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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549

FORM 20-F

(Mark One)

[ ]REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g)
OF THE SECURITIES EXCHANGE ACT OF 1934

OR

[ x ]ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2010

OR

[ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

OR

[ ]SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report

For the transition period from ____________to
____________________

Commission file number 000-32981

QWICK MEDIA INC.(Exact
name of Registrant as specified in its charter)

Not Applicable(Translation of Registrants
name into English)

The Cayman Islands(Jurisdiction of
incorporation or organization)

780  333 Seymour Street Vancouver, British Columbia,
Canada V6B 5A6(Address of principal executive offices)

Ross Tocher, President, 778.370.1719 rosstocher@trianequities.com
780-333 Seymour Street, Vancouver British Columbia Canada,
V6B 5A6(Name, Telephone, E-mail and/or Facsimile number and Address
of Company Contact Person)

Securities registered or to be registered pursuant to Section
12(b) of the Act.

|Title of each class | Name of each exchange on which registered
|------------------- | -----------------------------------------
|Not Applicable      | Not Applicable                           

Securities registered or to be registered pursuant to Section
12(g) of the Act.

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Common Shares Without Par Value(Title of
Class)

Securities for which there is a reporting obligation pursuant to
Section 15(d) of the Act.

Not Applicable(Title of Class)

Indicate the number of outstanding shares of each of the
issuers classes of capital or common stock as of the close of the period
covered by the annual report: 51,313,366 common shares

Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act. 
[ ] YES [ x ] NO

If this report is an annual or transition report, indicate by
check mark if the registrant is not required to file reports pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934. [ ] YES [ x ] NO

Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. [ x ] YES [ ] NO

Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files).
(Not applicable to the registrant at this time)[ ] YES [ ] NO

Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, or a non-accelerated filer. See
definition of accelerated filer and large accelerated filer in Rule 12b-2 of
the Exchange Act. (Check one):

|Large accelerated filer [ ] | Accelerated filer [ ] | Non-accelerated filer [ x ]
|--------------------------- | --------------------- | ---------------------------

Indicate by check mark which basis of accounting the registrant
has used to prepare the financial statements included in this filing:

|U.S. GAAP [ x ] | International Financial
      Reporting Standards as issued | Other [ ]
|--------------- | ----------------------------------------------------------- | ---------
|                | by the International Accounting
      Standards Board [ ]   |          

If Other has been checked in response to the previous
question, indicate by check mark which financial statement item the registrant
has elected to follow. [ ] Item 17 [ ] Item 18

If this is an annual report, indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act).[ ] YES [ x ] NO

(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PAST FIVE YEARS)

Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Sections 12, 13 or 15(d) of the
Securities Exchange Act of 1934 subsequent to the distribution of securities
under a plan confirmed by a court.[ ] YES [ ] NO

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INTRODUCTION AND INFORMATION REGARDING FORWARD-LOOKING
STATEMENTS

This annual company report on Form 20-F contains
forward-looking statements. Forward-looking statements are projections in
respect of future events or our future financial performance. In some cases, you
can identify forward-looking statements by terminology such as may, should,
intend, expect, plan, anticipate, believe, estimate, predict,
potential, or continue, or the negative of these terms or other comparable
terminology. These statements are only predictions and involve known and unknown
risks, including the risks in the section entitled Risk Factors commencing on
page 6, uncertainties and other factors, which may cause our or our industrys
actual results, levels of activity or performance to be materially different
from any future results, levels of activity or performance expressed or implied
by these forward-looking statements. These risks and uncertainties include: a
renewed downturn in international economic conditions; any adverse occurrence
with respect to the development or marketing of our technology; any adverse
occurrence with respect to any of our licensing agreements; our ability to
successfully bring products to market; product development or other initiatives
by our competitors; fluctuations in the availability and cost of materials
required to produce our products; any adverse occurrence with respect to
distribution of our products; potential negative financial impact from claims,
lawsuits and other legal proceedings or challenges; and other factors beyond our
control.

Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity or performance. Further, any forward-looking statement speaks
only as of the date on which such statement is made, and, except as required by
applicable law, we undertake no obligation to update any forward-looking
statement to reflect events or circumstances after the date on which such
statement is made or to reflect the occurrence of unanticipated events. New
factors emerge from time to time, and it is not possible for management to
predict all of such factors and to assess in advance the impact of such factors
on our business or the extent to which any factor, or combination of factors,
may cause actual results to differ materially from those contained in any
forward-looking statement.

In this Form 20-F, unless otherwise stated, references to we,
us, our and Qwick refer to Qwick Media Inc., a Cayman Islands corporation,
and references to Qeyos refer to our wholly-owned subsidiary, Qeyos Ad Systems
Inc., a British Columbia corporation. Unless otherwise stated, $ refers to
United States dollars.

