration statement or any material
change to such information in the registration statement;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(2) That, for the purpose of determining
any liability under the Securities Act of 1933, as amended, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">(3) To remove from
registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination
of the offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">(4) For purposes of
determining liability under the Securities Act of 1933 to any purchaser:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 1in">(i) If the Registrant is subject to Rule 430C,
each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration
statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included
in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in
a registration statement or prospectus that is part of the registration or made in a document incorporated or deemed incorporated
by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with
a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement
or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first
use.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">(5) That for the purpose
of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the
securities:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The undersigned registrant
undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless
of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser
by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered
to offer or sell such securities to such purchaser:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">(i) Any preliminary prospectus
or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">(ii) Any free writing
prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned
registrant;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">(iii) The portion of
any other free writing prospectus relating to the offering containing material information about the undersigned registrant or
its securities provided by or on behalf of the undersigned registrant; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">(iv) Any other communication
that is an offer in the offering made by the undersigned registrant to the purchaser.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Insofar as indemnification
for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under Item 24 above, or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities
Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection
with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SIGNATURES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In accordance with the requirements of
the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements
for the filing of this registrant's registration statement on Form S-1 and authorized this registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized, on January 7, 2013.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-variant: small-caps"><B>Aurora Gold Corporation</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt; color: black">By: </FONT></TD>
    <TD STYLE="width: 35%; border-bottom: windowtext 1pt solid; font-style: italic; font-weight: bold">/ s/ Lars Pearl</TD>
    <TD STYLE="width: 62%; font-style: italic; font-weight: bold">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 5%">Name:</TD>
    <TD STYLE="width: 45%">Lars Pearl</TD>
    <TD STYLE="width: 50%">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 5%">Title:</TD>
    <TD STYLE="width: 95%">President, Chief Executive Officer, (Principal Executive Officer) and Director</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt; color: black">By: </FONT></TD>
    <TD STYLE="border-bottom: windowtext 1pt solid; font-style: italic; font-weight: bold; width: 35%">/ s/ Ross Doyle</TD>
    <TD STYLE="width: 62%; font-style: italic; font-weight: bold">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 5%">Name:</TD>
    <TD STYLE="width: 45%">Ross Doyle</TD>
    <TD STYLE="width: 50%">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 5%">Title:</TD>
    <TD STYLE="width: 95%">Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) and Director</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Pursuant to the requirements of the Securities
Act of 1933, this registration statement has been signed below by the following persons in the capacities and on the dates indicated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt; color: black">By: </FONT></TD>
    <TD STYLE="width: 35%; border-bottom: windowtext 1pt solid; font-style: italic; font-weight: bold">/ s/ Lars Pearl</TD>
    <TD STYLE="font-size: 10pt; padding-left: 0.625in; width: 62%"><FONT STYLE="font-size: 10pt; color: black">Dated: January
7, 2013</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 5%">Name:</TD>
    <TD STYLE="width: 45%">Lars Pearl</TD>
    <TD STYLE="width: 50%">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 5%">Title:</TD>
    <TD STYLE="width: 95%">President, Chief Executive Officer, (Principal Executive Officer) and Director</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt; color: black">By: </FONT></TD>
    <TD STYLE="width: 35%; border-bottom: windowtext 1pt solid; font-style: italic; font-weight: bold">/ s/ Ross Doyle</TD>
    <TD STYLE="font-size: 10pt; padding-left: 0.625in; width: 62%"><FONT STYLE="font-size: 10pt; color: black">Dated: January
7, 2013</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 5%">Name:</TD>
    <TD STYLE="width: 45%">Ross Doyle</TD>
    <TD STYLE="width: 50%">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 5%">Title:</TD>
    <TD STYLE="width: 95%">Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) and Director</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt; color: black">By: </FONT></TD>
    <TD STYLE="width: 35%; border-bottom: windowtext 1pt solid; font-style: italic; font-weight: bold">/s/ Agustin Gomez de Segura</TD>
    <TD STYLE="font-size: 10pt; padding-left: 0.625in; width: 62%"><FONT STYLE="font-size: 10pt; color: black">Dated: January
7, 2013</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%">Agustin Gomez de Segura, Director</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt; color: black">By: </FONT></TD>
    <TD STYLE="width: 35%; border-bottom: windowtext 1pt solid; font-style: italic; font-weight: bold">/s/ Vladimir Bernshtein</TD>
    <TD STYLE="font-size: 10pt; padding-left: 0.625in; width: 62%"><FONT STYLE="font-size: 10pt; color: black">Dated: January
7, 2013</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%">Vladimir Bernshtein, Director</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt; color: black">By: </FONT></TD>
    <TD STYLE="width: 35%; border-bottom: windowtext 1pt solid; font-style: italic; font-weight: bold">/s/ Andrey Ratsko</TD>
    <TD STYLE="font-size: 10pt; padding-left: 0.625in; width: 62%"><FONT STYLE="font-size: 10pt; color: black">Dated: January
7, 2013</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 100%">Andrey Ratsko, Director</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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[{"type": "S-1", "sequence": "1", "filename": "v331059_s1.htm", "description": "FORM S-1", "secsgml_size_bytes": 1518289}]
{"company-data": {"conformed-name": "AURORA GOLD CORP", "cik": "0001037049", "assigned-sic": "1000", "irs-number": "133945947", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-1", "act": "33", "file-number": "333-185908", "film-number": "13514984"}, "business-address": {"street1": "C/- CORESCO AG", "street2": "LEVEL 3, GOTTHARDSTRASSE 20, ZUG", "city": "6304", "state": "V8", "zip": "00000", "phone": "41-7887-96966"}, "mail-address": {"street1": "C/- CORESCO AG", "street2": "LEVEL 3, GOTTHARDSTRASSE 20, ZUG", "city": "6304", "state": "V8", "zip": "00000"}}
As
filed with the Securities and Exchange Commission on January 7, 2013
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington, DC 20549
Form S-1
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
Aurora
Gold Corporation
(Exact name of registrant as specified in
its charter)
Delaware
1040
13-3945947
(State or Other Jurisdiction of incorporation or organization
(Primary Standard Industrial Classification Code Number)
(IRS Employer Identification Number)
Lars Pearl
C/- Coresco AG
Level 3
Gotthardstrasse 20
6304 Zug
Switzerland
C/- Coresco AG
Level 3
Gotthardstrasse 20
6304 Zug
Switzerland
Telephone: (+41) 7887-96966
Facsimile: (+41) 44 274 2818
Telephone: (+41) 7887-96966
Facsimile: (+41) 44 274 2818
(Address, including zip code and telephone
        number,
including area code, of registrant's
        principal
executive offices)
(Address, including zip code and telephone
        number,
including area code, of agent for service)
Copies of all communications and notices
to:
Joseph Sierchio, Esq.
Elishama Rudolph, Esq.
Sierchio & Company, LLP
430 Park Avenue
7th Floor
New York, New York 10022
Telephone: (212) 246-3030
Facsimile: (212) 246-3039
Approximate date of commencement of proposed sale to the
public:
As soon as practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to
be offered on a delayed or continuous basis pursuant to Rule 415 of the Securities Act of 1933, as amended, check here:
x
If this Form is filed to register additional securities for
an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same offering.
£
If this Form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering.
£
If this Form is a post-effective amendment filed pursuant to
Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering.
£
Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated
filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (
Check
one):
Large Accelerated Filer
£
Accelerated Filer
£
Non-accelerated Filer
£
(Do not check if a smaller reporting company)
Smaller reporting company
x
Calculation of Registration Fee
Securities to be Registered
Number of
Shares
Registered
Proposed
Maximum
Offering
Price Per
Share
(1)
Proposed
Maximum
Offering Price
(1)
Registration Fee
Common Stock Par Value $0.001
135,000,000
(2)
$
0.04
$
5,400,000
$
736.56
Total
135,000,000
(3)
$
5,400,000
$
736.56
(4)
(1)
Estimated solely for the purpose of computing the registration fee pursuant to
    Rule 457(c) under the Securities Act of 1933, as amended; the closing sale price of our stock on January 2, 2013, as quoted
    on the OTC Markets Group Inc. QB tier was $0.04 per share.
(2)
Represents 135,000,000 shares of our common stock, par value $0.001 per share, purchased by Alltech Capital Limited pursuant to a subscription agreement dated September 21, 2012, which we have agreed to register for resale on its behalf.
(3)
This registration statement includes an indeterminate number of additional shares of common stock issuable for no additional consideration pursuant to any stock dividend, stock split, recapitalization or other similar transaction effected without the receipt of consideration, which results in an increase in the number of outstanding shares of our common stock. In the event of a stock split, stock dividend or similar transaction involving our common stock, in order to prevent dilution, the number of shares registered shall be automatically increased to cover the additional shares in accordance with Rule 416(a) under the Securities Act.
(4)
Paid herewith.
Registrant hereby amends this registration statement on such
date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically
states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act,
or until the registration statement shall become effective on such date as the commission, acting under said section 8(a), may
determine.
Subject to Completion, Dated
January 7, 2013
The information in this Prospectus is not complete and may
be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission
is effective. This Prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities
in any state where the offer or sales is not permitted.
Prospectus
Aurora
Gold Corporation
135,000,000
Shares
of Common Stock
This prospectus
(the
"
Prospectus
")
relates to the resale by Alltech Capital Limited (the "
Selling Stockholder
"
or "
Alltech
") of up to 135,000,000 shares of our common stock, which the Selling Stockholder purchased pursuant
to a subscription agreement dated as of September 21, 2012. The shares were purchased pursuant to an exemption from the from the
registration requirements of the Securities Act of 1933, as amended (the "
Securities
Act
"), including,
Regulation S as the Selling Stockholder is not a U.S. Person (as that term is defined in Regulation S of the Securities Act) and
the Selling Stockholder purchased the shares in a transaction outside of the United States. The certificate representing the shares
bears a restrictive legend in accordance with Regulation S. In addition, we and the Selling Stockholder have complied or will comply
with the following requirements of Regulation S:
1.          the
offer or sale was made in an offshore transaction;
2.          we
did not make any directed selling efforts in the United States;
3.          no
offer or sale was made to a U.S. person or for the account or benefit of a U.S. person;
4.          the
Selling Stockholder certified that it was not a U.S. person and was not acquiring the securities for the account or benefit of
any U.S. person;
5.          the
Selling Stockholder agreed to resell such securities only in accordance with the provisions of Regulation S, pursuant to registration
under the Securities Act, or pursuant to an available exemption from registration; and agreed not to engage in hedging transactions
with regard to such securities unless in compliance with the Securities Act; and
6.          we
are required to refuse to register any transfer of the securities not made in accordance with the provisions of Regulation S pursuant
to registration under the Securities Act, or pursuant to an available exemption from registration.
Although we will pay substantially all the
expenses incident to the registration of the shares, we will not receive any proceeds from the sales by the Selling Stockholder.
The Selling Stockholder and any underwriter,
broker-dealer or agent that participates in the sale of the shares or interests therein may be deemed "underwriters"
within the meaning of Section 2(11) of the Securities Act. Any discounts, commissions, concessions, profit or other compensation
any of them earns on any sale or resale of the shares, directly or indirectly, may be underwriting discounts and commissions under
the Securities Act. If the Selling Stockholder is considered to be an "underwriter" within the meaning of Section 2(11)
of the Securities Act, it will be subject to the prospectus delivery requirements of the Securities Act.
Purchase of our shares of common stock is
highly speculative and involves a high degree of risk. You should carefully consider the risks and uncertainties described under
the heading "
Risk Factors
" beginning on page 6 of this Prospectus before making a decision to purchase any of
the Securities offered pursuant to this Prospectus.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION
NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The
Date Of This Prospectus Is January 7, 2013
Table
of Contents
Page #
Prospectus Summary
3
The Offering
4
Risk Factors
6
N
ote Regarding
Forward-Looking Statements
13
Use of Proceeds
13
Determination Of Offering Price
14
Market Price of and Dividends On Our Common Stock and Related Stockholder Matters
14
Management's Discussion and Analysis Of Financial Condition and Results of Operations
16
Description of Our Business and Properties
31
Directors, Executive Officers and Control Persons
37
Executive Compensation
43
Security Ownership of Certain Beneficial Owners and Management
47
Transactions With Related Persons, Promoters and Certain Control Persons
48
Description of Our Securities
50
The Selling Stockholder
52
Plan of Distribution
53
Limitation of Liability and Indemnification of Officers and Directors; Insurance
54
Disclosure of Commission Position On Indemnification for Securities Act Liabilities
55
Legal Matters
55
Experts
56
Where to Find
Additional Information
56
Index to Consolidated Financial Statements
56
Consolidated
Financial Statements
56
You should rely only on the information contained in this
Prospectus. We have not authorized any other person to provide you with different information. If anyone provides you with different
or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction
where an offer or sale is not permitted. You should assume that the information appearing in this Prospectus is accurate only as
of the date on the front cover of this Prospectus. Our business, financial condition, results of operations and prospects may have
changed since that date.
2
Prospectus
Summary
This summary contains material information
about us and the offering which is described in detail elsewhere in the Prospectus. Since it may not include all of the information
you may consider important or relevant to your investment decision, you should read the entire Prospectus carefully, including
the more detailed information regarding our company, the risks of purchasing our common stock discussed under "
Risk Factors
"
on page 6, and our financial statements and the accompanying notes.
Unless the context otherwise requires,
the terms "we," "our," "us," the "Company" and "Aurora Gold" refer
to Aurora Gold Corporation, a Delaware corporation.
Our Business
We were incorporated under the laws of the
State of Delaware on October 10, 1995, under the name "
Chefs Acquisition Corp
." Initially formed for the purpose
of engaging in the food preparation business, we redirected our business efforts in late 1995 following a change of control, which
occurred on October 30, 1995, to the acquisition, exploration and, if warranted, the development of mineral mineralized material
properties. We changed our name to "
Aurora Gold Corporation
" on August 20, 1996, to more fully reflect our mineralized
material exploration business activities.
Our general business strategy is to acquire
mineral properties either directly or through the acquisition of operating entities. Our continued operations and the recoverability
of mineral property costs is dependent upon the existence of economically recoverable mineral reserves, confirmation of our interest
in the underlying properties, our ability to obtain necessary financing to complete the development and upon future profitable
production.
Since 1996 we have acquired and disposed
of a number of properties. We have not established reserves on any of the properties that we owned or in which we have or have
had an interest.
We currently have interest in a strategic
land package of nine (9) properties none of which contain any reserves. The exploration license areas are divided into 2 groups,
the Săo Domingos and the Sao Joao areas. Please refer to "
Description of Our Business and Properties
."
We have no revenues, have sustained losses since inception, have been issued a going concern opinion by our auditors and rely upon
the sale of our securities to fund operations. We will not generate revenues even if any of our exploration programs indicate that
a mineral deposit may exist on our properties. Accordingly, we will be dependent on future financings in order to maintain our
operations and continue our exploration activities.
Please refer to
"
Risk Factors
."
Our principal
and technical office, from which we conduct our exploration and property acquisition activities, is located at
C/- Coresco
AG, Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland.
The telephone number is (+41) 7887-96966.
Risk Associated With Our Business
The search for valuable minerals as a business
is extremely risky. We can provide investors with no assurance that the exploration of any of the properties in which we have or
may acquire an interest will uncover commercially exploitable mineral reserves. It is likely that such properties will not contain
any reserves and, in all likelihood, any funds spent on exploration will probably be lost. In addition, problems such as unusual
or unexpected geological formations or other variable conditions are involved in exploration and, often result in unsuccessful
exploration efforts.
3
In addition, due to our limited capital
and mineralized materials, we are limited in the amount of exploration work we can do. As a result, our already low probability
of successfully locating mineral reserves will be reduced significantly further. Therefore, we may not find a commercial mineable
ore deposit prior to exhausting our funds. Furthermore, exploration costs may be higher than anticipated, in which case, the risk
of utilizing all of our funds prior to locating any ore deposits shall be greatly increased. Factors that could cause exploration
costs to increase are: adverse conditions, difficult terrain and shortages of qualified personnel.
Please refer to
"
Risk
Factors
."
The
Offering
Securities Being Offered:
A total of up to 135,000,000 shares of our common stock.
Offering Price Per Share:
The Selling Stockholder will determine at what price it may sell the offered shares, and such sales may be made at prevailing market prices, or at privately negotiated prices.
Selling Stockholder:
The Selling Stockholder purchased the shares pursuant to a subscription agreement dated September 21, 2012. Please refer to the section entitled "
The
Selling Stockholder
" of this Prospectus.
Authorized Capital Stock:
300,000,000 shares of common stock, each with a par value of $0.001.
Shares Outstanding Prior to Completion of the Offering:
249,144,706, without giving effect to the shares eligible for issuance upon exercise of outstanding options.
Shares Outstanding upon Closing of the Offering:
249,144,706, without giving effect to the shares eligible for issuance upon exercise of outstanding options.
Transfer Agent:
Worldwide Stock Transfer, LLC, 433 Hackensack Avenue, Level L, Hackensack, New Jersey 07601.
Risk Factors:
The search for valuable minerals as a business is extremely
        risky. We can provide investors with no assurance that the exploration of any of the properties in which we have or may acquire
        an interest will uncover commercially exploitable mineral reserves. It is likely that such properties will not contain any reserves
        and, in all likelihood, any funds spent on exploration will probably be lost. In addition, problems such as unusual or unexpected
        geological formations or other variable conditions are involved in exploration and, often result in unsuccessful exploration efforts.
In addition, due to our limited capital and mineralized materials,
        we are limited in the amount of exploration work we can do. As a result, our already low probability of successfully locating mineral
        reserves will be reduced significantly further. Therefore, we may not find a commercial mineable ore deposit prior to exhausting
        our funds. Furthermore, exploration costs may be higher than anticipated, in which case, the risk of utilizing all of our funds
        prior to locating any ore deposits shall be greatly increased. Factors that could cause exploration costs to increase are: adverse
        conditions, difficult terrain and shortages of qualified personnel.
Please refer to
"
Risk Factors
."
Use of Proceeds:
Although we will pay substantially all the expenses incident to the registration of the shares, we will not receive any proceeds from the sales by the Selling Stockholder. See "
Use of Proceeds
."
4
Selected Financial Data
We have not generated any operating revenues
to date. Our plans, funding requirements, sources and alternatives relating thereto are presented and discussed in "
Management's
Discussion and Analysis of Financial Condition and Results of Operations
."
The following table sets forth, for the
nine month periods ended September 30, 2012 and 2011, and for the fiscal years ended December 31, 2011 and 2010, certain selected
consolidated financial data. This information should be read in conjunction with our Audited Consolidated Financial Statements
and Notes thereto for the period ended December 31, 2011, and "
Management's Discussion and Analysis of Financial
Condition and Results of Operations
" included elsewhere herein.
The selected financial data provided below
are not necessarily indicative of our future results of operations or financial performance.
Consolidated Statements
of Operations Data:
For the Nine
Months Ended
September 30,
2012
(Unaudited)
For the Nine
Months Ended
September 30,
2011
(Unaudited)
For the Year
Ended December
31, 2011
For the Year
Ended December 31,
2010
Revenue
$
0
$
0
$
0
$
0
Operating loss
$
(661,204
)
$
(1,025,177
)
$
(1,869,827
)
$
(2,302,083
)
Net loss available to common stockholders
$
(566,344
)
$
(3,782,688
)
$
(4,627,338
)
$
(2,302,083
)
Basic and diluted net loss per share
$
(0.01
)
$
(0.04
)
$
(0.05
)
$
(0.03
)
Weighted average number of common shares outstanding used in basic and diluted net loss per share calculation
112,726,318
89,036,372
90,537,439
81,069,047
Consolidated Balance Sheet Data:
September 30, 2012
(Unaudited)
December 31, 2011
December 31, 2010
Cash and cash equivalents
$
1,241
$
237,426
$
579,191
Working Capital
$
(576,152
)
$
(300,218
)
$
227,326
Total assets
$
1,241
$
237,426
$
3,532,696
Total liabilities
$
577,393
$
537,644
$
372,019
Total stockholders' equity (deficiency)
$
(576,152
)
$
(300,218
)
$
3,160,667
5
Risk
Factors
You should carefully consider the risks described below
before purchasing any shares. Our most significant risks and uncertainties are described below; if any of the following risks actually
occur, our business, financial condition, or results of operations could be materially adversely affected, the trading of our common
stock could decline, and you may lose all or part of your investment therein. You should acquire the Shares only if you can afford
to lose your entire investment. Our filings with the Securities and Exchange Commission (the "SEC") also contain forward-looking
statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking
statements as a result of certain factors, including the risks we have described below. Please refer to
"
Note Regarding
Forward-Looking Statements
"
on page 13 of this Prospectus
.
Risks Related to Our Business, Property
and Industry
We are an exploration stage company
and have incurred substantial losses since inception.
We have never earned any revenues. In addition,
we have incurred net losses of $22,966,943 for the period from our inception (October 10, 1995) through September 30, 2012, and,
based upon our current plan of operation, we expect that we will incur losses for the foreseeable future.
Potential investors should be aware of the
difficulties normally encountered by mineral exploration companies and the high rate of failure of such companies. We are subject
to all of the risks inherent to an exploration stage business enterprise, such as limited capital, mineralized materials, lack
of manpower, and possible cost overruns associated with our exploration programs. Potential investors must also weigh the likelihood
of success in light of any problems, complications, and delays that may be encountered with the exploration of our properties.
Because we are small and do not have much
capital, we must limit our exploration activity. As such we may not be able to complete an exploration program that is as thorough
as we would like. In that event, an existing ore body may go undiscovered. Without an ore body, we cannot generate revenues and
you will lose your investment.
Our independent registered public
accounting firm has expressed substantial doubt about our ability to continue as a going concern, which may hinder our ability
to obtain future financing.
Our independent registered public accounting
firm has issued its report, which includes an explanatory paragraph for going concern uncertainty on our consolidated financial
statements as of and for the year ended December 31, 2011. Because we have not yet generated revenues from our operations our ability
to continue as a going concern is currently heavily dependent upon our ability to obtain additional financing to sustain our operations.
Such financing may take the form of the issuance of common or preferred stock or debt securities, or may involve bank financing.
Although we have completed several equity financings, the fact that our auditors have issued a "going concern" opinion
may hinder our ability to obtain additional financing in the future. Currently, we have no commitments to obtain any additional
financing, and there can be no assurance that financing will be available in amounts or on terms acceptable to us, if at all.
6
We cannot assure you that our common
stock will be re-listed, or that once re-listed, it will remain listed.
As a result of the delay in filing our periodic
reports with the SEC, we were unable to comply with the listing standards of OTCBB and our common stock was removed from the OTCBB
effective May 20, 2009. Our common stock was again listed on the OTCBB on August 5, 2010. We are currently listed on the OTC Markets
Group Inc. QB tier (the "
OTCQB
"), an interdealer quotation system that is, in almost all respects, comparable
to the OTCBB and which requires that we timely file periodic reports with the SEC. If we were to become delinquent in our filings,
our common stock may be de-listed from the OTCQB. If it is de-listed again in the future, the price of our common stock will likely
be adversely affected and there may be a decrease in the liquidity of our common stock.
Because we do not have any revenues,
we expect to incur operating losses for the foreseeable future.
We have never generated revenues and we
have never been profitable. Prior to completing exploration on our mineral properties, we anticipate that we will incur increased
operating expenses without realizing any revenues. We therefore expect to incur significant losses into the foreseeable future.
If we are unable to generate financing to continue the exploration of our properties, we will fail and you will lose your entire
investment.
None of the properties in which we
have an interest or the right to earn an interest have any known reserves.
We currently have interest in a strategic
land package of nine (9) properties none of which contain any reserves. Based on our exploration activities through the date of
this Prospectus, we do not have sufficient information upon which to assess the ultimate success of our exploration efforts. If
we do not establish reserves we may be required to curtail or suspend our operations, in which case the market value of our common
stock may decline and you may lose all or a portion of your investment.
We have only completed the initial stages
of exploration of our properties, and thus have no way to evaluate whether we will be able to operate our business successfully.
To date, we have been involved primarily in organizational activities, acquiring interests in properties and in conducting preliminary
exploration of properties. We have not earned any revenues and have not achieved profitability as of the date of this Prospectus.
We are subject to all the risks inherent
to mineral exploration, which may have an adverse affect on our business operations.
Potential investors should be aware of the
difficulties normally encountered by mineral exploration companies and the high rate of failure of such enterprises. The likelihood
of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection
with the exploration of the mineral properties that we plan to undertake. These potential problems include, but are not limited
to, unanticipated problems relating to exploration and additional costs and expenses that may exceed current estimates. If we are
unsuccessful in addressing these risks, our business will likely fail and you will lose your entire investment.
7
We are subject to the numerous risks and
hazards inherent to the mining industry and resource exploration including, without limitation, the following:
·
interruptions caused by adverse weather conditions; and
·
unforeseen limited sources of supplies resulting in shortages of materials, equipment and availability of experienced manpower.
The prices and availability of such equipment,
facilities, supplies and manpower may change and have an adverse effect on our operations, causing us to suspend operations or
cease our activities completely.
It is possible that our title for
the properties in which we have an interest will be challenged by third parties.
We have not obtained title insurance for
our properties. It is possible that the title to the properties in which we have our interest will be challenged or impugned. If
such claims are successful, we may lose our interest in such properties. For more information please refer to "
Management's
Discussion and Analysis of Financial Condition and Results of Operations
."
Our failure to compete with our competitors
in mineral exploration for financing, acquiring mining claims, and for qualified managerial and technical employees will cause
our business operations to slow down or be suspended.
Our competition includes large established
mineral exploration companies with substantial capabilities and with greater financial and technical mineralized materials than
we have. As a result of this competition, we may be unable to acquire additional attractive mining claims or financing on terms
we consider acceptable. We may also compete with other mineral exploration companies in the recruitment and retention of qualified
managerial and technical employees. If we are unable to successfully compete for financing or for qualified employees, our exploration
programs may be slowed down or suspended.
Compliance with environmental regulations
applicable to our operations may adversely affect our capital liquidity.
Mining is subject to potential risks and
liabilities associated with pollution of the environment and the disposal of waste products occurring as a result of mineral exploration
and production. All phases of our operations in Brazil, where our properties are located, will be subject to environmental regulations.
Environmental legislation in Brazil is evolving in a manner which will require stricter standards and enforcement, increased fines
and penalties for non-compliance, more stringent environmental assessments of proposed projects and a heightened degree of responsibility
for companies and their officers, directors and employees. It is possible that future changes in environmental regulation will
adversely affect our operations as compliance will be more burdensome and costly.
Because we have not allocated any money
for reclamation of any of our mining claims, we may be subject to fines if a mining claim is not restored to its original condition
upon termination of our activities.
Our directors may face conflicts of
interest in connection with our participation in certain ventures because they are directors of other mineral mineralized material
companies.
Our directors may also be a director of
other companies (including mineralized material exploration companies) and, if those other companies participate in ventures in
which we may participate, our directors may have a conflict of interest in negotiating and concluding terms respecting the extent
of such participation. It is possible that due to our directors' conflicting interests, we may be precluded from participating
in certain projects that we might otherwise have participated in, or we may obtain less favorable terms on certain projects than
we might have obtained if our directors were not also directors of other participating mineral mineralized materials companies.
In an effort to balance their conflicting interests, our directors may approve terms equally favorable to all of their companies
as opposed to negotiating terms more favorable to us but adverse to their other companies. Additionally, it is possible that we
may not be afforded certain opportunities to participate in particular projects because those projects are assigned to our directors'
other companies for which the directors may deem the projects to have a greater benefit.
8
Our future performance is dependent
on our ability to retain key personnel, loss of which would adversely affect our success and growth.
Our performance is substantially dependent
on performance of our senior management. In particular, our success depends on the continued efforts of Mr. Pearl, our President
and Chief Executive Officer. The loss of his services could have a material adverse effect on our business, results of operations
and financial condition as our potential future revenues would most likely dramatically decline and our costs of operations would
rise. We do not have employment agreements in place with any of our officers or our key employees, nor do we have key person insurance
covering our employees.
Risks Related To Our Common Stock
Our failure to timely file certain
periodic reports with the SEC poses significant risks to our business, each of which could materially and adversely affect our
financial condition and results of operations.
We did not timely file with the SEC our
Annual Report on Form 10-K for the fiscal year ended December 31, 2008, and our Quarterly Report on Form 10-Q for the quarterly
periods ended March 31, June 30, and September 30, 2009. Consequently, we were not compliant with the periodic reporting requirements
under the Securities Exchange Act of 1934, as amended. As a result of our failure to have timely filed our periodic reports with
the SEC, our stock was removed from trading on the OTC Bulletin Board (the "
OTCBB
") and began trading on the
"Pink Sheets." Our common stock was again listed on the OTCBB on August 5, 2010. In addition, our failure to timely
file those and possibly future periodic reports with the SEC could subject us to enforcement action by the SEC and shareholder
lawsuits. Any of these events could materially and adversely affect our financial condition and results of operations and our ability
to register with the SEC public offerings of our securities for our benefit or the benefit of our security holders.
There currently is a limited market
for our common stock on the OTCQB.
Our common stock is quoted on the OTCQB.
Trading in our common stock has been very limited, which could affect the price of our stock. We have no plans, proposals, arrangements
or understandings with any person with regard to the development of an active trading market for our common stock and no assurance
can be given that an active trading market will develop.
We may conduct further offerings in
the future in which case our current stockholders' shareholdings will be diluted.
Since our inception, we have relied on equity
sales of our common stock to fund our operations. We may conduct further equity offerings in the future to finance our current
projects or to finance subsequent projects that we decide to undertake. If common stock is issued in return for additional funds,
the price per share could be lower than that paid by our current stockholders. We anticipate continuing to rely on equity sales
of our common stock in order to fund our business operations. If we issue additional stock, our current stockholders' percentage
interest in us will be diluted. The result of this could reduce the value of their stock.
9
We have the ability to issue additional
shares of our common stock without asking for stockholder approval, which could cause our stockholders' investment to be
diluted.
Our Articles of Incorporation authorize
our Board of Directors (the "
Board
") to issue up to 300,000,000 shares of common stock. The power of the Board
to issue shares of common stock or warrants or options to purchase shares of common stock is generally not subject to stockholder
approval. Accordingly, any time the Board determines that it is in the best interests of the corporation to issue shares of its
common stock, your investment will be diluted.
We have issued nearly all of our authorized
shares of common stock and will likely have to either increase the number of shares we are authorized to issue, or conduct a reverse
stock split.
Our Articles of Incorporation authorize
out Board to issue up to 300,000,000 shares of our common stock. As of December 15, 2012, there are 249,144,706 shares of our common
stock issued and outstanding. Accordingly, in order to conduct any future equity financings we will likely have to either increase
the number of shares we are authorized to issue, or conduct a reverse stock split.
The value and transferability of our
shares may be adversely impacted by the limited trading market for our stock on the OTCQB, which is a quotation system, not an
issuer listing service, market or exchange. Because buying and selling stock on the OTCQB is not as efficient as buying and selling
stock through an exchange, it may be difficult for our stockholders to sell their shares or you may not be able to sell their shares
for an optimum trading price.
The OTCQB is a regulated quotation service
that displays real-time quotes, last sale prices and volume limitations in over-the-counter securities.
When fewer shares of a security are being
traded on the OTCQB, volatility of prices may increase and price movement may outpace the ability to deliver accurate quote information.
Lower trading volumes in a security may result in a lower likelihood of an individual's orders being executed and current
prices may differ significantly from the price one was quoted by the OTCQB at the time of the order entry. The dealer's spread
(the difference between the bid and ask prices) may be large and may result in substantial losses to the seller of securities on
the OTCQB if the common stock or other security must be sold immediately.
Our stock price historically has been
volatile and may continue to be volatile.
The market price of our common stock has
been, and is expected to continue to be, highly volatile. Factors, many of which are beyond our control, include, in addition to
other risk factors described in this section, the announcements of technological innovations by us or other companies, regulatory
matters, new or existing products or procedures, concerns about our financial position, operating results, litigation, government
regulation, developments or disputes relating to agreements, patents or proprietary rights, general economic, industry and market
conditions may have a significant impact on the market price of our stock. In addition, the future sales of shares of common stock
by our stockholders and the holders of our then outstanding warrants and options could have an adverse effect on the market price
of our outstanding shares of common stock.
10
The trading price of our common stock has,
from time to time, fluctuated widely and in the future may be subject to similar fluctuations. The trading price may be affected
by a number of factors including the risk factors set forth herein, as well as our operating results, financial condition, general
economic conditions, market demand for our common stock, and various other events or factors both in and out of our control. In
recent years, broad stock market indices, in general, and smaller capitalization companies, in particular, have experienced substantial
price fluctuations. In a volatile market, we may experience wide fluctuations in the market price of our common stock. These fluctuations
may have a negative effect on the market price of our common stock. To the extent our stock price fluctuates and/or remains low,
it could cause our stockholders to lose some or all of their investment and impair our ability to raise capital through the offering
of additional equity securities.
Future sales of our common stock could
adversely affect its price and our future capital-raising activities could involve the issuance of equity securities, which would
dilute your investment and could result in a decline in the trading price, if any, of our common stock.
We may sell securities in the public or
private equity markets if and when conditions are favorable, even if we do not have an immediate need for additional capital at
that time. Sales of substantial amounts of our common stock, or the perception that such sales could occur, could adversely affect
the prevailing market price of our common stock and our ability to raise capital. We may issue additional common stock in future
financing transactions or as incentive compensation for our executive management and other key personnel, consultants and advisors.
Issuing any equity securities would be dilutive to the equity interests represented by our then-outstanding shares of common stock.
The market price, if any, for our common stock could decrease as the market takes into account the dilutive effect of any of these
issuances. Furthermore, we may enter into financing transactions at prices that represent a substantial discount to the market
price of our common stock. A negative reaction by investors and securities analysts to any discounted sale of our equity securities
could result in a decline in the trading price of our common stock.
Alltech Capital Limited, a private
corporation, owns approximately 54% of our issued and outstanding stock. This ownership interest may preclude you from influencing
significant corporate decisions.
As of December 15, 2012, Alltech owned 135,000,000
shares, or approximately 54%, of our outstanding common stock. As a result, Alltech may be able to exercise significant influence
over matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions,
and will have significant control over our management and policies. Alltech's interests may be different from yours. For
example, it may support proposals and actions with which you may disagree or which are not in your interest. This concentration
of ownership could delay or prevent a change in control of our company or otherwise discourage a potential acquirer from attempting
to obtain control of our company, which in turn could reduce the price of our common stock. In addition, Alltech could use its
voting influence to maintain our existing management and directors in office, or support or reject other management and board proposals
that are subject to stockholder approval, such as the adoption of employee stock plans and significant unregistered financing transactions.
There are options to purchase shares
of our common stock currently outstanding.
As of December 15, 2012, we have granted
options to purchase shares of our common stock to various persons and entities, under which we could be obligated to issue up to
9,650,000 shares. The exercise prices of these options range from $0.05 to $0.12 per share. If issued, the shares underlying these
options would increase the number of shares of our common stock currently outstanding and dilute the holdings and voting rights
of our then-existing stockholders.
