--04-30
cpah
COUNTERPATH CORP
2012-01-31
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<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td align="left">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Note 1</b>
</font>
</font>
</td>
<td align="left" width="90%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>
<u>Nature of Operations</u>
</b>
</font>
</font>
</td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">CounterPath Corporation (the “Company”) was incorporated in the State of Nevada on April 18, 2003. The Company changed its name from CounterPath Solutions, Inc. to CounterPath Corporation on October 17, 2007. The Company’s common shares are quoted for trading on the Over-The-Counter Bulletin Board in the United States of America and on the TSX Venture Exchange in Canada.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On August 2, 2007, the Company acquired of all of the shares of NewHeights Software Corporation (“NewHeights”) through the issuance of 7,680,168 shares of the Company’s common stock and 369,836 preferred shares issued from a subsidiary of the Company that are exchangeable into 369,836 shares of common stock of the Company. For accounting purposes, the Company was deemed to be the acquirer of NewHeights based on certain factors including the number of common shares issued in the transaction as a proportion of the total common shares outstanding, and the composition of the board after the transaction.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On February 1, 2008, the Company acquired FirstHand Technologies Inc. (“FirstHand”), a private Ontario, Canada corporation, through the issuance of 5,900,014 shares of the Company’s common stock. For accounting purposes, the Company was deemed to be the acquirer of FirstHand based on certain factors including the number of common shares issued in the transaction as a proportion of the total common shares outstanding, and the composition of the board after the transaction.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On February 1, 2008, the Company acquired BridgePort Networks, Inc. (“BridgePort”), a private Delaware corporation, by way of merger in consideration for the assumption of all of the assets and liabilities of BridgePort. For accounting purposes, the Company was deemed to be the acquirer of BridgePort based on certain factors primarily being the composition of the board after the transaction.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On February 5, 2008, the Company\'s wholly-owned subsidiaries, NewHeights and CounterPath Solutions R&D Inc. were merged as a wholly-owned subsidiary of the Company under the name CounterPath Technologies Inc.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On March 19, 2008, the Company’s Board of Directors approved a five for one common stock consolidation. As a result, the Company\'s authorized capital decreased from 415,384,500 shares of common stock to 83,076,900 shares of common stock. The par value of the common stock was unaffected by the stock consolidation and remains at $0.001 per share. All per share amounts and outstanding shares, including all common stock equivalents (stock options and warrants) have been retroactively adjusted in the Consolidated Financial Statements and in the Notes to the Consolidated Financial Statements for all periods presented to reflect the stock consolidation.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On November 1, 2010, the Company\'s wholly-owned subsidiary, FirstHand Technologies Inc. was amalgamated with CounterPath Technologies Inc. and carrying on as CounterPath Technologies Inc.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The Company focuses on the design, development, marketing and sales of desktop and mobile communications application software, conferencing software, gateway (server) software and related professional services, such as pre and post sales technical support and customization services. The Company’s products are sold into the Voice over Internet Protocol (VoIP) market primarily to telecom carriers, telecom original equipment manufacturers and businesses in North America, Central and South America, Europe and Asia.</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td align="left">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Note 2</b>
</font>
</font>
</td>
<td align="left" width="90%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>
<u>Significant Accounting Policies</u>
</b>
</font>
</font>
</td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">These interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America and are stated in U.S. dollars except where otherwise disclosed. Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for the period necessarily involves the use of estimates, which have been made using careful judgment. Actual results may vary from these estimates.</font>
</font>
</p>
<p align="center"> </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr>
<td width="10%"> </td>
<td valign="top" width="5%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">a)</font>
</font>
</td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<u>Basis of Presentation</u>
</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, CounterPath Technologies Inc., a company existing under the laws of the province of British Columbia, Canada, BridgePort Networks, Inc. incorporated under the laws of the state of Delaware, BridgePort Networks (Europe) Ltd. Incorporated in the United Kingdom, and 6789722 Canada Inc., incorporated under the Canada Business Corporations Act. The results of NewHeights Software Corporation (which subsequently merged with another subsidiary to become CounterPath Technologies Inc.) are included from August 2, 2007, the date of acquisition. The results of FirstHand Technologies Inc. and BridgePort Networks, Inc. are included from February 1, 2008, the date of acquisition. All inter- company transactions and balances have been eliminated.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td valign="top" width="5%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">b)</font>
</font>
</td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<u>Interim Reporting</u>
</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The information presented in the accompanying interim consolidated financial statements is without audit pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">These statements reflect all adjustments, which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows for the interim periods presented in accordance with accounting principles generally accepted in the United States of America. Except where noted, these interim financial statements follow the same accounting policies and methods of their application as the Company’s April 30, 2011 annual consolidated financial statements. All adjustments are of a normal recurring nature. It is suggested that these interim financial statements be read in conjunction with the Company’s April 30, 2011 annual consolidated financial statements.</font>
</font>
</p>
</td>
</tr>
</table>
<p align="center"> </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Operating results for the nine months ended January 31, 2012 are not necessarily indicative of the results that can be expected for the year ending April 30, 2012.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td valign="top" width="5%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">c)</font>
</font>
</td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<u>New Accounting Pronouncements</u>
</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">In September 2009, the FASB revised the authoritative guidance for revenue recognition for arrangements with multiple deliverables. The new guidance modifies the requirements for determining whether a deliverable can be treated as a separate unit of accounting by removing the criteria that verifiable and objective evidence of fair value exists for the undelivered elements. In allocating transaction consideration among the deliverables, the guidance also introduced the concept of using management\'s best estimate of a stand-alone selling price as an alternate basis for allocation. The guidance is effective in fiscal years beginning on or after June 15, 2010, and the Company is required to adopt this guidance in its first quarter of fiscal 2012. The adoption of this standard did not have a material impact on the Company\'s financial statements.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
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<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">In September 2009, FASB’s Emerging Issues Task Force issued ASU 2009-14 “Certain Revenue Arrangements That Include Software Elements.” ASU 2009-14 addresses certain revenue arrangements that include software elements. This guidance states that tangible products with hardware and software components that work together to deliver the product functionality are considered non-software products, and the accounting guidance under the revenue arrangements with multiple deliverables is to be followed. This guidance is effective for arrangements entered into, or materially modified, in periods beginning on or after June 15, 2010, with earlier adoption permitted, and the Company is required to adopt this guidance in its first quarter of fiscal 2012. The adoption of ASU 2009-14 did not have a material impact on the Company\'s financial statements.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
In April 2010, the FASB issued Accounting Standards Update No. 2010-13,
<i>Effect of Denominating the Exercise Price of a Share-Based Payment Award in the Currency of the Market in Which the Underlying Equity Security Trades</i>
, amends Topic 718 to clarify that an employee share-based payment award with an exercise price denominated in the currency of a market in which a substantial portion of the entity’s equity securities trades should not be considered to contain a condition that is not a market, performance, or service condition. Therefore, an entity would not classify such an award as a liability if it otherwise qualifies as equity. It is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2010. The amendments should be applied by recording a cumulative-effect adjustment to the opening balance of retained earnings. The cumulative-effect adjustment should be calculated for all awards outstanding as of the beginning of the year in which the amendments are initially applied, as if the amendments had been applied consistently since the inception of the award. The adoption of ASC 2010-13 did not have a material impact on the Company\'s financial statements.