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TABLE OF CONTENTS

|PART
      I  |                 | 5                                                                                 
|------------- | --------------- | ----------------------------------------------------------------------------------
|              | ITEM
      1    | Identity
      of Directors, Senior Management and Advisers                       
|              | ITEM
      2    | Offer
      Statistics and Expected Timetable                                     
|              | ITEM
      3    | Key
      Information                                                             
|              | ITEM
      4    | Information
      on the Company                                                  
|              | ITEM
      4A   | Unresolved
      Staff Comments                                                   
|              | ITEM
      5    | Operating
      and Financial Review and Prospects                                
|              | ITEM
      6    | Directors,
      Senior Management and Employees                                  
|              | ITEM
      7    | Major
      Shareholders and Related Party Transactions                           
|              | ITEM
      8    | Financial
      Information                                                       
|              | ITEM
      9    | The
      Offer and Listing                                                       
|              | ITEM
      10   | Additional
      Information                                                      
|              | ITEM
      11   | Quantitative
      and Qualitative Disclosures About Market Risk                  
|              | ITEM
      12   | Description
      of Securities Other Than Equity Securities                      
|              |                 |                                                                                   
|PART
      II |                 | 55                                                                                
|              | ITEM
      13   | Defaults,
      Dividend Arrearages and Delinquencies                             
|              | ITEM
      14   | Material
      Modifications to the Rights of Security Holders and Use of Proceeds
|              | ITEM
      15   | Controls
      and Procedures                                                     
|              | ITEM
      15T  | Controls
      and Procedures                                                     
|              | ITEM
      16   | [Reserved]                                                                        
|              | ITEM
      16A  | Audit
      Committee Financial Expert                                            
|              | ITEM
      16B  | Code
      of Ethics                                                              
|              | ITEM
      16C  | Principal
      Accountant Fees and Services                                      
|              | ITEM
      16D. | Exemption
      from the Listing Standards for Audit Committees                   
|              | ITEM
      16E  | Purchases
      of Equity Securities the Company and Affiliated Purchasers        
|              | ITEM
      16F  | Change
      in Registrants Certifying Accountant                                
|              | ITEM
      16G  | Corporate
      Governance                                                        
|              | ITEM
      17   | Financial
      Statements                                                        
|              | ITEM
      18   | Financial
      Statements                                                        
|              | ITEM
      19   | Exhibits                                                                          

4

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PART I

|ITEM 1 | Identity of Directors, Senior Management and
      Advisers
|------ | -----------------------------------------------------------

Not applicable.

|ITEM 2 | Offer Statistics and Expected Timetable
|------ | ---------------------------------------

Not applicable.

|ITEM 3 | Key Information
|------ | ---------------

|A. | Selected Financial
Data
|-- | -----------------------

The following financial data summarizes selected financial data
for our company prepared in accordance with United States generally accepted
accounting principles (US GAAP) for the five fiscal years ended
December 31, 2010. The information presented below for the five year period
ended December 31, 2010 is derived from our financial statements which were
examined by our independent auditor. The information set forth below should be
read in conjunction with our audited financial statements and related notes
included in this annual report, and with the information appearing under the
heading Item 5. Operating and Financial Review and Prospects. The data is
presented in U.S. dollars.

Selected Financial Data(Stated in
U.S. Dollars - Calculated in accordance with US GAAP)(Audited)

Year ended Dec. 31, 2010
      (audited)
    Year ended Dec. 31, 2009
      (audited)
    Year ended Dec. 31, 2008
      (audited)
    Year ended Dec. 31, 2007
      (audited)
    Year ended Dec. 31, 2006
      (audited)Net sales or
      operating revenue
    $ -
    $ -
    $ -
    $ -
    $ -Total expenses
    188,016
    226,924
    104,412
    74,191
    67,488Loss from operations and continuing
      operations
    188,016
    226,924
    104,412
    74,191
    67,488Net loss
    188,016
    226,924
    104,412
    74,191
    67,488Basic and diluted loss per common share
    (0.00)
    0.01
    0.01
    0.01
    0.01Total assets
    1,340,858
    1,433
    659
    1,234
    396Total liabilities
    439,471
    297,030
    650,962
    547,125
    472,096Total stockholders equity (deficiency)
    901,387
    (295,597)
    (650,303)
    (545,891)
    (471,700)Capital stock
    51,313
    51,313
    12,538
    12,538
    12,538Weighted average number of common shares
      outstanding
    51,313,366
    22,311,517
    12,538,000
    12,538,000
    12,538,000Number of common shares outstanding as at
      period end
    51,313,366
    51,313,366
    12,538,000
    12,538,000
    12,538,000Long-term debt
    -
    -
    -
    -
    -Dividends per common share
    -
    -
    -
    -
    -


|B. | Capitalization and
  Indebtedness
|-- | ---------------------------------

Not applicable.

5

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|C. | Reasons for the Offer and Use of
      Proceeds
|-- | -----------------------------------------------

Not applicable.

|D. | Risk Factors
|-- | ------------

Much of the information included in this annual report includes
or is based upon estimates, projections or other forward-looking statements.
Such forward-looking statements include any projections or estimates made by our
company and our management in connection with our business operations. While
these forward-looking statements, and any assumptions upon which they are based,
are made in good faith and reflect our current judgment regarding the direction
of our business, actual results will almost always vary, sometimes materially,
from any estimates, predictions, projections, assumptions or other future
performance suggested herein. Such estimates, projections or other
forward-looking statements involve various risks and uncertainties as outlined
below. We caution the reader that important factors in some cases have affected
and, in the future, could materially affect actual results and cause actual
results to differ materially from the results expressed in any such estimates,
projections or other forward-looking statements.

The common shares of our company are considered speculative.
You should carefully consider the following risks and uncertainties in addition
to other information in this annual company report in evaluating our company and
our business before purchasing any shares of our company. Our business,
operating and financial condition could be harmed due to any of the following
risks.

Risks Relating to our Business

Our company currently does not generate revenue from its
planned operations, and as a result, we face a high risk of business
failure.