11
There are warrants to purchase shares
of our common stock currently outstanding.
As of December 15, 2012, there were 8,000,000
warrants outstanding to purchase an equal number of shares of our common stock at an exercise price of $0.08 per share through
June 20, 2013. If issued, the shares underlying these warrants would increase the number of shares of our common stock currently
outstanding and dilute the holdings and voting rights of our then-existing stockholders.
We do not intend to pay dividends
for the foreseeable future.
We currently intend to retain future earnings,
if any, to support the development and expansion of our business and do not anticipate paying cash dividends in the foreseeable
future. Our payment of any future dividends will be at the discretion of our Board after taking into account various factors, including
but not limited to our financial condition, operating results, cash needs, growth plans and the terms of any credit agreements
that we may be a party to at the time. Accordingly, investors must rely on sales of their common stock after price appreciation,
which may never occur, as the only way to realize their investment. Investors seeking cash dividends should not purchase our securities.
Our common stock is a "penny
stock," and because "penny stock" rules will apply, our stockholders may find it difficult to sell the shares
of our common stock they currently own.
Our common stock is a "penny stock"
as that term is defined under Rule 3a51-1 of the Exchange Act. Generally, a "penny stock" is a common stock that is
not listed on a securities exchange and trades for less than $5.00 a share. Prices often are not available to buyers and sellers
and the market may be very limited. Penny stocks in start-up companies are among the riskiest equity investments. Broker-dealers
who sell penny stocks must provide purchasers of these stocks with a standardized risk-disclosure document prepared by the SEC.
The document provides information about penny stocks and the nature and level of risks involved in investing in the penny stock
market. A broker must also give a purchaser, orally or in writing, bid and offer quotations and information regarding broker and
salesperson compensation, make a written determination that the penny stock is a suitable investment for the purchaser and obtain
the purchaser's written agreement to the purchase. Many brokers choose not to participate in penny stock transactions. Because
of the penny stock rules, there is less trading activity in penny stocks and our stockholders are likely to have difficulty selling
their shares.
FINRA sales practice requirements
may also limit a stockholder's ability to buy and sell our common stock.
In addition to the "penny stock"
rules described above, FINRA 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, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least
some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common
stock, which may limit our stockholders' ability to buy and sell our common stock and have an adverse effect on the market
for our shares.
12
Cost of compliance
with changing regulation of corporate governance and public disclosure has and will continue to result in additional expense.
Keeping abreast of,
and in compliance with, changing laws, regulations and standards relating to corporate governance and public disclosure, including
the Sarbanes-Oxley Act of 2002, new SEC regulations and, in the event we ever apply and are approved for listing on NASDAQ or another
registered stock exchange, NASDAQ and stock exchange rules, has required and will in the future require an increased amount of
management attention and external resources. We intend to continue to invest all reasonably necessary resources to comply with
evolving standards, which may result in increased general and administrative expenses and a diversion of management time and attention
from revenue-generating activities to compliance activities.
Note
Regarding Forward-Looking Statements
This Prospectus contains forward-looking
statements which involve assumptions and describe our future plans, strategies, and expectations, are generally identifiable by
use of the words "
may
," "
will
," "
should
," "
expect
,"
"
anticipate
," "
estimate
," "
believe
," "
intend
," or "
project
"
or the negative of these words or other variations on these words or comparable terminology. These statements are expressed in
good faith and based upon our current assumptions, expectations and projections, but there can be no assurance that these expectations
will be achieved or accomplished.
Such forward-looking statements include
statements regarding, among other things, (a) the potential for us to locate any reserves, our potential profitability, and cash
flows, (b) our growth strategies, (c) expectations from our exploration activities, (d) our future financing plans, and (e) our
anticipated needs for working capital.
Although forward-looking statements in this
report reflect the good faith judgment of our management, forward-looking statements are inherently subject to known and unknown
risks and uncertainties. Actual events or results may differ materially from those discussed in forward-looking statements as a
result of various factors, including, without limitation, the risks outlined under "
Risk Factors
" and matters
described in this Prospectus generally. In light of these risks and uncertainties, there can be no assurance that the forward-looking
statements contained in this filing will in fact occur. Readers are urged not to place undue reliance on these forward-looking
statements, which speak only as of the date of this Prospectus. We assume no obligation to update any forward-looking statements
in order to reflect any event or circumstance that may arise after the date of this Prospectus, other than as may be required by
applicable law or regulation.
We have little likelihood of long-term
success unless we are able to continue to raise capital from the sale of our securities or financing from other sources until,
if ever, we generate positive cash flow from operations.
Use
Of Proceeds
Although we will pay substantially all the
expenses incident to the registration of the shares, we will not receive any proceeds from the sales by the Selling Stockholder.
We received a total of $5,000,000 from the sale of the shares to the Selling Stockholder.
13
Determination
Of Offering Price
The Selling Stockholder will determine at
what price it may sell the offered shares, and such sales may be made at prevailing market prices, or at privately negotiated prices.
Please refer to "Plan of Distribution."
Market
Price of and Dividends On Our Common Stock and Related Stockholder Matters
Our common stock is currently quoted on
the OTCQB. Our common stock was removed from the OTCBB effective May 20, 2009, and relisted on the OTCBB on August 5, 2010.
Please
refer to "Risk Factors."
The following table sets forth the high
and low bid prices for shares of our common stock for the calendar quarters indicated as reported by the various listing services
for the last two years. These prices represent quotations between dealers without adjustment for retail mark-up, markdown or commission
and may not represent actual transactions. Our stock is also quoted on the Stuttgart Exchange under the symbol
A4G.SG
and
the Frankfurt Exchange under the symbols "
A4G.F
," and "
XE7RA.A4G.DE
" and on the Berlin-Bremen
Exchange under the symbol "
A4G.BER
."
First Quarter
Second Quarter
Third Quarter
Fourth
Quarter
2012 – High
$
0.12
$
0.09
$
0.05
$
0.06
2012 – Low
$
0.04
$
0.04
$
0.04
$
0.04
2011 – High
$
0.40
$
0.32
$
0.18
$
0.10
2011 – Low
$
0.24
$
0.12
$
0.09
$
0.10
The closing price of our common stock on January
2, 2013
, was $0.04
.
As of December 15, 2012, there were approximately
743 holders of record of our common stock.
We have not paid any cash dividends.
Please refer to "Dividend
Policy" below.
We do not have securities authorized for issuance under an equity compensation
plan.
As of
December
15, 2012, there were
9,650,000 stock options outstanding under our incentive stock option plan.
The stock options are exercisable at prices ranging from $0.05 to $0.12 per share, with expiration dates ranging from October 10,
2016 to April 19, 2017.
As of December 15, 2012, there were 8,000,000
warrants outstanding to purchase an equal number of shares of our common stock at an exercise price of $0.08 per share through
June 20, 2013. If the holders were to acquire all 8,000,000 shares issuable upon the exercise of outstanding warrants, we would
receive an additional
$640,000.
We did not make
any repurchases of our securities during the fiscal year ended December 31, 2011, or the subsequent period through
December
15, 2012.
Transfer Agent
The transfer agent of our common stock is
Worldwide Stock Transfer, LLC, having an office at 433 Hackensack Avenue, Level L, Hackensack, NJ, USA 07601.
14
Penny Stock
The SEC has adopted rules that regulate
broker-dealer practices in connection with transactions in penny stocks. Our stock is currently a "penny stock." Penny
stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities
exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such
securities is provided by the exchange or system. The penny stock rules require a broker-dealer, prior to a transaction in a penny
stock not otherwise exempt from those rules, deliver a standardized risk disclosure document prepared by the Commission, which:
(a) contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary
trading; (b) contains a description of the broker's or dealer's duties to the customer and of the rights and remedies
available to the customer with respect to a violation to such duties or other requirements of Securities' laws; (c) contains
a brief, clear, narrative description of a dealer market, including bid and ask prices for penny stocks and significance of the
spread between the bid and ask price; (d) contains a toll-free telephone number for inquiries on disciplinary actions; (e) defines
significant terms in the disclosure document or in the conduct of trading in penny stocks; and (f) contains such other information
and is in such form as the Commission shall require by rule or regulation. The broker-dealer also must provide to the customer,
prior to effecting any transaction in a penny stock, (a) bid and offer quotations for the penny stock; (b) the compensation of
the broker-dealer and its salesperson in the transaction; (c) the number of shares to which such bid and ask prices apply, or other
comparable information relating to the depth and liquidity of the market for such stock; and (d) monthly account statements showing
the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that prior
to a transaction in a penny stock not otherwise exempt from those 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 acknowledgment of the
receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy
of a written suitably statement.
These disclosure requirements may have the
effect of reducing the trading activity in the secondary market for our stock if it becomes subject to these penny stock rules.
Rule 144
At December 15,
2012, there were
249,144,706
shares of our common stock issued and outstanding, of which 159,990,838
shares are deemed "restricted securities," within the meaning of Rule 144. Absent registration under the Securities
Act, the sale of such shares is subject to Rule 144, as promulgated under the Securities Act.
In general, under Rule 144, subject to the
satisfaction of certain other conditions, a person deemed to be one of our affiliates, who has beneficially owned restricted shares
of our common stock for at least one year is permitted to sell in a brokerage transaction, within any three-month period, a number
of shares that does not exceed the greater of 1% of the total number of outstanding shares of the same class, or, if our common
stock is quoted on a stock exchange, the average weekly trading volume during the four calendar weeks preceding the sale, if greater.
Rule 144 also permits a person who presently
is not and who has not been an affiliate of ours for at least three months immediately preceding the sale and who has beneficially
owned the shares of common stock for at least nine months to sell such shares without restriction other than the requirement that
there be current public information as set forth in Rule 144. To the extent that Rule 144 is otherwise available, this provision
is currently applicable to all of the restricted shares. If a non-affiliate has held the shares for more than one year, such person
may make unlimited sales pursuant to Rule 144 without restriction.
15
The possibility that substantial amounts
of our common stock may be sold under Rule 144 into the public market may adversely affect prevailing market prices for the common
stock and could impair our ability to raise capital in the future through the sale of equity securities. Please refer to "
Risk
Factors
."
Dividend Policy
We have never paid cash dividends on our
capital stock and do not anticipate paying any cash dividends in the foreseeable future, but intend to retain our capital mineralized
materials for reinvestment in our business. Any future determination to pay cash dividends will be at the discretion of our Board
of and will be dependent upon our financial condition, results of operations, capital requirements and other factors as the Board
deems relevant.
Management's
Discussion And Analysis Of Financial Condition
And
Results Of Operations
The following information should be read
in conjunction with our audited consolidated financial statements and related notes thereto for the years ended December 31, 2011
and 2010, included elsewhere in this Prospectus. We also urge you to review and consider our disclosures describing various risks
that may affect our business, which are set forth under the heading "
Risk Factors
."
General
We are a mineral
exploration company engaged in the exploration of base, precious metals and industrial minerals worldwide. We were incorporated
under the laws of the State of Delaware on October 10, 1995, under the name "Chefs Acquisition Corp." We conduct our
exploration and property acquisition activities through our head office which is located at is located at
C/- Coresco AG,
Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland.
The telephone number is (+41) 7887-96966. We also
maintain an office in Brazil
at Av. Jornalista Ricardo Marinho, 360, sala 113, Ed. Cosmopolitan, Barra da Tijuca, Rio de
Janeiro, CEP 22631-350.
We had no revenues during the fiscal years
ended December 31, 2011 and 2010. Funds raised in fiscal 2012 and 2011 were used for exploration of our properties and general
administration. We have sustained losses since inception, have been issued a going concern opinion by our auditors and rely upon
the sale of our securities to fund operations. We will not generate revenues even if any of our exploration programs indicate that
a mineral deposit may exist on our properties. Accordingly, we will be dependent on future financings in order to maintain our
operations and continue our exploration activities.
On June 15, 2010, pursuant to the Asset
Purchase Agreement between Global Minerals Ltd. ("
GML
") and Mount Royale Ventures, LLC ("
MRV
"),
as Sellers, us and AGC Resources LLC, our wholly-owned subsidiary("
AGC
"), as Buyers, AGC acquired 50% interest
in the Front Range Gold Project joint venture ("
JV
"), and title to the Gold Hill Mill, and became a joint venture
partner with Gold Reef Mining Company, Mi Vida Enterprises, Inc., Gold Hill Mines, Inc. and Southern Cross Prospecting Company
("
Property Owners
").
On March 10, 2011,
Mi Vida Enterprises, Inc., Gold Hill Mines, Inc. and Southern Cross Prospecting Company intervened in a preexisting lawsuit commenced
by MRV against Gold Reef Mining Company in Boulder County District Court (the "
Action
"). Among other things,
they have alleged that GML was in material default of the JV agreement prior to the assignment by GML of its rights in the JV to
AGC in June of 2010, that GML wrongfully assigned its rights in the JV without permission of the Property Owners, and have asked
the court to declare the JV terminated. The Property Owners also alleged that the transfer of title to the Gold Hill Mill was subject
to a right of first refusal in favor of Gold Hill Mines, Inc., and that MRV conveyed its title to the Gold Hill Mill to AGC without
giving proper notice to Gold Hill Mines Inc. and in violation of a right of first refusal in favor of Gold Hill Mines, Inc., and
requested the court to enter an order granting Gold Hill Mines Inc. an option to purchase the Gold Hill Mill for $10,000, the amount
set in the right of first refusal.
16
A court decision in
favor of the Property Owners may have a material adverse effect on our ability to collect the purchase price, plus royalty from
the sale of AGC to Devtec Management Ltd. since an unfavorable court decision may result in AGC losing its 50% interest in the
JV as well as its interest in and to the Gold Hill Mill.
On June 14, 2011, we
entered into an Asset Purchase Agreement with Devtec Management Ltd. ("
Devtec
"), pursuant to which we sold our
subsidiary, AGC Resources LLC, which owns certain properties in Boulder, Colorado, to Devtec for a total of $2 million, plus royalty.
Devtec will pay us $1 million upon production of the cumulative total of 1,000 ounces of gold and/or silver, and a further $1 million
on the nine month anniversary of the payment of the first $1 million. Additionally, Devtec will pay us a 5% royalty from the start
of production.
Effective as of October
11, 2011, our
Board
granted 4,200,000 stock purchase options pursuant to our 2007 Stock Option
Plan (the "
Plan
"). Each of the options has an issue date, effective date and vesting date of October 11, 2011,
with an exercise price of $0.12 per share. The term of these options is five years. The options are exercisable at any time from
the grant date up to and including the October 10, 2016.
Effective as of November
24, 2011, our
Board
granted 3,650,000 stock purchase options pursuant to our Stock Option Plan.
Each of the options has an issue date, effective date and vesting date of November 24, 2011, with an exercise price of $0.05 per
share. The term of these options is five years. The options are exercisable at any time from the grant date up to and including
the November 24, 2016.
Effective as of December
15, 2011, we entered into debt settlement agreements with four creditors pursuant to which we issued 10,937,721 shares of our common
stock and the creditors agreed to forgive and release us from paying an aggregate of $218,754.42 owed to the creditors.
Effective as of December 20, 2011, we entered
into subscription agreements pursuant to which we sold an aggregate of 8,000,000 units of our securities at a purchase price of
$0.04 per unit, for a gross aggregate price of $320,000, to six investors in reliance upon an exemption from securities registration
afforded by, but not limited to, the provisions of Regulation S of the Securities Act of 1933. Each unit consisted of one share
of our common stock, $0.001 par value per share and one Series A Stock Purchase Warrant (the "
Series A Warrants
").
Each full Series A Warrant entitles the holder to purchase an additional share of our common stock at an exercise price of $0.08
per share for a period of eighteen months commencing on December 20, 2011 and expiring on June 20, 2013.
Significant developments during the nine month period ended
September 30, 2012 and Subsequent Events to December
15, 2012
From January 1, 2012 through December 15,
2012, we have been evaluating our property holdings in order to determine whether to implement exploration programs on our existing
properties or to acquire interests in new properties.
17
For the nine month
periods ended September 30, 2012 and 2011, we recorded exploration expenses of $131,724 compared to $261,304, respectively.
On September 21, 2012, we entered into a
subscription agreement with Alltech pursuant to which we agreed to sell to Alltech 135,000,000 shares of our common stock, representing
approximately 54% of our issued and outstanding shares of common stock, for a purchase price of $5,000,000. The closing of the
transaction occurred on October 5, 2012. As a result of the sale a change in control of the Company occurred. As a condition to
the closing of the transaction, we agreed to increase the size of our board of directors to five (5) members and to appointed two
board members selected by Alltech. The board of directors appointed each of Messrs. Vladimir Bernshtein and Andrey Ratsko to serve
as directors of the Company. Additionally, Mr. Bernshtein has been named as the Company's Chief Business Development Director.
Exploration Activities
We are a junior mineral exploration company
and conducts principal and technical activities from Coresco AG, Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland. The telephone
number is (+41) 41 711 0281. These offices are provided to the Company on a month-to-month basis. We believe these offices are
adequate for the business requirements during the next 12 months; we do not own any real property.
Management and the board reviewed and clarified
our strategic objectives to concentrate efforts on existing operations where infrastructure already exists, properties presently
being developed or in advanced stages of exploration that have potential for additional discoveries and grass-roots exploration
opportunities. We are currently concentrating on property exploration activities in Brazil.
The properties are in the exploration stage
only and without a known body of mineral reserves. Development of the properties will follow only if satisfactory exploration results
are obtained. Mineral exploration and development involves a high degree of risk and few properties that are explored are ultimately
developed into producing mines. There is no assurance that the mineral exploration and development activities will result in any
discoveries of commercially viable bodies of mineralization. The long-term profitability of the operations will be, in part, directly
related to the cost and success of the exploration programs, which may be affected by a number of factors.
We currently have an interest in a strategic
land package of nine (9) properties none of which contain any reserves. The exploration license areas are divided into 2 groups,
the Săo Domingos and the Sao Joao areas.
Three and nine months ended September
30, 2012 (Fiscal 2012) versus three and nine months ended September 30, 2011 (Fiscal 2011)
Revenues and Net Loss
– The
Company has yet to generate any revenues or establish any history of profitable operations. The Company recorded a net loss of
$(566,344) for the nine months ended September 30, 2012 (September 30, 2011: net loss $3,782,688) and $(70,112) for the three months
ended September 30, 2012 (September 30, 2011: net loss $446,985) or $(0.00) (September 30, 2011: $(0.00)) and $(0.01) [September
30, 2011: $(0.04)] per share.
Expenses
– The general and
administrative expenses consist primarily of personnel costs, legal costs, investor relations costs, stock based compensation costs,
accounting costs and other professional and administrative costs. General and Administrative expenses were $218,587 for the nine
months ended September 30, 2012 (September 30, 2011: $139,250) and $27,995 for the three months ended September 30, 2012 (September
30, 2011: $54,095). The decrease quarter on quarter costs reflects further cash conservation initiatives implemented my management.
Included in expenses are professional accounting and legal fees of $80,450 for the nine months ended September 30, 2012 (September
30, 2011: $189,198) and $47,674 for the three months ended September 30, 2012 (September 30, 2011: $25,219) which represents further
initiatives by management to settle long outstanding financial liabilities.
18
Exploration expenditures
–
Exploration expenses are charged to operations as they are incurred. The Company recorded exploration expenses of $131,724 for
the nine months ended September 30, 2012 (September 30, 2011: $261,304) and $7,772 for the three months ended September 30, 2012
(September 30, 2011: $23,055) the majority relating to maintenance activities at the Brazilian properties during the current quarter
and Colorado and Brazil mine in prior quarter.
Depreciation expense
– Depreciation
expenses charged to operations were nil for the nine months ended September 30, 2012 and nil for the three months ended September
30, 2012. (Nine months ended September 30, 2011: $22,001 and three months ended September 30, 2011: $6,538).
Gain on extinguishment of liabilities
– During the three and nine months ended September 30, 2012, the Company recorded gain on extinguishment of liabilities of
$94,860, which represents further initiatives by management to settle long outstanding financial liabilities.
Liquidity and Capital Resources
September 30, 2012 versus December 31,
2011:
Recent developments in capital markets have
restricted access to debt and equity financing for many companies. Our exploration properties are in the exploration stage and
have not commenced commercial production. Consequently, we have no history of earnings or cash flow from our operations. As a result,
we are reviewing our 2012 fiscal exploration and capital spending requirements in light of the current and anticipated global economic
environment.
We currently finance our activities primarily
by the private placement of securities. There is no assurance that equity funding will be accessible to us at the times and in
the amounts required to fund our activities. There are many conditions beyond our control, which have a direct bearing on the level
of investor interest in the purchase of our securities. We may also attempt to generate additional working capital through the
operation, development, sale or possible joint venture development of our properties; however, there is no assurance that any such
activity will generate funds that will be available for operations. Debt financing has been used to fund our property acquisitions
and exploration activities. We do not have "standby" credit facilities, or off-balance sheet arrangements and it does
not use hedges or other financial derivatives. We have no agreements or understandings with any person as to additional financing.
On September 21, 2012, we entered into a
subscription agreement with Alltech pursuant to which we agreed to sell to Alltech 135,000,000 shares of our common stock, representing
approximately 54% of our issued and outstanding shares of common stock, for a purchase price of $5,000,000. The closing of the
transaction occurred on October 5, 2012.
In October 2011, we filed a Registration
Statement on Form S-1 offering up to a maximum of 50,000,000 units of our securities at an offering price of $0.10 per Unit in
a direct public offering, without any involvement of underwriters or broker-dealers. Each Unit consists of one (1) share of common
stock at a $0.001 par value per share and one (1) Stock Purchase Warrant. Each full Warrant entitles the holder to purchase one
additional share of common stock at a price of $0.20 for a period of two years commencing November 1, 2011 through October 31,
2013. The Units will be sold by the Chief Executive Officer and Chief Financial Officer. A Notice of Effectiveness was issued April
25, 2012. The offer will expire January 20, 2013. To date, no funds have been obtained from this offering.
19
At September 30, 2012, we had cash of $1,241
(December 31, 2011: $237,426) and a working capital deficiency of $(576,152) and $(300,218) as at December 31, 2011. Total liabilities
as of September 30, 2012, were $577,393 (December 31, 2011: $537,644).
During April 2012, we entered into a debt
settlement agreement for $18,000 in accounts payable which was settled for 300,000 shares of common stock at an issue price of
$0.06 per share.
During March 2012, we entered into debt
settlement agreements for advances received from an individual and a company during fiscal 2011, as well as $14,454 of amounts
in accounts paable and accrued expenses. $119,454 was settled for 1,990,900 shares of common stock at an issue price of $0.06 per
share. Further details are provided under the common stock notes to these financial statements.
Our general business strategy is to acquire
mineral properties either directly or through the acquisition of operating entities. Our consolidated financial statements have
been prepared in accordance with generally accepted accounting principles in the United States of America and applicable to a going
concern which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of
business. As discussed in note 1 to the consolidated financial statements, we have incurred recurring operating losses since inception,
have not generated any operating revenues to date and have used cash of $381,481 from operating activities in 2012 through September
30. We require additional funds to meet our obligations and maintain our operations. We do not have sufficient working capital
to (i) pay our administrative and general operating expenses through June 30, 2013 and (ii) to conduct our preliminary exploration
programs. Without cash flow from operations, we may need to obtain additional funds (presumably through equity offerings and/or
debt borrowing) in order, if warranted, to implement additional exploration programs on our properties. While we may attempt to
generate additional working capital through the operation, development, sale or possible joint venture development of our properties,
there is no assurance that any such activity will generate funds that will be available for operations. Failure to obtain such
additional financing may result in a reduction of our interest in certain properties or an actual foreclosure of our interest.
We have no agreements or understandings with any person as to such additional financing.
Our exploration properties have not commenced
commercial production and we have no history of earnings or cash flow from our operations. While we may attempt to generate additional
working capital through the operation, development, sale or possible joint venture development of our property, there is no assurance
that any such activity will generate funds that will be available for operations.
Cash Flow
Nine months ended September 30, 2012
versus nine months ended September 30, 2011:
Operating activities:
We used cash
of $381,481 (September 30, 2011: $986,424). Changes in prepaid expenses and other assets resulted were nil during the period (September
30, 2011: increase of $7,016) and changes in accounts payable and accrued expenses (including related party) resulted in an increase
in cash of $224,063 (September 30, 2011: decrease in cash of $732).
Investing Activities:
There were
no investing activities during the period (September 30, 2011: $80,000 financial warranty from Colorado Mined Land Reclamation
bonds returned).
20
Financing Activities:
We intend to
finance activities by raising capital through the equity markets. In October 2011, we filed a Registration Statement on Form S-1
offering up to a maximum of 50,000,000 units of the Company's securities at an offering price of $0.10 per Unit in a direct public
offering, without any involvement of underwriters or broker-dealers. Each Unit consists of one (1) share of common stock at a $0.001
par value per share and one (1) Stock Purchase Warrant. Each full Warrant entitles the holder to purchase one additional share
of common stock at a price of $0.20 for a period of two years commencing November 1, 2011 through October 31, 2013. The Units will
be sold by the Chief Executive Officer and Chief Financial Officer. A Notice of Effectiveness was issued April 25, 2012. The offer
will expire January 20, 2013. To date, no funds have been obtained from this offering.
On September 21, 2012, we entered into a
subscription agreement with Alltech pursuant towhich we agreed to sell to Alltech 135,000,000 shares of our common stock, representing
approximately 54% of our issued and outstanding shares of common stock, for a purchase price of $5,000,000. The closing of the
transaction occurred on October 5, 2012.
In August 2012 we received an advance of
$50,000 from a director and officer of the Company. The advance is non-interest bearing and is due on successful capital raising.
On April 16, 2012, we entered into subscription
agreements for 1,316,000 shares of common stock at a purchase price of $0.06 per share for a gross aggregate price of $78,960.
Pursuant to the subscription agreements, each of the Investors has represented that they are not a U.S. person; as such term is
defined in Regulation S. In connection with the offering, we agreed to pay a cash commission equal to 8% of all funds received
or an aggregate of up $48,000 on the total maximum $600,000 subscription.
During April 2012, we entered into a debt
settlement agreement for $18,000 in accounts payable which was settled for 300,000 shares of common stock at an issue price of
$0.06 per share.
During March 2012, we entered into debt
settlement agreements for advances received from a director of the Company and a company during fiscal 2011 as well as $14,454
of amounts in accounts payable and accrued expenses. $119,454 was settled for 1,990,900 shares of common stock at an issue price
of $0.06 per share.
In March 2012, we entered into subscription
agreements for 625,217 shares of common stock at a purchase price of $0.06 per share for a gross aggregate price of $37,513. Share
certificates were not issued as at March 31, 2012 and they were treated as an Advance for Stock Subscriptions. The share certificates
were issued in April 2012. Pursuant to the subscription agreements, each of the Investors has represented that they are not a U.S.
person; as such term is defined in Regulation S. In connection with the offering, the Company has agreed to pay a cash commission
equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum $600,000 subscription that is being offered.
On December 20, 2011, we entered into subscription
agreements for 8,000,000 shares of common stock at a purchase price of $0.04 per share for a gross aggregate price of $320,000.
Attached to each unit of common stock is one (1) series A stock purchase warrant. Each full Series A warrant entitles the holder
to purchase an additional share of the Company's common stock at an exercise price of $0.08 per share for a period of eighteen
months commencing on December 20, 2011 and expiring on June 20, 2013. Pursuant to the subscription agreements, each of the Investors
has represented that they are not a U.S. person; as such term is defined in Regulation S. In connection with the offering, we agreed
to pay a cash commission equal to 8% of all funds received or an aggregate of up $25,600. The actual total amount was $8,800.
21
On December 15, 2011, we entered into debt
settlement agreements with creditors and related parties in consideration for the issue of our common stock at a per share price
of $0.02 per share. $218,754 was settled for 10,937,721 shares of common stock.
During the fiscal year 2011 the Company
received funds from advances from individuals and a company, totalling $257,000 that were non-interest bearing, were due on demand
and were unsecured. As at the end of the fiscal year this total amount was reduced to $137,000 due to $120,000 of this advance
being converted to common stock for settlement of this indebtedness in December 2011 at $0.04 per share.
In September 2011, we issued 1,671,000 shares
to an individual for cash at $0.10 per share. In September 2011, we issued 150,000 shares to a company for services rendered at
$0.16 per share.
In April 2011, as an incentive to assist
with future private placements, we authorized the payment of a non-cash finder's fee of 450,000 shares of common stock in
connection with the private placement completed in April 2010. The shares were issued in May 2011. All shares issued were to individuals
and companies who reside outside the United States of America. The issuance of the shares was exempt from the registration requirements
of Securities Act by virtue of Section 4(2) thereof as well as the exemption from registration requirements afforded by Regulation
S.
Year Ended December 31, 2011 (Fiscal 2011) versus Year Ended
December 31, 2010 (Fiscal 2010)
Revenues and Net Loss
– We
have yet to generate any revenues or establish any history of profitable operations. For the year ended December 31, 2011, we recorded
a net loss of $4,627,338 (2010: net loss $2,302,083) or $(0.05) [2010: $(0.03)] per share.
Expenses
– General and administrative
expenses consist primarily of personnel, legal, investor relations, stock based compensation, accounting and other professional
and administrative costs. For the year ended December 31, 2011 we recorded General and Administrative expenses of $550,655 (2010:
$397,848). Professional fees for accounting of $129,353 (2010: $120,220) and legal $111,772 (2010: $308,323) were also incurred.
The majority of the legal costs incurred during fiscal 2010 relate to the Global Asset Purchase Agreement on June 14, 2011.
Exploration expenditures
–
Exploration expenses are charged to operations as they are incurred. For the year ended December 31, 2011, we recorded exploration
expenses of $307,613 (2010: $644,313).
Depreciation expenses
– Depreciation
expenses charged to operations for the year ended December 31, 2011, were $27,897 (2010: $17,738).
AGC Resources LLC
–
(Boulder, Colorado Property
Disposed June 14, 2011)
On June 14, 2011, we entered into an Asset
Purchase Agreement with Devtec, pursuant to which the Company sold its subsidiary, AGC, which owns certain properties in Boulder,
Colorado (see Note 3(c) of our 2011 consolidated financial statements for a discussion of the specific assets purchased by AGC
in June 2010), to Devtec for a total of $2 million, plus royalty. Under the terms of the agreement, Devtec will pay us $1 million
upon production of the cumulative total of 1,000 ounces of gold and/or silver, and a further $1 million on the nine month anniversary
of the payment of the first $1 million. Additionally, Devtec will pay us a 5% royalty from the start of production.
22
We are unable to reasonably estimate the
amount of minerals the properties will produce, if any, and thus there is uncertainty as to whether the purchase price will be
collected. Further, the collection of any purchase price is also contingent on the outcome of the court case described in Note
3 of our 2011 consolidated financial statements. Given these factors, collection of the purchase price is not considered reasonably
possible at the time of this report given the current uncertain status of exploration work on the Boulder, Colorado properties
and the uncertainties of the related legal action and thus no purchase price has been recorded as of September 30, 2012. Once collection
of the purchase price becomes assured and the aforementioned uncertainties resolved, the purchase price will be recorded in the
Consolidated Statements of Operations.
Accordingly, we have recognized a loss on
the sale of our subsidiary of $2,757,511 for the year ended December 31, 2011, which represents the net book value of the assets
transferred to Devtec on June 14, 2011 (no liabilities were assumed by Devtec) as follows:
Reclamation bonds
$
245,221
Buildings and equipment
$
753,605
Participating interest in mineral property
$
1,758,685
Total
$
2,757,511
Liquidity and Capital Resources
December 31, 2011 versus December 31, 2010:
Recent developments in capital markets have
restricted access to debt and equity financing for many companies. Our exploration properties are in the exploration stage and
have not commenced commercial production. Consequently, we have no history of earnings or cash flow from its operations. As a result,
we are reviewing its 2012 exploration and capital spending requirements in light of the current and anticipated, global economic
environment.
We currently finance our activities primarily
by the private placement of securities. There is no assurance that equity funding will be accessible to us at the times and in
the amounts required to fund our activities. There are many conditions beyond our control which have a direct bearing on the level
of investor interest in the purchase of our securities. We may also attempt to generate additional working capital through the
operation, development, sale or possible joint venture development of its properties; however, there is no assurance that any such
activity will generate funds that will be available for operations. Debt financing has been used to fund our property acquisitions
and exploration activities. We do not have "standby" credit facilities, or off-balance sheet arrangements and it does
not use hedges or other financial derivatives. We have no agreements or understandings with any person or entity as to additional
financing.
At December 31, 2011, we had cash of $237,426
(2010: $579,191) and working capital deficiency of $(300,218) (2010 working capital of $227,326). Total liabilities as of December
31, 2011 were $537,644 (2010: $372,019).
On December 20, 2011, we entered into subscription
agreements for 8,000,000 shares of common stock at a purchase price of $0.04 per share for a gross aggregate price of $320,000.
Attached to each unit of common stock wass one (1) series A stock purchase warrant. Each full Series A warrant entitles the holder
to purchase an additional share of our common stock at an exercise price of $0.08 per share for a period of eighteen months commencing
on December 20, 2011 and expiring on June 20, 2013. Pursuant to the subscription agreements, each of the Investors has represented
that they are not a U.S. person; as such term is defined in Regulation S. In connection with the offering, we agreed to pay a cash
commission equal to 8% of all funds received or an aggregate of up $25,600.
23
On December 15, 2011,
we entered into debt settlement agreements with creditors and related parties in consideration for the issue of our common stock
at a per share price of $0.02 per share. $218,754 was settled for 10,937,721 shares of common stock.
During the 2011 we
received funds from advances from individuals and a company, totaling $257,000, that were non-interest bearing, were due on demand
and were unsecured. As at the end of the year this total amount was reduced to $137,000 due to $120,000 of this advance being converted
to common stock for settlement of this indebtedness in December 2011 at $0.04 per share.
In September 2011,
we issued 1,671,000 shares to an individual for cash at $0.10 per share. In September 2011, we issued 150,000 shares to a company
for services rendered at $0.16 per share.
In April 2011, as an
incentive to assist with future private placements, we authorized the payment of a non cash finder's fee of 450,000 shares
of our common stock in connection with the private placement completed in April 2010. The shares were issued in May 2011. All shares
issued were to individuals and companies who reside outside the United States of America. The issuance of the shares was exempt
from the registration requirements of Securities Act by virtue of Section 4(2) thereof as well as the exemption from registration
requirements afforded by Regulation S.
During the period January
1 to December 31, 2010, we received cash of $3,895,000 from a private placement of 12,983,335 common shares at $0.30 per share,
paid non cash finder's fees of 1,126,111 shares in connection with the private placement, issued 685,900 shares in settlement
of indebtedness and expenses amounting to $205,770 and paid a non cash finder's fee of 500,000 shares in connection with
a property acquisition valued at $0.30 per share. The shares were issued to individuals and companies who reside outside the USA.
The issuance of the shares were exempt from the registration requirements of Securities Act by virtue of Section 4(2) thereof as
well as the exemption from registration requirements afforded by Regulation S. Furthermore during 2010, two loans payable were
repaid at $250,000 each and two advances payable received during the year ended December 31, 2009 were repaid at $50,000 each.
