0001348788
2012-03-01
2012-11-30
0001348788
2013-01-14
0001348788
2012-11-30
0001348788
2012-02-29
0001348788
2012-09-01
2012-11-30
0001348788
2011-09-01
2011-11-30
0001348788
2011-03-01
2011-11-30
0001348788
2004-10-11
2012-11-30
0001348788
2011-02-28
0001348788
2011-11-30
0001348788
2004-10-10
0001348788
us-gaap:FurnitureAndFixturesMember
2012-11-30
0001348788
us-gaap:FurnitureAndFixturesMember
2012-02-29
0001348788
TSORE:WebsiteMember
2012-11-30
0001348788
TSORE:WebsiteMember
2012-02-29
0001348788
us-gaap:MachineryAndEquipmentMember
2012-11-30
0001348788
us-gaap:MachineryAndEquipmentMember
2012-02-29
0001348788
2012-06-01
2012-11-30
0001348788
2011-06-01
2011-11-30
0001348788
2011-03-01
2012-02-29
0001348788
TSORE:UnitedStatesMember
2012-03-01
2012-11-30
0001348788
TSORE:ColumbiaMember
2012-03-01
2012-11-30
0001348788
TSORE:UnitedStatesMember
2011-03-01
2012-02-29
0001348788
TSORE:ColumbiaMember
2011-03-01
2012-02-29
0001348788
TSORE:UnitedStatesMember
2011-03-01
2011-11-30
0001348788
TSORE:ColumbiaMember
2011-03-01
2011-11-30
0001348788
2010-03-01
2011-02-28
0001348788
TSORE:DirectorsMember
2011-03-01
2012-02-29
0001348788
TSORE:ConsultantsMember
2011-03-01
2012-02-29
0001348788
us-gaap:BoardOfDirectorsChairmanMember
2011-03-01
2012-02-29
0001348788
us-gaap:DirectorMember
2012-11-30
0001348788
us-gaap:DirectorMember
2012-02-29
iso4217:USD
xbrli:shares
iso4217:USD
xbrli:shares
xbrli:pure
TRESORO MINING CORP.
0001348788
10-Q
2012-11-30
false
No
No
Yes
Smaller Reporting Company
Q3
2013
24473934
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Tresoro Mining Corp. (the “Company”) was incorporated
under the laws of the State of Nevada on October 11, 2004 to promote and carry on any lawful business for which a corporation may
be incorporated under the laws of the State of Nevada. On May 24, 2007 the Company filed Articles of Merger with the Secretary
of State of Nevada in order to effectuate a merger whereby the Company (as Ancor Resources, Inc.) would merge with its newly incorporated
and wholly-owned subsidiary, Nu-Mex Uranium Corp. (“Nu-Mex”). This merger became effective June 4, 2007 and the Company,
being the surviving entity, changed its name to Nu-Mex Uranium Corp. On February 26, 2008 the Company filed Articles of Merger
with the Secretary of State of Nevada in order to effectuate a merger whereby the Company (as Nu-Mex) would merge with its newly
incorporated and wholly-owned subsidiary, Uranium International Corp. (“UIC”). This merger became effective as of March
11, 2008 and the Company, being the surviving entity, changed its name to Uranium International Corp. On May 17, 2010 the Company
filed Articles of Merger with the Secretary of State of Nevada in order to effectuate a merger whereby the Company (as UIC) would
merge with its newly incorporated and wholly-owned subsidiary, Mercer Gold Corporation (“Mercer”). This merger became
effective on the OTC Bulletin Board and effective with the State of Nevada on June 17, 2010 and the Company, being the surviving
entity, changed its name to Mercer Gold Corporation. On August 30, 2011, the Company filed Articles of Merger with the Secretary
of State of Nevada in order to effectuate a merger whereby the Company (as Mercer) would merge with its wholly-owned subsidiary,
Tresoro Mining Corp. (“Tresoro”). This merger became effective September 15, 2011 and the Company, being the surviving
entity, changed its name to Tresoro Mining Corp. The Company intends to engage in the acquisition and exploration of mining properties.
The Company is in the exploration stage and its operations principally involve research and development, market analysis, property
evaluation and other business planning activities, and no revenue has been generated to date.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Effective June 6, 2007, the Company completed a forward stock split
by the issuance of 5 new shares for each 1 outstanding share of the Company’s common stock. Further, on March 11, 2008 the
Company completed a forward stock split by the issuance of 1.5 new shares for each 1 outstanding share of the Company’s common
stock. Effective May 12, 2011, the Company completed a reverse stock split by the issuance of 1 new share for each 4 outstanding
shares of the Company’s common stock (Note 8). Unless otherwise noted, all references herein to number of shares, price per
share or weighted average shares outstanding have been adjusted to reflect these stock splits on a retroactive basis.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company is an exploration stage enterprise, as defined in Accounting
Standards Codification (the “Codification” or “ASC”) 915-10, “Development Stage Entities.”
The Company is devoting all of its present efforts to securing and establishing a new business and its planned principal operations
have not commenced. Accordingly, no revenue has been derived during the organization period.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Going Concern</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s interim consolidated financial statements as
at November 30, 2012, and for the three and nine months then ended have been prepared on a going concern basis, which contemplates
the realization of assets and the settlement of liabilities and commitments in the normal course of business.  The Company
has incurred operating losses since inception of $33,342,737. The Company requires additional funding to meet its ongoing obligations
and anticipated ongoing operating losses.  The ability of the Company to continue as a going concern is dependent on
raising capital to fund its initial business plan and ultimately to attain profitable operations.  Accordingly, these
factors raise substantial doubt as to the Company’s ability to continue as a going concern.  The Company intends
to continue to fund its exploration business by way of private placements and advances from shareholders as may be required. These
financials do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts
and classification of liabilities that might result from this uncertainty.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Unaudited Interim Consolidated Financial Statements</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The accompanying unaudited consolidated interim financial statements
have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions
to Form 10-Q. They do not include all information and footnotes required by United States generally accepted accounting principles
(“U.S. GAAP”) for complete financial statements. However, except as disclosed herein, there has been no material changes
in the information disclosed in the notes to the consolidated financial statements for the year ended February 29, 2012 included
in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission. The interim unaudited consolidated
financial statements should be read in conjunction with those consolidated financial statements included in the Form 10-K. In the
opinion of Management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments,
have been made. Operating results for the three and nine months ended November 30, 2012 are not necessarily indicative of
the results that may be expected for the year ending February 28, 2013.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Reclassifications</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Certain comparative figures on the balance sheet have been reclassified
in order to conform to the current year’s financial statement presentation with no effect on earnings</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following is a summary of significant accounting policies used
in the preparation of these interim consolidated financial statements.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Basis of Presentation</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The accounting and reporting policies of the Company conform to
U.S. GAAP applicable to exploration stage enterprises.  The functional currency is the U.S. dollar, and the consolidated
financial statements are presented in U.S. dollars.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The consolidated interim financial statements include the accounts
of the Company and its wholly-owned subsidiaries, Mercer One Panama Corp. and Mercer Two Panama Corp. which were incorporated on
June 2, 2010. All significant inter-company transactions and account balances have been eliminated upon consolidation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Mineral Property Expenditures</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Mineral property acquisition costs are initially capitalized as
intangible assets when purchased.  At the end of each fiscal quarter, the Company assesses the carrying costs for impairment.  If
proven and probable reserves are established for a property and it has been determined that a mineral property can be economically
developed, costs will be amortized using the units-of-production method over the estimated life of the probable reserve.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Mineral property exploration costs are expensed as incurred.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Estimated future removal and site restoration costs, when determinable,
are provided over the life of proven reserves on a units-of-production basis.  Costs, which include production equipment
removal and environmental remediation, are estimated each period by management based on current regulations, actual expenses incurred,
and technology and industry standards.  Any charge is included in exploration expense or the provision for depletion
and depreciation during the period and the actual restoration expenditures are charged to the accumulated provision amounts as
incurred.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of the date of these interim financial statements, the Company
has not established any proven or probable reserves on its mineral properties and incurred only acquisition and exploration costs.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Although the Company has taken steps to verify title to mineral
properties in which it has an interest, according to the usual industry standards for the stage of exploration of such properties,
these procedures do not guarantee the Company’s title.  Such properties may be subject to prior agreements or
transfers and title may be affected by undetected defects.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Use of Estimates</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 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 period.  Actual results could differ from those estimates. Significant areas requiring management’s
estimates and assumptions are the determination of the fair value of transactions involving common stock and financial instruments.