We have not generated any revenues from our planned operations
to date. As of December 31, 2010, we had accumulated $1,141,243 in losses since
inception. As a result of the completion of the acquisition of the shares of
Qeyos on January 28, 2011, our business is now the development of proprietary
software, know-how and hardware. Our software and hardware is used in the
digital out-of-home (DOOH) media advertising industry. Therefore, our
principal business is to provide our clients with advertising opportunities
through self-service, interactive digital kiosks, interactive window displays,
interactive transit displays and other interactive out-of-home advertising
displays, such as digital wall-scapes, spectaculars and mall displays that we
own and operate in North American and Chinese advertising markets. Our ability
to generate revenues from planned advertising sales depends largely on our
ability to provide a large interactive network of digital kiosks and digital TV
screens that show our programs in high traffic locations at trade-show
exhibitions and large retail stores and shopping malls. This, in turn, requires
that we obtain specialized broadcast interactive television
(Micro-broadcast) contracts or concession rights contracts in order to
operate our business. As such, in order to generate revenues, we will incur
substantial expenses in the development of our business. We therefore expect to
incur significant losses in the foreseeable future. We recognize that if we are
unable to generate significant revenues from our activities, our entire business
may fail. There is no history upon which to base any assumption as to the
likelihood that we will be successful in our plan of operation, and we can
provide no assurance to investors that we will generate operating revenues or
achieve profitable operations in the future.

If we are not able to effectively protect our
intellectual property, our business may suffer a material negative impact and
may fail.

The success of our company will be dependent on our ability to
protect and develop our technology, however, we have not yet obtained any
patents or trademarks. We have applied for a registered U.S. trade-name Qwick
Media, which is pending under serial number 85,078,835. If we are unable to
secure trademark and patent protection for our intellectual property in the
future or that protection is inadequate for future products, our business may be
materially adversely affected. Further, there is no assurance that our
interactive kiosks and displays or other aspects of our business do not or will
not infringe upon patents, copyrights or other intellectual property rights held
by third parties. Although we are not aware of any such claims, we may become
subject to legal proceedings and claims from time to time relating to the intellectual property of
others in the ordinary course of our business. If we are found to have violated
the intellectual property rights of others, we may be enjoined from using such
intellectual property, and we may incur licensing fees or be forced to develop
alternatives. In addition, we may incur substantial expenses and diversion of
management time in defending against these third-party infringement claims,
regardless of their merit. Successful infringement or licensing claims against
us may result in substantial monetary liabilities, which may materially and
adversely disrupt our business.

6

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We have had negative cash flows from operations and if we
are not able to obtain further financing, our business operations may
fail.

We had cash in the amount of $700,996 and a working capital of
$261,525 as of December 31, 2010. Although we obtained cash of $2,000,000 as a
result of the closing of the private placement on January 28, 2011, if our
current sources are insufficient to satisfy our cash requirements, we may seek
to sell additional equity or debt securities or obtain a credit facility. The
sale of convertible debt securities or additional equity securities could result
in additional dilution to our shareholders. The incurrence of indebtedness would
result in increased debt service obligations and could result in operating and
financing covenants that would restrict our operations and liquidity.

In addition, our ability to obtain additional capital on
acceptable terms is subject to a variety of uncertainties, including:

- investors perception of, and demand for, securities of alternative
  advertising media companies;
- conditions of the U.S. and other capital markets in which we may seek to
  raise funds;
- our future results of operations, financial condition and cash flows;
- Peoples Republic of China (PRC) governmental regulation of
  foreign investment in advertising services companies in the PRC;
- economic, political and other conditions in North America and the PRC; and
- PRC governmental policies relating to foreign currency borrowings.

We cannot assure you that financing will be available in
amounts or on terms acceptable to us, if at all. Any failure to raise additional
funds on favorable terms could have a material adverse effect on our liquidity
and financial condition and could cause our business to fail.

Our limited operating history may not provide an adequate
basis to judge our future prospects and results of operations.

Qeyos was incorporated and began operations in January 2009. As
such, our limited operating history may not provide a meaningful basis for
readers to evaluate our business, financial performance and prospects. It is
also difficult to evaluate the viability of our interactive digital media
Micro-broadcast network and other advertising media dedicated to the DOOH sector
because we do not have sufficient experience to address the risks frequently
encountered by early stage companies using new forms of advertising media and
entering new and rapidly evolving markets. Certain members of our senior
management team have worked together for only a relatively short period of time
and it may be difficult for readers to evaluate their effectiveness, on an
individual or collective basis, and their ability to address future challenges
to our business. Given our limited operating history, we may not be able to:

- preserve our position in the interactive digital media markets in North
  America and China;
- manage our emerging relationships with large retailers and Micro-broadcast
  sponsors to secure network broadcast and media management contracts or
  concession rights contracts and obtain such contracts or concession rights
  contracts to operate interactive digital media platforms in leading retail
  chains on commercially advantageous terms or at all;

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- obtain, retain and acquire advertising clients;
- manage our emerging relationships with third-party non-advertising content
  providers;
- secure a sufficient amount of low-cost interactive digital kiosks and
  digital TV screens from our suppliers;
- manage our expanding operations, including the integration of any future
  acquisitions;
- increase and diversify our revenue sources by successfully expanding into
  other complimentary advertising media platforms and replacing third party
  light box displays to interactive digital frames;
- respond to competitive market conditions;
- maintain adequate control of our expenses; or
- attract, train, motivate and retain qualified personnel.

If we are unsuccessful in addressing any of these risks, our
business may be materially and adversely affected.

If advertisers or the viewing public do not accept, or
lose interest in, our interactive digital media network, we may be unable to
generate sufficient cash flow from our operating activities and our prospects
and results of operations could be negatively affected.