</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
In April 2010, the FASB issued Accounting Standards Update No. 2010-17,
<i>Revenue Recognition— Milestone Method (Topic 605)</i>
–
<i>Revenue Recognition</i>
(ASU 2010-17). ASU 2010-17 provides guidance on defining the milestone and determining when the use of the milestone method of revenue recognition for research or development transactions is appropriate. It provides criteria for evaluating if the milestone is substantive and clarifies that a vendor can recognize consideration that is contingent upon achievement of a milestone as revenue in the period in which the milestone is achieved, if the milestone meets all the criteria to be considered substantive. ASU 2010-17 is effective for the Company in fiscal 2012 and should be applied prospectively. The adoption of ASU 2010-17 did not have a material impact on the Company\'s financial statements.
</font>
</font>
</p>
</td>
</tr>
</table>
<p align="center"> </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
In May 2011, the FASB issued Accounting Standards Update No. 2011-04,
<i>Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs</i>
, which aligns the fair value measurement and disclosure requirements in U.S. GAAP and the International Financial Reporting Standards (IFRSs). Many of the amendments in this ASU will not result in a change in requirements, but simply clarify existing requirements. The amendments in this ASU that do change a principle or requirement for measuring fair value or disclosing information about fair value measurements include the following: (1) the ASU permits an exception for measuring fair value when a reporting entity manages its financial instruments on the basis of its net exposure, rather than gross exposure, to those risks; (2) the ASU clarifies that the application of premiums and discounts in a fair value measurement is related to the unit of account for the asset or liability being measured at fair value; (3) the ASU prohibits blockage discounts for level 2 and 3 investments; and (4) the amendments expand the fair value measurement disclosures. The ASU is to be applied prospectively. For public entities, the ASU is effective during interim and annual periods beginning after December 15, 2011. The Company is currently evaluating the impact of the pending adoption of ASU 2011-04 on its consolidated financial statements.
</font>
</font>
</p>
</td>
</tr>
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<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
In June 2011 the FASB issued Accounting Standards Update 2011-05,
<i>Presentation of Comprehensive Income</i>
, which eliminates the option of presenting the components of other comprehensive income (OCI) as part of the statement of changes in stockholders’ equity. The ASU instead permits an entity to present the total of comprehensive income, the components of net income and the components of OCI either in a single continuous statement of comprehensive income or in two separate but consecutive statements. With either format, the entity is required to present each component of net income along with total net income, each component of OCI along with the total for OCI, and a total amount for comprehensive income. Also, the ASU requires entities to present, for either format, reclassification adjustments for items that are reclassified from OCI to net income in the statement(s) where the components of net income and the components of OCI are presented. This ASU is to be applied retrospectively. For public entities, the ASU is effective for interim and annual periods beginning after December 15, 2011. The Company does not anticipate that the adoption of ASU 2011-05 will have any impact on its consolidated financial statements.
</font>
</font>
</p>
</td>
</tr>
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<td width="10%"> </td>
<td width="5%"> </td>
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</tr>
<tr>
<td width="10%"> </td>
<td valign="top" width="5%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">d)</font>
</font>
</td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<u>Goodwill and Intangible Assets</u>
</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Goodwill represents the excess purchase price over the estimated fair value of net assets acquired as of the acquisition date. ASC Topic 350 (prior authoritative literature: Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets” (“SFAS No. 142”)). ASC 350 requires goodwill to be tested for impairment annually or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of the Company\'s business enterprise below its carrying value. These events or circumstances could include a significant change in the business climate, legal factors, operating performance indicators, competition, or sale or disposition of a significant portion of a reporting unit. Recoverability of goodwill is measured at the reporting unit level by comparing the reporting unit’s carrying amount, including goodwill, to the fair value of the reporting unit, which is measured based upon, among other factors, market multiples for comparable companies as well as a discounted cash flow analysis.</font>
</font>
</p>
</td>
</tr>
</table>
<p align="center"> </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Management has determined that the Company currently has a single reporting unit which is CounterPath Corporation. If the recorded value of the assets, including goodwill, and liabilities (“net book value”) of the reporting unit exceeds its fair value, an impairment loss may be required.</font>
</font>
</p>
</td>
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<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Goodwill of $6,339,717 (CDN$6,704,947) and $2,083,960 (CDN$2,083,752) was initially recorded in connection with the acquisition of NewHeights Software Corporation on August 2, 2007 and FirstHand Technologies Inc. on February 1, 2008. Translated to U.S. dollars using the period end rate, the goodwill balance at January 31, 2012 was $6,677,457 (CDN$6,704,947) (April 30, 2011 - $7,055,616) and $2,074,872 (CDN$2,083,752) (April 30, 2011 - $2,192,377), respectively. Management will perform its annual impairment test in its fiscal fourth quarter. No impairment charges were recorded for the nine months ended January 31, 2012 and 2011.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Intangible assets include the intangibles purchased in connection with the acquisition of NewHeights Software Corporation on August 2, 2007, and FirstHand Technologies Inc. and BridgePort Networks, Inc. on February 1, 2008.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The intangible assets of NewHeights are reported at acquisition cost and include amounts initially allocated to acquired technologies of $3,454,839 (CDN$3,678,100) and customer asset of $2,283,908 (CDN$2,431,500). The acquired technologies are amortized based on their estimated useful life of four years and the customer asset is amortized on the basis of Management’s estimate of the future cash flows from this asset over approximately five years, which is Management’s estimate of the useful life of the customer asset.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The intangible assets of FirstHand are reported at acquisition cost and include amounts initially allocated to acquired technologies of $2,804,700 (CDN$2,804,700) and customer asset of $587,000 (CDN$587,000). The acquired technologies are amortized based on their estimated useful life of four years and the customer asset is amortized on the basis of Management’s estimate of the future cash flows from this asset over approximately five years, which is Management’s estimate of the useful life of the customer asset.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The intangible assets of BridgePort are being carried and reported at acquisition cost and include amounts initially allocated to acquired technologies of $476,703 and customer asset of $43,594. The acquired technologies are amortized based on their estimated useful life of four years and the customer asset is amortized on the basis of Management’s estimate of the future cash flows from this asset over approximately five years, which is Management’s estimate of the useful life of the customer asset.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">A summary of the Company’s intangible assets, net, at January 31, 2012 is as follows:</font>
</font>
</p>
</td>
</tr>
</table>
<br/>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="34%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%"> </td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%"> </td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Accumulated</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%"> </td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="34%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%"> </td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Accumulated</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Impairment</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Net Carrying</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="34%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Cost</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Amortization</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Charge</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Amount</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="34%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Acquired technologies</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 6,306,337</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 4,417,679</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 1,888,658</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> –</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="34%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Customer assets</font>
</font>
</td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2,726,718</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,369,627</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,216,028</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">141,063</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="34%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Intangible assets</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 9,033,055</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 5,787,306</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 3,104,686</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 141,063</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
</table>
<p align="center"> </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td align="left">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Note 3</b>
</font>
</font>
</td>
<td align="left" width="90%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>
<u>Related Party Transactions</u>
</b>
</font>
</font>