Other areas requiring estimates include deferred tax balances and asset impairment tests.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Cash and Cash Equivalents</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the statements of cash flows, all highly liquid investments
with maturity of three months or less are considered to be cash equivalents.  There were no cash and cash equivalents
as of November 30, 2012 and February 29, 2012 that exceeded federally insured limits. The Company had $1,176 in restricted cash
as of November 30, 2012 (February 29, 2012 - $1,176).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Net Income (Loss) per Common Share</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b></b>The
Company computes income (loss) per share in accordance with ASC 260, “Earnings Per Share” which requires presentation
of both basic and diluted earnings per share on the face of the statement of operations.  Basic income (loss) per share
is computed by dividing net income (loss) available to common shareholders by weighted average number of outstanding common shares
during the period.  Diluted income (loss) per share gives effect to all dilutive potential common shares outstanding
during the period.  Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Fair Value Financial Instruments</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">A fair value hierarchy was established that prioritizes the inputs
used to measure fair value.  The hierarchy gives the highest priority to unadjusted quoted prices in active markets for
identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurements).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair values of the financial instruments were determined using
the following input levels and valuation techniques:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Level 1:  classification is applied
to any asset or liability that has a readily available quoted market price from an active market where there is significant transparency
in the executed/quoted price.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Level 2:  classification is applied
to assets and liabilities that have evaluated prices where the data inputs to these valuations are observable either directly or
indirectly, but do not represent quoted market prices from an active market.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Level 3:  classification is applied
to assets and liabilities when prices are not derived from existing market data and requires us to develop our own assumptions
about how market participants would price the asset or liability.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As at November 30, 2012, the fair value of cash and cash equivalents,
accounts payable, amounts due to related parties and promissory notes payable approximate carrying value due to their short maturities.     </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Foreign Currency Translation</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The financial statements are presented in U.S.
dollars.  In accordance with ASC 830, “Foreign Currency Matters”, foreign denominated monetary assets and
liabilities are translated to their U.S. dollar equivalents using foreign exchange rates which prevailed at the balance sheet date.  Revenue
and expenses are translated at average rates of exchange during the period.  Related translation adjustments are reported
as a separate component of stockholders’ equity, whereas gains or losses resulting from foreign currency transactions are
included in results of operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td style="font-weight: bold"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">Net Book Value</td>
<td nowrap="nowrap" style="font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">Cost</td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Accumulated</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>amortization</b></p></td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>November 30,</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2012</b></p></td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">February 29, 2012</td>
<td nowrap="nowrap" style="font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 50%">Furniture and fixtures</td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 3%">$</td>
<td style="width: 5%; text-align: right">649</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 5%"> </td>
<td style="width: 6%; text-align: right">226</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 4%"> </td>
<td style="width: 9%; text-align: right">423</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%">$</td>
<td style="width: 9%; text-align: right">561</td>
<td nowrap="nowrap" style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Website</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">9,167</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">5,000</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">4,167</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">9,167</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Machinery and equipment</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">7,176</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">1,774</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">5,402</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">5,910</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">16,992</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right">7,000</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right">9,992</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">15,638</td>
<td nowrap="nowrap"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During the nine months ended November 30, 2012, total additions
to property and equipment were $213 (February 29, 2012 - $9,761).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>(a)  Guayabales Property</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 5, 2010, the Company entered into a letter of intent (the
“LOI”), dated April 3, 2010 with Mercer Gold Corp., a private Canadian corporation (“Mercer Canada”).  Pursuant
to the LOI, Mercer Canada has granted to the Company an exclusive option (the “Option”) to acquire all of Mercer Canada’s
current underlying option interests under an option agreement, dated March 4, 2010 (the “Underlying Option Agreement”),
as entered into between Mercer Canada and Comunidad Mineral Guayabales (the “Underlying Property Owner”).  Pursuant
to the Underlying Option Agreement, Mercer Canada acquired from the Underlying Property Owner an option (the “Underlying
Option”) to acquire a 100% legal, beneficial and registerable interest in and to certain mineral property concession interest
which are held by way of license.  The mineral property interests are located in the Municipality of Marmato, Colombia
and are better known and described as the “Guayabales” property (collectively, the “Property”).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 13, 2010, the Company entered into a definitive Mineral
Assets Option Agreement with Mercer Canada (the “Mercer Option Agreement”).  The Mercer Option Agreement
replaces the previous underlying LOI.  The Mercer Option Agreement, as amended on December 30, 2010 and again on March
22, 2011, provides that, in order to exercise its Option, the Company is obligated to:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%">
<tr style="vertical-align: top">
<td style="width: 36px; font: 10pt Times New Roman, Times, Serif; text-align: right">1.  </td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">Pay to Mercer Canada $200,000 immediately upon the execution of the Mercer Option Agreement (the “Effective Date”) (paid on April 14, 2010);</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%">
<tr style="vertical-align: top">
<td style="width: 36px; font: 10pt Times New Roman, Times, Serif; text-align: right">2.  </td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">Issue to Mercer Canada, both prior to and after the due and complete exercise of the Options, an aggregate of up to 5,000,000 restricted shares of the Company’s common stock, as follows:</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; font: 10pt Times New Roman, Times, Serif; text-align: right">-  </td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">an initial issuance of 2,500,000 shares within two business days of the Effective Date (issued on April 15, 2010); and</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; font: 10pt Times New Roman, Times, Serif; text-align: right">-  </td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">a final issuance of 2,500,000 shares within five business days of the Company’s prior receipt of a “technical report” (as that term is defined in section 1.1 of National Instrument 43-101 of the Canadian Securities Administrators, Standards of Disclosure for Mineral Projects (“NI 43-101”) meeting certain criteria) (as at November 30, 2012, no technical report has been prepared);</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%">
<tr style="vertical-align: top">