The market for interactive digital media networks in North
America and China is relatively new and its potential is uncertain. We compete
for advertising spending with many forms of more established advertising media,
such as television, print media, Internet and other types of out-of-home
advertising. Our success depends on the acceptance of our interactive digital
media network by advertising clients and agencies and their continuing and
increased interest in this medium as a component of their advertising
strategies. Our success also depends on the viewing public continuing to be
receptive towards our interactive digital media network. Advertisers may elect
not to use our services if they believe that consumers are not receptive to our
Micro-broadcast network or that our network does not provide sufficient value as
an effective advertising medium. Likewise, if consumers find some element of our
network to be disruptive or intrusive, large retailing companies may decide not
to allow us to operate the interactive digital and interactive TV screens in
stores or shopping malls or to place our programs in high traffic areas, and
advertisers may view our micro-broadcast network as a less attractive
advertising medium compared to other alternatives. In that event, advertisers
may determine to decline spending on our Micro-broadcast network and interactive
advertising distribution channels.

Interactive DOOH advertising is a new concept in North America
and China and in the advertising industry generally. If we are not able to
adequately track consumer responses to our programs, in particular tracking the
demographics of consumers most receptive to interactive advertising, we will not
be able to provide sufficient feedback and data to existing and potential
advertising clients to help us generate demand and determine pricing. Without
improved market research, advertising clients may reduce their use of
interactive advertising and instead turn to more traditional forms of
advertising that have more established and proven analytical methods of tracking
effectiveness.

If a substantial number of advertisers lose interest in
advertising on our Micro-broadcast digital media networks for these or other
reasons, or become unwilling to purchase advertising time slots on our network,
we will be unable to generate sufficient revenues and cash flow to operate our
business, and our revenues, prospects and results of operations could be
negatively affected.

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We plan to derive the majority of our revenues from the
provision of advertising services. If there is a downturn in the advertising
industry, we may not be able to diversify our revenue sources and our ability to
generate revenues and our results of operations could be materially and
adversely affected.

We do not have any current plans to expand outside our existing
sector and enter into more advertising segments to diversify our revenue
sources. As a result, if there were a downturn our advertising sector for any
reason, we may not be able to diversify our revenue sources and our ability to
generate revenues and our results of operations could be materially and
adversely affected.

If we are unable to carry out our plan of operations as
specified in proposed contracts or obtain new contracts or concession rights
contracts on commercially advantageous terms or at all, we may be unable to
maintain or expand our Micro-broadcast network coverage and our costs may
increase significantly in the future.

Our ability to generate planned revenues from advertising sales
depends largely upon our ability to provide a large interactive network of
digital kiosks and digital TV screens that show our programs in high traffic
locations of trade-show exhibitions, large retail stores and shopping malls.
This, in turn, requires that we obtain Micro-broadcast contracts or concession
rights contracts to operate our business. There are no assurances that we will
be able to carry out our operations in a manner as specified in such future
contracts or that the typical terms of such contracts, ranging from three to
five years, will be capable of including any automatic renewal provisions.

We may depend on third-party program producers to provide
the non-advertising content that we include in our interactive programs. Failure
to obtain high-quality content on commercially reasonable terms could materially
reduce the attractiveness of our Micro-broadcast network, harm our reputation
and cause our planned revenues to be unrealized or to decline.

We are planning for the majority of our interactive digital
kiosks and TV screens to mix advertising and non-advertising content. We do not
produce or create any of the non-advertising content included in our programs.
The advertisers will provide us with the advertising content that they do not
retain us to produce. All of the non-advertising content is provided by
third-party content providers such as various local television stations and
television production companies. For example, we have plans to include a variety
of news and entertainment content provided by third parties on our
Micro-broadcast network, without charge, on the condition that their logo is
displayed throughout the duration of the provided content. Certain third-party
content providers also do not plan to charge us for their content.

There is no assurance that we will be able to secure these
contracts or obtain non-advertising content on satisfactory terms, or at all. In
addition, some of the third-party content providers that currently do not charge
us for their content may do so in the future. To make our programs more
attractive, we must continue to secure contracts with these and other
third-party content providers. If we fail to obtain a sufficient amount of
high-quality content on a cost-effective basis, advertisers may find advertising
on our Micro-broadcast networks unattractive and may not wish to purchase
advertising time slots on our network, which would materially and adversely
affect our ability to generate revenues from our advertising time slots and
cause our revenues to decline and our business and prospects to deteriorate.

If we are unable to attract advertisers to purchase
advertising time on our Micro-broadcast network, we will be unable to maintain
or increase our advertising fees, which could negatively affect our ability to
grow our profits.

The fees we charge advertising clients and agencies for time
slots on our network depend on the size and quality of our interactive network
and the demand by advertisers for advertising time on our network. We believe
advertisers will choose to advertise on our Micro-broadcast network in part
based on the intended size of our network, the desirability of the locations
where we have placed our interactive kiosks and digital TV screens and the
attractiveness of our network content. If we fail to establish sufficient
critical mass, maintain or increase the number of our interactive displays,
solidify our brand name and reputation as a quality interactive digital media
provider, or obtain high-quality non-advertising content at commercially
reasonable prices, advertisers may be unwilling to purchase time on our
Micro-broadcast network or to pay the levels of advertising fees we require to
grow our profits.

9

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When our planned advertising network of interactive
digital kiosks and TV screens reaches saturation in the major retail locations
where we seek to operate, we may be unable to offer additional time slots to
satisfy all of our advertisers needs, which could hamper our ability to
generate higher levels of revenues and profitability over time.

When our network of digital TV screens reaches saturation in
any particular Micro-broadcast network, we may be unable to offer additional
advertising time slots to satisfy all of our expected advertisers needs. We
would need to increase our advertising rates for advertising in such networks in
order to increase our revenues. However, advertisers may be unwilling to accept
rate increases, which could hamper our ability to generate higher levels of
revenues over time.

Including non-advertising content in our programs may be
deemed a form of broadcasting under applicable federal law. If so, we may be
required to obtain certain approvals and/or authorizations, the failure of which
may make us unable to continue to include non-advertising content in our
programs, which may cause our revenues to decline and our business and prospects
to deteriorate.