</td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The Company’s Chairman is the Chairman and founding shareholder of Mitel Networks Corporation (“Mitel”). On July 31, 2008 the Company entered into a source code license agreement whereby the Company licensed to Mitel the source code for the Your Assistant product in consideration of a payment of $650,000. Associated with the agreement are ongoing license fees to be paid by Mitel of $13.50 per copy deployed, declining to $9.00 per copy deployed after two years and declining from $9.00 to nil after four years. In addition, the agreement provides Mitel with a first right to match any third party offer to purchase the source code software and related intellectual property. The Company’s software license revenue for the three and nine months ended January 31, 2012, pursuant to the terms of these agreements, was $147,551 and $355,937 (2011 - $136,803 and $399,128), respectively. As at January 31, 2012, the Company had an accounts receivable balance from Mitel of $113,971 (April 30, 2011 - $114,369).</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">During the three and nine months ended January 31, 2012, the Company through its wholly owned subsidiary, CounterPath Technologies Inc., paid $19,902 and $59,706 (2011 - $19,971 and $59,913) to Kanata Research Park Corporation (“KRP”) for leased office space. KRP is controlled by the Company’s Chairman.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">In connection with a private placement on June 14, 2011, Wesley Clover, a company controlled by the Chairman of the Company, converted all of its outstanding convertible debentures of the Company in the aggregate principal amount of $490,750 to 358,211 shares of common stock concurrent with the closing of the private placement (Note 4). On August 24, 2011, Wesley Clover exercised 833,334 warrants at the original exercise price of $0.90 per share.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The above transactions are in the normal course of operations and are recorded at amounts established and agreed to between the related parties.</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td align="left">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Note 4</b>
</font>
</font>
</td>
<td align="left" width="90%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>
<u>Convertible Debentures</u>
</b>
</font>
</font>
</td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On July 30, 2010 and October 29, 2010, the Company issued two convertible debentures in the principal amounts of $483,300 and $490,750, respectively, to an investor. The debentures were convertible by the holder, at any time prior to maturity, in whole or in part into common shares of the Company at a conversion price of $1.00 per share. On October 29, 2010, the Company issued a third convertible debenture in the principal amount of $490,750 to a company controlled by the Chairman of the Company. The debenture was convertible by the holder at any time prior to maturity, in whole or in part into common shares of the Company at a conversion price of $1.37 per share. The three convertible debentures were unsecured, bearing interest at the prime bank rate as quoted by the Bank of Montreal with interest payable monthly and maturing on July 30, 2012.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The convertible debentures could be prepaid in whole or in part by the Company by paying 105% of the principal to be prepaid together with accrued and unpaid interest on or before July 30, 2011, or by paying 102.5% of the principal to be prepaid together with accrued and unpaid interest between July 31, 2011 and April 30, 2012, or by paying 100% of the principal to be prepaid together with accrued and unpaid interest between May 1, 2012 and July 30, 2012.</font>
</font>
</p>
<p align="center"> </p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Pursuant to ASC Topic 470-20, “Debt with Conversion and Other Options,” the Company determined that the convertible debentures issued on October 29, 2010 contain a beneficial conversion feature, as the fair value of the Company’s common stock on the date of issuance was greater than the initial conversion price.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Accordingly, the Company allocated $765,964 to the convertible debentures and $215,536 to the beneficial conversion feature. The amounts allocated to the beneficial conversion feature represent a discount on the debt financing which is accreted to income over the term of the debt. During the year ended April 30, 2011, the Company accreted $55,738 by way of discount on the debentures issued.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The convertible debentures issued on July 30, 2010 did not contain a beneficial conversion feature, as the fair value of the Company’s common stock on the date of issuance was equal to or less than the initial conversion price.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On June 14, 2011 all the outstanding convertible debentures of the Company in the aggregate principal amount of $1,464,800 were converted with a total of 1,332,261 common shares being issued to the holders. In addition, the Company accreted $159,798 by way of discount on the debentures issued.</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td align="left">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Note 5</b>
</font>
</font>
</td>
<td align="left" width="90%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>
<u>Exchangeable Shares</u>
</b>
</font>
</font>
</td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On August 2, 2007, the Company entered into a voting and exchange trust agreement among its subsidiary, 6789722 Canada Inc., and Valiant Trust Company whereby the Company issued and deposited with Valiant Trust a special preferred voting share of the Company in order to enable Valiant Trust to execute certain voting and exchange rights as trustee from time to time for and on behalf of the registered holders of the preferred shares of 6789722 Canada Inc. Each preferred share of 6789722 Canada Inc. is exchangeable into one share of common stock of the Company at the election of the shareholder, or, in certain circumstances, of the Company.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On October 9, 2008, and November 19, 2008, the Company issued 50,000 shares each totaling to 100,000 shares of common stock pursuant to a holder of 100,000 shares of exchangeable preferred shares of its subsidiary 6789722 Canada Inc. exercising their exchange rights. There were 269,841 outstanding exchangeable shares as of April 30, 2009 (April 30, 2008 - 369,841). As the exchangeable shares have already been recognized in connection with the acquisition of NewHeights, the value ascribed to these shares on exchange is $nil.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On May 11, 2009, the Company issued 50,000 shares of common stock pursuant to a holder of 50,000 shares of exchangeable preferred shares of its subsidiary 6789722 Canada Inc. exercising their exchange rights. On December 16, 2009, the Company issued 154,546 shares of common stock pursuant to a holder of 154,546 shares of exchangeable preferred shares of its subsidiary 6789722 Canada Inc. exercising their exchange rights.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On April 27, 2010, the Company issued 4,424 shares of common stock pursuant to a holder of 4,424 shares of exchangeable preferred shares of its subsidiary 6789722 Canada Inc. exercising their exchange rights. On May 14, 2010, the Company issued 50,000 shares of common stock pursuant to a holder of 50,000 shares of exchangeable preferred shares of its subsidiary 6789722 Canada Inc. exercising their exchange rights. On January 27, 2011, the Company issued 1,122 shares of common stock pursuant to a holder of 1,122 shares of exchangeable preferred shares of its subsidiary 6789722 Canada Inc. exercising their exchange rights.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On January 28, 2011, the Company redeemed all of the remaining 9,749 exchangeable shares outstanding pursuant to the Company\'s redemption call right under the provisions attaching to the exchangeable shares of 6789722 Canada Inc., and the voting and exchange trust agreement was terminated on January 28, 2011. As a result there were no outstanding exchangeable shares as of April 30, 2011 (April 30, 2010 – 60,871). As the exchangeable shares have already been recognized in connection with the acquisition of NewHeights, the value ascribed to these shares on exchange is $nil.</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td align="left">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Note 6</b>
</font>
</font>
</td>
<td align="left" width="90%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>
<u>Common Stock</u>
</b>
</font>
</font>
</td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<u>Private Placement</u>
</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On June 14, 2011, the Company issued an aggregate of 3,145,800 units under a brokered private placement for aggregate gross proceeds of $5,636,170 (CDN$5,505,150) at a price of $1.79 (CDN$1.75) per unit, with each unit consisting of one share of the Company’s common stock and one-half of one common share purchase warrant, with each whole warrant entitling the holder to purchase one additional common share of the Company’s common stock at an exercise price of CDN$2.25 per share until June 14, 2013. In connection with the offering, the Company issued an aggregate of 220,206 broker warrants, with each broker warrant entitling the holder thereof to purchase one common share of the Company at an exercise price of CDN$1.75 per share until December 14, 2012. In addition, the Company incurred $605,922 in share issue costs.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<u>Stock Options</u>
</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The Company has a stock option plan under which options to purchase common shares of the Company may be granted to employees, directors and consultants. Stock options entitle the holder to purchase common stock at a subscription price determined by the Board of Directors of the Company at the time of the grant. The options generally vest in the amount of 12.5% on the date which is six months from the date of grant and then beginning in the seventh month at 1/42 per month for 42 months, at which time the options are fully vested.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The maximum number of shares of common stock authorized by the stockholders and reserved for issuance by the Board of Directors of the Company under the 2010 Stock Option Plan is 6,860,000.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The Company has elected to use the Black-Scholes option pricing model to determine the fair value of stock options granted. In accordance with ASC 718 for employees, the compensation expense is amortized on a straight-line basis over the requisite service period which approximates the vesting period. Compensation expense for stock options granted to non-employees is amortized over the vesting period or, if none exists, over the service period. Compensation associated with unvested options granted to non-employees is remeasured on each balance sheet date using the Black-Scholes option pricing model.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The expected volatility of options granted has been determined using the method described under ASC 718 using the historical stock price. The expected term of options granted to employees in the current fiscal period has been determined utilizing the “simplified” method as prescribed by ASC 718 Share-Based Payment. For non-employees, based on the Company’s history, the expected term of the options approximates the full term of the options. The risk-free interest rate is based on a treasury instrument whose term is consistent with the expected term of the stock options. The Company has not paid and does not anticipate paying dividends on its common stock; therefore, the expected dividend yield is assumed to be zero. In addition, ASC 718 requires companies to utilize an estimated forfeiture rate when calculating the expense for the period, whereas prior to the adoption of ASC 718 the Company recorded forfeitures based on actual forfeitures and recorded a compensation expense recovery in the period when the awards were forfeited. As a result, based on the Company’s experience, the Company applied an estimated forfeiture rate of 15% for the nine month period ended January 31, 2012 and 2011 in determining the expense recorded in the accompanying consolidated statement of operations.</font>
