OPTION AGREEMENT

9 Months Ended

Jul. 31, 2013

OPTION AGREEMENT

(14) OPTION AGREEMENT

Pursuant to the LIMO Deed, as amended, during 2011, the Company paid Option Fees of $405,000, along with associated costs of $20,000.

The Company had 60 days from the date of the last option payment to exercise the option to purchase 20% of the Joint Venture for $1.35 million, inclusive of the option fees of $405,000. On October 24, 2011, the Company executed a Deed of Variation of Call Option extending the exercise date of Option to April 24, 2012, for a consideration of $55,000 for each month extended. The Company did not exercise the option to purchase 20% of the Joint Venture on April 24, 2012 and accordingly $425,000 of prepaid option fees were expensed in April 2012 (see note 1).