Our general business strategy is to acquire
mineral properties, or the rights to such properties, either directly or through the acquisition of operating entities. The consolidated
financial statements have been prepared in accordance with generally accepted accounting principles in the USA and applicable to
a going concern concept which contemplates the realization of assets and the satisfaction of liabilities and commitments during
the normal course of business. We have incurred recurring operating losses since inception, have not generated any operating revenues
to date and during 2011 operating activities used cash of $1,062,075 (2010: $2,423,112). We require additional funds to meet our
obligations and maintain the operations. We do not have sufficient working capital to (i) pay administrative and general operating
expenses through December 31, 2012 and (ii) to conduct preliminary exploration programs. Without cash flow from operations, we
may need to obtain additional funds (presumably through equity offerings and/or debt borrowing) in order, if warranted, to implement
additional exploration programs on the properties. While we may attempt to generate additional working capital through the operation,
development, sale or possible joint venture development of the properties, there is no assurance that any such activity will generate
funds that will be available for operations. Failure to obtain such additional financing may result in a reduction of interest
in certain properties or an actual foreclosure of interest. We have no agreements or understandings with any person as to such
additional financing.
Our exploration properties
have not commenced commercial production and we have no history of earnings or cash flow from operations. While we may attempt
to generate additional working capital through the operation, development, sale or possible joint venture development of property,
there is no assurance that any such activity will generate funds that will be available for operations.
24
Cash Flow
Operating activities:
During the
year ended December 31, 2011, our operating activities used cash of $1,062,075 (2010: $2,423,112). The following is a breakdown
of cash used for operating activities: Depreciation and amortization of $27,897 (2010: $17,738). Changes in prepaid expenses and
other assets resulted in an increase in cash of $20,344 (2010: $54,449). Changes in accounts payable and accrued expenses (including
related party) resulted in an increase in cash of $55,343 (2010: decrease $403,216).
Investing Activities:
During the
year ended December 31, 2011, $80,000 of the financial warranty with respect to the Colorado Mined Land Reclamation bonds was returned
to us. During the year ended December 31, 2010, we spent $500,000 acquiring the Front Range Gold joint venture property and related
buildings and equipment in Boulder, Colorado, USA, $17,800 on equipment and $325,221 was spent on Mined Land Reclamation Bonds
with the State of Colorado and the Front Range Project joint venture.
Financing Activities:
We intend to
finance activities by raising capital through the equity markets.
Dividends
We have neither declared nor paid any dividends
on our common stock. We intend to retain our earnings to finance growth and expand our operations and do not anticipate paying
any dividends on our common stock in the foreseeable future.
Asset-Backed Commercial Paper
We have no asset-backed commercial paper.
Fair Value of Financial Instruments and Risks
Fair value estimates
of financial instruments are made at a specific point in time, based on relevant
information
about financial markets and specific financial instruments. As these estimates are subjective in nature, involving uncertainties
and matters of significant judgment, they cannot be determined with precision. Changes in assumptions can significantly affect
estimated fair value.
The carrying value of cash, accounts payable
and accrued expenses, accounts payable and accrued expenses – related parties, advances payable and advances payable –
related party, and loans payable approximate their fair value because of the short-term nature of these instruments.
Management is of the opinion that we are
not exposed to significant interest or credit risks arising from these financial instruments.
We operate outside of the United States
of America (primarily in Brazil) and are exposed to foreign currency risk due to the fluctuation between the currency in which
we operate in and the U.S. dollar.
25
Share Capital
At December 15, 2012,
we had:
·
Authorized share capital of 300,000,000 common shares with par value of $0.001 each.
·
249,144,706 common shares were issued and outstanding (December 31, 2011 – 109,912,589).
·
9,650,
000
(December 31, 2011: 9,050,000) stock options were outstanding
under the incentive stock option plan. The stock options are exercisable at prices ranging from $0.05 to $0.12 per share, with
expiration dates ranging from October 10, 2016 to April 9, 2017. If the holders were to acquire all 9,650,000 (December 31, 2011:
9,050,000) shares issuable
upon
the exercise of all incentive stock options outstanding, we would
receive an additional $779,500 (December 31, 2011: $1,206,500).
·
8,000,000 warrants outstanding ( December 31, 2011: 8,000,000).
Market Risk Disclosures
We have not entered into derivative contracts
either to hedge existing risks or for speculative purposes during the nine months ended September 30, 2012, and the subsequent
period to December 15, 2012.
Off-balance Sheet Arrangements and Contractual Obligations
We do not have any off-balance sheet arrangements
or contractual obligations at September 30, 2012, and the subsequent period to December 15, 2012, that are likely to have or are
reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues
or expenses, results of operations, liquidity, capital expenditures or capital resources that have not been disclosed in our consolidated
financial statements.
Application of Critical Accounting Policies
The accounting policies and methods we utilize
in the preparation of our consolidated financial statements determine how we report our financial condition and results of operations
and may require our management to make estimates or rely on assumptions about matters that are inherently uncertain. Our accounting
policies are described in Note 2 to our December 31, 2011, consolidated financial statements. Our accounting policies relating
to mineral property and exploration costs and depreciation and amortization of property, plant and equipment are critical accounting
policies that are subject to estimates and assumptions regarding future activities.
Buildings and Equipment
Buildings and equipment are carried at cost
(including development and preproduction costs, capitalized interest, other financing costs and all direct administrative support
costs incurred during the construction period, net of cost recoveries and incidental revenues), less accumulated depletion and
depreciation including write-downs. Following the construction period, interest, other financing costs and administrative costs
are expensed as incurred.
On the commencement of commercial production,
depletion of each mining property is provided on the unit-of-production basis, using estimated proven and probable reserves as
the depletion basis.
26
Buildings and equipment utilized directly
in commercial mining activities are depreciated, following the commencement of commercial production, over their expected economic
lives using either the unit-of-production method or the straight-line method.
Depreciation for non-mining equipment is
provided over the following useful lives:
Vehicles: 10 years;
Office equipment, furniture and fixtures:
2 to 10 years.
We review the carrying values of its buildings
and equipment whenever events or changes in circumstances indicate that their carrying values may not be recoverable. An impairment
is considered to exist if total estimated future cash flows, or probability-weighted cash flows on an undiscounted basis, are less
than the carrying value of the assets. An impairment loss is measured and recorded based on discounted estimated future cash flows
associated with values beyond proven and probable reserves and resources. In estimating future cash flows, assets are grouped at
the lowest level for which there is identifiable future cash flows that are largely independent of cash flows from other asset
groups. Generally, in estimating future cash flows, all assets are grouped at a particular property for which there is identifiable
cash flows. Buildings and equipment utilized directly in commercial mining activities are depreciated, following the commencement
of commercial production, over their expected economic lives using either the unit-of-production method or the straight-line method.
Mineral Properties and Exploration Expenses
We account for our mineral properties on
a cost basis whereby all direct costs, net of pre-production revenue, relative to the acquisition of the properties are capitalized.
All sales and option proceeds received are first credited against the costs of the related property, with any excess credited to
earnings. Once commercial production has commenced, the net costs of the applicable property will be charged to operations using
the unit-of-production method based on estimated proven and probable recoverable reserves. The net costs related to abandoned properties
are charged to operations.
Exploration costs are charged to operations
as incurred until such time that proven reserves are discovered. From that time forward, we will capitalize all costs to the extent
that future cash flow from mineral reserves equals or exceeds the costs deferred. The deferred costs will be amortized over the
recoverable reserves when a property reaches commercial production. As at December 31, 2011 and 2010, we did not have proven reserves.
Exploration activities conducted jointly with others are reflected at our proportionate interest in such activities.
We review the carrying values of its mineral
properties on a regular basis by reference to the project economics including the timing of the exploration and/or development
work, the work programs and the exploration results experienced by us and others. The review of the carrying value of any producing
property will be made by reference to the estimated future operating results and net cash flows. When the carrying value of a property
exceeds its estimated net recoverable amount, provision is made for the decline in value.
The recoverability of the amounts recorded
for mineral properties is dependent on the confirmation of economically recoverable reserves, confirmation of our interest in the
underlying mineral claims, our ability to obtain the necessary financing to successfully complete their development and the attainment
of future profitable operations or proceeds from disposition.
Estimated costs related to site restoration
programs during the commercial development stage of the property are accrued over the life of the project.
27
Related Party Transactions
Our proposed business
raises potential conflicts of interests between certain of our officers and directors and us. Certain of our directors are directors
of other mineral resource companies and, to the extent that such other companies may participate in ventures in which we may participate,
our directors may have a conflict of interest in negotiating and concluding terms regarding the extent of such participation. In
the event that such a conflict of interest arises at a meeting of our directors, a director who has such a conflict will abstain
from voting for or against the approval of such participation or such terms. In appropriate cases, we will establish a special
committee of independent directors to review a matter in which several directors, or management, may have a conflict. From time
to time, several companies may participate in the acquisition, exploration and development of natural resource properties thereby
allowing for their participation in larger programs, involvement in a greater number of programs and reduction of the financial
exposure with respect to any one program. It may also occur that a particular company will assign all or a portion of its interest
in a particular program to another of these companies due to the financial position of the company making the assignment.
In determining whether
we will participate in a particular program and the interest therein to be acquired by it, the directors will primarily consider
the potential benefits to us, the degree of risk to which we may be exposed and our financial position at that time. Other than
as indicated, we have no other procedures or mechanisms to deal with conflicts of interest. We are not aware of the existence of
any conflict of interest as described herein.
Other than as disclosed
below, during the nine month period ended September 30, 2012, none of our current directors, officers or principal shareholders,
nor any family member of the foregoing, nor, to the best of our information and belief, any of our former directors, senior officers
or principal shareholders, nor any family member of such former directors, officers or principal shareholders, has or had any material
interest, direct or indirect, in any transaction, or in any proposed transaction which has materially affected or will materially
affect us.
There have been no
transactions or proposed transactions with officers and directors during the nine months ended September 30, 2012 to which we are
a party except as follows:
During
the nine-month period ended September 30, 2012 consulting fees of $297,190 (September 30, 2011: $191,742) were incurred to by our
directors and officers (or companies of the officers and directors). The transactions were recorded at the exchange amount, being
the value established and agreed to by the related parties.
Included
in accounts payable and accrued expenses and advance payable (related parties) as at September 30, 2012 and December 31, 2011 were
$322,419 and $nil respectively payable to officers and directors of the Company for consulting fees and various expenses incurred
on our behalf.
CURRENT OUTLOOK
General Economic Conditions
Current problems in credit markets and deteriorating
global economic conditions have lead to a slowdown of growth. The slowdown of growth is a major concern, as one of the biggest
risks to a full recovery for the metals industry would be a weak and/or slow demand resurgence in critical end markets. Prices
for raw materials continue to climb and/or remain near record highs. It is difficult in these conditions to forecast metal prices
and demand trends for products that we would produce if we had current mining operations. Credit market conditions have also increased
the cost of obtaining capital and limited the availability of funds. Accordingly, management is reviewing the effects of the current
conditions on our business.
28
It is anticipated
that for the foreseeable future, we will rely on the equity markets to meet our
financing
need.
We will also consider entering into joint venture arrangements to advance our projects.
Capital and Exploration Expenditures
We are reviewing our capital and exploration
spending in light of current market conditions. As a result of our review, we may curtail a portion of our capital and exploration
expenditures during 2011.
We are currently concentrating our exploration
activities in Brazil and Canada and examining data relating to the potential acquisition or joint venturing of additional mineral
properties in either the exploration or development stage.
Exploration Past, Present and Plans for Next Twelve Months
The following Plan
of Operation contains forward-looking statements that involve risks and uncertainties, as described below. The actual results could
differ materially from those anticipated in these forward-looking statements. During the next 12 months the Company intends to
raise additional funds through equity offerings and/or debt borrowing to meet the general and administrative operating expenses
and to conduct work on exploration properties. There is, of course, no assurance that we will be able to do so and the Company
does not have any agreements or arrangements with respect to any such financing. The exploration properties have not commenced
commercial production and we have no history of earnings or cash flow from operations. While we may attempt to generate additional
working capital through the operation, development, sale or possible joint venture development of properties, there is no assurance
that any such activity will generate funds that will be available for operations.
We intend to concentrate
exploration activities on the Brazilian Tapajos properties and examine data relating to the potential acquisition or joint venturing
of additional mineral properties in either the exploration or development stage in other South American countries. Additional contractors
and consultants may be hired on as and when the requirement occurs.
The exploration work
program for the remainder of 2012 will focus on the Brazilian properties. In Brazil we intend to follow up results from previous
work on the Sao Domingo property, including the previous drilling and mapping over the Fofoca Prospect ("
Fofoca
")
area. Follow up evaluation of the geophysical anomaly west of Fofoca is required to test any strike continuity of potential economic
mineralisation. This work will entail surface mapping, sampling of soils on a grid basis to delineate geochemical anomalies, stream
sediment sampling, geophysical surveying and drilling.
We
have set up a field operations centre at the Săo Domingos property and intend to continue to focus exploration activities
on anomalies associated with the Săo Domingos property. We selected the Săo Domingos property based on its proximity
to the other properties, and the logistics currently in place. Access to the Săo Domingos property is by light aircraft to
a well-maintained strip, by road along the government maintained Trans Garimpeiro highway, and by boat along the multitude of waterways
in the Amazon Basin
. Work conducted both on a regional and prospect scale since 2006 has included mapping, rock chip sampling,
a large scale soil geochemical sampling grid, ground-based geophysical testing, partial trenching over the vein systems and sub-surface
drill testing of several prospect areas at Fofoca, Esmeril, Santa Isabel and Atacadão.
29
The Fofoca is the primary
area of interest that has been identified to date. Hydrothermal alternation observed at Fofoca and surrounding prospects is considered
characteristic of epithermal style mineralization systems in the region. Fofoca has been interpreted as a multiple lode gold system,
with lodes that are shear hosted in granite country rocks and strike approximately east-west dipping moderately to the south. Gold
mineralization is associated with quartz veining which hosts various sulphides, including pyrite, arsenopyrite, galena and chalcopyrite.
Fofoca has over 580 meters of potential strike with typical breccia vein widths of over one meter dipping at around 80 degrees
south. Thicknesses of approximately 20 meters of quartz stockwork have been seen in drill core in the central parts of deposit
caused by post-mineralization brittle faulting.
Exploration work completed
at Fofoca in 2006 included logging of six trenches over anomalous quartz veins, followed by a 17 hole, HQ/NQ drill program (2,606
meters) to test the trenches at depth. Drilled to a maximum depth of 185 meters, with an average depth of 153 meters, the drilling
returned several high grade, thin intercepts of auriferous quartz veins.
A second HQ/NQ drilling
campaign (FOF-18 and 19) started in mid-2007 in which we drilled two holes into Fofoca. This program targeted down dip extensions,
with drill hole 18 descending to 250 meters, but only encountered small stockwork vein systems. Generally the drill holes encountered
thin hydrothermally brecciated, vuggy, sulphidic quartz veins with alterations ranging from argillic through to potassic (possible
overprinting), which is typical for this style of mineralisation. No metallurgical test work was undertaken.
Based on mapping, sampling,
trenching and ground-based IP surveys, the Fofoca structure appears to continue to the west, being displaced by late stage faulting
to the north. This structural trend is believed to link Fofoca with the Cachoeirinha (Fofoca West) area, providing the potential
to add significantly to currently outlined resources. No drilling has been conducted on Fofoca West. We will continue to evaluate
the potential of the São Domingós Project and will work to determine whether the Fofoca could evolve along strike
and link up with other noted targets further along strike. Further drilling, trenching and geophysics is planned to further assess
the São Domingós Project.
Currently the system
still remains open along strike in both directions and at depth. We will continue to evaluate the potential, and are confident
that Fofoca could evolve further and link up with other noted targets further along strike.
A recent discovery
was made on the Atacadau area and has been called Colibri. Here artisanal miners uncovered an area of stock work mineralization
that was subsequently sampled and returned some high-grade assays. Further sampling of material that was exposed by artisanal activity
around the Colibri occurrence was conducted. Whilst monitoring the artisanal activity mapping and measurements of the structures
and orientations of theoretical mineralization channels were conducted. The results showed that there are possible correlations
to the Atacadau mineralization noted from previous mapping and drilling. We intend to cut trenches across the strike of the mineralizing
structures to better understand the size both laterally and along strike. We will then test the strike extent with geophysics in
a similar manner as that conducted on the Fofoca area.
During 2012, we will
continue to follow up exploration results on the Fofoca area and plan to initiate further exploration programs on other areas of
the Sao Domingos property. It is anticipated that we will drill a series of holes within the Fofoca area for engineering and metallurgical
test work as well as to test for depth extensions of the known gold occurrences. Other exploration on the Săo Domingos property
areas will involve further mapping of the outcrop geology and sampling soils and scree from shafts of previous workers in order
to confirm lithologies and structural trends noted from drilling and published government maps. Currently, five anomalous areas
on the Sao Domingos property have been identified from soil and rock chip sampling, at Atacadão, Esmeril, Colibri, Fofoca
and Cachoeira, and we plan to conduct further investigation. Several other areas have been identified from remote sensing satellite
imagery which will also be followed up.
30
By viewing spectral
wave band ratio's designed to indicate iron oxides and clay minerals, we were able to decipher areas of past artisanal activity
which could lead to the discovery of further hard rock targets, as demonstrated by the discovery of further extensions to potential
mineralisation at Colibri and the newly discovered, Toucano, gold occurrence.
The Toucano occurrence
was a recent discovery, made during the 4th Quarter of 2011 located in the same vicinity as the Colibri gold occurrence and close
to the Fofoca resource area and the Attacadau occurrence. Toucano was found as a result of reviewing remote sensing imagery acquired
during the last quarter of 2011 and the occurrence of recent artisanal activity. Aurora conducted detailed mapping over the Toucano
occurrence and completed channel sampling across the exposed strike of potentially mineralised lithologies. As a result of the
significant channel sample results and the other high grade rock chip results taken from exposures within the Toucano system, we
intend to focus exploration delineating the potential area of mineralised material.
We have completed a
revised exploration plan and budget to test the lateral and depth extent of the Toucano occurrence with bulk sampling, trenching
and drilling during the 2012 exploration season. Exploration will also focus on testing for any sub parallel mineralisation that
may be associated with a broader mineralizing envelope that may include the Colibri gold occurrence. Previous sampling of areas
within Colibri assayed up to 5.94 g/t Gold in quartz veinlets associated to stock work mineralization.
Exploration will also
focus on the extension of the Fofoca area of mineralised material to test the strike extent as follow up to significant gold assays
from trenches along strike.
We recently concluded
a first pass project wide evaluation of tailings and alluvial potential. Results showed that follow up test work is recommended
and Aurora intends to apply for a trial mining license to carry out bulk sampling of potentially economic material. Concurrently
a technical team has been assembled to continue the evaluation of both the alluvial potential and the geometry of the hard rock
mineralisation in preparation for subsurface test work.
Description
of Our Business and Properties
We conduct our
activities from our principal and technical office located at
Coresco AG, Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland
The telephone number is (+41) 7887-96966. These offices are provided to us on a month to month basis. We believe that these offices
are adequate for our purposes. We do not own any real property or significant assets. Management believes that this space will
meet our needs for the next 12 months.
Mining Properties
We currently have an interest in a strategic
land package of nine (9) properties none of which contain any reserves. The exploration license areas are divided into 2 groups,
the Săo Domingos and the Sao Joao areas.
31
We have calculated
a body of mineralized material to Guide 7 standards calculated in accordance with the Australasian Joint Ore Reserves Committee
(the "
JORC
") code for reporting of Mineral Resources and Ore Reserves (the "
JORC Code
").
The JORC resource is currently estimated at 130,000 ounces at 2.0 g/t calculated on a 0.5 g/t cut off. This mineralized material
is located on the Săo Domingos property discussed below. The rest of the Brazil properties are in the preliminary exploration
stage and do not contain any known bodies of ore. We are also examining data relating to the potential acquisition of other exploration
properties in Latin America, South America.
Mineral exploration
and development involves a high degree of risk and few properties that are explored are ultimately developed into producing mines.
There is no assurance that planned production will result in a commercial success, as production is gold price and politically
sensitive. Once production has commenced the Company is able to gauge the onward commercial viability of the project. There is
no assurance that planned mineral exploration and development activities will result in any further discoveries of commercially
viable bodies of mineralization. The long-term profitability of operations will be, in part, directly related to the cost and success
of exploration programs, which may be affected by a number of factors.
We currently have an
interest in nine (9) properties located in Tapajos gold province in Para State, Brazil, Colibri and Sao Domingo, and due to their
proximity to each other, the 2 properties are jointly called the Sao Domingo project. We have conducted exploration activities
on the properties and have ranked the properties in order of merit and may discontinue such activities and dispose of some of the
rights to mineral exploration on the properties if further exploration work is not warranted.
The geology of the
Săo Domingos property is predominantly composed of paleo-proterozoic Parauari Granites that play host to a number of gold
deposits in the Tapajos Basin. Typical Granites of the younger Maloquinha Intrusive Suite have been noticed in the vicinity of
Molly Gold Target, and basic rocks considered to be part of the mesoproterozoic Cachoeira Seca Intrusive Suite occur around the
Esmeril target area. The Săo Domingos property was a previous large alluvial operation, and the property area covers numerous
areas of workings. The Săo Domingos property lies in the Tapajos Province of Para State, Brazil It is situated approximately
250 km SE of Itaituba, the regional centre. Small aircraft service Itaituba daily and on occasions flights can be sourced via Manaus.
Access from Itaituba to site is by small aircraft or unsealed road of average to poor quality. The road is subject to seasonal
closures and 'wet' season site access is granted via light aircraft utilizing the local airstrip.
Our strategy is to concentrate our efforts
on: (i) existing operations where an infrastructure already exists; (ii) properties presently being developed and/or in advanced
stages of exploration which have potential for additional discoveries; and (iii) grass-roots exploration opportunities. We are
currently concentrating our property exploration activities in Brazil. We are also examining data relating to the potential acquisition
of other exploration properties in Latin America, South America.
Mineral exploration and development involves
a high degree of risk and few properties that are explored are ultimately developed into producing mines. There is no assurance
that our planned production will result in a commercial success, as production is gold price and politically sensitive. Once production
has commenced we will be able to gauge the onward commercial viability of the project. There is no assurance that our planned mineral
exploration and development activities will result in any further discoveries of commercially viable bodies of mineralization.
The long-term profitability of our operations will be, in part, directly related to the cost and success of our exploration programs,
which may be affected by a number of factors.
Please refer to "Risk Factors."
32
Figure 1.	Brazil, South America-property
locality guide
Properties
Brazil
Săo Domingos
Location and access
The Săo Domingos property lies in the
Tapajos Province of Para State, Brazil It is situated approximately 250 km SE of Itaituba, the regional centre, and includes an
area of over 33,033.44 hectares ("
ha
"). Small aircraft service Itaituba daily and on this occasion flights were
sourced via Manaus. Access from Itaituba to site is by small aircraft or unsealed road of average to poor quality. The road is
subject to seasonal closures and as the visit was at the end of the 'wet' season site access was granted via light
aircraft utilizing the local airstrip.
Tenure
a)
DNPM Process 850.684/06:
We have good title over the mineral rights
object of the Brazilian Department of Mines
We have good title over the mineral rights, which were granted
as
Departamento Nacional de Produçăo Mineral ("
DNPM
")
Process
number 850.684/06 and which is valid and in force, free and clear of any judicial and extrajudicial encumbrances and taxes. The
São Domingos mineral rights are located at the Municipality of Itaituba, State of Pará, and are registered in our
name. On September 13, 2006, we applied to the DNPM for the conversion of the Application to an Exploration Permit covering an
area of 4,914.18 hectares. No payments or royalties are due regarding DNPM Process 850.384/06.
33
b)
DNPM
Process
850.782/05:
We have
good
title over the mineral rights object of the DNPM Process No. 850.782/05, which is valid and in force, free and clear of any judicial
and extrajudicial encumbrances and taxes. On November 8, 2005, it was submitted to DNPM the Exploration Claim for gold in the Municipality
of Itaituba, State of Pará. The Exploration Permit was granted on November 28, 2006, for a three-year period. The transfer
to Aurora was approved on March 24, 2009 and on September 28, 2009, it was requested the renewal of the Exploration Permit. This
area was reduced from 6,756 hectares to 5,651.98 hectares due to the overlapping with Garimpeira (alluvial) Mining properties held
by Mr Celio Paranhos. However the DNPM´s general attorney in Brasilia agreed with our legal thesis and nullified all applications
filed by Mr Paranhos (about to 1,900 applications). A new Exploration Permit rectifying the previous one was granted on August
20, 2010, for a three-year period, for an area of 6,656.20 hectares. No payments or royalties are due regarding the DNPM Process
850.782/05 since it was acquired through a permutation agreement with Altoro Mineração Ltda.
c)
DNPM Process 850.012/06 and 850.013/06:
The exploration claims were submitted to
DNPM on January 19, 2006, for gold covering an area of 1,128.08 hectares and 750.55 hectares respectively, in the Municipality
of Itaituba, State of Pará. According to information obtained such claims were correctly prepared and the required documents
are in place. The tenements 850.012/06 and 850.013/06 are held by Mr Antonio Oliveira Ferreira and were submitted to DNPM on January
19, 2006. The tenements are located at Itaituba, State of Pará and are valid and in force, free and clear of any judicial
and extrajudicial encumbrances and taxes, but the area was blocked since it is inside of a Garimpeira Reserve. The transfer to
us will be submitted after the Exploration Permits are granted. There are no payments or royalties related to the tenements according
to the agreement entered into with the previous owner.
d)
DNPM Process 850.119/06:
The exploration claim was submitted to DNPM
on March 7, 2006, for gold covering an area of 1,068.72 hectares, in the Municipality of Itaituba, State of Pará. Aurora
has good title over the mineral rights object of the DNPM Process No. 850.119/06, which is valid and in force, free and clear of
any judicial and extrajudicial encumbrances and taxes. We are the sole registered and beneficial holder of and own and possess
good title to the referred mineral rights. The Exploration Permit has not been granted yet. The above-mentioned area is not related
to any payments or royalties to third parties since we claimed them directly.
e)
DNPM Process 859.587/95:
The tenement, was held by Vera Lucia Lopes,
and is valid and in force, and is free and clear of any judicial and extrajudicial encumbrances and taxes. It is located at the
Municipality of Itaituba, State of Pará. On November 27, 1995, it was submitted to DNPM the Exploration Claim for gold.
The Exploration Permit was granted on September 15, 2006, for a three-year period covering an area of 5,000 hectares, and it was
valid until September 15, 2009. On July 15, 2009, it was requested the renewal of the Exploration Permit which was granted and
transferred to us and published on June 29, 2012. There are no payments or royalties related to the tenements since all payments
due under the terms of the agreement entered into with the previous owner have been already made.
34
f)
DNPM Processes 850.014/06,
850.581/06 and 850.256/07:
We have the right to acquire good title
over the mineral rights object of the Tenements. The Tenements are registered in the name of Antonio Oliveira Ferreira. The exploration
claims were submitted to DNPM respectively on January 19, 2006, August 8, 2006 and April 17, 2007 for gold covering the areas of
421.45 hectares, 4276.03 hectares and 4036.00 hectares, in the Municipality of Itaituba and Jacareacanga, State of Pará.
According to information obtained such claims were correctly prepared and the required documents are in place. The tenement 850.014/06
has not been transferred to Samba yet since the Exploration Permit has not been granted so far. The Exploration Permit for the
Process 850.581/06 was granted on February 15, 2011 for a three-year period, for an area of 4273.03 hectares. The transfer to Samba
Brazil Mineração Ltda has not been presented yet. The Exploration Permit for the Process 850.256/07 was granted on
November 30, 2007 for a three-year period but it was cancelled on May 21, 2008 because the holder didn't pay the annual fees
on time. On June 10, 2008 it was presented an appeal to have the annulment dismissed, which hasn't been analyzed yet. However,
if the appeal is not approved, Samba Brazil's rights over this tenement are guaranteed since only Samba Brazil has presented
a Bid application for this process on July 18 2008. According to the Agreement signed between Samba Brazil and Antonio Oliveira
Ferreira on June 5, 2008, a total amount of 120,000 Brazilian Real's has already been paid by Samba Brazil for the acquisition
of the Tenements.
Săo Joăo – Samba Minerals
farm in agreement
In May 2008 we signed an agreement with
Samba Minerals Limited ("
Samba
"), which was subsequently amended in August 2008, whereby Samba can earn up to
an 80% participating interest in the Săo Joăo project by funding exploration expenditures to completion of a feasibility
study on the property. Upon completion of a feasibility study, we will immediately transfer an 80% participation interest in the
property to Samba and enter into a formal joint venture agreement to govern the development and production of minerals from the
property. Samba can terminate its participation by providing us 30 days' notice in writing. Upon withdrawal from its participation,
Samba would forfeit to us all of its rights in relation to the project and would be free of any and all payment commitments yet
to be due. Samba will be the manager of the Săo Joăo project. On October 17, 2011, we terminated the license and Option
Agreement by providing written notice to Samba.
Comandante Araras Project - DNPM Processes
853.785/93 to 853.839/93 inclusive (relinquished):
On October 17, 2011,
we terminated the license and Option Agreement by providing written notice to Samba. We are free of all and any future payment
commitments. The interest in the properties was formally relinquished in January 2012.
São João
Project - DNPM Processes 851.533/94 to 851.592/94 inclusive (relinquished):
On
October 17, 2011 we terminated the license and Option Agreement by providing written notice to Samba. We are free of all
and
any future payment commitments. The interest in the properties was formally relinquished in January 2012.
35
Geology
The geology of the Săo Domingos property
is predominantly composed of paleo-proterozoic Parauari Granites that play host to a number of gold deposits in the Tapajos Basin.
Typical Granites of the younger Maloquinha Intrusive Suite have been noticed in the vicinity of Molly Gold Target, and basic rocks
considered to be part of the mesoproterozoic Cachoeira Seca Intrusive Suite occur around the Esmeril target area.
The Săo Domingos property was a previous
large alluvial operation, and the property area covers numerous areas of workings.
Location and access
The Săo Joăo property is located
in the central portion of the Southern Tapajos basin and is accessed by light aircraft from the regional centre of Itaituba. Access
is also possible by unsealed roads linking up to the Transgarimpeiro highway and by a purpose cut heavy vehicle access track linking
Sao Joao to the exploration centre at the primary project at Sao Domingo.
Geology
The prime targets
for the Săo Joăo property are located around and on the intersection of regional NW and NNW faults within the Pararui
Intrusive Suite and this area has been the focus of large-scale alluvial workings. The
Pararui
Intrusive Suite has proven to host the vast majority of gold deposits elsewhere within the Tapajos Gold Province. We conducted
a rock chip program over an area currently being excavated for gold in quartz systems via shallow underground workings. The sample
results have demonstrated that the quartz vein systems are highly mineralized and considered continuous for at least 200m. We are
confident that the quartz vein systems are much more extensive and are currently planning to increase the sample density of rock
and soil sampling over, and adjacent to, the current workings to locate further mineralized vein systems, and to drill test their
depth extensions in the near future.
Previous mining activity over a number of
years focused on the alluvial deposits within its many tributaries, and has now progressed to include the saprolite host rock and
out cropping quartz veins.
36
British Columbia, Canada – Kumealon
Property (relinquished):
On January 20, 2012, we relinquished our
claim over the Kumealon property located in British Columbia, Canada.
Directors,
Executive Officers and Control Persons
The following table and text set forth the
names and ages of all our directors and executive officers as of December 15, 2012. All of the directors will serve until the next
annual meeting of stockholders and until their successors are elected and qualified, or until their earlier death, retirement,
resignation or removal. There are no family relationships between or among the directors, executive officers or persons nominated
or charged by our company to become directors or executive officers. Executive officers serve at the discretion of the Board, and
are appointed to serve by the Board. Also provided herein are brief descriptions of the business experience of each director and
executive officer during the past five years and an indication of directorships held by each director in other companies subject
to the reporting requirements under the Federal securities laws.
Our Board currently consists of five members.
Directors serve for a term of one year and stand for election at our annual meeting of stockholders. Pursuant to our Bylaws, any
vacancy occurring in the Board, including a vacancy created by an increase in the number of directors, may be filled by the stockholders
or by the affirmative vote of a majority of the remaining directors though less than a quorum of the Board. A director elected
to fill a vacancy shall hold office only until the next election of directors by the stockholders. If there are no remaining directors,
the vacancy shall be filled by the stockholders.
Name and Address
Age
Current Position
Director or Officer Since
Lars M. Pearl
C/- Coresco AG
Level 3
Gotthardstrasse 20
6304 Zug, Switzerland
49
President, Chief Executive Officer and Director
April 27, 2007
Ross Doyle
C/- Coresco AG
Level 3
Gotthardstrasse 20
6304 Zug, Switzerland
39
Chief Financial Officer and Director
October 11, 2011
Agustin Gomez de Segura
(1)
C/- Coresco AG
Level 3
Gotthardstrasse 20
6304 Zug, Switzerland
56
Director
November 15, 2010
Vladimir Bernshtein
(2)
C/- Coresco AG
Level 3
Gotthardstrasse 20
6304 Zug, Switzerland
35
Chief Business Development Director and Director
October 5, 2012
Andrey Ratsko
(2)
C/- Coresco AG
Level 3
Gotthardstrasse 20
6304 Zug, Switzerland
57
Director
October 5, 2012
37
(1)
On October 11, 2011, Mr. Gomez de Segura was
appointed as Chairman of the Board.
(2)
Pursuant to the terms of the subscription agreement
entered into between us and Alltech, Alltech has the right to appoint two directors to our board. Each of Messrs. Bernshtein and
Ratsko were appointed on October 5, 2012, and were chosen by Alltech as their director designees.
Effective as of June 17, 2011, Mr. Michael
Montgomery resigned from his position as Chief Operating Officer and a director of ours.
The following is a description of the employment
history for each of our directors and officers for the last five years:
Lars Pearl
, 49, President, Director
and Chief Executive Officer of Cigma Metals Corporation (2004 to 2008); Mr. Pearl has been self employed as a geological consultant
from 1993 to 2004. Mr. Pearl has spent over 10 years as a geological consultant to projects in Australia, Tanzania, Russia, Kazakhstan,
Peru, Colombia and Ecuador. During the last 5 years Mr. Pearl was acting as a consultant geologist to various companies, including
Aurora Gold Corporation, Cigma Metals Corporation, Carnavale Resources Ltd and De Beira Goldfeilds in Australia, Brazil, Peru,
Ecuador and Tanzania before joining the board of Aurora Gold Corporation in April 2007. Mr. Pearl devotes approximately 80% of
his time dealing with the affairs of Aurora Gold. Mr. Pearl received a Bachelor of Applied Geology degree from the University of
Technology, Sydney Australia in 1993. Mr. Pearl's extensive experience, training and education as a geologist and his experience
with other resources exploration companies make him particularly qualified to serve as our director.