</font>
</p>
<p align="center"> </p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The weighted-average fair value of options granted during the nine months ended January 31, 2012 was $0.90 (2011 - $1.11) . The weighted-average assumptions utilized to determine such values are presented in the following table:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Nine Months Ended</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Nine Months Ended</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31, 2012</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31, 2011</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Risk-free interest rate</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.86%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.95%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Expected volatility</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">74.2%</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">83.1%</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Expected term</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">3.7 yrs</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">3.7 yrs</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Dividend yield</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0%</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0%</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Weighted average fair value</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.90</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.12</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The following is a summary of the status of the Company’s stock options as of January 31, 2012 and the stock option activity during the nine months ended January 31, 2012:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%"> </td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Weighted Average</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Number of</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Exercise Price</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Options</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>per Share</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Outstanding at April 30, 2011</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">3,607,663</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.97</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Granted</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,000,000</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.70</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Exercised</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">(323,662</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">)</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.44</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Forfeited/Cancelled</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">(303,399</font>
</font>
</td>
<td align="left" width="2%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">)</font>
</font>
</td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.73</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Expired</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">(13,400</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">)</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.47</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Outstanding at January 31, 2012</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">3,967,202</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.12</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr>
<td> </td>
<td bgcolor="#e6efff" width="60%"> </td>
<td bgcolor="#e6efff" width="1%"> </td>
<td bgcolor="#e6efff" width="12%"> </td>
<td bgcolor="#e6efff" width="2%"> </td>
<td bgcolor="#e6efff" width="1%"> </td>
<td bgcolor="#e6efff" width="12%"> </td>
<td bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Exercisable at January 31, 2012</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,999,295</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.81</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Exercisable at April 30, 2011</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,930,647</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.78</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The following table summarizes information regarding stock purchase options outstanding as of January 31, 2012:</font>
</font>
</p>
<div align="right">
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 7pt; border-collapse: collapse;" width="90%">
<tr valign="top">
<td align="left" nowrap="nowrap"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Number of</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Aggregate</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="22%"> </td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Number of</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Aggregate</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center" nowrap="nowrap">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Exercise</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Options</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Intrinsic</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="22%"> </td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Options</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Intrinsic</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Price</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Outstanding</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Value</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="22%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Expiry Date</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Exercisable</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Value</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center" bgcolor="#e6efff">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$0.44</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">405,008</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 490,060</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="22%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">December 15, 2013</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">306,452</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 370,807</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$0.47</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">482,277</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">569,087</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="22%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">May 1,2012 to September 26, 2016</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">480,610</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">567,120</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center" bgcolor="#e6efff">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$0.60</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">434,917</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">456,663</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="22%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">December 14, 2014</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">230,795</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">242,335</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$0.62</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">850,000</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">875,500</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="22%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">April 17, 2014</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">584,375</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">601,906</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center" bgcolor="#e6efff">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$1.70</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,000,000</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="22%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">December 14, 2016</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$1.90</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">435,000</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="22%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">December 14, 2015</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">117,812</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center" bgcolor="#e6efff">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$2.00</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">18,000</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="22%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">October 1, 2012 to February 28, 2015</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">18,000</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$2.15</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">240,000</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="22%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">September 7, 2016</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">240,000</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center" bgcolor="#e6efff">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$2.27</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">102,000</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="22%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">March 10, 2016</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">21,251</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">January 31, 2012</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">3,967,202</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 2,391,310</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="left" width="22%"> </td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,999,295</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 1,782,168</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="2%"> </td>
</tr>
<tr>
<td align="center" bgcolor="#e6efff"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
<td bgcolor="#e6efff" width="1%"> </td>
<td bgcolor="#e6efff" width="22%"> </td>
<td bgcolor="#e6efff" width="2%"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="11%"> </td>
<td bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="2%"> </td>
</tr>
<tr valign="top">
<td align="center">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">April 30, 2011</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">3,607,663</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 3,984,765</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="left" width="22%"> </td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,930,647</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="11%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 2,485,779</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="2%"> </td>
</tr>
</table>
</div>