<td style="width: 36px; font: 10pt Times New Roman, Times, Serif; text-align: right">3.  </td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">Provide funding for or expend minimum cumulative “Expenditures” for “Exploration and Development” (as defined in the Mercer Option Agreement) work on or in connection with any of the mineral interests comprising the Property interests of not less than $3,000,000, as follows:</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; font: 10pt Times New Roman, Times, Serif; text-align: right">-  </td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">no less than an initial $1,000,000 of the Expenditures shall be expended on the Property by December 31, 2011 ($1,000,000 incurred);</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; font: 10pt Times New Roman, Times, Serif; text-align: right">-  </td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">no less than a further $1,000,000 of the Expenditures shall be expended on the Property by December 31, 2012 ($1,000,000 incurred); and</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; font: 10pt Times New Roman, Times, Serif; text-align: right">-  </td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">no less than a final $1,000,000 of the Expenditures shall be expended on the Property by December 31, 2013 ($1,000,000 incurred).</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%">
<tr style="vertical-align: top">
<td style="width: 36px; font: 10pt Times New Roman, Times, Serif; text-align: right">4.  </td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">Pay on Mercer Canada’s behalf all underlying option, regulatory and governmental payments and assessment work required to keep the Property in good standing during the Option period (being that period from the Effective Date to the closing date in respect of the due and complete exercise of the Option as described in the Mercer Option Agreement, which shall not be later than January 13, 2013), and including, without limitation, all remaining cash payments required to be made to the Underlying Property Owner under the Underlying Option Agreement. On July 31, 2012, the Company agreed an amended option payment schedule with the Underlying Property Owner.  The Company must pay the Underlying Property Owner an aggregate of $4,000,000 in the instalments by the dates specified as follows:</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; font: 10pt Times New Roman, Times, Serif; text-align: right">- </td>
<td style="font: 10pt Times New Roman, Times, Serif">Pay $20,000 by October 14, 2009 (paid);</td></tr>
<tr style="vertical-align: top">
<td style="font: 10pt Times New Roman, Times, Serif; text-align: right">- </td>
<td style="font: 10pt Times New Roman, Times, Serif">Pay additional $40,000 on or by 90 days from October 14, 2009 (paid);</td></tr>
</table>
<p style="font: 12pt Times New Roman, Times, Serif; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; text-align: right">- </td>
<td>Pay additional $40,000 on or by April 14, 2010 (paid);</td></tr>
<tr style="vertical-align: top">
<td style="text-align: right">- </td>
<td>Pay additional $55,000 on or by July 14, 2010 (paid);</td></tr>
</table>
<p style="font: 12pt Times New Roman, Times, Serif; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; text-align: right">- </td>
<td>Pay additional $55,000 on or by October 14, 2010 (paid);</td></tr>
<tr style="vertical-align: top">
<td style="text-align: right">- </td>
<td>Pay additional $65,000 on or by January 14, 2011 (paid);</td></tr>
</table>
<p style="font: 12pt Times New Roman, Times, Serif; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; text-align: right">- </td>
<td>Pay additional $75,000 on or by April 14, 201l (paid);</td></tr>
<tr style="vertical-align: top">
<td style="text-align: right">- </td>
<td>Pay additional $75,000 on or by July 14, 201l (paid);</td></tr>
</table>
<p style="font: 12pt Times New Roman, Times, Serif; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; text-align: right">- </td>
<td>Pay additional $85,000 on or by October 14, 201l (paid);</td></tr>
<tr style="vertical-align: top">
<td style="text-align: right">- </td>
<td>Pay additional $85,000 on or by January 14, 2012 (paid);</td></tr>
</table>
<p style="font: 12pt Times New Roman, Times, Serif; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; text-align: right">- </td>
<td>Pay additional $50,000 on or by July 31, 2012 (paid);</td></tr>
<tr style="vertical-align: top">
<td style="text-align: right">- </td>
<td>Pay additional $60,000 on or by August 9, 2012 (paid);</td></tr>
</table>
<p style="font: 12pt Times New Roman, Times, Serif; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; text-align: right">- </td>
<td>Pay additional $50,000 on or by August 24, 2012 (not paid pending resolution of certain legal matters);</td></tr>
<tr style="vertical-align: top">
<td style="text-align: right">- </td>
<td>Pay additional $50,000 on or by October 1, 2012 (not paid pending resolution of certain legal matters);</td></tr>
</table>
<p style="font: 12pt Times New Roman, Times, Serif; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; text-align: right">- </td>
<td>Pay additional $50,000 on or by November 1, 2012 (not paid pending resolution of certain legal matters);</td></tr>
<tr style="vertical-align: top">
<td style="text-align: right">- </td>
<td>Pay additional $50,000 on or by December 1, 2012 (not paid pending resolution of certain legal matters);</td></tr>
</table>
<p style="font: 12pt Times New Roman, Times, Serif; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: top">
<td style="width: 60px; text-align: right">- </td>
<td>Pay additional $50,000 on or by the first of each month of 2013 and 2014 and each of the first 6 months of 2015 ( January, 2013 payment not paid pending resolution of certain legal matters); and</td></tr>
<tr style="vertical-align: top">
<td style="text-align: right">- </td>
<td>Pay additional $1,595,000 on or by July 14, 2015.</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During the three and six months ended November 30, 2012, the Company
incurred mineral properties exploration expenditures of $18,388 and $150,121, respectively (2011 - $Nil and $76,294, respectively).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0">Accounts payable and accrued liabilities are non-interest bearing,
unsecured and have settlement dates within one year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The amounts charged to the Company for the
services provided have been determined by negotiation among the parties and in certain cases, are covered by signed agreements.  It
is the position of the management of the company that these transactions were in the normal course of operations and were measured
at the exchange value which represented the amount of consideration established and agreed to by the related parties.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The balance due to related parties of $222,501
at November 30, 2012 (February 29, 2012 - $77,201) is due to directors, and a company controlled by a director and/or shareholder
of the Company and is unsecured, non-interest bearing and payable on demand.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During the three and nine months ended November
30, 2012, the Company paid or accrued management fees of $12,000 and $70,067, respectively, to directors of the Company (2011 -
$14,464 and $67,712, respectively).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The promissory note payable of $2,523,787 at
November 30, 2012 (February 28, 2012 - $1,882,257) consists of principal and accrued interest of $2,230,719 (February 29, 2012
- $1,743,263) and $293,068 (February 29, 2012 - $138,994), respectively. As of November 30, 2012, $2,523,787 (February 29, 2012
- $1,882,257) is secured by a non-exclusive general security agreement charging all of the Company’s president and after
acquired personal property, bears interest at 10% per annum and is due on demand.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Authorized</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The total authorized capital is 140,625,000 common shares with par
value of $0.001 per share.  On June 4, 2007, the Company increased the authorized share capital from 75,000,000 shares
of common stock to 375,000,000 shares of common stock with the same par value of $0.001 per share. On June 8, 2010, the Company
filed a Certificate of Change with the Nevada Secretary of State in relation to the 1.5 for one forward split of the Company’s
common shares on March 11, 2008 to effect the 1.5 for one forward split of the Company’s authorized common shares.  As
a result, the Company’s authorized capital was increased from 375,000,000 shares, par value of $0.001 per share, to 562,500,000
shares, par value of $0.001 per share. Effective May 12, 2011, the Company filed a Certificate of Change and Certificate of Correction
with the Nevada Secretary of State in relation to the 1 for 4 reverse stock split of the Company’s common shares to effect
the 1 for 4 reverse stock split of the Company’s authorized common shares (Note 1). As a result, the Company’s authorized
capital was decreased from 562,500,000 shares, par value of $0.001 per share to 140,625,000 shares, par value of $0.001 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Issued and Outstanding</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On June 4, 2007, the directors of the Company approved a special
resolution to undertake a forward split of the common stock of the company on a basis on 5 new common shares for 1 old common share.