Ross
Doyle
, 39,
Ross Doyle has been employed as a strategic business analyst and CFO for the past 15 years. During this period
his time was spent working with large commodity trading firms and financial institutions. During the last 5 years Mr Doyle worked
as a CFO at the head office of Glencore International AG in their Coal division. Subsequent to departing Glencore, Mr Doyle has
advised other commodity firms in a similar capacity, before joining the board of Aurora Gold Corporation in October 2011. Mr. Doyle
received a Bachelor of Commerce from the University of Queensland, Brisbane Australia and is a Chartered Accountant. Mr. Doyle's
extensive experience, training and education with other resources companies makes him particularly qualified to act as our CFO
and as a director.
Agustin Gomez
de Segura
, 56,
was awarded a Diploma in Engineering in Physical Chemistry from the Moscow
Technological University "MISA" (former Moscow Institute for Steel and Alloys). Mr. Gomez de Segura also completed
4 years of a Doctorate in Metal's Physics at Moscow Technological University. Mr. Gomez de Segura has had several senior roles
in publicly listed companies. Mr. Gomez de Segura's positions both past and present include: Director for Labtam Information &
Scientific Instruments (Australia) from 1983 till 1990. He was the Chairman of Advisory Board of Alina Bank (Russia) from 1994
till 1997.
Mr. de Segura's extensive scientific experience, training and education and
his overall business experience make him particularly qualified to serve as our director.
Vladimir Bernshtein
,
35,
has been active in the mining industry with Alltech Investments Limited (AIL) since 2004 and as the Investment Director
since 2008. During this time Mr. Bernshtein has been involved in various AIL projects including Oil & Gas exploration in Western
Siberia, Sakhalin Island and Kamchatka and Gold exploration in Kyrgyzstan. Mr. Bernshtein's extensive experience in the mining
industry make him
particularly qualified to serve as our director.
38
Andrei Ratsko
, 57, is a geologist
with vast experience within the exploration and mining sector having worked in Africa and the Commonwealth of Independent States.
Mr. Ratsko received his M.Sc. in Geography and Geomorphology from Lomonosov State University in Moscow. Since 2008 Mr Ratsko has
been employed by Alltech Group as the Director General of CJSC TK Geo Resource, which holds licenses for precious and base metals
in the Chuy region of the Kyrgyz Republic. Before joining Alltech Group Mr. Ratsko was an Executive Director at Swencore Consulting
Inc., where he worked on various exploration projects in Tanzania. Mr. Ratsko's extensive experience as a geologist in the
mining industry makes him
particularly qualified to serve as our director.
There are no family relationships between
any of the directors or executive officers.
Consideration of Director Nominees
Director Qualifications
We believe that our Board, to the extent
that our limited resources permit, should encompass a diverse range of talent, skill and expertise sufficient to provide sound
and prudent guidance with respect to our operations and interests. Each director also is expected to: exhibit high standards of
integrity, commitment and independence of thought and judgment; use his or her skills and experiences to provide independent oversight
to our business; participate in a constructive and collegial manner; be willing to devote sufficient time to carrying out their
duties and responsibilities effectively; devote the time and effort necessary to learn our business; and, represent the long-term
interests of all shareholders.
The Board has determined that the Board
as a whole must have the right diversity, mix of characteristics and skills for the optimal functioning of the Board in its oversight
of our affairs. The Board believes it should be comprised of persons with skills in areas such as: finance; real estate; banking;
strategic planning; human resources and diversity; leadership of business organizations; and legal matters. The Board may also
consider in its assessment of the Board's diversity, in its broadest sense, reflecting, but not limited to, age, geography,
gender and ethnicity.
In addition to the targeted skill areas,
the Board looks for a strong record of achievement in key knowledge areas that it believes are critical for directors to add value
to the Board, including:
·
Strategy
—knowledge of our business model, the formulation of corporate strategies, knowledge of key competitors
and markets;
·
Leadership
—skills in coaching and working with senior executives and the ability to assist the Chief Executive
Officer;
·
Organizational Issues
—understanding of strategy implementation, change management processes, group effectiveness
and organizational design;
·
Relationships
—understanding how to interact with investors, accountants, attorneys, management companies, analysts,
and communities in which we operate;
·
Functional
—understanding of finance matters, financial statements and auditing procedures, technical expertise,
legal issues, information technology and marketing; and
·
Ethics
—the ability to identify and raise key ethical issues concerning our activities and those of senior management
as they affect the business community and society.
39
Nomination Procedures
We have no nominating committee, and all
nominating functions are handled directly by the full Board, which the Board believes is the most effective and efficient approach,
based on the size of the Board and our current and anticipated operations and needs. As outlined above in selecting a qualified
nominee, the Board considers such factors as it deems appropriate which may include: the current composition of the Board; the
range of talents of the nominee that would best complement those already represented on the Board; the extent to which the nominee
would diversify the Board; the nominee's standards of integrity, commitment and independence of thought and judgment; and
the need for specialized expertise.
The Board and Board Meetings
Our Board consists of five members. Directors
serve for a term of one year and stand for election at our annual meeting of stockholders. Pursuant to our Bylaws, any vacancy
occurring in the Board, including a vacancy created by an increase in the number of directors, may be filled by the stockholders
or by the affirmative vote of a majority of the remaining directors though less than a quorum of the Board. A director elected
to fill a vacancy shall hold office only until the next election of directors by the stockholders. If there are no remaining directors,
the vacancy shall be filled by the stockholders.
At a meeting of stockholders,
any director or the entire Board may be removed, with or without cause, provided the notice of the meeting states that one of the
purposes of the meeting is the removal of the director. A director may be removed only if the number of votes cast to remove him
exceeds the number of votes cast against removal.
Our Board and management are committed to
responsible corporate governance to ensure that we are managed for the long-term benefit of its shareholders. To that end, the
Board and management periodically review and update, as appropriate, our corporate governance policies and practices. In doing
so, the Board and management review published guidelines and recommendations of institutional shareholder organizations and current
best practices of similarly situated public companies. The Board and management also regularly evaluate and, when appropriate,
will revise our corporate governance policies and practices in accordance with the requirements of the Sarbanes-Oxley Act of 2002
and the rules and listing standards issued by the SEC.
During the year ended December 31, 2011,
the Board held a total of four (4) meetings. All members of the Board attended all meetings of the Board.
Committees
We have no committees of the Board.
Legal Proceedings
During the past five years none of our directors,
executive officers, promoters or control persons has been:
·
the subject of 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;
·
convicted in a criminal proceeding or is subject to a pending criminal proceeding (excluding traffic violations and other minor
offenses);
·
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;
40
·
found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission
to have violated a federal or state securities or commodities law;
·
the subject of any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed,
suspended or vacated, relating to an alleged violation of:
o
Any Federal or State securities or commodities law or regulation; or
o
Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or
permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order,
or removal or prohibition order; or
o
Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity.
o
any federal or state judicial or administrative proceedings based on violations of federal or state securities, commodities,
banking or insurance laws and regulations, or any settlement to such actions (excluding settlements between private parties); and
o
any disciplinary sanctions or orders imposed by a stock, commodities or derivatives exchange or other self-regulatory organization.
CODE OF ETHICS
We have adopted a Code of Ethics that applies
to all of our officers, directors and employees, including its Chief Financial Officer and Chief Executive Officer, which complies
with the requirements of the Sarbanes-Oxley Act of 2002 and applicable FINRA listing standards. Accordingly, the Code of Ethics
is designed to deter wrongdoing, and to promote, among other things, honest and ethical conduct, full, timely, accurate and clear
public disclosures, compliance with all applicable laws, rules and regulations, the prompt internal reporting of violations of
the Code of Ethics, and accountability.
CORPORATE GOVERNANCE
We have adopted Corporate Governance Guidelines
applicable to our Board, which can be viewed on our website at http://aurora-gold.com/corporate-governance/.
Board Leadership Structure
We currently have five directors, three
of whom are also executive officers. Our Board has reviewed our current Board leadership structure — which consists of a
Chief Executive Officer a Chief Financial Officer and a Chairman of the Board— in light of the composition of the Board,
our size, the nature of our business, the regulatory framework under which we operates our stockholder base, our peer group and
other relevant factors, and has determined that this structure is currently the most appropriate Board leadership structure for
our company. Nevertheless, the Board intends to carefully evaluate from time to time whether our Chief Executive Officer and Chairman
positions should be combined based on what the Board believes is best for us and our stockholders.
Board Role in Risk Oversight
Risk is inherent in every business, and
how well a business manages risk can ultimately determine its success. We face a number of risks, including strategic risks, enterprise
risks, financial risks, and regulatory risks. While our management is responsible for day to day management of various risks we
face, the Board, as a whole, is responsible for evaluating our exposure to risk and to satisfy itself that the risk management
processes designed and implemented by management are adequate and functioning as designed. The Board reviews and discusses policies
with respect to risk assessment and risk management. The Board also has oversight responsibility with respect to the integrity
of our financial reporting process and systems of internal control regarding finance and accounting, as well as its financial statements.
41
Director Independence
Our securities are not listed on a U.S.
securities exchange and, therefore, we are not subject to the corporate governance requirements of any such exchange, including
those related to the independence of directors. However, at this time, after considering all of the relevant facts and circumstances,
our Board has determined that only Mr. Gomez de Segura is independent from our management and qualifies as "independent director"
under the standards of independence under the applicable FINRA listing standards. Upon our listing on any national securities exchange
or any inter-dealer quotation system, it will elect such independent directors as is necessary under the rules of any such securities
exchange.
Certain Relationships
There are no family relationships among
or between any of our officers and directors. Our proposed business raises potential conflicts of interests between certain of
our officers and directors and us. Certain of our directors are directors of other mineral resource companies and, to the extent
that such other companies may participate in ventures in which we may participate, our directors may have a conflict of interest
in negotiating and concluding terms regarding the extent of such participation. In the event that such a conflict of interest arises
at a meeting of our directors, a director who has such a conflict will abstain from voting for or against the approval of such
participation or such terms. In appropriate cases, we will establish a special committee of independent directors to review a matter
in which several directors, or management, may have a conflict. From time to time, several companies may participate in the acquisition,
exploration and development of natural resource properties thereby allowing for their participation in larger programs, involvement
in a greater number of programs and reduction of the financial exposure with respect to any one program. It may also occur that
a particular company will assign all or a portion of its interest in a particular program to another of these companies due to
the financial position of the company making the assignment.
In determining whether we will participate
in a particular program and the interest therein to be acquired by it, the directors will primarily consider the potential benefits
to us, the degree of risk to which we may be exposed and its financial position at that time. Other than as indicated, we have
no other procedures or mechanisms to deal with conflicts of interest. We are not aware of the existence of any conflict of interest
as described herein.
Compensation of Directors
Our Board determines the non-employee directors'
compensation for serving on the Board and its committees. In establishing director compensation, the Board is guided by the following
goals:
·
compensation should consist of a combination of cash and equity awards that are designed to fairly pay the directors for work
required for a company of our size and scope;
·
compensation should align the directors' interests with the long-term interests of stockholders; and
·
compensation should assist with attracting and retaining qualified directors.
Standard Arrangements
We do not pay a fee to our outside, non-officer
directors. We reimburse our directors for reasonable expenses incurred by them in attending meetings of the Board. During the years
ended December 31, 2010 and in 2011 through December 15, 2012, we paid non-officer directors, $0, $0 and $0, respectively, in consulting
fees.
42
Executive
Compensation
The responsibility
for establishing, administering and interpreting our policies governing the compensation and benefits for our executive officers
lies with our Board. In this connection the Board has not retained the services of any compensation consultants.
The goals of our executive compensation
program are to attract, motivate and retain individuals with the skills and qualities necessary to support and develop our business
within the framework of our small size and available resources. In 2012, we designed our executive compensation program to achieve
the following objectives:
·
attract and retain executives experienced in the resource exploration industry;
·
motivate and reward executives whose experience and skills are necessary to our ultimate success;
·
reward performance as warranted; and
·
align the interests of our executive officers and stockholders by motivating executive officers to increase stockholder value.
Summary Compensation Table
The following table summarizes the compensation
earned by the Named Executive Officers during the fiscal years ended December 31, 2011, and 2010:
Name
    and
principal
position
(a)
Year
December 31,
(b)
Salary
($)
(c)
Bonus
($)
(d)
Stock
awards
($)
(e)
Option
awards
($)
(f)
Non-equity
incentive
plan
compensation
($)
(g)
Non-qualified
deferred
compensation
earnings
($)
(h)
All
    other
compensation
($)
(i)
Total
($)
(j)
Lars M. Pearl
2011
135,529
-0-
-0-
103,480
-0-
-0-
-0-
239,009
President, CEO and Director
(2)
2010
181,850
-0-
-0-
-0-
-0-
-0-
-0-
181,850
Ross Doyle
2011
31,980
99,631
-0-
-0-
-0-
131,611
CFO and Director
(2)
2010
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
Michael Montgomery
2011
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
Former COO and Director
(2)
2010
157,741
-0-
-0-
-0-
-0-
-0-
-0-
157,741
43
(1)
Effective as October 1,
2012, each of Messrs. Pearl and Doyle agreed to reduce their salary to $6,000 per month.
(2)
Effective as of June 17, 2011, Mr. Michael Montgomery resigned as our COO and a director.
On October 11, 2011, we entered into a services
agreement with Global Strategic Synergies Gmbh ("
Global Strategic
") pursuant to which Mr. Ross Doyle serves
as our Chief Financial Officer. Pursuant to the terms of the services agreement, Global Strategic is paid a monthly consulting
fee of 10,000 Swiss Francs. The services agreement may be terminated by either party upon advanced written notice to the other
party of 20 business days. Mr. Doyle is an equal shareholder in Global Strategic with his wife.
None of our officers
or directors is a party to an employment agreement with us. Our entire Board sets the current year compensation levels of each
of the above named Executive Officers.
Effective January 1, 2010, Mr. Pearls' annual salary was $191,945 payable in
monthly installments of approximately $15,995. During the fourth quarter of 2010, Mr. Pearl's annual salary was revised to
$152,868 payable in monthly installments of approximately $12,739. Effective March 1, 2010, Mr. Montgomery's annual salary
was $184,248 payable in monthly installments of approximately $15,774.
Options/SAR Grants Table
In 2007, our Board approved the Plan which
was subsequently approved by our shareholders in July 2007, to offer an incentive to obtain services of key employees, directors
and consultants of ours. The Plan provides for the reservation for awards of an aggregate of 10% of the total shares of Common
Stock outstanding from time to time. No Plan participant may receive stock options exercisable for more than 1,000,000 shares of
common stock in any one calendar year. Under the Plan, the exercise price of an incentive stock option must be at least equal to
100% of the fair market value of the common stock on the date of grant (110% of fair market value in the case of options granted
to employees who hold more than 10% of our capital stock on the date of grant). The term of stock options granted under the Plan
is not to exceed ten years and the stock options vest immediately upon granting.
On January 20, 2012, we awarded 1,600,000
stock purchase options to directors and officer, with an exercise price of $0.05 per share. The term of these options is five years.
The options are exercisable at any time from the grant date up to and including November 20, 2017.
On November 24, 2011, we awarded 3,650,000
stock purchase options to directors, officers, consultants and employees with an exercise price of $0.05 per share. The term of
these options is five years. The options are exercisable at any time from the grant date up to and including November 24, 2016.
On October 11, 2011, we awarded 4,200,000
stock purchase options to directors, officers, consultants and employees with an exercise price of $0.12 per share. The term of
these options is five years. The options are exercisable at any time from the grant date up to and including October 10, 2016.
We awarded no stock purchase options, or
any other rights, to any of our directors or officers during the years ended December 31, 2010 and 2009.
On August 6, 2007, we awarded 2,300,000
stock purchase options to directors, officers and employees with an exercise price of $0.26 per share. The term of these options
is five years. The options were exercisable at any time from the grant date up to and including August 6, 2012.
44
The following is a
summary of stock option activity for the year ended December 31, 2011 and the status of stock options outstanding and exercisable
at December 31, 2011:
Stock Options #
Exercise Price
Ranges $
Outstanding and exercisable at December 31, 2010
1,700,000
0.26
Forfeited during year
500,000
-
Granted during year
7,850,000
0.12 - 0.05
Outstanding and exercisable at December 31, 2011
9,050,000
The following is a summary of stock option
granted and the status of stock options outstanding and exercisable at December 31, 2011 (we do not have any Stock Awards outstanding
as of December 31, 2011):
Option Awards
Name
Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#)
Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#)
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)
Option
Exercise
Price per
Share ($)
Option
Expiration Date
Lars Pearl
1,000,000
-
-
$
0.26
August 6, 2012
Cameron Richardson
200,000
-
-
$
0.26
August 6, 2012
Lars Pearl
1,000,000
-
-
$
0.12
October 10, 2016
Agustin Gomez de Segura
1,000,000
-
-
$
0.12
October 10, 2016
Ross Doyle
1,000,000
-
-
$
0.12
October 10, 2016
Joseph Sierchio
200,000
-
-
$
0.12
October 10, 2016
Coresco AG
1,000,000
-
-
$
0.12
October 10, 2016
Lars Pearl
1,250,000
-
-
$
0.05
November 23, 2016
Agustin Gomez de Segura
1,100,000
-
-
$
0.05
November 23, 2016
Ross Doyle
1,100,000
-
-
$
0.05
November 23, 2016
Luis Mauricio
200,000
-
-
$
0.05
November 23,
    2016
Total
9,050,000
Aggregated Option/SAR Exercises and Fiscal Year-End Option/SAR
Value Table
At December 31,
2011, we had 9,050,000 (December 31, 2010 - 1,700,000) stock purchase options outstanding. As of
December
15,
2012, we had 9,650,000 stock purchase options outstanding
At no time during the last completed fiscal
year did we, while a reporting company pursuant to Section 13(a) of 15(d) of the Exchange Act, adjust or amend the exercise price
of the stock options or SARs previously awarded to any of the named executive officers, whether through amendment, cancellation
or replacement grants, or any other means.
45
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. 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.
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
We reimburse our directors for reasonable
travel and other out-of-pocket expenses incurred in connection with attendance at meetings of our Board. Our Board may award special
remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director.
For the year ended December 31, 20111, we compensated Mr. Agustin Gomez de Segura, a non-employee director, $40,000 for his services
as a member of our Board. No director received and/or accrued any compensation for their services as a director, including committee
participation and/or special assignments, or incurred in connection with attending board meetings in the year ended December 31,
2010. Effective as of October 1, 2012, we have agreed to compensate each of our directors $6,000 per month for their services,
other than Mr. de Segura, who is compensated at a rate of $3,000 per month for his services.
Employment Contracts
On October 11, 2011, we entered into a services
agreement with Global Strategic pursuant to which Mr. Ross Doyle serves as our Chief Financial Officer. Pursuant to the terms of
the services agreement, Global Strategic is paid a monthly consulting fee of 10,000 Swiss Francs. The services agreement may be
terminated by either party upon advanced written notice to the other party of 20 business days.
During the year ended December 31, 2011,
consulting fees of $295,701 (year ended December 31, 2010 - $339,591) were paid to directors and officers of ours and its subsidiary.
The transactions were recorded at the exchange amount, being the value established and agreed to by the related parties.
There are no arrangements or plans in which
we provide pension, retirement or similar benefits for directors or executive officers. Our directors and executive officers may
receive stock options at the discretion of our Board. 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.
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.
46
Security
Ownership of Certain Beneficial
Owners
and Management
The following
table sets forth certain information regarding the beneficial ownership of our common stock as of
December
15,
2012, by (i) each person who is known by us to own beneficially more than five percent (5%) of our outstanding common stock; (ii)
each of the our directors and officers; and (iii) all of our directors and officers as a group. At
December
15,
2012, there were 249,144,706 shares of our common stock issued and outstanding.
Name and Address of Beneficial Owner
Amount and Nature of
Beneficial Owner
(1)
Percentage
of Class
5% Owners
Alltech Capital Limited
c/o
    Kaiser Partner Trust Services Anstalt
Pflugstrasse 10/12, Postfach 538
9490, Vaduz
Liechtenstein
135,000,000
54.2
%
Officers and Directors
Lars M. Pearl
C/- Coresco AG
Level 3
Gotthardstrasse
    20
6304 Zug, Switzerland
6,017,628
(2)
2.4
%
Ross Doyle
C/- Coresco AG
Level 3
Gotthardstrasse
    20
6304 Zug, Switzerland
5,205,545
(3)
2.1
%
Agustin Gomez de Segura
C/- Coresco AG
Level 3
Gotthardstrasse
    20
6304 Zug, Switzerland
5,428,896
(4)
2.2
%
Vladimir Bernshtein
C/- Coresco AG
Level 3
Gotthardstrasse
    20
6304 Zug, Switzerland
0
0
%
Andrey Ratsko
C/- Coresco AG
Level
    3
Gotthardstrasse 20
6304 Zug, Switzerland
0
0
%
Officers and directors
    (5 persons)
16,652,069
6.7
%
* less than 1%.
(1)
Calculated pursuant to rule 13d-3(d)
of the Exchange Act. Beneficial ownership is calculated based on 249,144,706 shares of common stock issued and outstanding on
a fully diluted basis as of December 15, 2012. Under Rule 13d-3(d) shares not outstanding which are subject to options, warrants,
rights or conversion privileges exercisable within 60 days are deemed outstanding for the purpose of calculating the number and
percentage owned by such person, but are not deemed outstanding for the purpose of calculating the percentage owned by each other
person listed.
47
(2)
Includes: (a) 1,488,533 shares of our common
stock owned by Mr. Pearl; (b) 25% of the 4,916,379 shares of our common stock owned by Coresco AG, a consulting group of which
Mr. Pearl is a 25% owner; (c) 1,000,000 stock purchase options awarded on October 11, 2011, the stock purchase options are exercisable
at $0.12 per share and have a term of five years. The options are exercisable at any time from the grant date up to and including
the October 10, 2016; (d) 250,000 of the 1,000,000 stock purchase options awarded on October 11, 2011, to Coresco AG, a consulting
group of which Mr. Pearl is a 25% owner, the stock purchase options are exercisable at $0.12 per share and have a term of five
years. The options are exercisable at any time from the grant date up to and including October 10, 2016; (e) 1,250,000 stock purchase
options awarded on November 24, 2011, the stock purchase options are exercisable at $0.05 per share and have a term of five years.
The options are exercisable at any time from the grant date up to and including November 23, 2016; and (f) 800,000 stock purchase
options awarded on January 13, 2012, the stock purchase options are exercisable at $0.05 per share and have a term of five years.
The options are exercisable at any time from the grant date up to and including January12, 2017.
(3)
Includes: (a) 1,626,450 shares of our common
stock owned by Mr. Doyle; (b) 25% of the 4,916,379 shares of our common stock owned by Coresco AG, a consulting group of which
Mr. Doyle is a 25% owner; (c) 1,000,000 stock purchase options awarded on October 11, 2011, the stock purchase options are exercisable
at $0.12 per share and have a term of five years. The options are exercisable at any time from the grant date up to and including
October 10, 2016; (d) 250,000 of the 1,000,000 stock purchase options awarded on October 11, 2011, to Coresco AG, a consulting
group of which Mr. Doyle is a 25% owner, the stock purchase options are exercisable at $0.12 per share and have a term of five
years. The options are exercisable at any time from the grant date up to and including October 10, 2016; (e) 1,100,000 stock purchase
options awarded on November 24, 2011, the stock purchase options are exercisable at $0.05 per share and have a term of five years.
The options are exercisable at any time from the grant date up to and including November 23, 2016.
(4)
Includes (a) 3,328,896 shares of our common stock
owned by Mr. de Segura; (b) 1,000,000 stock purchase options awarded on October 11, 2011, the stock purchase options are exercisable
at $0.12 per share and have a term of five years. The options are exercisable at any time from the grant date up to and including
October 10, 2016; and (c) 1,100,000 stock purchase options awarded on November 24, 2011, the stock purchase options are exercisable
at $0.05 per share and have a term of five years. The options are exercisable at any time from the grant date up to and including
November 23, 2016.
Changes in Control
On September 21, 2012, we entered into a
subscription agreement with Alltech pursuant to which we agreed to sell to Alltech 135,000,000 shares of our common stock, representing
approximately 54% of our issued and outstanding shares of common stock, for a purchase price of $5,000,000. The closing of the
transaction occurred on October 5, 2012. As a result of the sale a change in control of the Company occurred.
Transactions
With Related Persons, Promoters
and
Certain Control Persons
Our proposed business raises potential conflicts
of interests between certain of our officers and directors and us. Certain of our directors are directors of other mineral resource
companies and, to the extent that such other companies may participate in ventures in which we may participate, our directors may
have a conflict of interest in negotiating and concluding terms regarding the extent of such participation. In the event that such
a conflict of interest arises at a meeting of our directors, a director who has such a conflict will abstain from voting for or
against the approval of such participation or such terms. In appropriate cases, we will establish a special committee of independent
directors to review a matter in which several directors, or management, may have a conflict. From time to time, several companies
may participate in the acquisition, exploration and development of natural resource properties thereby allowing for their participation
in larger programs, involvement in a greater number of programs and reduction of the financial exposure with respect to any one
program. It may also occur that a particular company will assign all or a portion of its interest in a particular program to another
of these companies due to the financial position of the company making the assignment.
48
In determining whether we will participate
in a particular program and the interest therein to be acquired by it, the directors will primarily consider the potential benefits
to us, the degree of risk to which we may be exposed and its financial position at that time. Other than as indicated, we have
no other procedures or mechanisms to deal with conflicts of interest. We are not aware of the existence of any conflict of interest
as described herein.
Transactions with Related Persons
Other than as disclosed below, during the
fiscal year ended December 31, 2011 and through December 15, 2012, none of our current directors, officers or principal shareholders,
nor any family member of the foregoing, nor, to the best of our information and belief, any of our former directors, senior officers
or principal shareholders, nor any family member of such former directors, officers or principal shareholders, has or had any material
interest, direct or indirect, in any transaction, or in any proposed transaction which has materially affected or will materially
affect us.
There have been no transactions or proposed
transactions with officers and directors during the last two years to which we are a party except as follows:
During the nine-month period ended September
30, 2012, we incurred consulting fees of $297,190 (September 30, 2011: $191,742) to our directors and officers (or companies of
the officers and directors). The transactions were recorded at the exchange amount, being the value established and agreed to by
the related parties. Included in accounts payable and accrued expenses and advances payable (related parties) at September 30,
2012 and December 31, 2011 were $322,419 and $Nil respectively payable to our officers and directors for consulting fees and various
expenses incurred on our behalf.
On December 15, 2011, we entered into debt
settlement agreement with Mr. Ross Doyle pursuant to which we issued Mr. Doyle 1,626,450 shares of our common stock in exchange
for a release from paying $32,529 we owed to Mr. Doyle.
On December 15, 2011, we entered into debt
settlement agreement with Mr. Agustin Gomez de Segura pursuant to which we issued Mr. Gomez de Segura 2,328,896 shares of our common
stock in exchange for a release from paying $46,577.92 we owed to Mr. Gomez de Segura.
On December 15, 2011, we entered into debt
settlement agreement with Global Strategic pursuant to which we issued Global Strategic 2,065,996shares of our common stock in
exchange for a release from paying $41,319.92 we owed to Global Strategic. Mr Doyle, our Chief Financial Officer, is an equal shareholder
in Global Strategic with his wife.
On December 15, 2011, we entered into debt
settlement agreement with Coresco AG pursuant to which we issued Coresco AG 4,916,379 shares of our common stock in exchange for
a release from paying $98,327.58 we owed to Coresco AG.
Messrs. Lars Pearl and Ross Doyle each own 25%
of Coresco AG.
On November 24, 2011, we granted Mr. Lars
Pearl, our Chief Executive Officer, 1,250,000 stock purchase options. The stock purchase options are exercisable at $0.05 per share
and have a term of five years. The options are exercisable at any time from the grant date up to and including November 24, 2016.
49
On November 24, 2011, we granted Mr. Agustin
Gomez de Segura, a director, 1,100,000 stock purchase options. The stock purchase options are exercisable at $0.05 per share and
have a term of five years. The options are exercisable at any time from the grant date up to and including November 24, 2016.
On November 24, 2011, we granted Mr. Ross
Doyle, our Chief Financial Officer, 1,100,000 stock purchase options. The stock purchase options are exercisable at $0.05 per share
and have a term of five years. The options are exercisable at any time from the grant date up to and including November 24, 2016.
On October 11, 2011, we granted Mr. Lars
Pearl, our Chief Executive Officer, 1,000,000 stock purchase options. The stock purchase options are exercisable at $0.12 per share
and have a term of five years. The options are exercisable at any time from the grant date up to and including October 10, 2016.
On October 11, 2011, we entered into a consulting
agreement with Global Strategic pursuant to which Mr. Ross Doyle serves as our Chief Financial Officer. Pursuant to the terms of
the consulting agreement, Global Strategic is paid a monthly consulting fee of 10,000 Swiss Francs.
On October 11, 2011, we granted Mr. Ross
Doyle 1,000,000 stock purchase options. The stock purchase options are exercisable at $0.12 per share and have a term of five years.
The options are exercisable at any time from the grant date up to and including October 10, 2016.
On October 11, 2011, we granted Mr. Agustine
Gomez de Segura 1,000,000 stock purchase options. The stock purchase options are exercisable at $0.12 per share and have a term
of five years. The options are exercisable at any time from the grant date up to and including the October 10, 2016.
On October 11, 2011, we granted Coresco
AG 1,000,000 stock purchase. The stock purchase options are exercisable at $0.12 per share and have a term of five years. The options
are exercisable at any time from the grant date up to and including October 10, 2016. Messrs. Lars Pearl and Ross Doyle each own
25% of Coresco AG.
Description
of Our Securities
Our authorized
capital stock consists of 300,000,000 shares of common stock, par value $0.001 per share. As of
December
15,
2012, we had 249,144,706 shares of common stock outstanding.
Common Stock
Holders of our common stock are entitled
to one vote for each share held on all matters submitted to a vote of stockholders and do not have cumulative voting rights. Accordingly,
holders of a majority of the shares of our common stock entitled to vote in any election of directors may elect all of the directors
standing for election. Holders of our common stock are entitled to receive dividends ratably, if any, as may be declared from time
to time by our Board out of funds legally available therefor. Upon our liquidation, dissolution or winding up, the holders of our
common stock are entitled to receive ratably, our net assets available after the payment of all liabilities.
Holders of our common stock have no preemptive,
subscription, redemption or conversion rights, and there are no redemption or sinking fund provisions applicable to the common
stock. The outstanding shares of our common stock are, and the shares offered in this offering will be, when issued and paid for,
duly authorized, validly issued, fully paid and non-assessable.
50
Dividends
We have not declared any cash dividends
to date. We have no present intention of paying any cash dividends on our common stock in the foreseeable future, as we intend
to use earnings, if any, to generate growth. The payment of dividends, if any, in the future, rests within the discretion of our
Board and will depend, among other things, upon our earnings, capital requirements and our financial condition, as well as other
relevant factors. There are no restrictions in our Certificate of Incorporation or By-laws that restrict us from declaring dividends.
Shares Eligible for Future Sale
Future sales of a substantial number of
shares of our common stock in the public market could adversely affect market prices prevailing from time to time. Under the terms
of this offering, the Shares offered may be resold without restriction or further registration under the Securities Act of 1933,
except that any shares purchased by our "affiliates," as that term is defined under the Securities Act, may generally
only be sold in compliance with Rule 144 under the Securities Act.
Sale of Restricted Shares
Certain shares of our outstanding common
stock were issued and sold by us in private transactions in reliance upon exemptions from registration under the Securities Act
and have not been registered for resale. Additional shares may be issued pursuant to outstanding warrants and options. Such shares
may be sold only pursuant to an effective registration statement filed by us or an applicable exemption, including the exemption
contained in Rule 144 promulgated under the Securities Act.
Of the 249,144,706
shares of common stock outstanding as of
December
15, 2012, 89,153,868 are freely tradable by
persons other than our affiliates, without restriction under the Securities Act; and 159,990,838 shares are restricted securities
within the meaning of Rule 144 under the Securities Act and may not be sold unless an exemption from the registration requirements
of the Securities Act is available (including 144).
Sales Pursuant to Rule 144 by Non-Affiliates
Under Rule 144, a person who is not deemed
to have been one of our affiliates at the time of or at any time during the three months preceding a sale, and who has beneficially
owned the restricted ordinary shares proposed to be sold for at least six (6) months, including the holding period of any prior
owner other than an affiliate, is entitled to sell their shares without complying with the manner of sale and volume limitation
or notice provisions of Rule 144. We must be current in our public reporting if the non-affiliate is seeking to sell under Rule
144 after holding his shares between 6 months and one year. After one year, non-affiliates do not have to comply with any other
Rule 144 requirements.
Sales under Rule 144 by Affiliates
Persons who have beneficially owned restricted
shares of our common stock for at least six months but who are our affiliates at the time of, or at any time during the three months
preceding, a sale, would be subject to additional restrictions, by which such person would be entitled to sell within any three-month
period only a number of securities that does not exceed the greater of either of the following:
51
·
1% of the number of shares of common stock then outstanding; or
·
the average weekly trading volume of the common stock during the four calendar weeks preceding the filing of a notice on Form
144 with respect to the sale, provided that the common stock is listed on a national securities exchange or on The NASDAQ Stock
Market.
Sales under Rule 144 by our affiliates are
further limited under Rule 144, including the provisions thereof relating to the manner of sale, notice requirements and availability
of current public information about us.
Legal Proceedings
Although from time to time, we may become
involved in various lawsuits and legal proceedings which arise in the ordinary course of business, we are currently not aware of
any other legal proceedings or claims that we believe will have, individually, or in the aggregate, a material adverse affect on
our business, financial condition or operating results.
The
Selling Stockholder
The Selling Stockholder,
Alltech Limited Capital, is a corporation organized under the laws of Gibraltar. The Selling Stockholder purchased its shares of
our common stock pursuant to a subscription agreement dated as of September 21, 2012. Pursuant to the terms of the subscription
agreement, we have agreed to register for resale all 135,000,000 shares of our common stock purchased by the Selling Shareholder.
Although we
will pay substantially all the expenses incident to the registration of the shares, we will not receive any
proceeds from the sales by the Selling Stockholder; we did, however, receive $5,000,000 from the Selling Stockholder for the sale
of our shares.
Name of Selling Stockholders
(1)
No. of
Shares
Beneficially
Owned
Prior to the
Offering
% of Issued
and
Outstanding
Shares Owned
Prior to the
Offering
Number of
Shares
Registered
Under This
Offering
% of Issued
and
Outstanding
Shares Owned
After This
Offering
(2)
Alltech Capital Limited
(3)
135,000,000
54.2
135,000,000
0
(1)
Calculated
pursuant to Rule 13d-3(d) of the Exchange Act. Beneficial ownership is calculated based on 249,144,706 shares of common stock issued
and outstanding on a fully diluted basis as of December 15, 2012. The Selling Stockholder has sole voting and investment power
with respect to all such shares. Under Rule 13d-3(d) of the Exchange Act, shares not outstanding which are subject to options,
warrants, rights or conversion privileges exercisable within 60 days are deemed outstanding for the purpose of calculating the
number and percentage owned by such person, but are not deemed outstanding for the purpose of calculating the percentage owned
by each other person listed. To the best of our knowledge, the Selling Stockholder has not had a short position in our common stock;
is not a broker-dealer or an affiliate of a broker-dealer (a broker-dealer may be a record holder); has not held any position or
office, or has had any material relationship with us or any of our affiliates within the past three years. The Selling Stockholder
and any broker-dealers or agents that are involved in selling these shares are deemed to be underwriters within the meaning of
the Securities Act for such sales. An underwriter is a person who has purchased shares from an issuer with a view towards distributing
the shares to the public. In such event, any commissions received by such broker-dealers or agents and any profit on the resale
of the shares purchased by them may be considered to be underwriting commissions or discounts under the Securities Act.