<p align="center"> </p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The aggregate intrinsic value in the preceding table represents the total intrinsic value, based on the Company’s closing stock price of $1.65 per share as of January 31, 2012 (April 30, 2011 – $2.06), which would have been received by the option holders had all option holders exercised their options as of that date. The total number of in-the-money options vested and exercisable as of January 31, 2012 was 1,602,232 (April 30, 2011 –1,690,647). The total intrinsic value of options exercised during the nine months ended January 31, 2012 was $378,878 (2011 – $420,683). The grant date fair value of options vested during the nine months ended January 31, 2012 was $272,758 (2011 – $258,778).</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The following table summarizes information regarding the non-vested stock purchase options outstanding as of January 31, 2012.</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%"> </td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Weighted Average</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%"> </td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Grant Date Fair</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Number of Options</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Value</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Non-vested options at April 30, 2011</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,677,016</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.69</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Granted</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,000,000</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.90</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Vested</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">(474,967</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">)</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.57</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Cancelled/Forfeited</font>
</font>
</td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">(234,142</font>
</font>
</td>
<td align="left" width="2%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">)</font>
</font>
</td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.03</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Non-vested options at January 31, 2012</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,967,907</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.79</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">As of January 31, 2012 there was $1,336,199 of total unrecognized compensation cost related to unvested share-based compensation awards. This unrecognized compensation cost is expected to be recognized over a weighted average period of 3.27 years.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Employee and non-employee stock-based compensation amounts classified in the Company’s consolidated statements of operations for the three and nine months ended January 31, 2012 and 2011 are as follows:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="38%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Three Months Ended</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Nine Months Ended</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="38%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31,</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31,</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="38%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2012</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2011</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2012</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2011</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr>
<td> </td>
<td width="38%"> </td>
<td width="1%"> </td>
<td align="center" width="10%"> </td>
<td align="center" width="2%"> </td>
<td align="center" width="1%"> </td>
<td align="center" width="10%"> </td>
<td align="center" width="2%"> </td>
<td align="center" width="1%"> </td>
<td align="center" width="10%"> </td>
<td align="center" width="2%"> </td>
<td align="center" width="1%"> </td>
<td align="center" width="10%"> </td>
<td width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Cost of sales</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 8,835</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 8,971</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 26,754</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 19,312</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Sales and marketing</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">41,991</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">31,640</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">77,863</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">71,119</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Research and development</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">9,347</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">8,961</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">27,418</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">25,512</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">General and administrative</font>
</font>
</td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">42,876</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">28,003</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">104,274</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">134,359</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Total stock-based compensation</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 103,049</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 77,575</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 236,309</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 250,302</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<u>Warrants</u>
</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On June 14, 2011, the Company issued an aggregate of 3,145,800 units under a brokered private placement for aggregate gross proceeds of $5,636,170 (CDN$5,505,150) at a price of $1.79 (CDN$1.75) per unit, with each unit consisting of one share of the Company’s common stock and one-half of one common share purchase warrant, with each whole warrant entitling the holder to purchase one additional common share of the Company’s common stock at an exercise price of CDN$2.25 per share until June 14, 2013. In connection with the offering, the Company issued an aggregate of 220,206 broker warrants, with each broker warrant entitling the holder thereof to purchase one common share of the Company at an exercise price of CDN$1.75 per share until December 14, 2012.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Following the guidance in ASC 815-40-15, the Company recorded the warrants issued as derivative liabilities due to their exercise price being denominated in a currency other than the Company’s U.S. Dollar functional currency. The fair value of the derivative liability is revalued at the end of each reporting period, and the change in fair value of the derivative liability is recorded as a gain or loss in the Company’s consolidated statements of operations.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The warrant liability is accounted for at its fair value as follows:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" width="60%"> </td>
<td align="left" width="1%"> </td>
<td align="center" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31,</b>
</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" width="1%"> </td>
<td align="center" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>April 30,</b>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2012</b>
</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2011</b>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Fair value of warrant liability, at issuance</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 1,311,141</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> –</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Change in fair value of warrant liability for the period</font>
</font>
</td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">(636,232</font>
</font>
</td>
<td align="left" width="2%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">)</font>
</font>
</td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Fair value of warrant liability at January 31, 2012</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 674,909</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> –</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The Company used the Binomial method to estimate the fair value of the warrants with the following assumptions:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" width="52%"> </td>
<td align="left" width="1%"> </td>
<td align="center" width="16%"> </td>
<td align="center" width="2%"> </td>
<td align="center" width="1%"> </td>
<td align="center" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>As at the date of</b>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="52%"> </td>
<td align="left" width="1%"> </td>
<td align="center" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>As at</b>
</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" width="1%"> </td>
<td align="center" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>issuance</b>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="52%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31, 2012</b>
</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>June 14, 2011</b>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="52%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Risk-free interest rate</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="center" bgcolor="#e6efff" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.12%</font>
</font>
</td>
<td align="center" bgcolor="#e6efff" width="2%"> </td>
<td align="center" bgcolor="#e6efff" width="1%"> </td>
<td align="center" bgcolor="#e6efff" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.60%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="52%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Expected volatility</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="center" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">70%</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" width="1%"> </td>
<td align="center" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">70%</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="52%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Expected term</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="center" bgcolor="#e6efff" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.87 years to 1.37 years</font>
</font>
</td>
<td align="center" bgcolor="#e6efff" width="2%"> </td>
<td align="center" bgcolor="#e6efff" width="1%"> </td>
<td align="center" bgcolor="#e6efff" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.5 years to 2 years</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="52%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Dividend yield</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="center" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0%</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" width="1%"> </td>