On February 26, 2008, and effective March 11, 2008, the directors of the company approved a special resolution to undertake a further
forward split of the common stock of the company on a basis on 1.5 new common shares for 1 old share. Effective May 12, 2011, the
Company effected a 1 for 4 reverse stock split (Note 1).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">All references in these financial statements to number of common
shares, price per share and weighted average number of common shares have been adjusted to reflect these stock splits on a retroactive
basis, unless otherwise noted.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The total issued and outstanding capital stock is 24,473,934 commons
shares with par value of $0.001 per share.  The Company’s common stock issuances to date are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="width: 100%">
<tr style="vertical-align: top">
<td style="width: 48px; font: 10pt Times New Roman, Times, Serif; text-align: right">1.  </td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">On March 22, 2012, 4,014,565 common shares of the Company, valued at $200,728, were issued to settle the stock payable balance as of February 29, 2012.  On February 23, 2012, the Company agreed to settle $120,437 of promissory note payable debts by issuing 4,014,565 common shares fair valued at $200,728 or $0.05 per share and recognizing a loss on debt settlement of $80,291.</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>2010 Stock Option Plan</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Effective November 30, 2010 the Board of Directors of the Company
ratified, approved and adopted a Stock Option Plan (the “2010 Stock Option Plan”) for the Company in the amount of
3,431,875 shares.  In the event an optionee ceases to be employed or to provide services to the Company for reasons other
than cause, any Stock Option that is vested and held by such optionee may be exercisable within up to ninety calendar days after
the effective date that his position ceases.  No Stock Option granted under the Stock Option Plan is transferable.  Any
Stock Option held by an optionee at the time of his death may be exercised by his estate within one year of his death or such longer
period as the Board of Directors may determine.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Effective November 30, 2010, concurrent with the cancellation of
the 2008 Stock Option Plan, 1,125,000 outstanding options were cancelled and immediately replaced with 1,125,000 options in the
newly adopted 2010 Stock Option Plan.  The replacement options have an exercise price of $2.00 per share for terms of
four years. These options vest at a rate of 25% on grant and 25% at the end of each of six, twelve and eighteen months from the
date of grant.  The Company measured the incremental compensation cost as the excess of the fair value of the modified
options over the fair value of the original options immediately before the terms were modified. The incremental fair value resulting
from the modification/replacement of the original options was estimated to be<font style="color: red"> </font>$151,015 which
will be recorded over the vesting period of the options.  A total of $37,754 relating to vested options has been recorded
as stock-based compensation expense and was determined using the Black-Scholes option pricing model with an expected life of 2
years, a average risk free interest rate of 0.45%, a average dividend yield of 0% and average expected volatility of 194% and was
recorded as stock-based compensation expense during the year ended February 28, 2011. During the year ended February 29, 2012,
a total of 700,000 of these options expired and were cancelled.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As approved by the Board of Directors, on November 30, 2010, the
Company granted 337,500 stock options under the 2010 Stock Option Plan to certain directors of the Company at $2.00 per share for
terms of four years. These options vest at a rate of 25% on grant and 25% at the end of each of six, twelve and eighteen months
from the date of grant.  The total fair value of these options was estimated to be $465,048 ($1.38 per stock option)
was determined using the Black-Scholes option pricing model with an expected life of 4 years, a risk free interest rate of 1.16%,
a dividend yield of 0% and expected volatility of 187%.  A total of $116,262 relating to vested options was recorded
as stock-based compensation expense during the year ended February 28, 2011. During the year ended February 29, 2012, a total of
225,000 of these options expired and were cancelled.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As approved by the Board of Directors, on
November 30, 2010, the Company granted 50,000 stock options under the 2010 Stock Option Plan to certain consultants of the Company
at $2.00 per share for terms of four years. A total of 12,500 of these stock options vested on the grant date of December 1, 2010.
A total of 37,500 of these stock options vest 25% at the end of each of six, twelve and eighteen months from the date of grant.  The
total fair value of these options which vested during the year ended February 28, 2011 was estimated to be $17,224 ($1.38 per
stock option), and was determined using the Black-Scholes option pricing model with an expected life of 4 years, a risk free interest
rate of 1.16%, a dividend yield of 0% and expected volatility of 187% and was recorded as stock-based compensation expense during
the year ended February 28, 2011. During the year ended February 29, 2012, a total of 37,500 of these options expired and were
cancelled.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As approved by the Board of Directors, on March 14, 2011, the Company
granted 93,750 stock options under the 2010 Stock Option Plan to a director of the Company at $2.00 per share for terms of five
years. These options vest at a rate of 25% on grant and 25% at the end of each of six, twelve and eighteen months from the date
of grant.  The total fair value of these options was estimated to be $126,563 ($1.35 per stock option) was determined
using the Black-Scholes option pricing model with an expected life of 5 years, a risk free interest rate of 2.00%, a dividend yield
of 0% and expected volatility of 145%.  A total of $67,757 relating to vested options was recorded as stock-based compensation
expense during the year ended February 29, 2012. During the year ended February 29, 2012, a total of 93,750 of these options expired
and were cancelled.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During the year ended February 29, 2012, 1,056,250 stock options
with an exercise price of $2.00, previously granted to certain officers, directors and management of the Company, expired and were
cancelled.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s stock option activity for the nine month period
ended November 30, 2012 is summarized as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Number of options</b></p></td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted average exercise</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>price per</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>share</b></p></td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted average remaining</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>in contractual life (in years)</b></p></td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Balance, February 28, 2011</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">1,512,500</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">2.00</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td colspan="2" style="text-align: right">3.75 years</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 56%">Granted</td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%"> </td>
<td style="width: 10%; text-align: right">93,750</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%"> </td>
<td style="width: 12%; text-align: right">2.00</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 4%"> </td>
<td style="width: 10%; text-align: right">-</td>
<td nowrap="nowrap" style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Expired – cancelled</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">(668,750</td>
<td nowrap="nowrap">)</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">2.00</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Exercised</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Balance, February 28, 2012</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">550,000</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">2.00</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td colspan="2" style="text-align: right">2.75 years</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Granted</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Expired – cancelled</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">(12,500</td>
<td nowrap="nowrap">)</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">2.00</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Exercised</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Balance, November 30, 2012</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right">537,500</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right">2.00</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td colspan="2" style="border-bottom: black 2.25pt double; text-align: right">2.00 years</td>
<td nowrap="nowrap"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0">A total of 537,500 stock options are exercisable as at November
30, 2012.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company is subject to certain outstanding and future commitments
related to its mineral property interests (Note 4).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On June 9, 2011, Rahim Jivraj, a former officer and director of
the Company filed an action against the Company in the Supreme Court of British Columbia. The plaintiff alleges that the Company
owes him certain monies for payment under an alleged promissory note as well as pursuant to certain alleged management fees, expenses