(2)
The Selling Stockholder may sell some, all or
none of its shares. We do not know how long the Selling Stockholder will hold the shares offered hereunder before selling them.
We currently have no agreements, arrangements or understandings with the Selling Stockholder regarding the sale of any of the shares
by it.
(3)
Alltech Capital Limited is a subsidiary of Alltech
Group, a Russian based private direct investment company established in 1993 by graduates from Moscow State Technical University.
The strategy of Alltech Group is to invest in high-risk and high-yielding projects using bot its own and raised capital. Alltech
Group is active in various industries, including oil and gas; coal and anthracite and development of residential and commercial
real estate.
52
P
lan
of Distribution
The Selling Stockholder of our common stock
and any of its pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their shares of common
stock on the OTCQB or any other stock exchange, market or trading facility on which the shares are traded or in private transactions.
These sales may be at fixed or negotiated prices. The Selling Stockholder may use any one or more of the following methods when
selling shares:
·
ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
·
block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the
block as principal to facilitate the transaction;
·
purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
·
an exchange distribution in accordance with the rules of the applicable exchange;
·
privately negotiated transactions;
·
settlement of short sales entered into after the effective date of the registration statement of which this Prospectus is a
part;
·
an agreement with a broker-dealers to sell a specified number of such shares at a stipulated price per share;
·
through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
·
a combination of any such methods of sale; or
·
any other method permitted pursuant to applicable law.
The Selling Stockholder may also sell shares
under Rule 144, if available, rather than under this Prospectus.
Broker-dealers engaged by the Selling Stockholder
may arrange for other broker-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the Selling
Stockholder (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated,
but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in excess of a customary
brokerage commission in compliance with FINRA NASD Rule 2440; and in the case of a principal transaction a markup or markdown in
compliance with NASD IM-2440.
In connection with the sale of the common
stock or interests therein, the Selling Stockholder may enter into hedging transactions with broker-dealers or other financial
institutions, which may in turn engage in short sales of the common stock in the course of hedging the positions they assume. The
Selling Stockholder may also sell shares of the common stock short and deliver these securities to close out their short positions,
or loan or pledge the common stock to broker-dealers that in turn may sell these securities. The Selling Stockholder may also enter
into option or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative
securities which require the delivery to such broker-dealer or other financial institution of shares offered by this Prospectus,
which shares such broker-dealer or other financial institution may resell pursuant to this Prospectus (as supplemented or amended
to reflect such transaction).
53
The Selling Stockholder and any broker-dealers
or agents that are involved in selling the shares may be deemed to be "underwriters" within the meaning of the Securities
Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Act. In no event shall
any broker-dealer receive fees, commissions and markups which, in the aggregate, would exceed eight percent (8%).
We are required to pay certain fees and
expenses incurred by us incident to the registration of the shares. We have agreed to indemnify the Selling Stockholder against
certain losses, claims, damages and liabilities, including liabilities under the Act.
Because the Selling Stockholder may be deemed
to be an "underwriter" within the meaning of the Act, it will be subject to the prospectus delivery requirements of
the Securities Act including Rule 172 thereunder. In addition, any securities covered by this Prospectus which qualify for sale
pursuant to Rule 144 may be sold under Rule 144 rather than under this Prospectus. There is no underwriter or coordinating broker
acting in connection with the proposed sale of the resale shares by the Selling Stockholder.
We agreed to keep this Prospectus effective
until the date on which the shares may be resold by the Selling Stockholder without registration and without regard to any volume
limitations by reason of Rule 144 or any other rule of similar effect. The resale shares will be sold only through registered or
licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states, the resale shares
may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration
or qualification requirement is available and is complied with.
Under applicable rules and regulations under
the Exchange Act, any person engaged in the distribution of the resale shares may not simultaneously engage in market making activities
with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to the commencement of
the distribution. In addition, the Selling Stockholder will be subject to applicable provisions of the Exchange Act and the rules
and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of shares of the common stock
by the Selling Stockholder or any other person. We will make copies of this Prospectus available to the Selling Stockholder and
have informed them of the need to deliver a copy of this Prospectus to each purchaser at or prior to the time of the sale (including
by compliance with Rule 172 under the Securities Act).
Limitation
Of Liability and Indemnification of Officers and
Directors;
Insurance
Our Articles of Incorporation
limit the liability of directors to the maximum extent permitted by Delaware law. Delaware law provides that directors of a corporation
will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except liability for:
·
any breach of their duty of loyalty to the corporation or its stockholders;
·
acts or omissions not in good faith or which involve intentional misconduct or a knowing violation
of law;
·
unlawful payments of dividends or unlawful stock repurchases or redemptions; or
·
any transaction from which the director derived an improper personal benefit.
Our Bylaws provide
that we will indemnify our directors, officers, employees and other agents to the fullest extent permitted by law. We believe that
indemnification under our Bylaws covers at least negligence and gross negligence on the part of indemnified parties. Our Bylaws
also permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of
his or her actions in connection with their services to us, regardless of whether our Bylaws permit such indemnification.
54
There is no pending
litigation or proceeding involving any of our directors or officers as to which indemnification is required or permitted, and we
are not aware of any threatened litigation or proceedings that may result in a claim for indemnification.
Insofar
as an indemnification for liabilities arising under the
Securities
Act may be permitted for directors,
officers or persons controlling us pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC each
indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
Disclosure
of Commission Position On Indemnification
for
Securities Act Liabilities
Our directors and officers
are indemnified by our bylaws against amounts actually and necessarily incurred by them in connection with the defense of any action,
suit or proceeding in which they are a party by reason of being or having been our directors or officers or of our subsidiaries.
Our articles of incorporation provide that none of our directors or officers shall be personally liable for damages for breach
of any fiduciary duty as a director or officer involving any act or omission of any such director or officer. Insofar as indemnification
for liabilities arising under the Securities Act may be permitted to such directors, officers and controlling persons pursuant
to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against
public policy as expressed in the Securities Act and is, therefore, unenforceable.
In
the event that a claim for indemnification against such liabilities, other than the payment by us of expenses incurred or paid
by such director, officer or controlling person in the successful defense of any action, suit or proceeding, is asserted by such
director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of counsel
the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the
Securities
Act and will be governed by the
final adjudication of such issue.
Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling
persons pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification
is against public policy as expressed in the
Securities
Act and is, therefore, unenforceable.
In the event that a
claim for indemnification against such liabilities (other than our payment of expenses incurred or paid by a director, officer
or controlling person in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled
by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against
public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
L
egal
Matters
The validity of the Shares offered hereby
will be passed upon for us by Sierchio & Company, LLP, 430 Park Avenue, 7th Floor, New York, New York 10022. Joseph Sierchio,
the managing partner of Sierchio & Company, LLP, is the beneficial owner of 200,000 stock options.
55
E
xperts
Our consolidated financial statements at
December 31, 2011 and 2010, and for the years then ended, appearing herein have been audited by Peterson Sullivan, LLP, an independent
registered public accounting firm, as set forth in its report thereon appearing elsewhere herein, and are included in reliance
upon such report given on the authority of such firm as experts in accounting and auditing.
Where
You Can Find Additional Information
We file current, quarterly and annual reports
with the SEC on forms 8-K, 10-Q and 10-K. Our filings may be inspected and copied at the Public Reference Room maintained by the
SEC at 100 F Street, N.E., Washington, D.C. 20549. You can obtain information about operation of the Public Reference Room by calling
the SEC at 1-800-SEC-0330. The SEC also maintains an Internet site that contains reports, proxy and information statements, and
other information regarding issuers that file electronically with the SEC at http://www.sec.gov. Copies of such material can be
obtained from the public reference section of the SEC at prescribed rates. For further information with respect to us and the securities
being offered hereby, reference is hereby made to the registration statement, including the exhibits thereto and the financial
statements, notes, and schedules filed as a part thereto.
Index
to Consolidated Financial Statements
Page #
September 30, 2012 and 2011 (Unaudited)
Consolidated Balance Sheets September 30, 2012 (unaudited) and December 31, 2011
F-1
Consolidated Statements of Comprehensive Income (Loss) (unaudited) Three and Nine months ended September 30, 2012 and 2011; and for the period from October 10, 1995 (Inception) to September 30, 2012
F-2
Consolidated Statements of Cash Flows (unaudited) Nine months ended September 30, 2012 and
2011
and for
the
period from October 10, 1995 (Inception) to September 30, 2012
F-3
Consolidated Statements of Stockholders' Equity (Deficiency) for the Period from October 10, 1995 (Inception) to September 30, 2012
F-4
Notes to Consolidated Financial Statements (unaudited) Nine Months Ended September 30, 2012 and 2011
F-14
December 31, 2011 and 2010 (Audited)
Report of Independent Registered Public Accounting Firm
F-25
Consolidated Balance Sheets as of December 31, 2011 and 2010
F-26
Consolidated Statements of Operations from October 10, 1995 (inception) to December 31, 2011 and for the years ended December 31, 2011 and 2010
F-27
Consolidated Statements of Stockholders' Equity (Deficiency) and Comprehensive Income (Loss) for the period from October 10, 1995 (inception) to December 31, 2011
F-28
Consolidated Statements of Cash Flows for the period from October 10, 1995 (inception) to December 31, 2011 and for the years ended December 31, 2011 and 2010
F-32
Notes to Consolidated Financial Statements Years Ended December 31, 2011 and 2010
F-34
56
Aurora Gold Corporation
(An Exploration Stage Enterprise)
Consolidated Financial Statements (Expressed
in U.S. Dollars)
Quarterly Report for the Period Ended September
30, 2012
(Unaudited)
Consolidated Balance Sheets
AURORA GOLD CORPORATION
(An exploration stage enterprise)
As at
As at
Consolidated Balance Sheets
September 30
December 31
2012 (Unaudited)
2011
(Expressed in U.S. Dollars)
$
$
ASSETS
Current assets
Cash
1,241
237,426
Total current assets
1,241
237,426
Total
assets (all current)
1,241
237,426
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
Current liabilities
Accounts payable and accrued expenses
254,974
400,644
Advances payable
-
45,000
Accounts payable – related party
240,419
Advances payable – related party
82,000
92,000
Total current liabilities
577,393
537,644
Stockholders' Equity (Deficiency)
Common stock
Authorized: 300,000,000 (December 31, 2011: 300,000,000) common shares with par value of $0.001 each
Issued and outstanding:
114,144,706
(December 31, 2011: 109,912,589) common shares
114,145
109,913
Advances for stock subscriptions
-
20,000
Additional paid-in capital
22,346,349
22,040,994
Accumulated deficit during the exploration stage
(22,966,943
)
(22,400,600
)
Accumulated other comprehensive income (loss)
(69,703
)
(70,525
)
Stockholder' equity (deficiency)
(576,152
)
(300,218
)
Total liabilities and stockholders' equity (deficiency)
1,241
237,426
(The accompanying notes are an integral
part of these consolidated financial statements.)
F-
1
Aurora Gold Corporation
(An Exploration Stage Enterprise)
Consolidated Financial Statements (Expressed
in U.S. Dollars)
Quarterly Report for the Period Ended September
30, 2012
(Unaudited)
Consolidated Statements of Comprehensive
Income (Loss)
Cumulative
October 19,
1995
(inception) to
September 30,
2012
$
For the
Three
Months
Ended
September
30, 2012
$
For the
Three
Months
Ended
September
30, 2011
$
For the
Nine
Months
Ended
September 30,
2012
$
For the
Nine
Months
Ended
September
30, 2011
$
Operating Expenses
General and administrative
2,555,501
27,995
54,095
218,587
139,250
Depreciation and amortization
145,126
-
6,538
-
22,001
Imputed interest on loan payable – related party
1,560
-
-
-
-
Interest and bank charges
395,430
584
1,461
1,173
6,540
Foreign exchange loss (gain)
(13,756
)
-
(3,702
)
1,563
486
Professional fees – accounting and legal
1,888,486
47,674
25,219
80,450
189,198
Property search and negotiation
479,695
-
-
-
-
Salaries, management and consulting fees
3,698,880
80,947
95,098
227,707
406,398
Exploration expenses
9,863,063
7,772
23,055
131,724
261,304
Write-off of equipment
240,338
-
-
-
-
19,254,323
164,972
201,764
661,204
1,025,177
Other income (loss)
Gain (loss) on disposition of subsidiary
(2,541,037
)
-
(245,221
)
-
(2,757,511
)
Interest income
22,353
-
-
-
-
Gain on sale of rights to Matupa agreement (net)
80,237
-
-
-
-
Loss on investments
(37,971
)
-
-
-
-
Loss on spun-off operations
(316,598
)
-
-
-
-
Gain (loss) on extinguishment of liabilities
(919,605
)
94,860
-
94,860
-
(3,712,621
)
94,860
(245,221
)
94,860
(2,757,511
)
Net Loss
(22,966,944
)
(70,112
)
(446,985
)
(566,344
)
(3,782,688
)
Other comprehensive income (loss)
Foreign currency translation adjustments
(2,875
)
591
822
2,510
Comprehensive income (loss)
(72,987
)
(446,394
)
(565,522
)
(3,780,178
)
Net Loss Per Share – Basic and Diluted
*
$
(0.00
)
(0.01
)
$
(0.04
)
Weighted Average Shares Outstanding – Basic and Diluted
114,144,706
89,540,183
112,726,318
89,036,372
* amount is less than $(0.01) per share
(The accompanying notes are an integral part of these consolidated financial statements.)
F-
2
Aurora Gold Corporation
(An Exploration Stage Enterprise)
Consolidated Financial Statements (Expressed
in U.S. Dollars)
Quarterly Report for the Period Ended September
30, 2012
Consolidated Statements of Cash Flows
Cumulative
October 19, 1995
(inception)
to September 30
2012
$
For the Nine
Months
Ended
September
30, 2012
$
For the Nine
Months
Ended
September
30, 2011
$
Net loss for the period
(22,966,944
)
(566,344
)
(3,782,688
)
Adjustments to reconcile net loss to cash used in operating activities
Depreciation and amortization
145,126
-
22,001
Stock compensation expense on stock option grants
1,624,012
55,660
-
Expenses satisfied with issuance of common stock
1,202,054
-
24,500
Expenses satisfied with transfer of marketable securities
33,903
-
-
Imputed interest on loan payable - related parties
1,560
-
-
Write-off of mineral property assets
240,338
-
-
Adjustment for spin-off of Aurora Metals (BVI) Limited
316,498
-
-
Loss on disposal of subsidiary
2,757,511
-
2,757,511
Realized loss on investments
37,971
-
-
Gain on sale of rights to Matupa agreement (net)
(80,237
)
-
-
(Gain) loss on extinguishment of liabilities
919,605
(94,860
)
-
Foreign exchange (gain) loss related to notes payable
(24,534
)
-
-
Change in operating assets and liabilities
Decrease (Increase) in receivables and other assets
(206,978
)
-
-
(Increase) decrease in prepaid expenses and other assets
(20,459
)
-
(7,016
)
Increase (decrease) in accounts payable and accrued expenses (including related party)
1,331,114
224,063
(732
)
Net Cash Used in Operating Activities
(14,689,460
)
(381,481
)
(986,424
)
Cash Flows From Investing Activities
Purchase of equipment
(205,348
)
-
-
Proceeds on disposal of equipment
16,761
-
-
Payment for mineral property Reclamation Bonds
(245,221
)
-
80,000
Proceeds from disposition of marketable securities
32,850
-
-
Acquisition of mineral property costs and related equipment
(672,981
)
-
-
Payment for incorporation cost
(11,511
)
-
-
Net Cash Provided by (Used in) Investing Activities
(1,085,450
)
-
80,000
Cash Flows From Financing Activities
Proceeds from common stock less issuance costs
14,140,912
96,473
167,100
Loan proceeds from related party
289,000
-
-
Net proceeds from (payments on) convertible notes and loans
969,252
-
-
Net proceeds from (payments on) advances payable
45,000
-
257,000
Net proceeds from (payments on) advances payable – related parties
142,000
50,000
-
Net Cash Provided by Financing Activities
15,586,164
146,473
424,100
Effect of Exchange Rate Changes on Cash
189,987
(1,177
)
(3,565
)
(Decrease) Increase in Cash
1,241
(236,185
)
(485,889
)
Cash at Beginning of Period
-
237,426
579,191
Cash at End of Period
1,241
1,241
93,302
(The accompanying notes are an integral part of these consolidated financial statements.)
F-
3
Aurora Gold Corporation
(An Exploration Stage Enterprise)
Consolidated Financial Statements (Expressed
in U.S. Dollars)
Quarterly Report for the Period Ended September
30, 2012
Consolidated Statements of Stockholders'
Equity (Deficiency)
Common Stock Shares
Amount
Additional
paid-in
capital
Advances for
Stock
Subscriptions
Accumulated
(deficit)
during
Exploration
Stage
Accumulated
other
comprehensive
income (loss)
Total
stockholders'
equity
(deficiency)
#
$
$
$
$
$
$
Balance, October 10, 1995
-
-
-
-
-
-
-
Issuance of common stock for settlement
    of indebtedness
11,461,153
11,461
-
-
-
-
11,461
Net (loss) for the period
-
-
-
-
-
Balance December 31, 1995
11,461,153
11,461
-
-
-
-
11,461
Adjustment for reverse stock split
(7,640,766
)
(7,641
)
-
-
-
-
(7,641
)
Issuance of common stock for - cash at $0.001 per
    share
5,800,000
5,800
341,761
-
-
-
347,561
- resource property
300,000
300
2,700
-
-
-
3,000
Net (loss) for the period
(361,208
)
-
(361,208
)
Balance December 31, 1996
9,920,387
9,920
344,461
(361,208
)
-
(6,827
)
Issuance of common stock for - cash in March 1997
    at $1.00 per share (less issue costs of $4,842)
750,000
750
744,408
-
-
-
745,158
Net (loss) for the period
-
(615,880
)
-
(615,880
)
Balance December 31, 1997
10,670,387
10,670
1,088,869
-
(977,088
)
-
122,451
Issuance of common stock for:
- settlement of indebtedness
96,105
96
68,601
-
-
-
68,697
F-
4
Common Stock Shares
Amount
Additional
paid-in
capital
Advances for
Stock
Subscriptions
Accumulated
(deficit)
during
Exploration
Stage
Accumulated
other
comprehensive
income (loss)
Total
stockholders'
equity
(deficiency)
#
$
$
$
$
$
$
- cash in May 1998 at $1.25 per share
200,000
200
249,800
-
-
-
250,000
- cash in November 1998 at $0.75 per share
71,667
72
53,678
-
-
-
53,750
- cash in December 1998 at $0.75 per share
143,333
143
107,357
-
-
-
107,500
Grant of options to employees and directors
518,900
-
-
-
518,900
Grant of options to consultants
172,100
-
-
-
172,100
Net (loss) for the period
-
(1,151,604
)
-
(1,151,604
)
Balance December 31, 1998
11,181,492
11,181
2,259,304
-
(2,128,692
)
-
141,794
Issuance of common stock for:
- settlement of indebtedness
231,286
231
160,151
-
-
-
160,382
- cash in March 1999 at $0.656 per share
22,871
23
14,977
-
-
-
15,000
- finder's fee in February 1999 at $0.81 per share
25,000
25
20,287
-
-
-
20,312
Grant of options to consultants
29,500
-
-
-
29,500
Cash advanced on stock subscriptions
425,000
-
425,000
Net (loss) for the period
-
(855,391
)
-
(855,391
)
Balance December 31, 1999
11,460,649
11,461
2,484,219
425,000
(2,984,083
)
-
(63,403
)
Issuance of common stock for:
- settlement of indebtedness
199,000
199
99,301
-
-
-
99,500
F-
5
Common Stock Shares
Amount
Additional
paid-in
capital
Advances for
Stock
Subscriptions
Accumulated
(deficit)
during
Exploration
Stage
Accumulated
other
comprehensive
income (loss)
Total
stockholders'
equity
(deficiency)
#
$
$
$
$
$
$
- cash in March 2000 at $0.50 per share
350,000
350
174,650
(175,000
)
-
-
-
- cash in March 2000 at $0.455 per share
550,000
550
249,450
(250,000
)
-
-
-
Cancellation of shares in April 2000
(90,706
)
(91
)
(56,600
)
-
-
-
(56,691
)
Exercise of options in June 2000
405,000
405
3,645
-
-
-
4,050
Spin-off of Aurora Metals (BVI) Limited
316,498
-
-
-
316,498
Net (loss) for the period
-
(677,705
)
-
(677,705
)
Balance December 31, 2000
12,873,943
12,874
3,271,163
-
(3,661,788
)
-
(377,751
)
- Net income for the period
-
128,545
-
128,545
- Unrealized holding losses on available-for-sale securities
-
-
(141,928
)
(141,928
)
Balance December 31, 2001
12,873,943
12,874
3,271,163
-
(3,533,243
)
(141,928
)
(391,134
)
Issuance of common stock for:
- settlement of indebtedness
3,708,038
3,708
351,492
-
-
-
355,200
- Net loss for the period
-
(137,329
)
-
(137,329
)
- Unrealized holding losses on available-for-sale securities
-
-
141,928
141,928
Balance, December 31, 2002
16,581,981
16,582
3,622,655
-
(3,670,572
)
-
(31,335
)
Issuance of common stock for:
- settlement of indebtedness
2,752,450
2,752
114,806
-
-
-
117,558
F-
6
Common Stock Shares
Amount
Additional
paid-in
capital
Advances for
Stock
Subscriptions
Accumulated
(deficit)
during
Exploration
Stage
Accumulated
other
comprehensive
income (loss)
Total
stockholders'
equity
(deficiency)
#
$
$
$
$
$
$
- cash in  December 2003 at $0.25 per share
100,000
100
24,900
-
-
-
25,000
- Net loss for the period
-
(96,404
)
-
(96,404
)
- Unrealized holding losses on available-for-sale securities
-
-
-
-
Balance, December 31, 2003
19,434,431
19,434
3,762,361
-
(3,766,976
)
-
14,819
Issuance of common stock for:
- cash in January 2004 at $0.25 per share, less issuance costs
100,000
100
22,400
-
-
-
22,500
Imputed interest
1,560
-
-
-
1,560
- Net loss for the period
-
(223,763
)
-
(223,763
)
- Unrealized holding losses on available-for-sale securities
-
-
-
-
Balance, December 31, 2004
19,534,431
19,534
3,786,321
-
(3,990,739
)
-
(184,884
)
Issuance of common stock for:
- cash in July 2005 at $0.05 per share
13,000,000
13,000
637,000
-
-
-
650,000
- settlement of indebtedness
3,684,091
3,684
158,816
-
-
-
162,500
- Net (loss) for the period
-
(457,271
)
-
(457,271
)
- Unrealized holding losses on available-for-sale securities
-
-
(4,614
)
(4,614
)
F-
7
Common Stock Shares
Amount
Additional
paid-in
capital
Advances for
Stock
Subscriptions
Accumulated
(deficit)
during
Exploration
Stage
Accumulated
other
comprehensive
income (loss)
Total
stockholders'
equity
(deficiency)
#
$
$
$
$
$
$
Balance, December 31, 2005
36,218,522
36,218
4,582,137
-
(4,448,010
)
(4,614
)
165,731
Issuance of common stock for - cash in February 2006 at $0.50 per
    share less issuance costs of $110,000:
8,000,000
8,000
3,882,000
-
-
-
3,890,000
- non cash finder's fee in December 200 at $0.70 per share
250,000
250
174,750
-
-
-
175,000
- cash in December 2006 at $0.50 per share
1,000,000
1,000
499,000
-
-
-
500,000
- Net (loss) for the period
-
(5,463,855
)
-
(5,463,855
)
- Foreign currency translation adjustments
-
-
(3,692
)
(3,692
)
- Reclassification adjustment for losses on available-for-sale securities
    included in net loss
-
-
4,614
4,614
Balance, December 31, 2006
45,468,522
45,468
9,137,887
-
(9,911,865
)
(3,692
)
(732,202
)
Issuance of common stock for:
- cash in March 2007 at $0.50 per share
500,000
500
249,500
-
-
-
250,000
- cash in July 2007 at $0.25 per share
5,000,000
5,000
1,245,000
-
-
-
1,250,000
- settlement of indebtedness in August 2007 at $0.20 per share
250,000
250
49,750
-
-
-
50,000
F-
8
Common Stock Shares
Amount
Additional
paid-in
capital
Advances for
Stock
Subscriptions
Accumulated
(deficit)
during
Exploration
Stage
Accumulated
other
comprehensive
income (loss)
Total
stockholders'
equity
(deficiency)
#
$
$
$
$
$
$
- cash in September 2007 at $0.20 per share
4,000,000
4,000
796,000
-
-
-
800,000
Stock option compensation expense
454,295
-
-
-
454,295
- Net (loss) for the period
-
(3,259,732
)
-
(3,259,732
)
- Foreign currency translation adjustments
-
-
(65,255
)
(65,255
)
Balance, December 31, 2007
55,218,522
55,218
11,932,432
-
(13,171,597
)
(68,947
)
(1,252,894
)
- Issuance of common stock for - non cash finder's fee in July 2008 at
    $0.10 per share
250,000
250
24,750
-
-
-
25,000
- settlement of indebtedness in December2008 at $0.06 per share
2,603,333
2,603
153,597
-
-
-
156,200
- Net (loss) for the period
-
(520,105
)
-
(520,105
)
- Foreign currency translation adjustments
-
-
36,259
36,259
Balance, December 31, 2008
58,071,855
58,071
12,110,779
-
(13,691,702
)
(32,688
)
(1,555,540
)
- Issuance of common stock for - settlement of indebtedness in September 2009
    at $0.15 per share
5,000,000
5,000
1,748,616
-
-
-
1,753,616
- cash in September 2009 at $0.10 per share less finder's fee
3,000,000
3,000
255,000
-
-
-
258,000
F-
9
Common Stock Shares
Amount
Additional
paid-in
capital
Advances for
Stock
Subscriptions
Accumulated
(deficit)
during
Exploration
Stage
Accumulated
other
comprehensive
income (loss)
Total
stockholders'
equity
(deficiency)
#
$
$
$
$
$
$
- non cash finder's fee September 2009
    at $0.10 per share
420,000
420
41,580
-
-
-
42,000
- settlement of indebtedness in November 2009 at $0.18 per share
100,000
100
17,899
-
-
-
17,999
- settlement of indebtedness in November 2009 at $0.24 per
    share
150,000
150
35,611
-
-
-
35,761
- cash in December 2009 at $0.30 per share
1,666,667
1,667
498,333
-
-
-
500,000
- Net (loss) for the period
-
(1,779,477
)
-
(1,779,477
)
- Foreign currency translation adjustments
-
-
(60,171
)
(60,171
)
Balance, December 31, 2009
68,408,522
68,408
14,707,818
-
(15,471,179
)
(92,859
)
(787,812
)
- Issuance of common stock for cash in April 2010
    at $0.30 per share less finder's fee (paid with 1,126,111 shares included herein)
14,109,446
14,110
3,880,890
-
-
-
3,895,000
- non cash property acquisition in June 2010 at
    $0.40 per share
5,000,000
5,000
1,995,000
-
-
-
2,000,000
- settlement of indebtedness in September 2010 at $0.30 per share
160,500
161
47,989
-
-
-
48,150
- settlement of indebtedness in September 2010 at $0.30 per share
325,400
325
97,295
-
-
-
97,620
F-
10
Common Stock Shares
Amount
Additional
paid-in
capital
Advances for
Stock
Subscriptions
Accumulated
(deficit)
during
Exploration
Stage
Accumulated
other
comprehensive
income (loss)
Total
stockholders'
equity
(deficiency)
#
$
$
$
$
$
$
- payment of expenses in September 2010 at $0.30 per share
200,000
200
59,800
-
-
-
60,000
- non cash finder's fee in September 2010 related to the June
    2010 property acquisition at $0.30 per share
500,000
500
149,500
-
-
-
150,000
- Net (loss) for the period
-
(2,302,083
)
-
(2,302,083
)
- Foreign currency translation adjustments
-
-
(198
)
(198
)
Balance, December 31, 2010
88,703,868
88,704
20,938,292
-
(17,773,262
)
(93,057
)
3,160,677
-Issuance of common stock for non cash finder's fee in May
    2011 at $0.042 per share
450,000
450
(450
)
-
-
-
-
-Issuance of common stock for cash in September 2011 at $0.10 per
    share
1,671,000
1,671
165,429
-
-
-
167,100
-Issuance of common stock for settlement of indebtedness in September
    2011 at $0.16 per share
150,000
150
24,350
-
-
-
24,500
-Issuance of common stock for settlement of indebtedness in December
    2011 at $0.02 per share
10,937,721
10,938
207,816
218,754
F-
11
Common Stock Shares
Amount
Additional
paid-in
capital
Advances for
Stock
Subscriptions
Accumulated
(deficit)
during
Exploration
Stage
Accumulated
other
comprehensive
income (loss)
Total
stockholders'
equity
(deficiency)
#
$
$
$
$
$
$
-Issuance of common stock for cash in
    December 2011 at $0.04 per share
8,000,000
8,000
312,000
320,000
-Issuance of common stock for cash in December 2011
    at $0.04 per share - oversubscribed
20,000
20,000
-Stock option compensation expense
393,557
393,557
- Net (loss) for the period
-
(4,627,338
)
-
(4,627,338
)
- Foreign currency translation adjustments
-
-
22,532
22,532
Balance, December 31, 2011
109,912,589
109,913
22,040,994
20,000
(22,400,600
)
(70,525
)
(300,218
)
Issuance of common stock for settlement of indebtedness
    in March 2012 at $0.06 per share
1,990,900
1,991
117,463
119,454
Issuance of common stock for cash in March 2012
    at $0.06 per share – shares not issued until April 2012
17,513
17,513
Issuance of common stock for cash in April 2012
    at $0.06 per share
1,316,000
1,316
77,644
78,960
Issuance of common stock for settlement of indebtedness
    in April 2012 at $0.06 per share
300,000
300
17,700
18,000
F-
12
Common Stock Shares
Amount
Additional
paid-in
capital
Advances for
Stock
Subscriptions
Accumulated
(deficit)
during
Exploration
Stage
Accumulated
other
comprehensive
income (loss)
Total
stockholders'
equity
(deficiency)
#
$
$
$
$
$
$
Issuance of common stock in April 2012
    for Advances for Stock Subscriptions
625,217
625
36,888
(37,513
)
-
Stock option compensation expense
55,660
55,660
- Net (loss) for the period
(566,344
)
(566,344
)
- Foreign currency translation adjustments
822
822
Balance, September 30, 2012
114,144,706
114,145
22,346,349
-
(22,966,944
)
(69,703
)
(576,153
)
(The accompanying notes are an integral
part of these consolidated financial statements.)
F-
13
Aurora Gold Corporation
(An Exploration Stage Enterprise)
Consolidated Financial Statements (Expressed
in U.S. Dollars)
Quarterly Report for the Period Ended September
30, 2012
Notes to Consolidated Financial Statements
1.
Organization, Nature of Business, Going Concern and Management's Plans
Aurora Gold Corporation ("the Company")
was formed on October 10, 1995 under the laws of the State of Delaware and is in the business of location, acquisition, exploration
and, if warranted, development of mineral properties. The Company's focus is on the exploration and development of its exploration
properties located in the Tapajos Gold Province, State of Pará, Brazil (see Note 3). The Company has not yet determined
whether its properties contain mineral reserves that may be economically recoverable and has not generated any operating revenues
to date.
These interim consolidated financial statements
have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates
the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The general business
strategy of the Company is to acquire mineral properties either directly or through the acquisition of operating entities. The
Company has incurred recurring operating losses since inception, has not generated any operating revenues to date and during the
period ended September 30, 2012, operating activities used cash of $381,481 (September 30, 2011: $986,424). The Company requires
additional funds to meet its obligations and maintain its operations.
These conditions raise substantial doubt
about the Company's ability to continue as a going concern. Management's plans in this regard are to raise equity financing through
private or public equity investment in order to support existing operations and expand its business. The Company currently has
a Prospectus out on offer and these details are included in further detail in these notes. There is however no assurance that such
additional funding will be available to the Company when required, or on terms acceptable to the Company. In the event that the
Company cannot obtain additional funds, on a timely basis, or the operations do not generate sufficient cash flow, the Company
may be forced to curtail development or cease activities. These consolidated financial statements do not include any adjustments
that might result from this uncertainty.
2.
Summary of Significant Accounting Policies
a.
Basis of Preparation
The Company follows accounting standards
set by the Financial Accounting Standards Board (FASB). The FASB sets accounting principles generally accepted (GAAP) in the United
States that the Company follows to ensure they consistently report their financial condition, results of operations, and cash flows.
References to GAAP issued by the FASB in these footnotes are to the FASB Accounting Standards Codification (ASC) or also referred
to as Codification.
These interim consolidated financial statements
have been prepared in accordance with GAAP and include the accounts of the Company and its wholly owned subsidiaries, Aurora Gold
Mineração Ltda ("Aurora Gold Mineração") and AGC Resources LLC ("AGC") (through
to date of disposition of AGC, June 14, 2011) Collectively, they are referred to herein as "the Company." Significant
inter-company accounts and transactions have been eliminated.
Certain information and footnote disclosures
normally included in consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant
to such Securities and Exchange Commission (SEC) rules and regulations. The interim period consolidated financial statements should
be read together with the audited consolidated financial statements and accompanying notes included in the Company's audited
consolidated financial statements for the year ended December 31, 2011. In the opinion of the management of the Company, the unaudited
consolidated financial statements contained herein contain all adjustments (consisting of a normal recurring nature) necessary
to present a fair statement of the results of the interim periods presented.
F-
14
b.
Use of Estimates
The preparation of financial statements
in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from those estimates and assumptions.
c.
Cash Equivalents
Cash equivalents
comprise certain highly liquid instruments with a maturity date of three months or less when purchased. The Company has cash equivalents
of $1,241 and $93,302 at September 30, 2012 and 2011 respectively.
Amounts paid for income taxes during the periods ended
September 30, 2012 and 2011 were nil; and for interest paid nil respectively.
d.
Buildings and Equipment
Buildings and equipment are carried at
cost (including development and preproduction costs, capitalized interest, other financing costs and all direct administrative
support costs incurred during the construction period, net of cost recoveries and incidental revenues), less accumulated depletion
and depreciation including write-downs. Following the construction period, interest, other financing costs and administrative costs
are expensed as incurred. On the commencement of commercial production, depletion of each mining property is provided on the unit-of-production
basis, using estimated proven and probable reserves as the depletion basis. Buildings and equipment utilized directly in commercial
mining activities are depreciated, following the commencement of commercial production, over their expected economic lives using
either the unit-of-production method or the straight-line method. Depreciation for non-mining equipment is provided over the following
useful lives:
Vehicles
10 years
Office equipment, furniture and fixtures
2 to 10 years
The Company reviews the carrying values
of its buildings and equipment whenever events or changes in circumstances indicate that their carrying values may not be recoverable.