Current laws and regulations in North America and China may
prohibit any entities or individuals from broadcasting non-advertising content
through television networks without the prior approval of the relevant
authorities. Applicable laws and regulations do not, however, expressly classify
the display of non-advertising content through digital media networks such as
ours as a form of broadcasting. Although we believe we are in compliance with
current laws and regulations in the jurisdictions in which we intend to operate
we cannot assure you that the relevant authorities will reach the same
conclusion.

If we are in fact deemed to be engaged in the broadcasting of
non-advertising content, we may be subject to monetary penalties or may be
forced to eliminate non-advertising content from the programs included in our
Micro-broadcast digital TV screens, all of which could have a material and
adverse effect on our intended business operations. In addition, if new laws or
regulations are promulgated that characterize our business operations as
engaging in the broadcasting of non-advertising content, we would be required to
obtain additional approvals and/or authorizations. If we fail to obtain any
required approvals and/or authorizations, we may not be able to continue to
include non-advertising content in our programs and advertisers may find our
network less attractive and be unwilling to purchase advertising time slots on
our network, which may cause our revenues to decline and our business and
prospects to deteriorate.

Because we may rely on third-party agencies to help
source advertising clients, our failure to retain key third-party agencies or
attract additional agencies on favorable terms could materially and adversely
affect our revenue growth.

We plan to engage third-party agencies to assist us in sourcing
advertising clients from time to time. We do not have any long-term or exclusive
agreements with these agencies, including our key third-party agencies, and
cannot assure that we will obtain or continue to maintain favorable
relationships with them. If we fail to obtain and retain key third-party
agencies or attract additional agencies, we may not be able to secure or retain
advertising clients or attract new advertisers or advertising agency clients and
our business and results of operations could be materially adversely affected.

We shall be dependent on a limited number of customers
for a significant portion of our revenues and this dependence may continue or
reoccur in the future, which would make us more vulnerable to the loss of
intended major customers or delays in payments from these customers.

Given our limited operating history and the rapid growth of our
industry, we cannot assure that we will not be dependent on a small number of
customers in the future. If we fail to sell our services to one or more of our
major customers in any particular period, or if a large customer purchases less
of our services or fails to purchase additional advertising time on our
Micro-broadcast networks, our revenues could be unrealized or could decline and our
operating results could be adversely affected. In addition, the dependence on a
small number of customers could leave us more vulnerable to delays in payments
from these customers. If one of our intended anchor customers is significantly
delinquent with their payments, our financial conditions may be materially and
adversely affected.

10

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If we are unable to adapt to changing advertising trends
and the technology needs of advertisers and consumers, we will not be able to
compete effectively and we will be unable to realize, increase or maintain our
revenues which may materially and adversely affect our business prospects and
revenues.

The market for interactive advertising requires us to
continuously identify new advertising trends and the technological needs of both
advertisers and consumers, which may require us to develop new formats, features
and enhancements for our Micro-broadcasting advertising network.

We must be able to quickly and cost-effectively expand into
additional advertising media and platforms beyond interactive kiosks and
interactive digital TV screens if advertisers find other media and platforms,
such as mobile applications, to be more attractive and cost-effective. In
addition, as the advertising industry is highly competitive and fragmented with
many advertising agencies exiting and emerging, we must closely monitor the
trends in the advertising agency community. We must maintain strong
relationships with leading advertising agencies to make certain that we are
reaching the leading advertisers and are responsive to the needs of both the
advertising agencies and the advertisers.

We currently plan to play advertisements in our network
primarily through Internet VPN broadband and wireless 3G+ networking, and
digital players, respectively. In the future, we may be required to incur
development and acquisition costs in order to keep pace with new technology
needs but we may not have the financial resources necessary to fund and
implement future technological innovations or to replace obsolete technology.
Furthermore, we may fail to respond to these changing technology needs. For
example, if we fail to implement such changes on our network or fail to do so in
a timely manner, our competitors or future entrants into the market who take
advantage of such initiatives could gain a competitive advantage over us.

If we cannot succeed in defining, developing and introducing
new formats, features and technologies on a timely and cost-effective basis,
advertising demand for our advertising network may decrease and we may not be
able to compete effectively or attract advertising clients, which would have a
material and adverse effect on our business prospects and revenues.

We face significant competition in the global advertising
industry, and if we do not compete successfully against new and existing
competitors in North America and China, we may not realize or may lose our
future market share, and our intended profitability may be adversely affected.

We face significant competition in the global advertising
industry. We compete for advertising clients primarily on the basis of network
size and coverage, location, price, the quality of our programs, the range of
services that we offer and brand recognition. We compete for overall advertising
spending with other alternative advertising media companies, such as Internet,
street furniture, billboard and public transport advertising companies, and with
traditional advertising media, such as newspapers, television, magazines and
radio. We also compete for advertising dollars spent in the passive display DOOH
advertising industry. We must compete with other media platforms of advertising
for which we do not have exclusivity, including billboards, light boxes and
print media. In addition, we may also face competition from new entrants into
interactive advertising in the future.

Significant competition could reduce our planned operating
margins and profitability and result in a loss of intended market share. Some of
our existing and potential competitors may have competitive advantages, such as
significantly greater brand recognition, financial, marketing or other resources
and may be able to mimic and adopt our business model. In addition, several of
our competitors have significantly larger advertising networks than we do, which
gives them an ability to reach a larger number of overall potential consumers
and which make them less susceptible to downturns in particular sectors, such as
the interactive sector. Moreover, significant competition will provide
advertisers with a wider range of media and advertising service alternatives,
which could lead to lower prices and decreased revenues, gross margins and
profits. We cannot assure you that we will be able to successfully compete
against new or existing competitors.