<td align="center" width="16%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0%</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The warrant liability is revalued at the end of each reporting period with the change in the fair value of the derivative liability recorded as a gain or loss in the Company’s consolidated statement of operations. The fair value of the warrants will continue to be classified as a liability until such time as they are exercised, expire or there is an amendment to the respective agreements that renders these financial instruments to be no longer classified as a liability.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">At the time of the private placement offering, the Company allocated the proceeds to each of the common shares and the one-half of one common share purchase warrants. Because the warrants were classified as liability and are subsequently marked to fair value through earnings in each reporting period, the Company allocated the proceeds of $1,311,141 to the warrants at inception with the residual proceeds of $3,773,946 allocated to common stock.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">During the nine months ended January 31, 2011, the Company entered into a warrant agreement with a customer whereby the Company issued 1,000,000 stock purchase warrants as part of a contract that the Company entered into with the customer. The fair value of 372,222 stock purchase warrants that was charged to revenue during the nine months ended January 31, 2011 was $161,710.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The following table summarizes information regarding the warrants outstanding as of January 31, 2012:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="30%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="13%"> </td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Weighted</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="25%"> </td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="30%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Number of</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Average</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="25%"> </td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="30%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Warrants</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Exercise Price</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="25%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Expiry Dates</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="30%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Warrants at April 30, 2011</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2,666,667</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.12</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="center" bgcolor="#e6efff" width="25%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">October 29, 2011 to July 30, 2012</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="30%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Granted</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,793,106</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2.19</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="center" width="25%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">December 14, 2012 to June 14, 2013</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="30%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Exercised</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">(1,666,668</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">)</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.90</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="center" bgcolor="#e6efff" width="25%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">October 29, 2011</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="30%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Warrants at January 31, 2012</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2,793,105</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="13%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.94</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="center" width="25%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">July 30, 2012 to June 14, 2013</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<u>Employee Stock Purchase Plan</u>
</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Under the terms of the Employee Stock Purchase Plan (ESPP), all regular salaried (non-probationary) employees may purchase up to 6% of their base salary in shares of common stock of the Company at market price. The Company matches 50% of the shares purchased by issuing or purchasing at market price up to 3% of the respective employee’s base salary in shares.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">A total of 700,000 shares have been reserved for issuance under the ESPP. As of January 31, 2012, a total of 556,401 shares (April 30, 2011 - 556,401) were available for issuance under the ESPP. During the nine months ended January 31, 2012, no shares (April 30, 2011 - 55,571) were sold or issued to employees under the ESPP.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<u>Deferred Share Unit Plan</u>
</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Under the terms of the Deferred Share Unit Plan (DSUP) which is effective as at October 22, 2009, each deferred share unit is equivalent to one share of common stock. The maximum number of shares of common stock that may be reserved for issuance to any one participant pursuant to deferred share units granted under the DSUP and any share compensation arrangement is 5% of the number of shares of common stock of the Company outstanding at the time of reservation and, as applicable, any grants of deferred share units to any one participant may not exceed a value of $100,000 per annum on the date of grant. A deferred share unit (DSU) granted to a participant who is a director of the board of the Company shall vest immediately on the award date. A deferred share unit granted to a participant other than a director will generally vest as to one-third (1/3) of the number of deferred share units granted on the first, second and third anniversaries of the award date. Fair value of the DSU’s, which is based on the closing price of the Company’s common stock on the date of grant, is recorded as compensation expense over the vesting period.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">A total of 2,000,000 shares have been reserved for issuance under the DSUP. During the nine months ended January 31, 2012, deferred share units were issued under the DSUP, of which 108,108 were granted to officers or employees and 93,243 were granted to non-employee directors. As of January 31, 2012, a total of 411,936 shares were available for issuance under the DSUP.</font>
</font>
</p>
<p align="center"> </p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The following table summarizes the Company’s outstanding DSU awards as of January 31, 2012, and changes during the period then ended:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%"> </td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Weighted Average</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%"> </td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Grant Date Fair</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Number of DSU’s</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Value Per Unit</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">DSU’s outstanding at April 30, 2011</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,386,713</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.83</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Granted</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">201,351</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.85</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Conversions</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">DSU’s outstanding at January 31, 2012</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1,588,064</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.96</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The following table summarizes information regarding the non-vested deferred share units outstanding as of January 31, 2012:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" width="60%"> </td>
<td align="left" width="1%"> </td>
<td align="center" width="12%"> </td>
<td align="center" width="2%"> </td>
<td align="center" width="1%"> </td>
<td align="center" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Weighted Average</b>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%"> </td>
<td align="left" width="1%"> </td>
<td align="center" width="12%"> </td>
<td align="center" width="2%"> </td>
<td align="center" width="1%"> </td>
<td align="center" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Grant Date Fair</b>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Number of DSU’s</b>
</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Value Per Unit</b>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Non-vested DSU’s at April 30, 2011</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">426,083</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">0.89</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Granted</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">201,351</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.85</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Vested</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">(197,768</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">)</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2.18</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Non-vested DSU’s at January 31, 2012</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">429,666</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1.23</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">As of January 31, 2012 there was $385,435 (2011 – $240,338) of total unrecognized compensation cost related to unvested deferred share units awards. This unrecognized compensation cost is expected to be recognized over a weighted average period of 2.02 years (2011 – 2.24 years).</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Employee and non-employee deferred share unit based compensation amounts classified in the Company’s consolidated statements of operations for the nine months ended January 31, 2012 and 2011 are as follows:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" width="38%"> </td>
<td align="left" width="1%"> </td>
<td align="center" colspan="4" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Three Months Ended</b>
</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" width="1%"> </td>
<td align="center" colspan="4" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Nine Months Ended</b>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="38%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" colspan="4" style="border-bottom: 1px solid rgb(0, 0, 0);" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31,</b>
</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" colspan="4" style="border-bottom: 1px solid rgb(0, 0, 0);" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31,</b>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="38%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2012</b>
</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2011</b>
</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2012</b>
</font>
</font>
</td>
<td align="center" width="2%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2011</b>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">General and administrative</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 55,600</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 32,236</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 296,523</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 441,293</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Total deferred share unit-based compensation</font>
</font>