An impairment is considered to exist if total estimated future cash flows, or probability-weighted cash flows on an undiscounted
basis, are less than the carrying value of the assets. An impairment loss is measured and recorded based on discounted estimated
future cash flows associated with values beyond proven and probable reserves and resources. In estimating future cash flows, assets
are grouped at the lowest level for which there is identifiable future cash flows that are largely independent of cash flows from
other asset groups. Generally, in estimating future cash flows, all assets are grouped at a particular property for which there
are identifiable cash flows. Buildings and equipment utilized directly in commercial mining activities are depreciated, following
the commencement of commercial production, over their expected economic lives using either the unit-of-production method or the
straight-line method.
e.
Mineral Property Reclamation Bonds and Other Related Refundable Costs
Costs paid for the purchase of reclamation
bonds and other related costs that are refundable are capitalized. If amounts paid are not to be refunded then they will be expensed
when it is determined they will not be refunded.
f.
Mineral Properties and Exploration Expenses
The Company accounts for its mineral properties
on a cost basis whereby all direct costs, net of pre-production revenue, relative to the acquisition of the properties are capitalized.
All sales and option proceeds received are first credited against the costs of the related property, with any excess credited to
earnings. Once commercial production has commenced, the net costs of the applicable property will be charged to operations using
the unit-of-production method based on estimated proven and probable recoverable reserves. The net costs related to abandoned properties
are charged to operations.
F-
15
Exploration costs are charged to operations
as incurred until such time that proven reserves are discovered. From that time forward, the Company will capitalize all costs
to the extent that future cash flow from mineral reserves equals or exceeds the costs deferred. The deferred costs will be amortized
over the recoverable reserves when a property reaches commercial production. As at September 30, 2012 and 2011, the Company does
not have proven reserves. Exploration activities conducted jointly with others are reflected at the Company's proportionate interest
in such activities.
The Company reviews the carrying values
of its mineral properties on a regular basis by reference to the project economics including the timing of the exploration or development
work, the program of works and the exploration results experienced by the Company and others. The review of the carrying value
of any producing property will be made by reference to the estimated future operating results and net cash flows. When the carrying
value of a property exceeds its estimated net recoverable amount, provision is made for the decline in value.
The recoverability of the amounts recorded
for mineral properties is dependent on the confirmation of economically recoverable reserves, confirmation of the Company's
interest in the underlying mineral claims, the ability of the Company to obtain the necessary financing to successfully complete
their development and the attainment of future profitable operations or proceeds from disposal.
Estimated costs related to site restoration
programs during the commercial development stage of the property are accrued over the life of the project.
g.
Stock-Based Compensation
The Company accounts for share-based payments
under the fair value method of accounting for stock-based compensation consistent with GAAP. Under the fair value method, stock-based
compensation cost is measured at the grant date based on the fair value of the award using the Black-Sholes option pricing model
and is recognized to expense on a straight-line basis over the requisite service period, which is generally the vesting period.
Where upon grant the options vest immediately the stock-based costs are expensed immediately.
h.
Interest Expense
Interest expense for the periods ended
September 30, 2012 and 2011 were nil.
i.
Foreign Currency Translation and Transactions
The Company's reporting currency is the
United States Dollar (USD). Aurora Gold Mineração Ltda is a foreign operation and its functional currency is the
Brazilian Real (Real). Certain contractual obligations in these consolidated financial statements are stated in Brazilian Real's.
At the periods ended September 30, 2012 and 2011 the Brazilian Real exchange rate to the USD was $0.49290 to 1 Real (September
30, 2011: USD $0.55330 to 1 Real).
The Company translates foreign assets and
liabilities of its subsidiaries, other than those denominated in USD, at the rate of exchange at the balance sheet date. Income
and expenses of these subsidiaries are translated at the average rate of exchange throughout the reporting period. Gains or losses
from these translations are reported as a separate component of other comprehensive income (loss) until all or a part of the investment
in the subsidiaries is sold or liquidated. The translation adjustments do not recognize the effect of income tax because the Company
expects to reinvest the amounts indefinitely in operations.
Transaction gains and losses that arise
from exchange rate fluctuations on transactions denominated in a currency other than the local functional currency are included
in foreign exchange (gain) loss in the consolidated statements of operations.
j.
Concentration of Credit Risk
Financial instruments that subject the
Company to concentrations of credit risk consist primarily of cash and cash equivalents. The Company places its cash with high
credit quality financial institutions in Brazil and Canada. The Company occasionally has cash deposits in excess of federally insured
limits. The Company had funds deposited in banks beyond the insured limits as of September 30, 2012 and 2011 respectively. The
Company has not experienced any losses related to these balances, and management believes the credit risk to be minimal.
F-
16
k.
Fair Value of Financial Instruments and Risks
Fair value estimates of financial instruments
are made at a specific point in time, based on relevant information about financial markets and specific financial instruments.
As these estimates are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined
with precision. Changes in assumptions can significantly affect estimated fair value. The carrying value of cash, accounts payable,
accrued expenses and advances payable (including related parties) approximate their fair value because of the short-term nature
of these instruments.
Management is of the opinion that the Company
is not exposed to significant interest or credit risks arising from these financial instruments. The Company operates outside of
the United States of America (primarily in Brazil) and is exposed to foreign currency risk due to the fluctuation between the currency
in which the Company operates in and the USD.
l.
Income Taxes
The Company has adopted ASC 740,
Accounting
for Income Taxes
, which requires the Company to recognize deferred tax liabilities and assets for the expected future tax consequences
of events that have been recognized in the Company's financial statements or tax returns using the liability method. Under this
method, deferred tax liabilities and assets are determined based on the differences between the financial statement carrying amounts
and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to
reverse. In July 2006, the FASB issued an interpretation, which clarifies the accounting for uncertainty in income taxes recognized
in a company's financial statements in accordance with GAAP. This interpretation prescribes a recognition threshold and measurement
attribute for the financial statement recognition and measurement of a tax position taken in a tax return. It also provides guidance
on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Estimated interest
and penalties related to recording uncertain tax positions when recorded are included as a component of income tax expense on the
consolidated statement of operations. The Company has not recorded any liabilities for uncertain tax positions or any related interest
and penalties. The Company's tax returns are open to audit for the years ending December 31, 2008 to 2011 respectively.
m.
Basic and Diluted Net Income (Loss) Per Share
Earnings (loss) per share is computed by
dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during
the reporting period including common stock issued effective the date committed. Common stock issuable is considered outstanding
as of the original approval date for the purposes of earnings per share computations. Diluted earnings (loss) per common share
is computed by dividing net earnings (loss) by the sum of (a) the basic weighted average number of shares of common stock outstanding
during the period and (b) additional shares that would have been issued and potentially dilutive securities. During the nine months
ended September 30, 2012 and 2011 the diluted earnings (loss) per share was equivalent to the basic earnings (loss) per share because
all potentially dilutive securities were anti-dilutive due to the net losses incurred. Potentially dilutive securities consist
of stock options and warrants outstanding at the end of the reporting period. Stock options outstanding as at September 30, 2012
were 9,650,000 (September 30, 2011:1,200,000). Warrants outstanding as at September 30, 2012 were 8,000,000 (September 30, 2011:
Nil).
n.
Interim Financial Statements
In the opinion of management, the accompanying
unaudited condensed financial statements contain all adjustments which include only normal recurring adjustments, necessary to
present fairly the Company's financial position, results of operations and cash flows for the periods shown. The results
of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period.
The unaudited financial statements should
be read in conjunction with the Company's audited financial statements and notes for the year ended December 31, 2011, which
are included in the Company's Annual Report on Form 10-K.
F-
17
o.
Recent Accounting Pronouncements
The Company considers the effects of new
accounting pronouncements on the accounting, presentation and disclosure of its consolidated financial statements, as such pronouncements
become known. In June 2011, the FASB issued Accounting Standards Update ("ASU") No. 2011-05, Comprehensive Income or
ASU 2011-05. The guidance in ASU 2011-05 revises the manner in which entities present comprehensive income in their financial statements.
An entity is required to report the components of comprehensive income in either one or two consecutive financial statements:
·
A single, continuous statement must present the components of net
income and total net income, the components of other comprehensive income and total other comprehensive income, and a total for
comprehensive income.
·
In a two-statement approach, an entity must present the components
of net income and total net income in the first statement. That statement must be immediately followed by a financial statement
that presents the components of other comprehensive income, a total for other comprehensive income, and a total for comprehensive
income.
ASU 2011-05 does not change the items that
must be reported in other comprehensive income. The amendments in ASU 2011-05 are effective for fiscal years beginning after December
15, 2011 and the Company adopted this guidance effective January 1, 2012. In the consolidated statements of comprehensive income
(loss) the Company has presented comprehensive income in a single continuous statement.
At present, there are no other such pronouncements
not yet effective that the Company expects will have a material impact on these consolidated financial statements.
3.
Mineral Properties and Exploration Expenses
(a)
São Domingos Project in the Municipality of Itaituba, in the Tapajos gold province of
the State of Para, Brazil, Department of National Production Minerals (DNPM) Processes 850.684/06 and 850.782/05:
i.
DNPM Processes 850.684/06:
Aurora has good title over the mineral rights, which were granted
as DNPM Process number 850.684/06 and which is valid and in force, free and clear of any judicial and extrajudicial encumbrances
and taxes. The São Domingos mineral rights are located at the Municipality of Itaituba, State of Pará, and are registered
in the name of Aurora. On September 13, 2006 the Company applied to the DNPM for the conversion of the Application to an Exploration
Permit covering an area of 4,914.18 hectares. No payments or royalties are due regarding DNPM Process 850.384/06.
ii.
DNPM Processes 850.782/05:
Aurora has good title over the mineral rights object of the
DNPM Process No. 850.782/05, which is valid and in force, free and clear of any judicial and extrajudicial encumbrances and taxes.
On November 8, 2005 it was submitted to DNPM the Exploration Claim for gold in the Municipality of Itaituba, State of Pará.
The Exploration Permit was granted on November 28, 2006 for a three-year period. The transfer to Aurora was approved on March 24,
2009 and on September 28, 2009 it was requested the renewal of the Exploration Permit. This area was reduced from 6,756 hectares
to 5,651.98 hectares due to the overlapping with Garimpeira (alluvial) Mining properties held by Mr Celio Paranhos. However the
DNPM´s general attorney in Brasilia agreed with Aurora's legal thesis and nullified all applications filed by Mr Paranhos
(about to 1,900 applications). A new Exploration Permit rectifying the previous one was granted on August 20, 2010 for a three-year
period, for an area of 6,656.20 hectares. No payments or royalties are due regarding the DNPM Process 850.782/05 since it was acquired
through a permutation agreement with Altoro Mineração Ltda.
F-
18
iii.
DNPM Processes 850.012/06 and 850.013/06:
The exploration claims were submitted to DNPM on January 19,
2006, for gold covering an area of 1,128.08 hectares and 750.55 hectares respectively, in the Municipality of Itaituba, State of
Pará. According to information obtained such claims were correctly prepared and the required documents are in place. The
tenements 850.012/06 and 850.013/06 are held by Mr Antonio Oliveira Ferreira and were submitted to DNPM on January 19, 2006. The
tenements are located at Itaituba, State of Pará and are valid and in force, free and clear of any judicial and extrajudicial
encumbrances and taxes, but the area was blocked since it is inside of a Garimpeira Reserve. The transfer to Aurora will be submitted
after the Exploration Permits are granted. There are no payments or royalties related to the tenements according to the agreement
entered into with the previous owner.
iv.
DNPM Process 850.119/06:
The exploration claim was submitted to DNPM on March 7, 2006,
for gold covering an area of 1,068.72 hectares, in the Municipality of Itaituba, State of Pará. Aurora has good title over
the mineral rights object of the DNPM Process No. 850.119/06, which is valid and in force, free and clear of any judicial and extrajudicial
encumbrances and taxes. Aurora is the sole registered and beneficial holder of and owns and possesses good title to the referred
mineral rights. The Exploration Permit has not been granted yet. The above-mentioned area is not related to any payments or royalties
to third parties since Aurora claimed them directly.
v.
DNPM Process 859.587/95:
The tenement, was held by Vera Lucia Lopes, and is valid and
in force, and is free and clear of any judicial and extrajudicial encumbrances and taxes. It is located at the Municipality of
Itaituba, State of Pará. On November 27, 1995, it was submitted to DNPM the Exploration Claim for gold. The Exploration
Permit was granted on September 15, 2006, for a three-year period covering an area of 5,000 hectares, and it was valid until September
15, 2009. On July 15, 2009, it was requested the renewal of the Exploration Permit which was granted and transferred to Aurora
and published on June 29, 2012. There are no payments or royalties related to the tenements since all payments due under the terms
of the agreement entered into with the previous owner have been already made.
(b)
Gold properties in the Municipality of Itaituba, in the Tapajos gold province of the State of
Para, Brazil, Department of National Production Minerals (DNPM) Processes
vi.
Comandante Araras Project - DNPM Processes 853.785/93 to 853.839/93 inclusive (relinquished):
On October 17, 2011 the Company terminated
this licence and Option Agreement by providing written notice to Samba. The Company is free of all and any future payment commitments.
The interest in the properties was formally relinquished in January 2012.
vii.
São João Project - DNPM Processes 851.533/94 to 851.592/94 inclusive (relinquished):
On October 17, 2011 the Company terminated
this licence and Option Agreement by providing written notice to Samba. The Company is free of all and any future payment commitments.
The interest in the properties was formally relinquished in January 2012.
viii.
DNPM Processes 850.014/06, 850.581/06 and 850.256/07:
The Company has the right to acquire good
title over the mineral rights object of the Tenements. The Tenements are registered in the name of Antonio Oliveira Ferreira. The
exploration claims were submitted to DNPM respectively on January 19, 2006, August 8, 2006 and April 17, 2007 for gold covering
the areas of 421.45 hectares, 4276.03 hectares and 4036.00 hectares, in the Municipality of Itaituba and Jacareacanga, State of
Pará. According to information obtained such claims were correctly prepared and the required documents are in place. The
tenement 850.014/06 has not been transferred to Samba yet since the Exploration Permit has not been granted so far. The Exploration
Permit for the Process 850.581/06 was granted on February 15, 2011 for a three-year period, for an area of 4273.03 hectares. The
transfer to Samba Brazil Mineração Ltda has not been presented yet. The Exploration Permit for the Process 850.256/07
was granted on November 30, 2007 for a three-year period but it was cancelled on May 21, 2008 because the holder didn't pay
the annual fees on time. On June 10, 2008 it was presented an appeal to have the annulment dismissed, which hasn't been analyzed
yet. However, if the appeal is not approved, Samba Brazil's rights over this tenement are guaranteed since only Samba Brazil
has presented a Bid application for this process on July 18 2008. According to the Agreement signed between Samba Brazil and Antonio
Oliveira Ferreira on June 5, 2008, a total amount of 120,000 Brazilian Real's has already been paid by Samba Brazil for the
acquisition of the Tenements.
F-
19
(c)
British Columbia, Canada – Kumealon Property (relinquished)
On January 20, 2012 the Company's Kumealon claim over
the property was relinquished.
(d)
Sale of AGC Resources
On June 14, 2011, the Company, entered into an Asset Purchase
Agreement with Devtec Management Ltd. ("Devtec"), pursuant to which the Company sold its subsidiary, AGC, which owns
certain properties in Boulder, Colorado (see note 3(b) for a discussion of the specific assets purchased by AGC in June 2010),
to Devtec for a total of $2 million, plus royalty. Under the terms of the agreement, Devtec will pay the Company $1 million upon
production of the cumulative total of 1,000 ounces of gold and/or silver, and a further $1 million on the six-month anniversary
of the payment of the first $ 1 million. Additionally, Devtec will pay the Company a 5% royalty from the start of production.
The Company was unable to reasonably estimate the amount of
minerals the properties will produce, if any, and thus there was uncertainty as to whether the purchase price will be collected.
Given this, collection of the purchase price is not considered reasonably possible at the time of these consolidated financial
statements given the current uncertain status of exploration work on the Boulder, Colorado properties and thus no purchase price
has been recorded as of September 30, 2012. Therefore, the Company recognized a loss on the sale of its subsidiary of $2,757,511
for the nine months ended September 30, 2011, which represented the net book value of the assets transferred to Devtec on June
14, 2011 (no liabilities were assumed by Devtec) as follows:
Reclamation bonds
$
245,221
Buildings and equipment
$
753,605
Participating interest in mineral property
$
1,758,685
$
2,757,511
Subsequent to the sale of AGC, the Company
determined it would not retain ownership to the reclamation bonds asset associated with the properties. A loss of $245,221, the
carrying value of the bonds, was recorded during the three months ended September 30, 2011. The disclosed total loss from the sale
of AGC was adjusted to include the loss on the disposition of the reclamation bonds.
4.
Advances Payable
During March 2012, the Company entered
into debt settlement agreements for $105,000 of advances received from a director of the Company and a company during fiscal 2011.
During August 2012, the Company received $50,000 from a director and officer as an advance, which is non-interest bearing and due
on successful capital raising. As at September 30, 2012 advances payable were $82,000.
5.
Common Stock
On September 21, 2012, Aurora Gold Corporation
(the "Company"), entered into a subscription agreement (the "Subscription Agreement ") with Alltech Capital
Limited ("Investor"), pursuant to which the Company agreed to sell, and the Investor agreed to purchase, 135,000,000
shares of the Company's common stock for a purchase price of $5,000,000. The closing of the transaction contemplated by the
Subscription Agreement occurred in October, 2012 (see Note 9), subject to each of the Company and Investor satisfactorily meeting
or waiving the closing conditions contained in the Subscription Agreement. A copy of the Subscription Agreement was lodged with
the SEC on September 27, 2012.
F-
20
The Company intends to finance activities
by raising capital through the equity markets. In October 2011 the Company filed a Registration Statement on Form S-1 offering
up to a maximum of 50,000,000 units of the Company's securities at an offering price of $0.10 per Unit in a direct public offering,
without any involvement of underwriters or broker-dealers. Each Unit consists of one (1) share of common stock at a $0.001 par
value per share and one (1) Stock Purchase Warrant. Each full Warrant entitles the holder to purchase one additional share of common
stock at a price of $0.20 for a period of two years commencing November 1, 2011 through October 31, 2013. The Units will be sold
by the Chief Executive Officer and Chief Financial Officer. A Notice of Effectiveness was issued April 25, 2012. The offer will
expire January 20, 2013. To date, no funds have been obtained from this offering.
On April 16, 2012,
the Company entered into subscription agreements for 1,316,000 shares of common stock at a purchase price of $0.06 per share for
a gross aggregate price of $78,960. Pursuant to the subscription agreements, each of the Investors has represented that they are
not a U.S. person; as such term is defined in Regulation S. In connection with the offering, the Company has agreed to pay a cash
commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum $600,000 subscription.
During April
2012, the Company entered into a debt settlement agreement for $18,000 in accounts payable which was settled for 300,000
shares of common stock at an issue price of $0.06 per share.
During March
2012, the Company entered into debt settlement agreements for advances received from a director of the Company and a company during
fiscal 2011 as well as $14,454 of amounts in accounts payable and accrued expenses. $119,454 was settled for 1,990,900
shares
of common stock at an issue price of $0.06 per share. As at March 31, 2012 advances on stock subscriptions were $37,513 and received
during that quarter.
In March 2012, the Company entered into
subscription agreements for 625,217 shares of common stock at a purchase price of $0.06 per share for a gross aggregate price of
$37,513. Share certificates were not issued as at March 31, 2012 and they were treated as an Advance for Stock Subscriptions. The
share certificates were issued in April 2012. Pursuant to the subscription agreements, each of the Investors has represented that
they are not a U.S. person; as such term is defined in Regulation S. In connection with the offering, the Company has agreed to
pay a cash commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum $600,000 subscription
that is being offered.
On December 20, 2011, the Company entered
into subscription agreements for 8,000,000 shares of common stock at a purchase price of $0.04 per share for a gross aggregate
price of $320,000. Attached to each unit of common stock is one (1) series A stock purchase warrant. Each full Series A warrant
entitles the holder to purchase an additional share of the Company's common stock at an exercise price of $0.08 per share
for a period of eighteen months commencing on December 20, 2011 and expiring on June 20, 2013. Pursuant to the subscription agreements,
each of the Investors has represented that they are not a U.S. person; as such term is defined in Regulation S. In connection with
the offering, the Company has agreed to pay a cash commission equal to 8% of all funds received or an aggregate of up $25,600.
The actual amount included in creditors for the period ended March 31, 2012 was $8,800. It is anticipated this will be the total
amount of commission paid.
On December 15, 2011, the Company entered
into debt settlement agreements with creditors and related parties in consideration for the issue of the Company's common
stock at a per share price of $0.02 per share. $218,754 was settled for 10,937,721 shares of common stock.
In September 2011, 1,671,000 shares were
issued to an individual for cash at $0.10 per share. In September 2011, 150,000 shares were issued to a company for services rendered
at $0.16 per share.
In April 2011, as an incentive to assist
with future private placements, the Company authorized the payment of a non-cash finder's fee of 450,000 shares of common
stock of the Company in connection with the private placement completed in April 2010. The shares were issued in May 2011. All
shares issued were to individuals and companies who reside outside the United States of America. The issuance of the shares was
exempt from the registration requirements of Securities Act by virtue of Section 4(2) thereof as well as the exemption from registration
requirements afforded by Regulation S.
F-
21
6.
Stock
Options
In 2007, the Company's Board of Directors
approved the 2007 Stock Option Plan (amended September 29, 2008) ("the Plan") to offer an incentive to obtain services
of key employees, directors and consultants of the Company. The Plan provides for the reservation for awards of an aggregate of
10% of the total shares of Common Stock outstanding from time to time. No Plan participant may receive stock options exercisable
for more than 2,500,000 shares of Common Stock in any one calendar year. Under the Plan, the exercise price of an incentive stock
option must be at least equal to 100% of the fair market value of the common stock on the date of grant (110% of fair market value
in the case of options granted to employees who hold more than 10% of the Company's capital stock on the date of grant). The term
of stock options granted under the Plan is not to exceed ten years and the stock options vest immediately upon granting.
The following is a summary of stock option
activity and the status of stock options outstanding and exercisable at September 30, 2012:
Stock
Options
#
Weighted
Average
Exercise Price
$
Remaining
Contractual
Life (years)
As At
Aggregate
Intrinsic value
As At
Outstanding and exercisable at December 31, 2011
9,050,000
0.110
4.28
36,500
Forfeited during quarter March 31, 2012
(200,000
)
0.260
-
-
Granted during quarter March 31, 2012
1,600,000
0.050
-
-
Outstanding and exercisable at March, 31, 2012
10,450,000
0.090
4.21
42,000
Granted during quarter June 30, 2012
200,000
0.065
-
-
Outstanding and exercisable at June, 30, 2012
10,650,000
0.097
3.97
34,125
Forfeited during quarter September 30, 2012
(1,000,000
)
0.260
-
-
Granted during quarter September 30, 2012
-
-
-
-
Outstanding and exercisable at September, 30, 2012
9,650,000
0.080
3.74
52,500
The aggregate
intrinsic value in the table above represents the total pre-tax intrinsic value for all "in-the-money" options (i.e.
the difference between the Company's closing stock price on the last trading day of the fiscal year and the exercise price,
multiplied by the number of shares) that would have been received by the option holders had all option holders exercised their
options on September 30, 2012.
During the quarter
ended September 30, 2012, Lars Pearl's 1,000,000 options lapsed on August 6, 2012.
Effective
April 10, 2012, the Company's board of directors granted 200,000 stock purchase options pursuant to the Company's 2007
Stock Option Plan. Each of the Options has an issue date, effective date and vesting date of April 10, 2012, with an exercise price
of $0.065 per share. The term of these Options are five years. The Options are exercisable at any tim
e from the grant date
up to and including April 9, 2017.
During the quarter
ended March 31, 2012, Cameron Richardson departed the Company, an exercise notice for the 200,000 options held was not lodged and
consequently the options lapsed during the quarter.
Effective January
13, 2012, the Company's board of directors granted 1,600,000 stock purchase options pursuant to the Company's 2007
Stock Option Plan. Each of the Options has an issue date, effective date and vesting date of January 13, 2012, with an exercise
price of $0.05 per share. The term of these Options are five years. The Options are exercisable at any time from the grant date
up to and including January 12, 2017.
F-
22
Effective
November 24, 2011, the Company's board of directors granted 3,650,000 stock purchase options pursuant to the Company's
2007 Stock Option Plan. Each of the Options has an issue date, effective date and vesting date of November 24, 2011, with an exercise
price of $0.05 per share. The term of these Options are five years. The Options are exercisable at any tim
e from the grant
date up to and including November 23, 2016.
Effective October
11, 2011, the Company's board of directors granted 4,200,000 stock purchase options pursuant to the Company's 2007
Stock Option Plan. Each of the Options has an issue date, effective date and vesting date of October 11, 2011, with an exercise
price of $0.12 per share. The term of these Options are five years. The Options are exercisable at any time from the grant date
up to and including October 10, 2016.
On June 15, 2011
Michael Montgomery resigned from the board of directors, an exercise notice for the 500,000 options held was not lodged and consequently
the options lapsed on July 15, 2011.
The total fair
value of options granted during the three months ended June 30, 2012 was $11,979 (June 30, 2011: nil) and expensed in full as options
were vested in full on grant. The fair value of options are determined using the Black Scholes option pricing model that takes
into account the exercise price, the expected life of the option, the share price at grant date (April 10, 2012) and expected price
volatility of the underlying share, the expected dividend yield (nil assumed) and the risk free interest rate (4.50% used) for
the term of the option. Management determined 2.50 years to be the average expected likely life of the options and utilized the
simplified method due to the fact that the Company has not had significant options granted to develop historical data to provide
a reasonable basis to estimate option lives. Volatility rates were calculated at the grant date of the option tranche and a rate
of 161.04% was used.
The total fair
value of options granted for the three months ended March 31, 2012 was $43,681 (March 31, 2011: nil) and expensed in full as options
were vested in full on grant. The fair value of options are determined using the Black Scholes option pricing model that takes
into account the exercise price, the expected life of the option, the share price at grant date (January 13, 2012) and expected
price volatility of the underlying share, the expected dividend yield (nil assumed) and the risk free interest rate (4.50% used)
for the term of the option. Management determined 2.50 years to be the average expected likely life of the options and utilized
the simplified method due to the fact that the Company has not had significant options granted to develop historical data to provide
a reasonable basis to estimate option lives. Volatility rates were calculated at the grant date of the option tranche and a rate
of 120.89% was used.
As of September
30, 2012, there are outstanding Warrants to purchase 8,000,000 shares of common stock with an exercise price of $0.08 expiring
June 20, 2013.
7.
Related Party
Transactions
Related party transactions not disclosed elsewhere in these
consolidated financial statements include:
·
During the nine-month period ended September 30, 2012 consulting fees of $297,190 (September 30,
2011: $191,742) were incurred to directors and officers (or companies of the officers and directors) of the Company. The transactions
were recorded at the exchange amount, being the value established and agreed to by the related parties.
·
Included in accounts payable and accrued expenses and advances payable (related parties) at September
30, 2012 and December 31, 2011 were $322,419 and $Nil respectively payable to officers and directors of the Company for consulting
fees and various expenses incurred on behalf of the Company.
8.
Non-Cash Investing and Financing Activities
In September 2011, 150,000 shares were issued to a company for
services rendered at $0.16 per share. The shares were issued to a company who resides outside the United States of America.
In April 2011, as an incentive to assist with future private
placements, the Company authorized the payment of a non-cash finder's fee of 450,000 shares of common stock of the Company
in connection with the private placement completed in April 2010. The shares were issued in May 2011. The issuance of these shares
had no net effect on total shareholders' equity or results of operations as they related to fees associated with issuance of shares.
F-
23
9.
Subsequent Events
On September 21, 2012, Aurora Gold Corporation
(the "Company"), entered into a subscription agreement (the "Subscription Agreement ") with Alltech Capital
Limited ("Investor"), pursuant to which the Company agreed to sell, and the Investor agreed to purchase, 135,000,000
shares of the Company's common stock for a purchase price of $5,000,000. The closing of the transaction contemplated by the
Subscription Agreement occurred in October 2012, subject to each of the Company and Investor satisfactorily meeting or waiving
the closing conditions contained in the Subscription Agreement. A copy of the Subscription Agreement was lodged with the SEC on
September 27, 2012.
On October 5,
2012, the Company, completed the sale of 135,000,000 shares of the Company's common stock for a purchase price of $5,000,000,
to Alltech Capital Limited pursuant to the terms of a subscription agreement entered into between the Company and the Alltech Capital
Limited dated September 21, 2012. As a result of the sale of 135,000,000 shares of the Company's common stock of approximately
54%, a change in control of the Company has occurred. As a condition to the closing of the transaction, the Company agreed to increase
the size of its board of directors to five (5) members and to appoint two board members selected by the Investor. The board of
directors appointed each of Messrs. Vladimir Bernshtein and Andrey Ratsko to serve as directors of the Company. Additionally, Mr.
Bernshtein has been named as the Company's Chief Business Development Director.
Other than the
aforementioned there were no subsequent events at the date of filing.
F-
24
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
Aurora Gold Corporation
We have audited the accompanying consolidated
balance sheets of Aurora Gold Corporation (an exploration stage company) and Subsidiary ("the Company") as of December 31,
2011 and 2010, and the related consolidated statements of operations, stockholders' equity (deficiency) and comprehensive income
(loss), and cash flows for the years then ended, and for the period from October 10, 1995 (date of inception) to December 31,
2011. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated 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 misstatement. The Company
has determined that it is not required to have, nor were we engaged to perform, an audit of its internal control over financial
reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's
internal control over financial reporting. Accordingly, we express no such opinion. 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 consolidated financial
statements referred to above present fairly, in all material respects, the financial position of Aurora Gold Corporation (an exploration
stage company) and Subsidiary as of December 31, 2011 and 2010, and the results of their operations and their cash flows for
the years then ended, and for the period from October 10, 1995 (date of inception) to December 31, 2011, in conformity with
accounting principles generally accepted in the United States.
The accompanying consolidated financial
statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the consolidated
financial statements, the Company has incurred operating losses since inception, has not been able to generate any operating revenues
to date, and used cash from operations of $1,062,075 in 2011. These conditions raise substantial doubt about the Company's ability
to continue as a going concern. Management's plans regarding those matters are also described in Note 1. The consolidated financial
statements do not include any adjustments that might result from the outcome of this uncertainty.
/S/ PETERSON SULLIVAN LLP
Seattle, Washington
March 23, 2012
F-
25
AURORA GOLD CORPORATION
(An exploration stage enterprise)
Consolidated Balance Sheets
December 31, 2011 and 2010
(Expressed in U.S. Dollars)
AURORA GOLD CORPORATION
(An exploration stage enterprise)
As at
As at
Consolidated Balance Sheets
December 31
December 31
December 31, 2011 and 2010
2011
2010
(Expressed in U.S. Dollars)
$
$
ASSETS
Current assets
Cash
237,426
579,191
Prepaid expenses and other assets
-
20,154
Total current assets
237,426
599,345
Non-current assets
Mineral property reclamation bonds
-
325,221
Buildings and equipment, net
-
849,445
Participating interest in mineral property (Note 3)
-
1,758,685
Total non-current assets
-
2,933,351
Total
assets
237,426
3,532,696
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
Current liabilities
Accounts payable and accrued expenses
400,644
354,755
Accounts payable and accrued expenses – related parties
-
17,264
Advances payable
45,000
-
Advances payable – related parties
92,000
-
Total current liabilities
537,644
372,019
Stockholders' Equity (Deficiency)
Common stock
Authorised: 300,000,000 (2010: 300,000,000) common shares with par value of $0.001 each
Issued and outstanding: 109,912,589 (2010: 88,703,868) common shares
109,913
88,704
Advances for stock subscriptions
20,000
-
Additional paid-in capital
22,040,994
20,938,292
Accumulated deficit during the exploration stage
(22,400,600
(17,773,262
Accumulated other comprehensive income (loss)
(70,525
(93,057
Stockholder' equity (deficiency)
(300,218
3,160,677
Total liabilities and stockholders' equity (deficiency)
237,426
3,532,696
(The accompanying notes are an integral
part of these consolidated financial statements.)
F-
26
AURORA GOLD CORPORATION
(An exploration stage enterprise)
Consolidated Statements of Operations
(Expressed in U.S. Dollars)
Cumulative
October 10 1995
(inception)
Year Ended
Year Ended
to December 31
December 31
December 31
2011
2011
2010
$
$
$
Expenses
Administrative and general
2,336,914
550,655
397,848
Depreciation and amortization
145,126
27,897
17,738
Imputed interest on loan payable - related party
1,560
-
-
Interest and bank charges
394,257
7,867
26,148
Foreign exchange loss (gain)
(15,319
)
(1,613
)
7,778
Professional fees - accounting and legal
1,808,036
241,125
428,543
Property search and negotiation
479,695
-
150,000
Salaries, management and consulting fees
3,471,173
668,926
629,715
8,621,442
1,494,857
1,657,770
Exploration expenses
9,731,339
307,613
644,313
Write-off of equipment
240,338
67,357
-
18,593,119
1,869,827
2,302,083
Other income (loss)
Gain / (loss) on disposition of subsidiary
(2,541,037
)
(2,757,511
)
-
Interest income
22,353
-
-
Gain on sale of rights to Matupa Agreement (net)
80,237
Loss on investments
(37,971
)
-
-
Loss on spun-off operations
(316,598
)
-
-
Loss on debt extinguishment
(1,014,465
)
-
-
(3,807,481
)
-
-
Net loss for the period
(22,400,600
)
(4,627,338
)
(2,302,083
)
Loss per share
- basic and diluted
(0.05
)
(0.03
)
Weighted average number of common shares
Outstanding
- basic and diluted
90,537,439
81,069,047
(The accompanying notes are an integral
part of these consolidated financial statements.)