and disbursements which is asserted were incurred by the plaintiff in the plaintiff’s prior role as an officer and director
of the Company.  The Company is of the view that such allegations are without merit and has and intends to vigorously
contest the action.  On July 13, 2011, the Company filed a defence to this action and a counterclaim against the plaintiff
denying that any monies are owing and seeking damages against the plaintiff for breach of contract, breach of fiduciary duty and
misrepresentation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On July 11, 2011, Mercer Gold Corp. (“Mercer BC”), a
privately held British Columbia company which is owned and/or controlled by Mr. Jivraj, delivered a letter to the Company which
purported to allege defaults (the “First Notice of Default”) under the Company’s existing Mineral Assets Option
Agreement, dated for reference effective as at April 13, 2010 (the “Option Agreement”), with Mercer BC, with respect
to the Guayables Gold Project in Columbia. It is the Company’s position that the allegations of default re without merit
and the letter was not valid notice of default under the Option Agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On July 19, 2011, the Company responded and advised Mercer BC as
to its position with respect to each allegation of default in the First Notice of Default.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On August 25, 2011, Mercer BC delivered a letter to the Company,
which purported to terminate the Option Agreement on the basis that the alleged defaults had not been cured. The Company regards
Mercer BC’s position as without merit and considers the purported termination to be invalid. The Company intends to continue
as operator of the mineral property interest underlying the project as set forth in the Option Agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On September 9, 2011, the Company gave notice to Mercer BC that
it intends to commence arbitration proceedings to address the validity of the termination.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On September 13, 2011, the Company filed an amended counterclaim
as against Mr. Jivraj. The counterclaim seeks an order requiring Mr. Jivraj to disgorge to the Company all of his shares in Mercer
BC together with restitution of all benefits he received from the Company while serving as its President. The Company also seeks
damages, including aggravated and punitive damages. The counterclaim alleges that Mr. Jivraj acted in a conflict of interest, while
President of the Company, by reason of his failure to divest himself of his interest in Mercer BC. It alleges that he formed a
plan to use funds raised by the Company to develop the Option Agreement property interests, and then took active steps to put the
Company in a position where it might default under the Option Agreement. It is alleged that he then resigned from the Company and
resumed his position as President of Mercer BC in order to assist Mercer BC in reacquiring these property interests so that he
could vend the property interests to another third party for new consideration. The counterclaim alleges that Mr. Jivraj has attempted
to usurp a mature business opportunity belonging to the Company by assisting Mercer BC in issuing the default notice and the termination
notice, in breach of fiduciary duty. In addition, the counterclaim alleges that Mr. Jivraj has interfered with the Company's economic
interests using unlawful means, including fraud, deceit, conversion, slander of title and defamation. The counterclaim includes
particulars of unlawful conduct, including an attempt by Mr. Jivraj to convince a Company consultant to assist him in triggering
a default under the Option Agreement by ensuring that a third party service supplier was not paid.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On September 20, 2011 the Company filed a notice of application
against each of Mr. Jivraj and Mercer BC, seeking an injunction against Mr. Jivraj and Mercer BC to restrain them from interfering
with the Company's activities as operator of the Guayabales Gold Project in Colombia and from interfering with the Company's rights
as optionee under the Option Agreement, pending conclusion of arbitration.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On October 3, 2011, Mercer BC filed a Response to Civil Claim, and
on October 11, 2011 Mercer BC filed a Counterclaim, joining the members of the Company's Board of Directors as defendants. These
pleadings have been filed in opposition to the Company's claim seeking an interlocutory injunction pending arbitration of the parties'
dispute concerning Mercer BC's purported termination of the Option Agreement. The Counterclaim seeks, among other things, a declaration
that the Option Agreement is void and/or rescission of the Option Agreement. The Counterclaim also seeks damages. The Company denies
all of the claims made in the Counterclaim as malicious, spurious and without factual basis.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On December 6, 2011 the British Columbia Supreme Court (the "Court")
issued Reasons for Judgment (the "Reasons for Judgment") granting an injunction against both Mr. Jivraj and Mercer BC,
enjoining each of them from taking any steps to interfere with the Company's role as operator of the Guayabales Gold Project located
in Colombia (the "Property") and interfering with the Option Agreement, pending completion of the arbitration proceeding
commenced by the Company with respect to such matter (the "Arbitration Proceeding"). The Court has also ordered that
a counterclaim filed by Mercer BC in the Court shall be stayed.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Court rejected Mercer BC's application to stay the Arbitration
Proceeding commenced by the Company. Mercer BC had argued that the Company was barred from seeking arbitration to challenge Mercer
BC's termination of the Option Agreement. The Court determined that the Company was not barred and that the issues sought to be
determined by the Company are appropriately advanced in the Arbitration Proceeding now being administered by the British Columbia
International Commercial Arbitration Centre.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In the Reasons for Judgment, the Court has also ordered each of
Mercer BC and Mr. Jivraj to disclose, within 24 hours, the names of all persons and entities with whom Mr. Jivraj has discussed
a possible sale or deal concerning the Property since March 28, 2011, and to refrain from communicating with any person or entity
for the purpose of discussing a possible agreement concerning the Property in a manner inconsistent with the Company's continuing
role as optionee and operator of the Property, pending the Arbitration Proceeding. The Court has further restrained Mr. Jivraj
from taking any steps to transfer his shares in Mercer BC and the Company to any third party.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On December 21, 2011, Mercer BC delivered a letter to the Company
providing notice of default (the “Second Notice of Default”) which purported to allege default by the Company under
section 2.2(c)(i) of the Option Agreement as amended by the Company and Mercer BC on or about March 22, 2011.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On December 29, 2011, the Company responded and advised Mercer BC
that the Company disputes the validity of the Second Notice of Default, that it denies that such default has occurred and that
it is submitting the question to arbitration.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 9, 2012, the Company filed a notice to arbitrate the
Second Notice of Default with Mercer BC and the British Columbia International Commercial Arbitration Centre pursuant to Article
16.2 of the Option Agreement (“Arbitration Proceeding #2), whereby the Company is seeking: (i) a declaration that the Second
Notice of Default is invalid; (ii) in the alternative, a declaration that the Company was not in default as alleged in the Second
Notice of Default; and (ii) an order requiring Mercer BC to pay to the Company costs of the arbitration.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 13, 2012, the arbitrators (the “Arbitrators”)
of the Arbitration Proceeding dealing with the First Notice of Default ordered the Company and Mercer BC to post $35,000 each as
security for the Arbitrators’ fees. The Company complied with this order, however, Mercer BC has not.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 16, 2012, the Company applied to the Arbitration Proceeding
to strike portions of Mercer BC’s defense on the basis that it raised factual issues, which were beyond the jurisdiction
of the Arbitration Proceeding. The Company’s application was dismissed, however, in responding to the application, Mercer
BC withdrew a further allegation of default, leaving only two remaining allegations of default from the original ten grounds of
default contained in the First Notice of Default.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 29, 2012, the Arbitration Proceeding #2 dealing with
the Second Notice of Default was settled on the basis that Mercer BC withdrew the Second Notice of Default, without prejudice to
its ability to assert default on the same grounds after December 31, 2012.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On March 5, 2012, the Arbitrators provided Mercer BC with a further
14 days to comply with the payment order, however, Mercer BC failed to comply with such order.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On March 19, 2012, the Arbitrators declared the termination notice
that was issued by Mercer BC to the Company on August 25, 2011 as invalid.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On May 2, 2012, the Arbitrators ordered that the Arbitration Proceedings
shall be suspended until such time as Mercer BC complies with its order.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On August 6, 2012, the Company commenced an
action against Rahim Jivraj and Mercer BC in US Federal Court under Civil Action number C12-1325 MJP. The Complaint against Jivraj
and Mercer BC includes Federal Securities Fraud, Controlling Person Liability, Defamation, Breach of Fiduciary Duty, and Tortious.Breach