</td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 55,600</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 32,236</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 296,523</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 441,293</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
</table>
<p align="center"> </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td align="left">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Note 7</b>
</font>
</font>
</td>
<td align="left" width="90%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>
<u>Segmented Information</u>
</b>
</font>
</font>
</td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The Company’s chief operating decision maker reviews financial information presented on a consolidated basis, accompanied by desegregated information about revenues by geographic region for purposes of making operating decisions and assessing financial performance. Accordingly, the Company has concluded that it has one reportable operating segment.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Foreign revenues are based on the country in which the customer is located. The following is a summary of total revenues by geographic area for the three and nine months ended January 31, 2012 and 2011:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="38%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Three Months Ended</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Nine Months Ended</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="38%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31,</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31,</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="38%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2012</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2011</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2012</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2011</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">North America</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 2,333,540</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 1,734,031</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 6,285,291</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 4,688,080</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Europe</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">940,391</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">867,454</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2,552,706</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2,127,894</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Asia and Africa</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">156,118</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">299,733</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">553,390</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">535,476</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Latin America</font>
</font>
</td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">55,822</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">120,884</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">327,071</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">457,900</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="38%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 3,485,871</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 3,022,102</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 9,718,458</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 7,809,350</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Contained within the results of North America for the three and nine months ended January 31, 2012 are revenues from the United States of $1,610,754 and $4,143,930 (2011 - $869,702 and $3,303,109) respectively and from Canada of $722,786 and $2,141,361 (2011 - $864,329 and $1,384,971) respectively.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Contained within the results of Europe for the three and nine months ended January 31, 2012 are revenues from the United Kingdom of $400,139 and $1,236,771 (2011 - $407,104 and $1,202,222) respectively, from Czech Republic of $166,946 and $174,220 (2011 - $26,067 and $nil) respectively, Germany of $59,729 and $196,915 (2011 - $64,576 and $148,811) respectively, from France of $26,668 and $147,767 (2011 - $4,840 and $19,058) respectively, and from the Netherlands of $17,358 and $124,728 (2011 - $110,417 and $138,855) respectively.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Contained within the results of Asia and Africa for the three and nine months ended January 31, 2012 are revenues from Australia of $22,481 and $106,226 (2011 - $10,824 and $54,296) respectively, from South Africa of $10,285 and $98,531 (2011 - $12,842 and $27,158) respectively, from Japan of $20,840 and $63,531 (2011 - $114,560 and $174,806) respectively, and from Tunisia of $42,681 and $46,641 (2011 - $nil and $nil) respectively.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Contained within the results of Latin America for the three and nine months ended January 31, 2012 are revenues from Mexico of $22,077 and $101,066 (2011 - $31,541 and $148,040) respectively, from Brazil of $5,341 and $87,230 (2011 - $18,175 and $39,472) respectively, from Chile of $nil and $18,123 (2011 - $7,204 and $128,802) respectively, and from Colombia of $9,276 and $37,696 (2011 - $46,376 and $69,869) respectively.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">All of the Company’s long-lived assets, which include equipment, intangible assets, goodwill and other assets, are located in Canada and the United States as follows:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="27%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>As at</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="60%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31, 2012</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>April 30, 2011</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Canada</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 8,948,748</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 10,190,468</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="60%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">United States</font>
</font>
</td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">7,709</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">25,071</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="60%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 8,956,457</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="12%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 10,215,539</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
</table>
<p align="center"> </p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">The proportion of total revenue from significant customers for the three and nine months ended January 31, 2012 and 2011 is summarized as follows:</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="38%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Three Months Ended</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Nine Months Ended</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="38%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31,</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" colspan="4" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="23%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>January 31,</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="38%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2012</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2011</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2012</b>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>2011</b>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Customer A</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">13%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">-%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">6%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">-%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Customer B</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">10%</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">11%</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">9%</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">13%</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Customer C</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">18%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">10%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">8%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="38%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Customer D</font>
</font>
</td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">1%</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">9%</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2%</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="right" style="border-bottom: 1px solid rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">15%</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="38%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">26%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">38%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">27%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="1%"> </td>
<td align="right" bgcolor="#e6efff" style="border-bottom: 3px double rgb(0, 0, 0);" width="10%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">36%</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Accounts receivable balances for Customer A were $483,000 as at January 31, 2012 (April 30, 2011 - $nil). Accounts receivable balances for Customer B were $233,500 as at January 31, 2012 (April 30, 2011 -$311,100). Accounts receivable balances for Customer C were $53,675 as at January 31, 2012 (April 30, 2011 - $881,400). Accounts receivable balances for Customer D were $77,896 as at January 31, 2012 (April 30, 2011 - $93,837).</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td align="left">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Note 8</b>
</font>
</font>
</td>
<td align="left" width="90%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>
<u>Commitments</u>
</b>
</font>
</font>
</td>
</tr>
</table>
<br/>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr>
<td width="10%"> </td>
<td valign="top" width="5%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">a)</font>
</font>
</td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On December 30, 2010, the Company entered into an extension agreement on an existing lease, which commenced on April 1, 2011 and expires March 31, 2012. The monthly lease payment under the extension agreement is $1,667. The lease expense for the three months ended January 31, 2012 was $5,001 (2011 - $7,017).</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td valign="top" width="5%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">b)</font>
</font>
</td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On April 29, 2005, the Company entered into a lease for office premises, which commenced on October 1, 2005 and expires on September 30, 2012 for which a deposit of $9,888 was made. The monthly lease payment under this agreement is $9,888 plus $8,664 in operating costs. The Company is subleasing part of these premises for a monthly charge of $7,475. The sublease commenced on August 1, 2007 and expires on September 30, 2012. The lease expense net of rental revenue for the three and nine months ended January 31, 2012 was $14,146 and $42,438 (2011 - $14,146 and $42,438) respectively.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td valign="top" width="5%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">c)</font>
</font>