F-
27
AURORA GOLD CORPORATION
(An exploration stage enterprise)
Consolidated Statements of Stockholder's
Equity (Deficiency)
and Comprehensive Income (Loss)
October 10, 1995 (inception) to December
31, 2011
(Expressed in U.S. Dollars)
Accumulated
Total
Advances for
Accumulated
Other
stockholders'
Common Stock
Additional
Comprehensive
Stock
(deficit) during
comprehensive
equity
Shares
Amount
paid-in capital
(loss)
Subscriptions
exploration stage
income (loss)
(deficiency)
#
$
$
$
$
$
$
$
Balance, October 10, 1995
-
-
-
-
-
-
-
Issuance of common stock for - settlement of indebtedness
11,461,153
11,461
-
-
-
-
-
11,461
Net (loss) for the period
-
-
-
-
-
-
Total comprehensive (loss)
-
-
Balance December 31, 1995
11,461,153
11,461
-
-
-
-
-
11,461
Adjustment for reverse stock split
(7,640,766
)
(7,641
)
-
-
-
-
-
(7,641
)
Issuance of common stock for - cash at $0.001 per share
5,800,000
5,800
341,761
-
-
-
-
347,561
- resource property
300,000
300
2,700
-
-
-
-
3,000
Net (loss) for the period
(361,208
)
(361,208
)
-
(361,208
)
Total comprehensive (loss)
(361,208
)
Balance December 31, 1996
9,920,387
9,920
344,461
(361,208
)
-
(6,827
)
Issuance of common stock for - cash in March 1997 at $1.00 per share  (less issue costs of $4,842)
750,000
750
744,408
-
-
-
-
745,158
Net (loss) for the period
(615,880
)
-
(615,880
)
-
(615,880
)
Total comprehensive (loss)
(615,880
)
Balance December 31, 1997
10,670,387
10,670
1,088,869
-
(977,088
)
-
122,451
Issuance of common stock for:
- settlement of indebtedness
96,105
96
68,601
-
-
-
-
68,697
- cash in May 1998 at $1.25 per share
200,000
200
249,800
-
-
-
-
250,000
- cash in November 1998 at $0.75 per share
71,667
72
53,678
-
-
-
-
53,750
- cash in December 1998 at $0.75 per share
143,333
143
107,357
-
-
-
-
107,500
Grant of options to employees and directors
518,900
-
-
-
-
518,900
Grant of options to consultants
172,100
-
-
-
-
172,100
Net (loss) for the period
(1,151,604
)
-
(1,151,604
)
-
(1,151,604
)
Total comprehensive (loss)
(1,151,604
)
Balance December 31, 1998
11,181,492
11,181
2,259,304
-
(2,128,692
)
-
141,794
Issuance of common stock for:
- settlement of indebtedness
231,286
231
160,151
-
-
-
-
160,382
F-
28
- cash in March 1999 at $0.656 per share
22,871
23
14,977
-
-
-
-
15,000
- finder's fee in February 1999 at $0.81 per share
25,000
25
20,287
-
-
-
-
20,312
Grant of options to consultants
29,500
-
-
-
-
29,500
Cash advanced on stock subscriptions
-
425,000
-
425,000
Net (loss) for the period
(855,391
)
-
(855,391
)
-
(855,391
)
Total comprehensive (loss)
(855,391
)
Balance December 31, 1999
11,460,649
11,461
2,484,219
425,000
(2,984,083
)
-
(63,403
)
Issuance of common stock for:
- settlement of indebtedness
199,000
199
99,301
-
-
-
-
99,500
- cash in March 2000 at $0.50 per share
350,000
350
174,650
-
(175,000
)
-
-
-
- cash in March 2000 at $0.455 per share
550,000
550
249,450
-
(250,000
)
-
-
-
Cancellation of shares in April 2000
(90,706
)
(91
)
(56,600
)
-
-
-
-
(56,691
)
Exercise of options in June 2000
405,000
405
3,645
-
-
-
-
4,050
Spin-off of Aurora Metals (BVI) Limited
316,498
-
-
-
-
316,498
Net (loss) for the period
(677,705
)
-
(677,705
)
-
(677,705
)
Total comprehensive (loss)
(677,705
)
Balance December 31, 2000
12,873,943
12,874
3,271,163
-
(3,661,788
)
-
(377,751
)
Components of comprehensive income (loss):
- Net income for the period
128,545
-
128,545
-
128,545
- Unrealized holding losses on available-for-sale securities
(141,928
)
-
-
(141,928
)
(141,928
)
Total comprehensive (loss)
(13,383
)
Balance December 31, 2001
12,873,943
12,874
3,271,163
-
(3,533,243
)
(141,928
)
(391,134
)
Issuance of common stock for:
- settlement of indebtedness
3,708,038
3,708
351,492
-
-
-
-
355,200
Components of comprehensive income (loss):
-
-
-
-
- Net loss for the period
(137,329
)
-
(137,329
)
-
(137,329
)
- Unrealized holding losses on available-for-sale securities
141,928
-
-
141,928
141,928
Total comprehensive (loss)
4,599
Balance, December 31, 2002
16,581,981
16,582
3,622,655
-
(3,670,572
)
-
(31,335
)
Issuance of common stock for:
- settlement of indebtedness
2,752,450
2,752
114,806
-
-
-
-
117,558
- cash in  December 2003 at $0.25 per share
100,000
100
24,900
-
-
-
-
25,000
Components of comprehensive income (loss):
- Net loss for the period
(96,404
)
-
(96,404
)
-
(96,404
)
- Unrealized holding
-
-
-
-
-
F-
29
losses  on available-for-sale securities Total comprehensive (loss)
(96,404
)
Balance, December 31, 2003
19,434,431
19,434
3,762,361
-
(3,766,976
)
-
14,819
Issuance of common stock for:
- cash in January 2004 at $0.25 per share, less issuance costs
100,000
100
22,400
-
-
-
-
22,500
Imputed interest
1,560
-
-
-
-
1,560
Components of comprehensive income (loss):
- Net loss for the period
(223,763
)
-
(223,763
)
-
(223,763
)
- Unrealized holding losses on available-for-sale securities
-
-
-
-
-
Total comprehensive (loss)
(223,763
)
Balance, December 31, 2004
19,534,431
19,534
3,786,321
-
(3,990,739
)
-
(184,884
)
Issuance of common stock for:
- cash in July 2005 at $0.05 per share
13,000,000
13,000
637,000
-
-
-
-
650,000
- settlement of indebtedness
3,684,091
3,684
158,816
-
-
-
-
162,500
Components of comprehensive income (loss):
- Net (loss) for the period
(457,271
)
-
(457,271
)
-
(457,271
)
- Unrealized holding losses on available-for-sale securities
(4,614
)
-
-
(4,614
)
(4,614
)
Total comprehensive (loss)
(461,885
)
Balance, December 31, 2005
36,218,522
36,218
4,582,137
-
(4,448,010
)
(4,614
)
165,731
Issuance of common stock for - cash in February 2006 at $0.50 per share less issuance costs of $110,000:
8,000,000
8,000
3,882,000
-
-
-
-
3,890,000
- non cash finder's fee in December 200 at $0.70 per share
250,000
250
174,750
-
-
-
-
175,000
- cash in December 2006 at $0.50 per share
1,000,000
1,000
499,000
-
-
-
-
500,000
Components of comprehensive income (loss):
t (loss) for the period
(5,463,855
)
-
(5,463,855
)
-
(5,463,855
)
- Foreign currency translation adjustments
(3,692
)
-
-
(3,692
)
(3,692
)
- Reclassification adjustment for losses on available-for-sale securities included in net loss
4,614
-
-
4,614
4,614
Total comprehensive (loss)
(5,462,933
)
Balance, December 31, 2006
45,468,522
45,468
9,137,887
-
(9,911,865
)
(3,692
)
(732,202
)
Issuance of common stock for:
- cash in March 2007 at $0.50 per share
500,000
500
249,500
-
-
-
-
250,000
F-
30
- cash in July 2007 at $0.25 per share
5,000,000
5,000
1,245,000
-
-
-
-
1,250,000
- settlement of indebtedness in August 2007 at $0.20 per share
250,000
250
49,750
-
-
-
-
50,000
- cash in September 2007 at $0.20 per share
4,000,000
4,000
796,000
-
-
-
-
800,000
Stock option compensation expense
454,295
-
-
-
-
454,295
Components of comprehensive income (loss):
- Net (loss) for the period
(3,259,732
)
-
(3,259,732
)
-
(3,259,732
)
- Foreign currency translation adjustments
(65,255
)
-
-
(65,255
)
(65,255
)
Total comprehensive (loss)
(3,324,987
)
Balance, December 31, 2007
55,218,522
55,218
11,932,432
-
(13,171,597
)
(68,947
)
(1,252,894
)
- Issuance of common stock for - non cash finder's fee in July 2008 at $0.10 per share
250,000
250
24,750
-
-
-
-
25,000
- settlement of indebtedness in December2008 at $0.06 per share
2,603,333
2,603
153,597
-
-
-
-
156,200
Components of comprehensive income (loss):
- Net (loss) for the period
(520,105
)
-
(520,105
)
-
(520,105
)
- Foreign currency translation adjustments
36,259
-
-
36,259
36,259
Total comprehensive (loss)
(483,846
)
Balance, December 31, 2008
58,071,855
58,071
12,110,779
-
(13,691,702
)
(32,688
)
(1,555,540
)
- Issuance of common stock for - settlement of indebtedness in September 2009 at $0.15 per share
5,000,000
5,000
1,748,616
-
-
-
-
1,753,616
- cash in September 2009 at $0.10 per share less finder's fee
3,000,000
3,000
255,000
-
-
-
-
258,000
- non cash finder's fee September 2009 at $0.10 per share
420,000
420
41,580
-
-
-
-
42,000
- settlement of indebtedness in November 2009 at $0.18 per share
100,000
100
17,899
-
-
-
-
17,999
- settlement of indebtedness in November 2009 at $0.24 per share
150,000
150
35,611
-
-
-
-
35,761
- cash in December 2009 at $0.30 per share
1,666,667
1,667
498,333
-
-
-
-
500,000
Components of comprehensive income (loss):
- Net (loss) for the period
(1,779,477
)
-
(1,779,477
)
-
(1,779,477
)
- Foreign currency translation adjustments
(60,171
)
-
-
(60,171
)
(60,171
)
Total comprehensive (loss)
(1,839,648
)
Balance, December 31, 2009
68,408,522
68,408
14,707,818
-
(15,471,179
)
(92,859
)
(787,812
)
F-
31
- Issuance of common stock for cash in April 2010 at $0.30 per share less finder's fee (paid with 1,126,111 shares included herein)
14,109,446
14,110
3,880,890
-
-
-
-
3,895,000
- non cash property acquisition in June 2010 at $0.40 per share
5,000,000
5,000
1,995,000
-
-
-
-
2,000,000
- settlement of indebtedness in September 2010 at $0.30 per share
160,500
161
47,989
-
-
-
-
48,150
- settlement of indebtedness in September 2010 at $0.30 per share
325,400
325
97,295
-
-
-
-
97,620
- payment of expenses in September 2010 at $0.30 per share
200,000
200
59,800
-
-
-
-
60,000
- non cash finder's fee in September 2010 related to the June 2010 property acquisition at $0.30 per share
500,000
500
149,500
-
-
-
-
150,000
Components of comprehensive income (loss)
- Net (loss) for the period
(2,302,083
)
-
(2,302,083
)
-
(2,302,083
)
- Foreign currency translation adjustments
(198
)
-
-
(198
)
(198
)
Total comprehensive (loss)
(2,302,281
)
Balance, December 31, 2010
88,703,868
88,704
20,938,292
-
(17,773,262
)
(93,057
)
3,160,677
-Issuance of common stock for non cash finder's fee in May 2011 at $0.042 per share
450,000
450
(450
)
-
-
-
-
-
-Issuance of common stock for cash in September 2011 at $0.10 per share
1,671,000
1,671
165,429
-
-
-
-
167,100
-Issuance of common stock for settlement of indebtedness in September 2011 at $0.16 per share
150,000
150
24,350
-
-
-
-
24,500
-Issuance of common stock for settlement of indebtedness in December 2011 at $0.02 per share
10,937,721
10,938
207,816
218,754
-Issuance of common stock for cash in December 2011 at $0.04 per share
8,000,000
8,000
312,000
320,000
-Issuance of common stock for cash in December 2011 at $0.04 per share - oversubscribed
20,000
20,000
-Stock option compensation expense
393,557
393,557
-Components of comprehensive income (loss)
- Net (loss) for the period
(4,627,338
)
-
(4,627,338
)
-
(4,627,338
)
- Foreign currency translation adjustments
22,532
-
-
22,532
22,532
Total comprehensive (loss)
(4,604,806
)
Balance, December 31, 2011
109,912,589
109,913
22,040,994
20,000
(22,400,600
)
(70,525
)
(300,218
)
(The accompanying notes are an integral
part of these consolidated financial statements.)
F-
32
AURORA GOLD CORPORATION
(An exploration stage enterprise)
Consolidated Statements of Cash Flows
(Expressed in U.S. Dollars)
Cumulative
October 10 1995
(inception)
Year Ended
Year Ended
to December 31
December 31
December 31
2011
2011
2010
$
$
$
Net loss for the period
(22,400,600
)
(4,627,338
)
(2,302,083
)
Adjustments to reconcile net loss to cash used in operating activities
depreciation and amortization
145,126
27,897
17,738
stock compensation expense on stock option grants
1,568,352
393,557
-
expenses satisfied with issuance of common stock
1,202,054
243,254
210,000
expenses satisfied with transfer of marketable securities
33,903
-
-
imputed interest on loan payable - related parties
1,560
-
-
write-off of mineral property assets
240,338
67,357
-
adjustment for spin-off of Aurora Metals (BVI) Limited
316,498
-
-
loss on disposal of subsidiary
2,757,511
2,757,511
-
realized loss on investments
37,971
-
-
gain on sale of rights to Matupa agreement (net)
(80,237
)
-
-
realized loss on debt extinguishment
1,014,465
-
-
foreign exchange (gain) loss related to notes payable
(24,534
)
-
-
Change in operating assets and liabilities
-
-
-
Decrease (Increase) in receivables and other assets
(206,978
)
-
-
(Increase) decrease in prepaid expenses and other
(20,459
)
20,344
54,449
Assets
Increase (decrease) in accounts payable and accrued expenses (including related party)
1,107,051
55,343
(403,216
)
Net Cash Used in Operating Activities
(14,307,979
)
(1,062,075
)
(2,423,112
)
Cash Flows From Investing Activities
Purchase of equipment
(205,348
)
-
(17,800
)
Proceeds on disposal of equipment
16,761
-
-
Payment for mineral property Reclamation Bonds
(245,221
)
80,000
(325,221
)
Proceeds from disposition of marketable securities
32,850
-
-
Acquisition of mineral property costs and related
(672,981
)
-
(500,000
)
Equipment
Payment for incorporation cost
(11,511
)
-
-
Net Cash Used in Investing Activities
(1,085,450
)
80,000
(843,021
)
Cash Flows From Financing Activities
Proceeds from common stock less issuance costs
14,044,439
507,100
3,895,000
Loan proceeds from related party
289,000
-
-
Net proceeds from (payments on) convertible notes and loans
969,252
-
(500,000
)
Net proceeds from (payments on) advances payable
45,000
45,000
(50,000
)
Net proceeds from (payments on) advances payable -related parties
92,000
92,000
(50,000
)
Net Cash Provided by Financing Activities
15,439,691
644,100
3,295,000
Effect of exchange rate changes on Cash
191,164
(3,790
)
(6,633
)
(Decrease) Increase in Cash
237,426
(341,765
)
22,234
Cash - Beginning of Period
-
579,191
556,957
Cash - End of Period
237,426
237,426
579,191
(The accompanying notes are an integral
part of these consolidated financial statements.)
F-
33
AURORA GOLD CORPORATION
Notes to the consolidated financial statements
December 31, 2011 and 2010
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Nature of Business and Going Concern
Aurora Gold Corporation ("the Company") was formed
on October 10, 1995 under the laws of the State of Delaware and is in the business of location, acquisition, exploration and, if
warranted, development of mineral properties. The Company's focus is on the exploration and development of its exploration
properties located in the Tapajos Gold Province, State of Pará, Brazil (see Note 3). The Company has not yet determined
whether its properties contain mineral reserves that may be economically recoverable and has not generated any operating revenues
to date.
These consolidated financial statements have been prepared in
accordance with generally accepted accounting principles applicable to a going concern which contemplates the realization of assets
and the satisfaction of liabilities and commitments in the normal course of business. The general business strategy of the Company
is to acquire mineral properties either directly or through the acquisition of operating entities. The Company has incurred recurring
operating losses since inception, has not generated any operating revenues to date and during 2011 operating activities used cash
of $1,062,075 (2010: $2,423,112). The Company requires additional funds to meet its obligations and maintain its operations.
These conditions raise substantial doubt about the Company's
ability to continue as a going concern. Management's plans in this regard are to raise equity financing through private or public
equity investment in order to support existing operations and expand its business. There is no assurance that such additional funds
will be available to the Company when required or on terms acceptable to the Company. In the event that the Company cannot obtain
additional funds, on a timely basis, or the operations do not generate sufficient cash flow, the Company may be forced to curtail
development or cease activities. These consolidated financial statements do not include any adjustments that might result from
this uncertainty.
1. Significant Accounting Policies
(a)
Principles of Consolidation
The Company follows accounting standards set by the Financial
Accounting Standards Board, referred to as the "FASB". The FASB sets accounting principles generally accepted in the
United States ("GAAP") that the Company follows to ensure they consistently report their financial condition, results
of operations, and cash flows. References to GAAP issued by the FASB in these footnotes are to the FASB Accounting Standards Codification,
referred to as Codification or "ASC".
These consolidated financial statements have been prepared in
accordance with GAAP and include the accounts of the Company and its wholly-owned subsidiaries, Aurora Gold Mineração
Ltda ("Aurora Gold Mineracao") and AGC Resources LLC ("AGC") (through to date of disposition of AGC, June
14, 2011, see Note 3). Collectively, they are referred to herein as "the Company". Significant inter-company accounts
and transactions have been eliminated. Aurora Gold Mineração was incorporated on October 27, 2005. AGC was formed
as a Limited Liability company on April 21, 2010 under the law of Colorado USA to hold the assets purchased from Global Minerals
Ltd as discussed in Note 3.
(b)
Accounting Estimates
The preparation of consolidated financial statements in conformity
with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those estimates and assumptions
F-
34
(c)
Cash Equivalents
Cash equivalents comprise certain highly liquid instruments
with a maturity of three months or less when purchased. The Company did not have any cash equivalents at December 31, 2011 and
2010. No amounts were paid for income taxes in 2011 or 2010 and cash paid for interest was nil in 2011 (2010: $45,065).
(d)
Buildings and equipment
Buildings and equipment are carried at cost (including development
and preproduction costs, capitalized interest, other financing costs and all direct administrative support costs incurred during
the construction period, net of cost recoveries and incidental revenues), less accumulated depletion and depreciation including
write-downs. Following the construction period, interest, other financing costs and administrative costs are expensed as incurred.
On the commencement of commercial production, depletion of each
mining property is provided on the unit-of-production basis, using estimated proven and probable reserves as the depletion basis.
Buildings and equipment utilized directly in commercial mining
activities are depreciated, following the commencement of commercial production, over their expected economic lives using either
the unit-of-production method or the straight-line method.
Depreciation for non-mining equipment is provided over the following
useful lives:
-
Vehicles
10 years
-
Office equipment, furniture and fixtures
2 to 10 years
The Company reviews the carrying values of its buildings and
equipment whenever events or changes in circumstances indicate that their carrying values may not be recoverable. An impairment
is considered to exist if total estimated future cash flows, or probability-weighted cash flows on an undiscounted basis, are less
than the carrying value of the assets. An impairment loss is measured and recorded based on discounted estimated future cash flows
associated with values beyond proven and probable reserves and resources. In estimating future cash flows, assets are grouped at
the lowest level for which there is identifiable future cash flows that are largely independent of cash flows from other asset
groups. Generally, in estimating future cash flows, all assets are grouped at a particular property for which there are identifiable
cash flows. Buildings and equipment utilized directly in commercial mining activities are depreciated, following the commencement
of commercial production, over their expected economic lives using either the unit-of-production method or the straight-line method.
(e)
Mineral property reclamation bonds and other related refundable costs
Costs paid for the purchase of reclamation bonds and other related
costs that are refundable are capitalized. If amounts paid are not to be refunded then they will be expensed when it is determined
they will not be refunded.
(f)
Mineral properties and exploration expenses
The Company accounts for its mineral properties on a cost basis
whereby all direct costs, net of pre-production revenue, relative to the acquisition of the properties are capitalized. All sales
and option proceeds received are first credited against the costs of the related property, with any excess credited to earnings.
Once commercial production has commenced, the net costs of the applicable property will be charged to operations using the unit-of-production
method based on estimated proven and probable recoverable reserves. The net costs related to abandoned properties are charged to
operations.
Exploration costs are charged to operations as incurred until
such time that proven reserves are discovered. From that time forward, the Company will capitalize all costs to the extent that
future cash flow from mineral reserves equals or exceeds the costs deferred. The deferred costs will be amortized over the recoverable
reserves when a property reaches commercial production. As at December 31, 2011 and 2010, the Company does not have proven reserves.
Exploration activities conducted jointly with others are reflected at the Company's proportionate interest in such activities.
F-
35
The Company reviews the carrying values of its mineral properties
on a regular basis by reference to the project economics including the timing of the exploration and/or development work, the work
programs and the exploration results experienced by the Company and others. The review of the carrying value of any producing property
will be made by reference to the estimated future operating results and net cash flows. When the carrying value of a property exceeds
its estimated net recoverable amount, provision is made for the decline in value.
The recoverability of the amounts recorded for mineral properties
is dependent on the confirmation of economically recoverable reserves, confirmation of the Company's interest in the underlying
mineral claims, the ability of the Company to obtain the necessary financing to successfully complete their development and the
attainment of future profitable operations or proceeds from disposition.
Estimated costs related to site restoration programs during
the commercial development stage of the property are accrued over the life of the project.
(g)
Stock-based compensation
The Company accounts for share-based payments under the fair
value method of accounting for stock-based compensation consistent with GAAP. Under the fair value method, stock-based compensation
cost is measured at the grant date based on the fair value of the award using the Black-Sholes option pricing model and is recognized
to expense on a straight-line basis over the requisite service period, which is generally the vesting period.
(h)
Interest expense
Interest expense was $0 in 2011 (2010: $14,150).
(i)
Foreign currency translations and transactions
The Company's reporting currency is the U.S. Dollar. Aurora
Gold Mineracao Ltda is a foreign operation and its functional currency is the Brazilian Real (Real). Certain contractual obligations
in these consolidated financial statements are stated in Brazilian Reals. The Brazilian Real to U.S. dollar exchange rate at December
31, 2011 was U.S. $0.5357 to 1 Real (2010: U.S. $0.5966 to 1 Real).
The Company translates foreign assets and liabilities of its
subsidiaries, other than those denominated in U.S. dollars, at the rate of exchange at the balance sheet date. Income and expenses
of these subsidiaries are translated at the average rate of exchange throughout the year. Gains or losses from these translations
are reported as a separate component of other comprehensive income (loss) until all or a part of the investment in the subsidiaries
is sold or liquidated. The translation adjustments do not recognize the effect of income tax because the Company expects to reinvest
the amounts indefinitely in operations.
Transaction gains and losses that arise from exchange rate fluctuations
on transactions denominated in a currency other than the local functional currency are included in foreign exchange (gain) loss
in the consolidated statements of operations.
(j)
Concentration of credit risk
Financial instruments that subject the Company to concentrations
of credit risk consist primarily of cash and cash equivalents. The Company places its cash with high credit quality financial institutions
in Brazil and the Canada. The Company occasionally has cash deposits in excess of federally insured limits. The Company had funds
deposited in banks beyond the insured limits as of December 31, 2011 and 2010. The Company has not experienced any losses related
to these balances, and management believes its credit risk to be minimal.
F-
36
(k)
Comprehensive income
The Company has adopted FASB ASC 220,
Reporting Comprehensive
Income
, which establishes standards for reporting and display of comprehensive income, its components and accumulated balances.
The Company is disclosing this information on its Consolidated Statement of Stockholders' Equity (Deficiency) and Comprehensive
Income (loss). Comprehensive income comprises equity except those resulting from investments by owners and distributions to owners.
Accumulated other comprehensive income consists entirely of foreign currency translation adjustments at December 31, 2011 and 2010.
(l)
Fair value of financial instruments and risks
Fair value estimates of financial instruments are made at a
specific point in time, based on relevant information about financial markets and specific financial instruments. As these estimates
are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined with precision.
Changes in assumptions can significantly affect estimated fair value.
The carrying value of cash, accounts payable, accrued expenses
and advances payable (including related parties) approximate their fair value because of the short-term nature of these instruments.
Management is of the opinion that the Company is not exposed
to significant interest or credit risks arising from these financial instruments.
The Company operates outside of the United States of America
(primarily in Brazil) and is exposed to foreign currency risk due to the fluctuation between the currency in which the Company
operates in and the U.S. dollar.
(m)
Income taxes
The Company has adopted ASC 740,
Accounting for Income Taxes
,
which requires the Company to recognize deferred tax liabilities and assets for the expected future tax consequences of events
that have been recognized in the Company's financial statements or tax returns using the liability method. Under this method, deferred
tax liabilities and assets are determined based on the differences between the financial statement carrying amounts and tax bases
of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. In July
2006, the FASB issued an interpretation which clarifies the accounting for uncertainty in income taxes recognized in a company's
financial statements in accordance with GAAP. This interpretation prescribes a recognition threshold and measurement attribute
for the financial statement recognition and measurement of a tax position taken in a tax return. It also provides guidance on derecognition,
classification, interest and penalties, accounting in interim periods, disclosure and transition. Estimated interest and penalties
related to recording uncertain tax positions when recorded are included as a component of income tax expense on the consolidated
statement of operations. The Company has not recorded any liabilities for uncertain tax positions or any related interest and penalties.
The Company's tax returns are open to audit for the years ending December 31, 2008 to 2011.
(n)
Earnings (loss) per share
Earnings (loss) per share is computed by dividing net income
or loss available to common stockholders by the weighted average number of common shares outstanding during the year including
common stock issued effective the date committed. Common stock issuable is considered outstanding as of the original approval date
for the purposes of earnings per share computations. Diluted loss per common share is computed by dividing net loss by the sum
of (a) the basic weighted average number of shares of common stock outstanding during the period and (b) additional shares that
would have been issued and potentially dilutive securities and is equivalent to basic loss per share for 2011 and 2010 because
potentially dilutive securities were anti-dilutive due to the net losses incurred in each year. Potentially dilutive securities
outstanding consist of stock options outstanding as at December 31, 2011 of 9,050,000 (2010:1,700,000) and warrants outstanding
at December 31, 2011 of 8,000,000 (2010: nil).
F-
37
(o)
New Accounting Pronouncements
The Company considers the effects of new accounting pronouncements
on the accounting, presentation and disclosure of its consolidated financial statements as such pronouncements become known. .
In June 2011, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") No. 2011-05, Comprehensive
Income or
ASU 2011-05. The guidance in ASU 2011-05 revises the manner
in which entities present comprehensive income in their financial statements. An entity is required to report the components of
comprehensive income in either one or two consecutive financial statements:
·
A single, continuous statement must present the components of net income and total net income, the components of other comprehensive
income and total other comprehensive income, and a total for comprehensive income.
·
In a two-statement approach, an entity must present the components of net income and total net income in the first statement.
That statement must be immediately followed by a financial statement that presents the components of other comprehensive income,
a total for other comprehensive income, and a total for comprehensive income.
ASU 2011-05 does not change the items that must be reported
in other comprehensive income. The amendments in ASU 2011-05 are effective for fiscal years beginning after December 15, 2011.
The Company does not believe the adoption of ASU 2011-05 will have a material impact on the presentation of information in its
financial statements.
At present, there are no other such pronouncements that the
Company expects will have a material impact on these consolidated financial statements.
3. Mineral Properties and Exploration Expenses
(a)
São Domingos Project - DNPM Processes 850.684/06 and 850.782/05:
i.
DNPM Processes 850.684/06:
Aurora has good title over the mineral rights which were granted
as DNPM Process number 850.684/06 and which is valid and in force, free and clear of any judicial and extrajudicial encumbrances
and taxes. The São Domingos mineral rights are located at the Municipality of Itaituba, State of Pará, and are registered
in the name of Aurora. On September 13, 2006 the Company applied to the DNPM for the conversion of the Application to an Exploration
Permit covering an area of 4,914.18 hectares. No payments or royalties are due regarding DNPM Process 850.384/06.
ii.
DNPM Processes 850.782/05:
Aurora has good title over the mineral rights object of the
DNPM Process No. 850.782/05, which is valid and in force, free and clear of any judicial and extrajudicial encumbrances and taxes.
On November 8, 2005 it was submitted to DNPM the Exploration Claim for gold in the Municipality of Itaituba, State of Pará.
The Exploration Permit was granted on November 28, 2006 for a 3 (three) years period. The transfer to Aurora was approved on March
24, 2009 and on September 28, 2009 it was requested the renewal of the Exploration Permit.
This area was reduced from 6,756 ha to 5,651.98 ha due to the
overlapping with Garimpeira (alluvial) Mining properties held by Mr. Celio Paranhos. However the DNPM´s general attorney
in Brasilia agreed with Aurora's legal thesis and nullified all applications filed by Mr. Paranhos (about to 1,900 applications).
A new Exploration Permit rectifying the previous one was granted
on August 20, 2010 for a 3 (three) years period, for an area of 6,656.20 hectares.
F-
38
No payments or royalties are due regarding the DNPM Process
850.782/05 since it was acquired through a permutation agreement with Altoro Mineração Ltda.
iii.
DNPM Process 850.400/07:
On July 8, 2011 Aurora allowed the Exploration
Permit was granted on July 09
th
2008 and covering an area of 9,832.26 ha, to lapse.
iv.
DNPM Processes 850.012/06 and 850.013/06:
The exploration claims were submitted to
DNPM on January 19th 2006, for gold covering an area of 1,128.08 ha and 750.55 ha respectively, in the Municipality of Itaituba,
State of Pará. According to information obtained such claims were correctly prepared and the required documents are in place.
The tenements 850.012/06 and 850.013/06
are held by Mr. Antonio Oliveira Ferreira and were submitted to DNPM on January 19th 2006. The tenements are located at Itaituba,
State of Pará and are valid and in force, free and clear of any judicial and extrajudicial encumbrances and taxes, but the
area was blocked since it is inside of a Garimpeira Reserve.
The transfer to Aurora will be submitted
after the Exploration Permits are granted.
There are no payments or royalties related
to the tenements according to the agreement entered into with the previous owner.
v.
DNPM Process 850.119/06:
The exploration claim was submitted to
DNPM on March 07th, 2006, for gold covering an area of 1,068.72 ha, in the Municipality of Itaituba, State of Pará.
Aurora has good title over the mineral
rights object of the DNPM Process No. 850.119/06, which is valid and in force, free and clear of any judicial and extrajudicial
encumbrances and taxes. Aurora is the sole registered and beneficial holder of and owns and possesses good title to the referred
mineral rights. The Exploration Permit has not been granted yet.
The above mentioned area is not related
to any payments or royalties to third parties since they were claimed by Aurora directly.
vi.
DNPM Process 859.587/95:
The tenement, which is held by Vera Lucia
Lopes, is valid and in force, and is free and clear of any judicial and extrajudicial encumbrances and taxes. It is located at
the Municipality of Itaituba, State of Pará. On November 27, 1995, it was submitted to DNPM the Exploration Claim for gold.
The Exploration Permit was granted on September 15, 2006, for a three year period covering an area of 5,000 ha, and it was valid
until September 15, 2009. On July 15, 2009, it was requested the renewal of the Exploration Permit but it hasn't been analyzed
by the DNPM yet. The transfer to Aurora was submitted on November 23, 2006, but it hasn't been approved yet.
There are no payments or royalties related
to the tenements since all payments due under the terms of the agreement entered into with the previous owner have been already
made.
(b) Gold properties in the Municipality
of Itaituba, in the Tapajos gold province of the State of Para, Brazil
vii.
Comandante Araras Project - DNPM Processes 853.785/93 to 853.839/93 inclusive:
Aurora has good title over the mineral
rights object of the DNPM Processes number 853.785/93 to 853.839/93, which are valid and in force, free and clear of any judicial
and extrajudicial encumbrances and taxes. The Comandante Arara Mineral Rights are located at the Municipality of Itaituba, State
of Pará, and are registered in the name of the previous holder since it has not been granted an Exploration Permit yet.
The Comandante Arara Mineral Rights are comprised by 55 Applications for Alluvial Mine of 50 hectares each (2747.22 ha), presented
to DNPM on October 05th, 1993. The conversion to the Authorization Regime was applied on December 11st, 2008 and has not been analyzed
yet, so that the Exploration Permit will be granted only after this analysis.
F-
39
On October 17, 2011 the Company terminated
this licence and Option Agreement by providing written notice to Samba. The Company is free of all and any future payment commitments.
The interest in the properties will be formally relinquished in fiscal 2012.
The Comandante Araras Option Agreement
dated July 2, 2007, and amendments dated June 2, 2008, November 10, 2008, and September 18, 2009, allows the Company to perform
geological surveys and assessment work necessary to ascertain the existence of possible mineral deposits which may be economically
mined and to earn a 100% interest in the Comandante Araras property mineral rights via structured cash payments. The total option
agreement payments for the mineral rights are structured as follows: November 1, 2006 R$20,000 (paid); November 15, 2006 –
R$40,000 (paid); December 15, 2006 R$40,000 (paid); May 18, 2007 - R$15,000 (paid); May 29, 2007 – R$50,000 (paid); June
25, 2008 – USD $80,000 (paid by Samba Minerals Limited as part of the agreement with them discussed in note 3; November 30,
2008 – USD $20,000 or 100,000 shares of Samba Minerals Limited at a deemed issue price of $0.20 per Samba share (paid by
Samba Minerals Limited as part of the agreement with them discussed in note 3; November 30, 2008 – 400,000 shares of Samba
Minerals Limited at a deemed issue price of $0.20 per Samba share (to be issued by Samba when the Exploration Permit is granted
and transferred to Aurora). The vendor will have a 1.5% Net Smelter Royalty. The Royalty payment can be purchased at any time upon
written notice to the vendor and payment in Reals (Brazilian currency) of the equivalent of USD $1,000,000. The option agreement
can be terminated at any time upon written notice to the vendor and the Company will be free of any and all payment commitments
yet to be due.
viii. São João Project - DNPM Processes
851.533/94 to 851.592/94 inclusive:
On October 17, 2011 the Company terminated
this licence and Option Agreement by providing written notice to Samba. The Company is free of all and any future payment commitments.
The interest in the properties will be formally relinquished in fiscal 2012.
Aurora has good title over the mineral
rights which were granted as DNPM Process numbers 851.533/94 to 851.592/94 inclusive and which are valid and in force, free and
clear of any judicial and extrajudicial encumbrances and taxes. The São João mineral rights are located at the Municipality
of Itaituba, State of Pará, and are registered in the name of the previous holder since an Exploration Permit has not yet
been granted. The São João mineral rights comprise 60 Applications for Alluvial Mine of 50 hectares each (2687.66
ha) which was presented to DNPM on May 16, 1994. On August 30, 2006 the previous holder of the Applications applied for the conversion
of the Applications to Exploration Permits. When the conversion request is approved by the Authorities, the previous holder will
be granted the Exploration Permit for an area of 3000 ha. The assignment of the São João mineral rights to Aurora
can only be done after the approval of the Applications and the actual granting of an Exploration Permit to the previous Holder.