of Implied Covenant of Good Faith and Fair Dealing. The claim is for compensatory damages, which claim may exceed US $43 million,
presumed defamation damages and punitive damages, and return of the ten million shares of the Company's stock held by Jivraj and
his nominees, as well as legal fees and costs.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company delivered a notice on October 11,
2012 that in 14 days it intends to take a default judgment against Rahim Jivraj and Mercer BC.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On November 19, 2012, Mercer Gold Corp. (BC)
filed a Notice of Civil Claim in the British Columbia Supreme Court seeking termination of the April 13, 2010 agreement between
Mercer Gold Corp. (BC) and the Company relating to the Guayabales gold project in Colombia. The Company regards this action to
be entirely without merit.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On November 30th, 2012 the Company filed a
Response to Civil Claim (the "Response") in response to the civil claim of Mercer Gold Corp. (BC) filed in B.C Supreme
Court on November 19, 2012.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Response states, in part, that "The
present Notice of Civil Claim is an attempt by [Rahim] Jivraj and the Plaintiff [Mercer BC] and to evade the Order of Mr. Justice
Greyell, to evade the arbitration provisions of the Option Agreement, and to evade the obligation to pay arbitration fees."  "The
Notice of Claim is an abuse of process of the court by the Plaintiff [Mercer BC] and [Rahim] Jivraj personally."</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Response seeks orders that the Notice of
Civil Claim is an abuse of process of the court, and that special costs be awarded against Mercer B.C. and Rahim Jivraj.  It
also seeks interim and permanent injunctions restraining Mercer B.C. and Rahim Jivraj, based in whole or in part, directly or indirectly,
on the Option Agreement, or any matters alleged in the actions described in the Response.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The US Federal Court Action commenced by
the Company on August 6, 2012 against Rahim Jivraj and Mercer BC continues to proceed. On January 10, 2013, the
Company filed submissions to the Chief Justice, including the following proposed order which reads, in part: " IT IS
FURTHER ORDERED, ADJUDGED AND DECREED that: (1) Defendant Mercer Gold Corp. (BC) is not permitted to litigate in this Court
without qualified legal counsel and no further delay shall be permitted for it to procure counsel. (2) The Answer with
respect to defendant Mercer Gold Corp. (BC) is stricken; and, (3) Defendant Mercer Gold Corp. (BC) has defaulted and judgment
may be taken.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s only business activity
is exploration and development of mineral properties.  This activity is carried out in Colombia.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The breakdown by geographic area for the nine
month period ended November 30, 2012 is as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: bottom">
<td> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">United States</td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">Colombia</td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">Total</td>
<td nowrap="nowrap" style="font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 64%">Net loss</td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; text-align: right">562,992</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; text-align: right">119,148</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; text-align: right">682,140</td>
<td nowrap="nowrap" style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Current assets</td>
<td style="text-align: right"> </td>
<td>$</td>
<td style="text-align: right">2,157</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td>$</td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td>$</td>
<td style="text-align: right">2,157</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Deposit</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">1,176</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">1,176</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Property and equipment and website</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">9,992</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">9,992</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Other assets</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">5,795,000</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">5,795,000</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Total assets</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">2,157</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">5,806,168</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">5,808,325</td>
<td nowrap="nowrap"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> <b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0">The breakdown by geographic area for the year ended February 29,
2012 is as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: bottom">
<td> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">United States</td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">Colombia</td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">Total</td>
<td nowrap="nowrap" style="font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 64%">Net loss</td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; text-align: right">1,249,618</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; text-align: right">757,869</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; text-align: right">2,007,487</td>
<td nowrap="nowrap" style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Current assets</td>
<td style="text-align: right"> </td>
<td>$</td>
<td style="text-align: right">9,631</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td>$</td>
<td style="text-align: right">116</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td>$</td>
<td style="text-align: right">747</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Deposit</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">1,176</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">1,176</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Property and equipment and website</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">15,638</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">15,638</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Other assets</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">5,735,000</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">5,735,000</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Total assets</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">9,631</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">5,750,754</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">5,761,561</td>
<td nowrap="nowrap"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0">The breakdown by geographic area for the nine month period ended
November 30, 2011 is as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: bottom">
<td> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">United States</td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">Colombia</td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">Total</td>
<td nowrap="nowrap" style="font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 64%">Net loss</td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; text-align: right">1,125,730</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; text-align: right">597,249</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; text-align: right">1,722,979</td>
<td nowrap="nowrap" style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Current assets</td>
<td style="text-align: right"> </td>
<td>$</td>
<td style="text-align: right">89,583</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td>$</td>
<td style="text-align: right">258</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td>$</td>
<td style="text-align: right">89,841</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Property and equipment</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">6,064</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">6,064</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Other assets</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">5,650,000</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">5,650,000</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Total assets</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">89,583</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">5,656,322</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">5,745,905</td>
<td nowrap="nowrap"> </td></tr>
</table>
2157
9747
126134
7806
2157
9747
1176
1176
9992
15638
423
561
4167
9167
5402
5910
5808325
5761561
5808325
5761561
957124
1015050
3703412
2974508
2104913
2787053
33342737
32660597
5795000
5735000
24474
20459
35423176
35226463
200728
--02-28
140625000
140625000
0.001
0.001
24473934
20459375
24473934
20459375
14625000
5859
181
213
768
7194
46280
17095
3740
23740
407480
180504
43471
226888
329356
1489333
70067
12000
36463
69038
641357
5894
41484
251823
150121
18388
776294
2285820
23144
-38438
2786
108901
520995
41300
11300
18085
74304
234557
9190
89888
213883
11879022
-160406
213
107
1188
517275
63997
383744
1637661
32510989
154074
54916
37035
85318
820469
-671349
-118913
-420779
-1722979
-33331458
10791
2534
11279
-682140
-121447
-420779
-1722979
-33342737
-0.03
-0.01
-0.02
-0.10
24166254
24473934
18085749
17619739
154074
85713
811194
24000
107
1188
-88170
-120843
-160406
19319
1176
6906
-57926
686309
939000
145300
29124
468891
-434833
-733514
-4639407
9167
60000
235000
1420000
213
-486
8291
-60213
-234514
-1437458
764283
592456
474700
2543010
25398
-105000
-25000
-578773
400000
3375900
487456
849700
6079022
-7590
-118328
2157
127733
240000
1900000
60000
658322
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The accounting and reporting policies
of the Company conform to U.S. GAAP applicable to exploration stage enterprises.  The functional currency is the U.S.
