EQUITY

3 Months Ended

May 31, 2012

Notes to Financial Statements

NOTE 2 - EQUITY

During the three months ended May 31, 2012, the Company sold 880,000 shares of common stock for total proceeds of $880,000, of which the Company received $855,000 and the remaining $25,000 will be received subsequent to May 31, 2012. The Company has accounted for the $25,000 received subsequent to May 31, 2012 as a subscription receivable on its balance sheet.

The Company has authorized 150,000,000 shares of common stock, par value $0.0001 per share, and has 20,954,422 shares of common stock issued and outstanding as of May 31, 2012.

The Company has authorized 10,000,000 shares of preferred stock, par value $0.0001 per share, and has 0 shares of preferred stock issued and outstanding as of May 31, 2012.

May 2012 Private Placement

On May 1, 2012, we entered into a securities purchase agreement with certain institutional and accredited investors for the issuance and sale in a private placement consisting of, in the aggregate, (a) 880,000 shares of common stock, at a price per share of $1.00 and (b) four-year warrants to purchase up to 220,000 shares of common stock at an exercise price of $1.40 per share, expiring on May 1, 2016, for aggregate gross proceeds of $880,000 (the “May 2012 Private Placement”). As of May 31, 2012, we have closed on $855,000 and have a subscription receivable for the remaining amount. The amounts recorded as a subscription receivable have been collected subsequent to the quarter end.

In connection with the May 2012 Private Placement, we also entered into a registration rights agreement with the investors whereby we agreed to file a registration statement with the Securities and Exchange Commission to register for resale the shares of common stock and the shares of common stock underlying the warrants within 120 calendar days of the closing date, and to have the registration statement declared effective within 180 calendar days of the closing date or within 270 calendar days of the closing date in the event of a full review of the registration statement by the SEC.

Restricted Stock Grant

On May 22, 2012, the Company issued 50,000 restricted shares to each of our two directors, Patrick T. Mooney and Johan M. “Thijs”Spoor, for services rendered to the Company. The restricted shares shall vest pursuant to the Company listing its shares of Common Stock on a national securities exchange. The restricted shares expire on May 21, 2022 if the Company fails to meet the vesting conditions. The fair value of the restricted stock is $400,000, which will be expensed over a 10 year period. $0 has been expensed as of May 31, 2012 related to the restricted stock grant.