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Our plan of operations is subject to fluctuations in the
demand for interactive DOOH advertising, which is affected by, among other
things, seasonality and general economic conditions, and a decrease in the
demand for interactive DOOH advertising may make it difficult for us to sell our
advertising time slots.

Our planned operations are directly linked to the fortunes of
the DOOH advertising industry. Demand for such advertising fluctuates
significantly from period to period, is subject to seasonality due to weather
conditions, and is particularly susceptible to downturns in the economy, any of
which could lead to a reduction in the growth of the DOOH industry in North
America and China.

A decrease in demand for our planned advertising services
may materially and adversely affect our ability to generate revenues, our
financial condition and results of operations.

Demand for our advertising services, and the resulting
advertising spending by our clients, may fluctuate due to changes in general
economic conditions, and advertising spending typically decreases during periods
of economic downturn.

Our clients may reduce the money they spend to advertise on our
network for a number of reasons, including:

- a general decline in economic conditions;
- a general decline in the number of consumers and consumer spending;
- a decline in economic conditions in the particular cities where our network
  plans to be located;
- a decision to shift advertising expenditures to other available advertising
  media; and
- a decline in advertising spending in general.

A decrease in demand for advertising media in general and for
our advertising services in particular would materially and adversely affect our
ability to generate revenues from our advertising services, and our financial
condition and results of operations.

If we fail to manage our growth effectively, we may not
be able to take advantage of market opportunities, execute our expansion
strategies or meet the demands of our advertising clients.

Rapid growth and expansion may place significant strain on our
management personnel, systems and resources. We must establish and continue to
expand our operations to meet the anticipated demands of advertisers for larger
and more diverse network coverage. To accommodate our growth, we anticipate that
we will need to implement a variety of new and upgraded operational and
financial systems, procedures and controls, including the improvement of our
accounting and other internal management systems, all of which require
substantial management efforts.

We also will need to continue to expand, train, manage and
motivate our workforce as well as manage our relationships with our prospective
clientele and third-party non-advertising content providers. We must add sales
and marketing offices and personnel to service relationships with new
Micro-broadcast sponsors that we will aim to add as part of our network. As we
add new interactive kiosks and interactive digital TV screens and other media
platforms, we will need to incur greater maintenance costs to maintain our
equipment.

All of these endeavors will require substantial managerial
efforts and skill, as well as the incurrence of additional expenditures. We
cannot assure the reader that we will be able to manage our growth effectively,
and we may not be able to take advantage of market opportunities, execute our
expansion strategies or meet the demands of our advertising clients.

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Future acquisitions may have an adverse effect on our
ability to manage our business.

We may acquire businesses, technologies, services or products
which are complementary to our core interactive digital media network business.
Future acquisitions may expose us to potential risks, including risks associated
with:

- the integration of new operations, services and personnel;
- unforeseen or hidden liabilities;
- the diversion of resources from our existing business and technology;
- our potential inability to generate sufficient revenue to offset new costs;
- the expenses of acquisitions; or
- the potential loss of or harm to relationships with both employees and
  advertising clients resulting from our integration of new businesses.

Any of the potential risks listed above could have a material
and adverse effect on our ability to manage our business, our revenues and net
income.

We may need to raise additional debt funding or sell additional
equity securities to make such acquisitions. The raising of additional debt
funding by us, if required, would result in increased debt service obligations
and could result in additional operating and financing covenants, or liens on
our assets, that would restrict our operations. The sale of additional equity
securities could result in additional dilution to our shareholders.

Our quarterly and annual operating results are difficult
to predict and may fluctuate significantly from period to period in the future.

Our future quarterly and annual operating results are difficult
to predict and may fluctuate significantly from period to period based on the
seasonality of interactive, consumer spending and corresponding advertising
trends in North America and China. In addition, DOOH and advertising spending in
North America and China generally tends to increase during holidays and tends to
decrease during the fourth quarter. DOOH and advertising spending in North
America and China is also affected by certain special events and related
government measures. As a result, period-to-period comparisons of our operating
results may be unreliable as an indication of our future performance.

We may experience seasonality effects due to the seasonality of
DOOH and advertising spending in North America and China. Other factors that may
cause our operating results to fluctuate include a deterioration of economic
conditions in North America and China and potential changes to the regulation of
the advertising industry in North America and China, which are discussed
elsewhere in this Form 20-F. If our projected revenues for a particular quarter
are lower than we expect, we may be unable to reduce our operating expenses for
that quarter by a corresponding amount, which would harm our operating results
for that quarter relative to our operating results from other quarters.

We may be subject to, and may expend significant
resources in defending against, government actions and civil suits based on the
content we provide through our interactive digital media network.

Civil claims may be filed against us for fraud, defamation,
subversion, negligence, copyright or trademark infringement or other violations
due to the nature and content of the information displayed on our network. If
consumers find the content displayed on our network to be offensive, clientele
may seek to hold us responsible for any consumer claims or may terminate their
relationships with us. Offensive and objectionable content and legal standards
for defamation and fraud in China are less defined than in North America and
other countries and we may not be able to properly screen out unlawful content.

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In addition, if the security of our content management system
is breached and unauthorized images, text or audio sounds are displayed on our
network, viewers or the government may find these images, text or audio sounds
to be offensive, which may subject us to civil liability or government censure
despite our efforts to ensure the security of our content management system. Any
such event may also damage our reputation. If our advertising viewers do not
believe our content is reliable or accurate, our business model may become less
appealing to viewers in North America and China and our advertising clients may
be less willing to place advertisements on our network.