dollar, and the consolidated financial statements are presented in U.S. dollars.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The consolidated interim financial statements
include the accounts of the Company and its wholly-owned subsidiaries, Mercer One Panama Corp. and Mercer Two Panama Corp. which
were incorporated on June 2, 2010. All significant inter-company transactions and account balances have been eliminated upon consolidation.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">Mineral property acquisition costs are
initially capitalized as intangible assets when purchased.  At the end of each fiscal quarter, the Company assesses the
carrying costs for impairment.  If proven and probable reserves are established for a property and it has been determined
that a mineral property can be economically developed, costs will be amortized using the units-of-production method over the estimated
life of the probable reserve.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">Mineral property exploration costs are
expensed as incurred.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">Estimated future removal and site restoration
costs, when determinable, are provided over the life of proven reserves on a units-of-production basis.  Costs, which
include production equipment removal and environmental remediation, are estimated each period by management based on current regulations,
actual expenses incurred, and technology and industry standards.  Any charge is included in exploration expense or the
provision for depletion and depreciation during the period and the actual restoration expenditures are charged to the accumulated
provision amounts as incurred.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">As of the date of these interim financial
statements, the Company has not established any proven or probable reserves on its mineral properties and incurred only acquisition
and exploration costs.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">Although the Company has taken steps
to verify title to mineral properties in which it has an interest, according to the usual industry standards for the stage of exploration
of such properties, these procedures do not guarantee the Company’s title.  Such properties may be subject to prior
agreements or transfers and title may be affected by undetected defects.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 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 period.  Actual results could differ from those estimates. Significant areas requiring management’s
estimates and assumptions are the determination of the fair value of transactions involving common stock and financial instruments.
Other areas requiring estimates include deferred tax balances and asset impairment tests.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">For the statements of cash flows, all
highly liquid investments with maturity of three months or less are considered to be cash equivalents.  There were no
cash and cash equivalents as of November 30, 2012 and February 29, 2012 that exceeded federally insured limits. The Company had
$1,176 in restricted cash as of November 30, 2012 (February 29, 2012 - $1,176)</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company computes income (loss) per
share in accordance with ASC 260, “Earnings Per Share” which requires presentation of both basic and diluted earnings
per share on the face of the statement of operations.  Basic income (loss) per share is computed by dividing net income
(loss) available to common shareholders by weighted average number of outstanding common shares during the period.  Diluted
income (loss) per share gives effect to all dilutive potential common shares outstanding during the period.  Dilutive
loss per share excludes all potential common shares if their effect is anti-dilutive.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">A fair value hierarchy was established
that prioritizes the inputs used to measure fair value.  The hierarchy gives the highest priority to unadjusted quoted
prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs
(Level 3 measurements).</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair values of the financial instruments
were determined using the following input levels and valuation techniques:</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">Level 1:  classification is
applied to any asset or liability that has a readily available quoted market price from an active market where there is significant
transparency in the executed/quoted price.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">Level 2:  classification is
applied to assets and liabilities that have evaluated prices where the data inputs to these valuations are observable either directly
or indirectly, but do not represent quoted market prices from an active market.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">Level 3:  classification is
applied to assets and liabilities when prices are not derived from existing market data and requires us to develop our own assumptions
about how market participants would price the asset or liability.</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">As at November 30, 2012, the fair value
of cash and cash equivalents, accounts payable, amounts due to related parties and promissory notes payable approximate carrying
value due to their short maturities.     </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The financial statements are presented
in U.S. dollars.  In accordance with ASC 830, “Foreign Currency Matters”, foreign denominated monetary assets
and liabilities are translated to their U.S. dollar equivalents using foreign exchange rates which prevailed at the balance sheet
date.  Revenue and expenses are translated at average rates of exchange during the period.  Related translation
adjustments are reported as a separate component of stockholders’ equity, whereas gains or losses resulting from foreign
currency transactions are included in results of operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td style="font-weight: bold"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">Net Book Value</td>
<td nowrap="nowrap" style="font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">Cost</td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Accumulated</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>amortization</b></p></td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>November 30,</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2012</b></p></td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; font-weight: bold; text-align: center">February 29, 2012</td>
<td nowrap="nowrap" style="font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 50%">Furniture and fixtures</td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 3%">$</td>
<td style="width: 5%; text-align: right">649</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 5%"> </td>
<td style="width: 6%; text-align: right">226</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 4%"> </td>
<td style="width: 9%; text-align: right">423</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%">$</td>
<td style="width: 9%; text-align: right">561</td>
<td nowrap="nowrap" style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Website</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">9,167</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">5,000</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">4,167</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">9,167</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Machinery and equipment</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">7,176</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">1,774</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">5,402</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">5,910</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">16,992</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right">7,000</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right">9,992</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double">$</td>
<td style="border-bottom: black 2.25pt double; text-align: right">15,638</td>
<td nowrap="nowrap"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s stock option activity for the nine month period
ended November 30, 2012 is summarized as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Number of options</b></p></td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted average exercise</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>price per</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>share</b></p></td>
<td nowrap="nowrap" style="font-weight: bold"> </td>
<td style="font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted average remaining</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>in contractual life (in years)</b></p></td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td colspan="2"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Balance, February 28, 2011</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">1,512,500</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">2.00</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td colspan="2" style="text-align: right">3.75 years</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 56%">Granted</td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%"> </td>
<td style="width: 10%; text-align: right">93,750</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%"> </td>
<td style="width: 12%; text-align: right">2.00</td>
<td nowrap="nowrap" style="width: 1%"> </td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 4%"> </td>
<td style="width: 10%; text-align: right">-</td>
<td nowrap="nowrap" style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Expired – cancelled</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">(668,750</td>
<td nowrap="nowrap">)</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">2.00</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Exercised</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Balance, February 28, 2012</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">550,000</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">2.00</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td colspan="2" style="text-align: right">2.75 years</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Granted</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td>Expired – cancelled</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">(12,500</td>
<td nowrap="nowrap">)</td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">2.00</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td> </td>
<td style="text-align: right">-</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Exercised</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right">-</td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td nowrap="nowrap"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td>Balance, November 30, 2012</td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right">537,500</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right">2.00</td>
<td nowrap="nowrap"> </td>
<td style="text-align: right"> </td>
<td colspan="2" style="border-bottom: black 2.25pt double; text-align: right">2.00 years</td>
<td nowrap="nowrap"> </td></tr></table>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The breakdown by geographic area for
the nine month period ended November 30, 2012 is as follows:</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: bottom">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; line-height: 115%; font-weight: bold; text-align: center">United States</td>