The São João Option Agreement
dated January 20, 2006 and amendments dated June 2, 2008 and December 2, 2008, allows the Company to perform geological surveys
and assessment work necessary to ascertain the existence of possible mineral deposits which may be economically mined and to earn
a 100% interest in the São João property mineral rights. Under the terms of the Option Agreement and amendments,
a total amount of USD $1,435,000 (one million four hundred and thirty five thousand dollars) is due by Aurora for the acquisition
of the São João mineral rights. The total option agreement payments for the mineral rights are structured as follows:
April 12, 2006 – USD $20,000 (paid); September 12, 2006 – USD $25,000 (paid); September 12, 2007 – USD $60,000
(paid); June 25, 2008 - $100,000 (paid by Samba Minerals Limited as part of the agreement with them discussed in note 3; December
5, 2008 – USD $40,000 (paid by Samba Minerals Limited as part of the agreement with them discussed in note 3; January 15,
2009 – USD $30,000 (paid by Samba Minerals Limited as part of the agreement with them discussed in note 3; February 15, 2009
– USD $30,000 (paid by Samba Minerals Limited as part of the agreement with them discussed in note 3; April 30, 2009 to March
30, 2011 – USD $8,333.33 per month (April 30, 2009 to December 31, 2010 paid by Samba Minerals Limited as part of the agreement
with them discussed in note 3); July 30, 2011 – USD $950,000.
F-
40
The vendor will have a 1.5% Net Smelter
Royalty. The Royalty payment can be purchased at any time upon written notice to the vendor and payment in Reals (Brazilian currency)
of the equivalent of USD $1,000,000. The option agreement can be terminated at any time upon written notice to the vendor and the
Company will be free of any and all payment commitments yet to be due.
ix. DNPM Processes 850.014/06, 850.581/06 and 850.256/07:
The Company has the right to acquire good
title over the mineral rights object of the Tenements. The Tenements are registered in the name of Antonio Oliveira Ferreira. The
exploration claims were submitted to DNPM respectively on January 19th 2006, August 8th 2006 and April 17th 2007 for gold covering
the areas of 421.45 ha, 4276.03 ha and 4036.00 ha, in the Municipality of Itaituba and Jacareacanga, State of Pará. According
to information obtained such claims were correctly prepared and the required documents are in place. The tenement 850.014/06 has
not been transferred to Samba yet since the Exploration Permit has not been granted so far.
The Exploration Permit for the Process
850.581/06 was granted on February 15th, 2011 for a three years period, for an area of 4273.03 hectares. The transfer to Samba
Brasil Mineração Ltda has not been presented yet.
The Exploration Permit for the Process
850.256/07 was granted on November 30th 2007 for a three years period but it was cancelled on May 21st 2008 because the holder
didn't pay the annual fees on time. On June 10th 2008 it was presented an appeal to have the annulment dismissed which hasn't
been analyzed yet. However, if the appeal is not approved, Samba Brasil's rights over this tenement are guaranteed since
only Samba Brasil has presented a Bid application for this process on July 18th 2008.
According to the Agreement signed between
Samba Brasil and Antonio Oliveira Ferreira on June 5th 2008, a total amount of R$ 120.000,00 (one hundred and twenty thousand reais)
has already been paid by Samba Brasil for the acquisition of the Tenements.
(c) Boulder County, Colorado, U.S.A. – Front Range
Gold Project
On June 15, 2010, pursuant to the Asset
Purchase Agreement between Global Minerals Ltd. ("GML") and Mount Royale Ventures, LLC ("MRV"), as Sellers,
and the Company and AGC Resources LLC, the Company's wholly-owned subsidiary ("AGC"), as Buyers, AGC acquired
50% interest in the Front Range Gold Project joint venture ("JV"), and title to the Gold Hill Mill and related equipment,
and became a joint venture partner with Gold Reef Mining Company, Mi Vida Enterprises, Inc., Gold Hill Mines, Inc. and Southern
Cross Prospecting Company ("Property Owners"). The purchase price consisted of $600,000 in cash and 5,000,000 shares
of common stock of the Company.
Of the $600,000 in cash payments, $100,000
was expensed as a non-refundable deposit in a previous period. The fair value of the 5 million shares issued was based on a market
value of $0.40 per share on the date of the purchase, or $2,000,000. Therefore, the total consideration paid for the asset purchase
was determined to be $2,500,000.
The Company allocated the consideration
paid of $2,500,000 among the assets acquired resulting in $1,758,685 being allocated to the participating interest in the mineral
property and $741,315 to depreciable mining and other equipment.
On March 10, 2011, Mi Vida Enterprises,
Inc., Gold Hill Mines, Inc. and Southern Cross Prospecting Company intervened in a preexisting lawsuit commenced by MRV against
Gold Reef Mining Company in Boulder County District Court (the "Action"). Among other things, they have alleged that
GML was in material default of the JV agreement prior to the assignment by GML of its rights in the JV to AGC in June of 2010,
that GML wrongfully assigned its rights in the JV without permission of the Property Owners, and have asked the court to declare
the JV terminated. The Property Owners also alleged that the transfer of title to the Gold Hill Mill was subject to a right of
first refusal in favor of Gold Hill Mines, Inc., and that MRV conveyed its title to the Gold Hill Mill to AGC without giving proper
notice to Gold Hill Mines Inc. and in violation of a right of first refusal in favor of Gold Hill Mines, Inc., and requested the
court to enter an order granting Gold Hill Mines Inc. an option to purchase the Gold Hill Mill for $10,000, the amount set in the
right of first refusal.
F-
41
A court decision in favor of the Property
Owners may have a material adverse affect on the Company's ability to collect the purchase price, plus royalty from the sale
of AGC to Devtec Management Ltd. discussed below since an unfavorable court decision may result in AGC losing its 50% interest
in the JV as well as its interest in and to the Gold Hill Mill.
Sale of AGC Resources LLC
On June 14, 2011, the Company, entered
into an Asset Purchase Agreement with Devtec Management Ltd. ("Devtec"), pursuant to which the Company sold its subsidiary,
AGC, which as discussed previously owns certain properties in Boulder, Colorado (see note 3 for a discussion of the specific assets
purchased by AGC in June 2010), to Devtec for a total of $2 million, plus royalty. Under the terms of the agreement, Devtec will
pay the Company $1 million upon production of the cumulative total of 1,000 ounces of gold and/or silver, and a further $1 million
on the nine month anniversary of the payment of the first $1 million. Additionally, Devtec will pay the Company a 5% royalty from
the start of production.
The Company is unable to reasonably estimate the amount of minerals
the properties will produce, if any, and thus there is uncertainty as to whether the purchase price will be collected. Further,
the collection of any purchase price is also contingent on the outcome of the court case described in the notes. Given these factors,
collection of the purchase price is not considered reasonably possible at the time of these consolidated financial statements given
the current uncertain status of exploration work on the Boulder, Colorado properties and the uncertainties of the related legal
action and thus no purchase price has been recorded as of December 31, 2011. Once collection of the purchase price becomes assured
and the aforementioned uncertainties resolved, the purchase price will be recorded in the Consolidated Statements of Operations.
Therefore, the Company is recognizing a
loss on the sale of its subsidiary of $2,757,511 for the year ended December 31, 2011, which represents the net book value of the
assets transferred to Devtec on June 14, 2011 (no liabilities were assumed by Devtec) as follows:
Reclamation bonds
$
245,221
Buildings and equipment
$
753,605
Participating interest in mineral property
$
1,758,685
Total
$
2,757,511
(d)
British Columbia, Canada – Kumealon Property
In February 1999, the Company acquired,
by staking, a 741 acre limestone property located on the north shore of Kumealon Inlet, southeast of Prince Rupert, British Columbia,
Canada. A finder's fee of 25,000 shares of common stock of the Company was issued in connection with these claims.
In fiscal year 2000, there were no proven
mineral reserves discovered and the Company continuously operated with a working capital deficiency. These conditions raised substantial
doubt regarding the recovering of the capitalized acquisition cost. Pursuant to GAAP the Company wrote off the capitalized acquisition
cost of $23,630 to operations. The Company's ownership interest in this property was in good standing at December 31, 2011.
On January 20, 2012 the Company relinquished
the licence.
(e)
Joint Venture with Samba Minerals Limited
On October 17, 2011 the Company terminated
this Joint Venture Agreement by providing written notice to Samba. The Company is free of all and any future payment commitments.
F-
42
4.
Buildings and Equipment, Net
2011
2010
Year Ending December 31
($)
($)
Vehicles
-
107,589
Office equipment
-
66,159
Furniture and fixtures
-
21,995
Subtotal
-
195,743
Accumulated depreciation
-
(87,613
)
-
108,130
Gold Hill mill equipment
-
558,440
Gold Hill buildings
-
182,875
Closing Value
-
849,445
During the year ended December 31, 2011
management reviewed the net carrying values of the equipment to determine whether circumstances indicated that the net carrying
values may not be recoverable. An impairment is considered to exist if the total estimated future cash flows, or probability-weighted
cash flows on an undiscounted basis, are less than the carrying value of the assets. In estimating future cash flows, assets are
grouped at the lowest level for which there is identifiable future cash flows that are largely independent of cash flows from other
asset groups. Generally, in estimating future cash flows, all assets are grouped at a particular property for which identifiable
cash flows exist.
Management assessed the cash flows from
each asset group currently on the consolidated balance sheet in December 2011 and determined an impairment of $67,357 necessary
to reflect the carrying value of the assets as December 31, 2011.
The breakdown of the net book values of
the buildings and equipment by location as at fiscal year-end is Colorado $nil (2010: $756,055), and Brazil $nil (2010: $93,390).
5.
Advances Payable
During the year ended December 31, 2011
the Company received funds from advances from individuals and a company, totaling $257,000, that were non-interest bearing, were
due on demand and were unsecured. As at the end of the year this total amount was reduced to $137,000 (of which $92,000 is due
to a related party) due to $120,000 of this advance being converted to common stock for settlement of this indebtedness in December
2011 at $0.04 per share.
6.
Common Stock
The Company intends to finance activities
by raising capital through the equity markets. In October 2011, the Company filed a Registration Statement on Form S-1 offering
up to a maximum of 50,000,000 units of the Company's securities at an offering price of $0.10 per Unit in a direct public offering,
without any involvement of underwriters or broker-dealers. Each Unit consists of one (1) share of common stock at a $0.001 par
value per share and one (1) Stock Purchase Warrant. Each full Warrant entitles the holder to purchase one additional share of common
stock at a price of $0.20 for a period of two years commencing November 1, 2011 through October 31, 2013. The Units will be sold
by the Chief Executive Officer and President. To date, no funds have been obtained from this offering.
On December 20, 2011, the Company entered
into subscription agreements for 8,000,000 shares of common stock at a purchase price of $0.04 per share for a gross aggregate
price of $320,000. Attached to each unit of common stock is one (1) series A stock purchase warrant. Each full Series A warrant
entitles the holder to purchase an additional share of the Company's common stock at an exercise price of $0.08 per share
for a period of eighteen months commencing on December 20, 2011 and expiring on June 20, 2013. Pursuant to the subscription agreements,
each of the Investors has represented that they are not a U.S. person, as such term is defined in Regulation S. In connection with
the offering, the Company has agreed to pay a cash commission equal to 8% of all funds received or an aggregate of up $25,600.
On December 15, 2011, the Company entered
into debt settlement agreements with creditors and related parties in consideration for the issue of the Company's common
stock at a per share price of $0.02 per share. $218,754 was settled for 10,937,721 shares of common stock.
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43
In September 2011, 1,671,000 shares were
issued to an individual for cash at $0.10 per share. In September 2011, 150,000 shares were issued to a company for services rendered
at $0.16 per share.
In April 2011, as an incentive to assist
with future private placements, the Company authorized the payment of a non cash finder's fee of 450,000 shares of common
stock of the Company in connection with the private placement completed in April 2010. The shares were issued in May 2011. All
shares issued were to individuals and companies who reside outside the United States of America. The issuance of the shares was
exempt from the registration requirements of Securities Act by virtue of Section 4(2) thereof as well as the exemption from registration
requirements afforded by Regulation S.
During the period January 1 to December
31, 2010, the Company received cash of $3,895,000 from a private placement of 12,983,335 common shares at $0.30 per share, paid
non cash finder's fees of 1,126,111 shares in connection with the private placement, issued 685,900 shares in settlement
of indebtedness and expenses amounting to $205,770 and paid a non cash finder's fee of 500,000 shares in connection with
a property acquisition valued at $0.30 per share. The shares were issued to individuals and companies who reside outside the USA.
The issuance of the shares were exempt from the registration requirements of Securities Act by virtue of Section 4(2) thereof as
well as the exemption from registration requirements afforded by Regulation S.
7.
Stock Options and Warrants
In 2007, the Company's Board of Directors
approved the 2007 Stock Option Plan (amended September 29, 2008) ("the Plan") to offer an incentive to obtain services
of key employees, directors and consultants of the Company. The Plan provides for the reservation for awards of an aggregate of
10% of the total shares of Common Stock outstanding from time to time. No Plan participant may receive stock options exercisable
for more than 2,500,000 shares of Common Stock in any one calendar year. Under the Plan, the exercise price of an incentive stock
option must be at least equal to 100% of the fair market value of the common stock on the date of grant (110% of fair market value
in the case of options granted to employees who hold more than 10% of the Company's capital stock on the date of grant). The term
of stock options granted under the Plan is not to exceed ten years and the stock options vest immediately upon granting.
The following is a summary of stock option
activity for the years ended December 31, 2011 and 2010, and the status of stock options outstanding and exercisable at December
31, 2011:
Stock
Options
#
Weighted
Average Exercise
Price
$
Remaining
Contractual
Life (years)
12/31/2011
Aggregate
Intrinsic value at
12/31/2011
Outstanding and exercisable at December 31, 2009
2,200,000
0.26
Forfeited
(500,000
)
0.26
Outstanding and exercisable at December 31, 2010
1,700,000
0.26
-
-
Forfeited during year
(500,000
)
0.26
-
-
Granted during year
7,850,000
0.09
-
-
Outstanding and exercisable at December 31, 2011
9,050,000
0.11
4.28
36,500
The aggregate intrinsic value in the table
above represents the total pretax intrinsic value for all "in-the-money" options (i.e. the difference between the Company's
closing stock price on the last trading day of the fiscal year and the exercise price, multiplied by the number of shares) that
would have been received by the option holders had all option holders exercised their options on December 31, 2011.
On June 15, 2011 Michael Montgomery resigned
from the board of directors, an exercise notice for the 500,000 options held were not lodged and consequently the options lapsed
on July 15, 2011.
F-
44
Effective October 11, 2011, the Company's
board of directors granted 4,200,000 stock purchase options pursuant to the Company's 2007 Stock Option Plan. Each of the
Options has an issue date, effective date and vesting date of October 11, 2011, with an exercise price of $0.12 per share. The
term of these Options are five years. The Options are exercisable at any time from the grant date up to and including the 10
th
day of October, 2016.
Effective November 24, 2011, the Company's
board of directors granted 3,650,000 stock purchase options pursuant to the Company's 2007 Stock Option Plan. Each of the
Options has an issue date, effective date and vesting date of November 24, 2011, with an exercise price of $0.05 per share. The
term of these Options are five years. The Options are exercisable at any time from the grant date up to and including the 23
rd
day of November, 2016.
The total fair value of options granted
for the year ended December 31 2011 (2010: nil) was $393,557 and expensed in full as options were vested in full on grant. The
fair value of options are determined using the Black Scholes option pricing model that takes into account the exercise price, the
expected life of the option, the share price at grant date (October 11, 2011 and November 24, 2011) and expected price volatility
of the underlying share, the expected dividend yield (nil assumed) and the risk free interest rate (4.50% used) for the term of
the option. Management determined 2.50 years to be the average expected likely life of the options and utilized the simplified
method due to the fact that the Company has not had significant options granted to develop historical data to provide a reasonable
basis to estimate option lives. Volatility rates were calculated at the grant date of each option tranche and rates of 116.95%
and 120.89% respectively were used.
As of December 31, 2011, there are outstanding
Warrants to purchase 8,000,000 shares of common stock with an exercise price of $0.08 expiring June 2013.
8.
Related Party Transactions
Related party transactions not disclosed
elsewhere in these consolidated financial statements include:
a.
During the fiscal year 2011, consulting fees of $295,701 (2010: $339,591) were incurred to directors and officers of the Company.
The transactions were recorded at the exchange amount, being the value established and agreed to by the related parties.
b.
Included in accounts payable and accrued expenses (related parties) at December 31, 2011 is nil (2010: $17,264) payable to
an officer and director of the Company for consulting fees and various expenses incurred on behalf of the Company.
9.
Non-Cash Investing and Financing Activities
In September 2011, 150,000 shares were
issued to a company for services rendered at $0.16 per share. The shares were issued to a company who resides outside the United
States of America.
In April 2011, as an incentive to assist
with future private placements, the Company authorized the payment of a non cash finder's fee of 450,000 shares of common
stock of the Company in connection with the private placement completed in April 2010. The shares were issued in May 2011. The
issuance of these shares had no net effect on total shareholders' equity or results of operations as they related to fees associated
with issuance of shares.
In September 2010 the Company issued 685,900
shares of common stock of the Company in settlement of indebtedness amounting to $205,770; paid a non cash finder's fee of
1,126,111 shares of common stock of the Company in connection with the private placement of 12,983,335 shares at $0.30 per share
completed in April 2010; and paid a non cash finder's fee of 500,000 shares in connection with a property acquisition valued
at $0.30 per share. The shares were issued to individuals and companies who reside outside the United States of America.
In June 2010, pursuant to an Asset Purchase
Agreement, the Company issued 5 million shares of its common stock, which were authorized for issuance at $0.40 per share for the
acquisition of assets further discussed in Note 3, and acquired Global Minerals Ltd. 50% participating interest in the joint venture
agreement dated December 18, 2002 between Consolidated Global Minerals Ltd and the property owners of the Front Range Gold JV property.
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45
10.
Income Taxes
a.
The Company and its subsidiary operate in several tax jurisdictions, and its income is subject to various rates of taxation.
The Company has net losses for tax purposes in the United States and Brazil totaling approximately $12,067,183 and $7,169,598,
respectively, which may be applied against future taxable income. Accordingly, there is no tax expense for the years ended December
31, 2011 and 2010. The potential tax benefits arising from these losses have not been recorded in the consolidated financial statements
as a full valuation allowance has been recorded against them. The Company evaluates its valuation allowance requirements on an
annual basis based on projected future operations. When circumstances change and this causes a change in management's judgment
about the recoverability of deferred tax assets, the impact of the change on the valuation allowance is reflected in current operations.
The right to claim the tax losses in the United States expire according to the following table:
Fiscal Year of Expiry
Amount $
2012
564,000
2018
331,000
2019
795,000
2020
550,000
2022
138,000
2023
90,000
2024
222,000
2025
457,000
2026
1,094,000
2027
800,000
2028
561,000
2029
479,000
2030
2,065,000
2031
3,921,183
12,067,183
Tax losses carried forward in Brazil have
no expiration date and are available to offset up to 30% of annual income before tax in any year.
b.
The tax effects of temporary differences that give rise to the Company's net deferred tax asset are as follows:
2011
$
2010
$
Tax loss carry forwards
6,540,506
5,180,000
Valuation allowance
(6,754,903
)
(5,294,000
)
Stock compensation expense
214,397
114,000
-
-
c.
The reconciliation of income tax computed at the federal statutory rate to income tax expense is as follows:
2011
$
2010
$
Tax at statutory rate
(1,573,295
)
(783,000
)
Movement in deferred tax asset
212,349
743,000
Change in valuation allowance for deferred tax asset
1,460,903
-
Other
(99,957
)
40,000
Income tax expense
$
-
$
-
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46
11.
Subsequent events
(a)
Effective January 13, 2012, the Company's board of directors granted 1,600,000 stock purchase options pursuant to the
Company's 2007 Stock Option Plan. Each of the Options has an issue date, effective date and vesting date of January 13, 2012,
with an exercise price of $0.05 per share. The term of these Options are five years. The Options are exercisable at any time from
the grant date up to and including the 12
th
day of January 2017.
(b)
On 20
th
January 2012 the Company's Kumealon claim over the property was relinquished.
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47
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Our estimated expenses in connection with
the issuance and distribution of the securities being registered are:
Securities and exchange commission filing fee
$
650
Accounting fees and expenses
5,000
Legal fees and expenses
15,000
Transfer agent and fees
500
Printing and mailing expenses
500
Miscellaneous offering expenses
1,350
Total
$
23,000
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 ("
Section 145
")
of the Delaware General Corporation Law, as amended (the "
DGCL
"), permits indemnification of directors, officers,
agents and controlling persons of a corporation under certain conditions and subject to certain limitations. Section 145 empowers
a corporation to 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, by reason of the fact that he or she is or
was a director, officer or agent of the corporation or another enterprise if serving at the request of the corporation. Depending
on the character of the proceeding, a corporation may indemnify against expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred in connection with such action, suit or proceeding if the
person indemnified acted in good faith and in a manner he or she 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 or her conduct
was unlawful. In the case of an action by or in the right of the corporation, no indemnification may be made with respect to any
claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the
extent that the Court of Chancery or the court in which such action or suit was brought shall determine that despite the adjudication
of liability such person is fairly and reasonably entitled to indemnity for such expenses which the court shall deem proper. Section
145 further provides that to the extent a present or former director or officer of a corporation has been successful in the defense
of any action, suit or proceeding referred to above or in the defense of any claim, issue or matter therein, such person shall
be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by such person in connection therewith.
Insofar as indemnification
for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling us pursuant
to the foregoing provisions, or otherwise, we have been advised that in the opinion of SEC, such indemnification is against public
policy as expressed in the
Securities
Act and is, therefore, unenforceable.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
During the past three
years, we have offered and sold the following shares of common stock which were not registered under the Securities Act of 1933,
as amended.
In September 2009, 3,000,000 common shares
were authorized for issuance at $0.10 per share for cash proceeds of $300,000. The shares were physically issued in January 2010
to individuals and companies who reside outside the United States of America (in accordance with the exemption from registration
requirements afforded by Regulation S as promulgated thereunder). The placement agent was paid a commission of 420,000 shares of
our common stock. The shares were physically issued to the agent in January 2010.
In September 2009, convertible notes payable
and related accrued interest aggregating $739,152 (AUD $850,479) were settled through the issuance of 5,000,000 shares of our common
stock. The shares were issued to a company who resides outside the United States of America (in accordance with the exemption from
registration requirements afforded by Regulation S as promulgated thereunder).
In November 2009, 100,000 shares were authorized
for issuance in connection with debt settlements at $0.18 per share. The shares were physically issued in January 2010 to a company
who resides outside the United States of America (in accordance with the exemption from registration requirements afforded by Regulation
S as promulgated thereunder).
In November 2009, 150,000 shares were authorized
for issuance in connection with debt settlements at $0.24 per share. The shares were physically issued in January 2010 to a company
who resides outside the United States of America (in accordance with the exemption from registration requirements afforded by Regulation
S as promulgated thereunder).
In December 2009, 1,666,667 common shares
were authorized for issuance at $0.30 per share for net cash proceeds of $500,000. The shares were physically issued in January
2010 to an individual who resides outside the United States of America (in accordance with the exemption from registration requirements
afforded by Regulation S as promulgated thereunder).
In April 2010, 12,983,335 common shares
were authorized for issuance at $0.30 per share for net cash proceeds of $3,895,000. The shares were physically issued in April
2010 to an individuals and companies who reside outside the United States of America (in accordance with the exemption from registration
requirements afforded by Regulation S as promulgated thereunder). A finders' fee of 1,126,111 common shares were authorized
for issuance in connection with the private placement at $0.30 per share to a company who resides outside the United States of
America). The shares were subsequently issued in September 2010.
In June 2010, the Company issued 5 million
shares of its common stock to Global Minerals Ltd., a British Columbia (Canada) corporation with offices in British Columbia Canada,
at $0.40 per share for a cost of $2,000,000, in connection with the Asset Purchase Agreement dated June 15, 2010, pursuant to which
the Company acquired Global Minerals Ltd. 50% participating interest in the joint venture agreement dated December 18, 2002 between
Consolidated Global Minerals Ltd. and the property owners of the Front Range Gold JV property, acquired the Front Range Gold property
assets of Mount Royale Ventures, LLC., which include a permitted mill and mining equipment and acquired a 50% equity interest in
the Black Cloud Mine Claim Group, tenements located within the Front Range Gold property. The issuance of the shares was exempt
from the registration requirements of Securities Act by virtue of Section 4(2) thereof as well as the exemption from registration
requirements afforded by Regulation S. A finders' fee of 500,000 common shares was authorized for issuance in connection
with the Asset Purchase Agreement at $0.30 per share to an individual and a company who reside outside the United States of America.
The shares were issued in September 2010.
In September 2010, 685,900 shares were issued
in connection with debt settlements and payment of expenses at $0.30 per share. The shares were issued to individuals and companies
who reside outside the United States of America (in accordance with the exemption from registration requirements afforded by Regulation
S as promulgated thereunder).
In April 2011, as an incentive to assist
with future private placements, the Company authorized the payment of a non cash finders' fee of 450,000 shares of common
stock of the Company in connection with the private placement completed in April 2010. The shares were issued in May 2011. The
issuance of these shares had no net effect on total shareholders' equity or results of operations as they related to fees
associated with issuance of shares.
In September 2011, 1,671,000 shares were
issued in connection with debt settlements at $0.10 per share. The shares were issued to an individual who resides outside the
United States of America (in accordance with the exemption from registration requirements afforded by Regulation S as promulgated
thereunder).
In December 2011, 10,937,721 shares were
issued in connection with debt settlements at $0.02 per share. The shares were issued to an individual who resides outside the
United States of America (in accordance with the exemption from registration requirements afforded by Regulation S as promulgated
thereunder).
In September 2012, 135,000,000 common shares
were authorized for issuance at $0.037 per share for net cash proceeds of $5,000,000. The shares were physically issued in October,
2012, to a corporation which resides outside the United States of America (in accordance with the exemption from registration requirements
afforded by Regulation S as promulgated thereunder).
ITEM 16.
EXHIBITS
EXHIBIT
DESCRIPTION OF EXHIBIT AND FILING REFERENCE NUMBER
3.1.1
Certificate of Incorporation incorporated by reference to the registration statement on Form 10SB filed on June 4, 1998 (SEC File No. 000-24393 98720970).
3.1.2
Certificate of Amendment to the Certificate of Incorporation incorporated by reference to the registration statement on Form 10SB filed on June 4, 1998 (SEC File No. 000-24393 98720970).
3.1.3
Certificate of Restoration and Renewal of Certificate of Incorporation incorporated by reference to the registration statement on Form 10SB filed on June 4, 1998 (SEC File No. 000-24393 98720970).
3.2.1
By-laws incorporated by reference to the registration statement on Form 10SB filed on June 4, 1998 (SEC File No. 000-24393 98720970).
3.2.2
Amended and Restated By-laws incorporated by reference to the registration statement on Form 10SB filed on June 4, 1998 (SEC File No. 000-24393 98720970).
4.1
Form of Subscription Agreement incorporated by reference to the Post-Effective registration statement on Form S-1 filed on March 16, 2011 (SEC File No. 333-171312-11692134).
4.2
Form of Series B Warrant incorporated by reference to the Post-Effective registration statement on Form S-1 filed on March 16, 2011 (SEC File No. 333-171312-11692134) (This form of warrant was previously designated Series A Warrants but has been changed to Series B Warrants).
4.3
Debt Settlement Agreement with Samba Minerals Limited incorporated by reference to the registration statement on Form S-1 filed on June 3, 2010 (SEC File No. 333-167301-10876788).
4.4
Form of Debt Settlement Agreement with Axino AG, Heroe Investments Inc, Jolanda Investments Ltd, Gemeinhardt GmbH, Lars Pearl and WS Marketing GmbH incorporated by reference to the registration statement on Form S-1 filed on June 3, 2010 (SEC File No. 333-167301-10876788).
4.5
Form of Subscription Agreement incorporated by reference to the Form 8-K filed on December 21, 2011 (SEC File No. 000-24393-111274887).
4.6
Form of Series A Warrant incorporated by reference to the Form 8-K filed on December 21, 2011 (SEC File No. 000-24393-111274887).
4.7
Form of Debt Settlement Agreement with Ross Doyle, Global Strategic Synergies Pty LTD, Coresco AG and Agustin Gomez de Segura incorporated by reference to the Form 8-K filed on December 21, 2011 (SEC File No. 000-24393-111274887).
4.8
Subscription Agreement dated September 21, 2012, between Aurora Gold Corporation and Alltech Capital Limited incorporated by reference to the Form 8-K filed on September 27, 2012 (SEC File No. 000-24393-121112568).
5.1
Opinion of Sierchio & Company, LLP.*
10.1
Consulting Agreement between Hans W. Biener of SupplyConsult GbR and Aurora Gold Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).
10.2
Confidentiality Agreement between Hans W. Biener of SupplyConsult GbR and Aurora Gold Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).
10.3
Assignment of Novo Porto and Santa Clara Memorandum of Understanding to Aurora Gold Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).
10.4
Novo Porto Memorandum of Understanding Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).
10.5
Declaration of Translator for translation of Porto Novo Memorandum of Understanding from Portuguese to English Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379051269300).
10.6
Novo Porto Option Agreement incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.7
Declaration of Translator for translation of Novo Porto Option Agreement from Portuguese to English Corporation incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.8
Santa Clara Memorandum of Understanding incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379051269300).
10.9
Declaration of Translator for translation of Santa Clara Memorandum of Understanding from Portuguese to English Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379051269300).
10.10
Assignment of Ouro Mil Memorandum of Understanding to Aurora Gold Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).
10.11
Ouro Mil Memorandum of Understanding Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).
10.12
Declaration of Translator for translation of Ouro Mil Memorandum of Understanding from Portuguese to English Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).
10.13
Ouro Mil Option Agreement incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.14
Declaration of Translator for translation of Ouro Mil Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.15
Assignment of Sao Domingos Memorandum of Understanding to Aurora Gold Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).
10.16
Sao Domingos Memorandum of Understanding Corporation incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-30379 051269300).
10.17
Declaration of Translator for translation of Sao Domingos Memorandum of Understanding from Portuguese to English incorporated by reference to the registration statement on Form SB filed on December 16, 2005 (SEC File No. 333-130379 051269300).
10.18
Săo Domingos Option Agreement incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.19
Declaration of Translator for translation of Săo Domingos Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.20
Santa Isabel Option Agreement incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.21
Declaration of Translator for translation of Santa Isabel Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.22
Săo Joăo Option Agreement incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.23
Declaration of Translator for translation of Săo Joăo Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.24
Piranhas Memorandum of Understanding incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.25
Declaration of Translator for translation of Piranhas Memorandum of Understanding from Portuguese to English incorporated by reference to the Form 10-KSB filed on March 28, 2006 (SEC File No. 000-24393-06715925).
10.26
Branca de Neve Memorandum of Understanding incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).
10.27
Declaration of Translator for translation of Branca de Neve Memorandum of Understanding from Portuguese to English incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).
10.28
Bigode Memorandum of Understanding incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).
10.29
Declaration of Translator for translation of Bigode Memorandum of Understanding from Portuguese to English incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).
10.30
Santa Lucia Memorandum of Understanding incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).
10.31
Declaration of Translator for translation of Santa Lucia Memorandum of Understanding from Portuguese to English incorporated by reference to the Form 10-QSB filed on July 26, 2006 (SEC File No. 000-24393-06981489).
10.34
Settlement Agreement dated as of August 9, 2007 between the Company and Luis Mauricio incorporated by reference to the Form SB-2 filed on November 13, 2007 (SEC File No. 333-147341 071238655).
10.35
Form of Subscription Agreement incorporated by reference to the Form SB-2 filed on November 13, 2007 (SEC File No. 333-147341 071238655).
10.36
Comandante Araras Memorandum of Understanding incorporated by reference to the Form 10-KSB filed on April 15, 2008 (SEC File No. 000-24393-147341 08758054).
10.37
2007 Stock Option Plan incorporated by reference to the Form 10-KSB filed on April 15, 2008 (SEC File No. 000-24393-147341 08758054).
10.38
Asset Purchase Agreement dated June 15, 2010, incorporated by reference to the registration statement on Form S-1/A filed on June 28, 2010 (SEC File No. 333-167301-10921067).
10.39
Asset Purchase Agreement dated June 14, 2011, incorporated by reference to the Form 8-K filed on June 23, 2011 (SEC File No. 000-24393-11927834).
10.40
Services Agreement dated October 11, 2011 between the Company and Global Strategic Synergies Gmbh incorporated by reference to the Form 8-K filed on October 13, 2011 (SEC File No. 000-24393-111139352).
23.1
Consent of Sierchio & Company, LLP (included in Exhibit 5.1).*
23.2
Consent of Peterson Sullivan LLP.*
24.1
Power of Attorney.*
99.1
Corporate Governance Principles incorporated by reference to the Form 10-KSB filed on March 25, 2004 (SEC File No. 000-24393-04689262).
* Filed herewith.
ITEM 17.
UNDERTAKINGS
The undersigned registrant
hereby undertakes:
(1) To file, during
any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i) to include any
prospectus required by Section 10(a)(3) of the Securities Act of 1933, as amended;
(ii) to reflect in the prospectus any facts
or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the Securities and Exchange Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the effective registration statement; and
(iii) to include any
material information with respect to the plan of distribution not previously disclosed in the registration statement or any material
change to such information in the registration statement;
(2) That, for the purpose of determining
any liability under the Securities Act of 1933, as amended, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from
registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination
of the offering.
(4) For purposes of
determining liability under the Securities Act of 1933 to any purchaser:
(i) If the Registrant is subject to Rule 430C,
each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration
statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included
in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in
a registration statement or prospectus that is part of the registration or made in a document incorporated or deemed incorporated
by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with
a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement
or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first
use.
(5) That for the purpose
of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the
securities:
The undersigned registrant
undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless
of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser
by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered
to offer or sell such securities to such purchaser:
(i) Any preliminary prospectus
or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
(ii) Any free writing
prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned
registrant;
(iii) The portion of
any other free writing prospectus relating to the offering containing material information about the undersigned registrant or
its securities provided by or on behalf of the undersigned registrant; and
(iv) Any other communication
that is an offer in the offering made by the undersigned registrant to the purchaser.
Insofar as indemnification
for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under Item 24 above, or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities
Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection
with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.
SIGNATURES
In accordance with the requirements of
the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements
for the filing of this registrant's registration statement on Form S-1 and authorized this registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized, on January 7, 2013.
Aurora Gold Corporation
By:
/ s/ Lars Pearl
Name:
Lars Pearl
Title:
President, Chief Executive Officer, (Principal Executive Officer) and Director
By:
/ s/ Ross Doyle
Name:
Ross Doyle
Title:
Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) and Director
Pursuant to the requirements of the Securities
Act of 1933, this registration statement has been signed below by the following persons in the capacities and on the dates indicated.
By:
/ s/ Lars Pearl
Dated: January
7, 2013
Name:
Lars Pearl
Title:
President, Chief Executive Officer, (Principal Executive Officer) and Director
By:
/ s/ Ross Doyle
Dated: January
7, 2013
Name:
Ross Doyle
Title:
Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) and Director
By:
/s/ Agustin Gomez de Segura
Dated: January
7, 2013
Agustin Gomez de Segura, Director
By:
/s/ Vladimir Bernshtein
Dated: January
7, 2013
Vladimir Bernshtein, Director
By:
/s/ Andrey Ratsko
Dated: January
7, 2013
Andrey Ratsko, Director