</td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On January 11, 2011, the Company entered into a lease agreement, which commenced on October 1, 2011, and expires September 30, 2014 for which a deposit of $49,795 was made. The monthly lease payment under the agreement is $20,148 plus $21,178 in operating costs. The lease expense for the three and nine months ended January 31, 2012 was $123,978 and $390,889 (2011 - $135,351 and $406,053) respectively. Management believes that this office space is adequate for the operations of the Company for the foreseeable future.</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td valign="top" width="5%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">d)</font>
</font>
</td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On May 1, 2009, the Company modified its existing lease agreement for office premises, as a result of which it surrendered a substantial part of the previously leased area. The new agreement commenced on May 1, 2009 and expires on April 20, 2012. The monthly lease payment under this agreement is $6,634 (CDN$6,662). This lease expense is a related party transaction as it was incurred with a company with a director in common with the Company. The lease expense for the three and nine months ended January 31, 2012 was $19,903 and $59,709 (2011 - $19,903 and $59,709) respectively. On December 9, 2011, the Company signed a fifth amendment to the existing lease agreement to extend the lease starting May 1, 2012 to April 30, 2014. The monthly lease payment under the new lease extension will be $7,007 (CDN$7,034).</font>
</font>
</p>
</td>
</tr>
</table>
<p align="center"> </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr>
<td width="10%"> </td>
<td valign="top" width="5%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">e)</font>
</font>
</font>
</font>
</td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On March 12, 2009, the Company and its wholly-owned subsidiary, CounterPath Technologies Inc., entered into a settlement agreement with a founder and former officer of the Company. Under the settlement agreement, the Company will pay a total of $492,971 (CDN$495,000) over 45 months at a rate of CDN$11,000 per month and pay for health benefits for 33 months from the date of the agreement.</font>
</font>
</font>
</font>
</p>
</td>
</tr>
<tr>
<td width="10%"> </td>
<td width="5%"> </td>
<td> </td>
</tr>
<tr>
<td width="10%"> </td>
<td valign="top" width="5%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">f)</font>
</font>
</font>
</font>
</td>
<td>
<p align="justify">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On August 2, 2011, the Company entered into extension of an existing operating lease agreement which commenced on August 1, 2011 and expires on February 28, 2013. The monthly lease payment under the new extension agreement is $6,700. The lease expense for the three and nine months ended January 31, 2012 was $20,100 and $62,062 (2011 - $21,825 and $71,250).</font>
</font>
</font>
</font>
</p>
</td>
</tr>
</table>
<p align="justify" style="margin-left: 15%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">Total payable over the term of the agreements for the years ended April 30 are as follows:</font>
</font>
</font>
</font>
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 8pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="30%"> </td>
<td align="left" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Office Leases –</b>
</font>
</font>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Office Leases –</b>
</font>
</font>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Sub Lease</b>
</font>
</font>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Total Office</b>
</font>
</font>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" width="1%"> </td>
<td align="center" nowrap="nowrap" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Settlement</b>
</font>
</font>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" nowrap="nowrap" width="30%"> </td>
<td align="left" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Related Party</b>
</font>
</font>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Unrelated Party</b>
</font>
</font>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Income</b>
</font>
</font>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Leases</b>
</font>
</font>
</font>
</font>
</td>
<td align="center" nowrap="nowrap" width="2%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="1%"> </td>
<td align="center" nowrap="nowrap" style="border-bottom: 1px solid rgb(0, 0, 0);" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Agreement</b>
</font>
</font>
</font>
</font>
</td>
<td align="left" nowrap="nowrap" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="30%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2012</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 19,903</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 203,065</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> (22,424</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">)</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 200,544</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</font>
</font>
</td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 32,865</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="30%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2013</font>
</font>
</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">84,082</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">655,663</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">(37,374</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">)</font>
</font>
</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">702,371</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">82,162</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="30%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2014</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">84,082</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">495,906</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">579,988</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="30%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2015</font>
</font>
</font>
</font>
</td>
<td align="left" width="1%"> </td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">206,627</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">206,627</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%"> </td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" bgcolor="#e6efff" width="30%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">2016</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
<td align="left" bgcolor="#e6efff" width="1%"> </td>
<td align="right" bgcolor="#e6efff" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">–</font>
</font>
</font>
</font>
</td>
<td align="left" bgcolor="#e6efff" width="2%"> </td>
</tr>
<tr valign="top">
<td> </td>
<td align="left" width="30%"> </td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</font>
</font>
</td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 188,067</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</font>
</font>
</td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 1,561,261</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</font>
</font>
</td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> (59,798</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">)</font>
</font>
</font>
</font>
</td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</font>
</font>
</td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 1,689,530</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
<td align="left" width="1%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">$</font>
</font>
</font>
</font>
</td>
<td align="right" width="8%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;"> 115,027</font>
</font>
</font>
</font>
</td>
<td align="left" width="2%"> </td>
</tr>
</table>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td align="left">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Note 9</b>
</font>
</font>
</td>
<td align="left" width="90%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>
<u>Derivative Instruments and Hedging Activities</u>
</b>
</font>
</font>
</td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">In the normal course of business, the Company is exposed to fluctuations in interest rates and the exchange rates associated with foreign currencies. The Company’s primary objective for holding derivative financial instruments is to manage foreign currency exchange rate risk.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<u>Foreign Currency Exchange Rate Risk</u>
</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">A majority of the Company’s revenue activities are transacted in U.S. dollars. However, the Company is exposed to foreign currency exchange rate risk inherent in conducting business globally in numerous currencies, of which the most significant to its operations for the nine months ended January 31, 2012 is the Canadian dollar. The Company is primarily exposed to a strengthening Canadian dollar as its operating expenses are primarily denominated in Canadian dollars while its revenues are primarily denominated in U.S. dollars. The Company’s foreign currency risk management program includes foreign currency derivatives with cash flow hedge accounting designation that utilizes foreign currency forward contracts to hedge exposures to the variability in the U.S. dollar equivalent of anticipated non-U.S. dollar-denominated cash flows. These instruments generally have a maturity of less than one year. For these derivatives, the Company reports the after-tax gain or loss from the effective portion of the hedge as a component of accumulated other comprehensive income (loss) in stockholders’ equity and reclassifies it into earnings in the same period in which the hedged transaction affects earnings, and within the same line item on the consolidated statements of operations as the impact of the hedged transaction. The Company did not enter into any forward contracts during the nine months ended January 31, 2012.</font>
</font>
</p>
<p align="center"> </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-color: black; font-size: 10pt; border-collapse: collapse;" width="100%">
<tr valign="top">
<td align="left">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>Note 10</b>
</font>
</font>
</td>
<td align="left" width="90%">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">
<b>
<u>Subsequent Events</u>
</b>
</font>
</font>
</td>
</tr>
</table>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On March 8, 2012, the Company granted 25,000 stock options to an employee pursuant to its 2010 Stock Option Plan. Each stock option entitles the holder thereof the right to purchase one share of common stock at a price equal to the closing market price on March 8, 2012. The options vest in the amount of 12.5% on the date which is six months from the date of grant and then beginning in the seventh month at 1/42 per month for 42 months, at which time the options are fully vested.</font>
</font>
</p>
<p align="justify" style="margin-left: 10%;">
<font style="font-size: 10pt;">
<font style="font-family: times new roman,times,serif;">On February 16, 2012, the Company announced a Normal Course Issuer Bid pursuant to which the Company may acquire up to an aggregate of 1,995,414 shares of its common stock by way of open market transactions over the next 12-month period representing approximately 5% of the issued and outstanding common shares of the Company.</font>
</font>
</p>
<p align="center"> </p>