We do not have any business liability, disruption or
litigation insurance, and any business disruption or litigation we experience
might result in our incurring substantial costs and the diversion of
resources.

The insurance industry in China is still at an early stage of
development. Insurance companies in China offer limited business insurance
products and do not, to our knowledge, offer business liability insurance. While
business disruption insurance is available to a limited extent in China, we have
determined that the risks of disruption, cost of such insurance and the
difficulties associated with acquiring such insurance on commercially reasonable
terms make it impractical for us to have such insurance. As a result, except for
fire insurance, we do not have any business liability, disruption or litigation
insurance coverage for our operations in China. Any business disruption or
litigation may result in our incurring substantial costs and the diversion of
resources.

Risks Related to Regulation of Our Business and to Our
Structure

Compliance with advertising laws and regulations may be
difficult and could be costly, and failure to comply could subject us to
government sanctions.

Advertising laws and regulations require advertisers,
advertising operators and advertising distributors, including businesses such as
ours, to ensure that the content of the advertisements they prepare or
distribute are fair and accurate and are in full compliance with applicable law.
Violation of these laws or regulations may result in penalties, including fines,
confiscation of advertising fees, orders to cease dissemination of the
advertisements and orders to publish an advertisement correcting the misleading
information. In circumstances involving serious violations, government may
revoke a violators license for advertising business operations.

As an interactive advertising service provider, we are
obligated under laws and regulations to monitor the advertising content that is
shown on our network for compliance with applicable law. In general, the
advertisements shown on our network have previously been broadcast over public
television networks and have been subjected to internal review and verification
of such networks. We are still required to independently review and verify these
advertisements for content compliance before displaying the advertisements. In
addition, if a special government review is required for certain product
advertisements before they are shown to the public, we are obligated to confirm
that such review has been performed and approval has been obtained. In addition,
for advertising content related to certain types of products and services, such
as food products, alcohol, cosmetics, pharmaceuticals and medical procedures, we
are required to confirm that the advertisers have obtained requisite government
approvals including the advertising clients operating qualifications, proof of
quality inspection of the advertised products, government pre-approval of the
contents of the advertisement and filing with the local authorities.

We endeavor to comply with such requirements, including by
requesting relevant documents from the advertisers. However, we cannot assure
the reader that each advertisement that an advertiser or advertising agency
client provides to us and which we include in our Micro-broadcast network
programs is in compliance with relevant advertising laws and regulations or that
the supporting documentation and government approvals provided to us by our
advertising clients in connection with certain advertising content are complete.
Although we review advertising content for compliance with relevant laws and
regulations, the content standards in the PRC are less certain and less clear
than in those in countries such as the United States and we cannot assure the
reader that we will be able to properly review the content to comply with the
standards imposed on us with certainty.

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If the PRC government finds that the agreements that
establish the structure for operating our China business do not comply with PRC
governmental restrictions on foreign investment in the advertising industry and
in the operating of non-advertising content, we could be subject to severe
penalties.

PRC regulations currently permit 100% foreign ownership of
companies that provide advertising services. Any foreign entities that invest in
the advertising services industry are required to have at least three years of
direct operations in the advertising industry outside of China. In addition, PRC
regulations currently prohibit foreign investment in the production and
operation of any non-advertising content. We do not currently directly operate
an advertising business outside of China and thus cannot qualify under PRC
regulations until three years after we commence any such operations outside of
China or until we acquire a company that has directly operated an advertising
business outside of China for the required period of time. Penalties for
violations include:

- revoking the business and operating licenses of our pending PRC
  subsidiaries and affiliates;
- discontinuing or restricting our pending PRC subsidiaries and affiliates
  operations;
- imposing conditions or requirements with which we or our pending PRC
  subsidiaries and affiliates may not be able to comply;
- requiring us or our pending PRC subsidiaries and affiliates to restructure
  the relevant ownership structure or operations; or
- restricting or prohibiting our use of the proceeds of the concurrent
  private placement to finance our business and operations in China.

The imposition of any of these penalties would result in a
material and adverse effect on our ability to conduct our business.

Changes in laws and regulations governing interactive
advertising or otherwise affecting our business in North America or China may
result in substantial costs and diversion of resources and may materially and
adversely affect our business prospects and results of operations.

There are no existing laws or regulations that specifically
define or regulate interactive DOOH advertising. It has been reported that the
relevant PRC government authorities are currently considering adopting new
regulations governing Internet based interactive television advertising. We
cannot predict the timing and effects of such new regulations. Changes in laws
and regulations governing the content of interactive advertising, our business
licenses or otherwise affecting our planned business in China may result in
substantial costs and diversion of resources and may materially and adversely
affect our business prospects and results of operations.

Risks Related to Doing Business in China

Adverse changes in the political and economic policies of
the PRC government could have a material adverse effect on the overall economic
growth of China, which could reduce the demand for our services and have a
material adverse effect on our competitive position.

Our business, financial condition, results of operations and
prospects are affected significantly by economic, political and legal
developments of China. The Chinese economy differs from the economies of most
developed countries in many respects, including:

- the amount of government involvement;
- the level of development;
- the growth rate;

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- the control of foreign exchange; and
- the allocation of resources.

While the Chinese economy has experienced significant growth in
the past 25 years, growth has been uneven both geographically and among various
sectors of the economy. The PRC government has implemented various measures to
encourage economic growth and guide the allocation of resources. Some of these
measures may benefit the overall Chinese economy, but may also have a negative
effect on us. We cannot predict the future direction of political or economic
reforms or the effects such measures may have on our business, financial
position or results of operations. Any adverse change in the political or
economic conditions in China, including changes in the policies of the PRC
government or in laws and regulations in China, could have a material adverse
effect on the overall economic growth of China and in the interactive
advertising industry. Such developments could have a material adverse effect on
our business, lead to reduction in demand for our services and materially and
adversely affect our competitive position.