<td nowrap="nowrap" style="line-height: 115%; font-weight: bold"> </td>
<td style="line-height: 115%; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; line-height: 115%; font-weight: bold; text-align: center">Colombia</td>
<td nowrap="nowrap" style="line-height: 115%; font-weight: bold"> </td>
<td style="line-height: 115%; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; line-height: 115%; font-weight: bold; text-align: center">Total</td>
<td nowrap="nowrap" style="line-height: 115%; font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td colspan="2" style="line-height: 115%"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td colspan="2" style="line-height: 115%"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td colspan="2" style="line-height: 115%"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 64%; line-height: 115%">Net loss</td>
<td style="width: 1%; line-height: 115%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; line-height: 115%; text-align: right">562,992</td>
<td nowrap="nowrap" style="width: 1%; line-height: 115%"> </td>
<td style="width: 1%; line-height: 115%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; line-height: 115%; text-align: right">119,148</td>
<td nowrap="nowrap" style="width: 1%; line-height: 115%"> </td>
<td style="width: 1%; line-height: 115%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; line-height: 115%; text-align: right">682,140</td>
<td nowrap="nowrap" style="width: 1%; line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="line-height: 115%">Current assets</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%">$</td>
<td style="line-height: 115%; text-align: right">2,157</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%">$</td>
<td style="line-height: 115%; text-align: right">-</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%">$</td>
<td style="line-height: 115%; text-align: right">2,157</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%">Deposit</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">-</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">1,176</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">1,176</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="line-height: 115%">Property and equipment and website</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">-</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">9,992</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">9,992</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%">Other assets</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%; text-align: right">-</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%; text-align: right">5,795,000</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%; text-align: right">5,795,000</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%">Total assets</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="border-bottom: black 2.25pt double; line-height: 115%; text-align: right">2,157</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="border-bottom: black 2.25pt double; line-height: 115%; text-align: right">5,806,168</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="border-bottom: black 2.25pt double; line-height: 115%; text-align: right">5,808,325</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
</table>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">The breakdown by geographic area for the year ended February
29, 2012 is as follows:</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: bottom">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; line-height: 115%; font-weight: bold; text-align: center">United States</td>
<td nowrap="nowrap" style="line-height: 115%; font-weight: bold"> </td>
<td style="line-height: 115%; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; line-height: 115%; font-weight: bold; text-align: center">Colombia</td>
<td nowrap="nowrap" style="line-height: 115%; font-weight: bold"> </td>
<td style="line-height: 115%; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; line-height: 115%; font-weight: bold; text-align: center">Total</td>
<td nowrap="nowrap" style="line-height: 115%; font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td colspan="2" style="line-height: 115%"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td colspan="2" style="line-height: 115%"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td colspan="2" style="line-height: 115%"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 64%; line-height: 115%">Net loss</td>
<td style="width: 1%; line-height: 115%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; line-height: 115%; text-align: right">1,249,618</td>
<td nowrap="nowrap" style="width: 1%; line-height: 115%"> </td>
<td style="width: 1%; line-height: 115%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; line-height: 115%; text-align: right">757,869</td>
<td nowrap="nowrap" style="width: 1%; line-height: 115%"> </td>
<td style="width: 1%; line-height: 115%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; line-height: 115%; text-align: right">2,007,487</td>
<td nowrap="nowrap" style="width: 1%; line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="line-height: 115%">Current assets</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%">$</td>
<td style="line-height: 115%; text-align: right">9,631</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%">$</td>
<td style="line-height: 115%; text-align: right">116</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%">$</td>
<td style="line-height: 115%; text-align: right">747</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%">Deposit</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">-</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">1,176</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">1,176</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="line-height: 115%">Property and equipment and website</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">-</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">15,638</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">15,638</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%">Other assets</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%; text-align: right">-</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%; text-align: right">5,735,000</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%; text-align: right">5,735,000</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%">Total assets</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="border-bottom: black 2.25pt double; line-height: 115%; text-align: right">9,631</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="border-bottom: black 2.25pt double; line-height: 115%; text-align: right">5,750,754</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="border-bottom: black 2.25pt double; line-height: 115%; text-align: right">5,761,561</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
</table>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">The breakdown by geographic area for the nine month period
ended November 30, 2011 is as follows:</p>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%">
<tr style="vertical-align: bottom">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; line-height: 115%; font-weight: bold; text-align: center">United States</td>
<td nowrap="nowrap" style="line-height: 115%; font-weight: bold"> </td>
<td style="line-height: 115%; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; line-height: 115%; font-weight: bold; text-align: center">Colombia</td>
<td nowrap="nowrap" style="line-height: 115%; font-weight: bold"> </td>
<td style="line-height: 115%; font-weight: bold"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; line-height: 115%; font-weight: bold; text-align: center">Total</td>
<td nowrap="nowrap" style="line-height: 115%; font-weight: bold"> </td></tr>
<tr style="vertical-align: bottom">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td colspan="2" style="line-height: 115%"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td colspan="2" style="line-height: 115%"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td colspan="2" style="line-height: 115%"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 64%; line-height: 115%">Net loss</td>
<td style="width: 1%; line-height: 115%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; line-height: 115%; text-align: right">1,125,730</td>
<td nowrap="nowrap" style="width: 1%; line-height: 115%"> </td>
<td style="width: 1%; line-height: 115%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; line-height: 115%; text-align: right">597,249</td>
<td nowrap="nowrap" style="width: 1%; line-height: 115%"> </td>
<td style="width: 1%; line-height: 115%; text-align: right"> </td>
<td style="width: 1%; border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="width: 9%; border-bottom: black 2.25pt double; line-height: 115%; text-align: right">1,722,979</td>
<td nowrap="nowrap" style="width: 1%; line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="line-height: 115%">Current assets</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%">$</td>
<td style="line-height: 115%; text-align: right">89,583</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%">$</td>
<td style="line-height: 115%; text-align: right">258</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%">$</td>
<td style="line-height: 115%; text-align: right">89,841</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%">Property and equipment</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">-</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">6,064</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right">6,064</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="line-height: 115%">Other assets</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%; text-align: right">-</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%; text-align: right">5,650,000</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%"> </td>
<td style="border-bottom: black 1.5pt solid; line-height: 115%; text-align: right">5,650,000</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="line-height: 115%">Total assets</td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="border-bottom: black 2.25pt double; line-height: 115%; text-align: right">89,583</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="border-bottom: black 2.25pt double; line-height: 115%; text-align: right">5,656,322</td>
<td nowrap="nowrap" style="line-height: 115%"> </td>
<td style="line-height: 115%; text-align: right"> </td>
<td style="border-bottom: black 2.25pt double; line-height: 115%">$</td>
<td style="border-bottom: black 2.25pt double; line-height: 115%; text-align: right">5,745,905</td>
<td nowrap="nowrap" style="line-height: 115%"> </td></tr>
</table>
<p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt"> </p>
<p style="font: 10pt/115% Times New Roman, Times, Serif; margin: 0 0 10pt"> </p>
1176
1176
0
0
16992
649
9167
7176
7000
226
5000
1774
18388
0
150121
76294
213
9761
70067
12000
14464
67712
2230719
1743263
293068
138994
0.10
682140
1722979
2007487
562992
119148
1249618
757869
1125730
597249
2157
89841
747
2157
9631
116
89583
258
1176
1176
1176
1176
9992
6064
15638
9992
15638
6064
5795000
5650000
5735000
5795000
5735000
5650000
5808325
5745905
5761561
2157
5806168
9631
5750754
89583
5656322
537500
550000
1512500
93750
1056250
-12500
-668750
2
2
2
2.00
2
2
P0Y
P0Y
P0Y
P0Y
P0Y
P0Y
P2Y
P4Y
0.0045
0.0116
0.00
0.00
1.94
1.87
700000
225000
37500
93750
700000
225000
37500
93750
116262
67757
P2Y
P2Y9M
P3Y9M
2523787
1882257
222501
77201
222501
77201
2523787
1882257