Uncertainties with respect to the PRC legal system could
limit the legal protections available to us or result in substantial costs and
the diversion of resources and management attention.

We conduct our software development business in part through
agreement and assistance from Companion Sino-net Technology Development
(Beijing) Co., Ltd., which is an indirect 90% corporate subsidiary and affiliate
of R. J. Tocher Holdings Ltd., a company owned by our Chief Executive Officer,
Ross James Tocher, which is subject to PRC laws and regulations applicable to
foreign investment in China and, in particular, laws applicable to
wholly-foreign owned companies. The PRC legal system is based on written
statutes. Prior court decisions may be cited for reference but have limited
precedential value. Since 1979, PRC legislation and regulations have
significantly enhanced the protections afforded to various forms of foreign
investments in China. However, since these laws and regulations are relatively
new and the PRC legal system continues to rapidly evolve, the interpretations of
many laws, regulations and rules are not always uniform and enforcement of these
laws, regulations and rules involve uncertainties, which may limit the legal
protections available to us. In addition, any litigation in China may be
protracted and result in substantial costs and the diversion of resources and
management attention.

Fluctuations in exchange rates may have a material
adverse effect on your investment.

The reporting and functional currency of our company is the
U.S. dollar. However, a substantial portion of the expected revenues and
expenses of our consolidated operating subsidiaries and affiliate entities may
be denominated in CAD and RMB. The value of these currencies against the U.S.
dollar may fluctuate and is affected by, among other things, changes in the
political and economic conditions in Canada and China. Fluctuations in exchange
rates, primarily those involving the U.S. dollar, may affect the relative
purchasing power of our working capital and our balance sheet and earnings per
share in U.S. dollars. In addition, appreciation or depreciation in the value of
the foreign currencies relative to the U.S. dollar would affect our financial
results reported in U.S. dollar terms without giving effect to any underlying
change in our business or results of operations. Fluctuations in the exchange
rate will also affect the relative value of any dividend we may issue which will
be exchanged into U.S. dollars, and earnings from, and the value of, any U.S.
dollar-denominated investments we make in the future.

Very limited hedging transactions are available in China to
reduce our exposure to exchange rate fluctuations. To date, we have not entered
into any hedging transactions in an effort to reduce our exposure to foreign
currency exchange risk. While we may decide to enter into hedging transactions
in the future, the availability and effectiveness of these hedges may be limited
so that we may not be able to successfully hedge our exposure at all. In
addition, our currency exchange losses may be magnified by PRC exchange control
regulations that restrict our ability to convert RMB into foreign currency. As a
result, fluctuations in exchange rates may have a material adverse effect on
your investment.

Restrictions on currency exchange may limit our ability
to receive and use our revenues or financing effectively.

Under Chinas existing foreign exchange regulations, we will be
permitted to pay dividends in foreign currencies, without prior approval from
the State Administration of Foreign Exchange (SAFE), by complying with
certain procedural requirements. However, we cannot assure you that the
PRC government will not take measures in the future to restrict access to
foreign currencies for current account transactions.

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Foreign exchange transactions by our planned subsidiary and
affiliated entities in China such as Companion Sino-net Technology Development
(Beijing) Co., Ltd. continue to be subject to significant foreign exchange
controls and require the approval of SAFE or registration with, PRC governmental
authorities. In particular, if we or other foreign lenders make foreign currency
loans to our subsidiaries or variable interest entities in China, these loans
must be registered with the SAFE, and if we finance them by means of additional
capital contributions, these capital contributions must be approved or
registered by certain government authorities including the SAFE, the Ministry of
Commerce or their local counterparts. These limitations could affect the ability
of these entities to obtain foreign currencies through debt or equity financing,
and could affect our business and financial condition.

Risks Relating to our Management

Because our officers, directors and principal
shareholders control a large percentage of our common stock, such insiders have
the ability to influence matters affecting our shareholders.

Our officers and directors, in the aggregate, beneficially own
48.59% of the issued and outstanding shares of our common stock. As a result,
they have the ability to influence matters affecting our shareholders, including
the election of our directors, the acquisition or disposition of our assets, and
the future issuance of our shares. Because our officers, directors and principal
shareholders control such shares, investors may find it difficult to replace our
management if they disagree with the way our business is being operated. Because
the influence by these insiders could result in management making decisions that
are in the best interest of those insiders and not in the best interest of the
investors, you may lose some or all of the value of your investment in our
common stock.

Our business depends substantially on the continuing
efforts of our senior executives, and our business may be severely disrupted if
we lose their services.

Our future success heavily depends upon the continued services
of our senior executives and other key employees. In particular, we rely on the
expertise, financial assistance and experience of our chief executive officer,
Ross J. Tocher. We rely on the industry expertise, experience in our business
operations and sales and marketing, of our Vice-president of Operations, Alan
Husejnagic, and Vice-president of Sales, Steve Owst, and their working
relationships with our employees, our other major shareholders, our advertising
clients, Micro-broadcast network sponsors and advertisers, and relevant
government authorities.

If one or more of our senior executives were unable or
unwilling to continue in their present positions, we might not be able to
replace them easily or at all. If any of our senior executives joins a
competitor or forms a competing company, we may lose clients, suppliers, key
professionals and staff members. Each of our executive officers has entered into
an employment agreement with us, which contains non-competition provisions.
However, if any dispute arises between our executive officers and us, we cannot
assure you the extent to which any of these agreements could be enforced.

As a majority of our directors and officers are residents
of countries other than the United States, investors may find it difficult to
enforce, within the United States, any judgments obtained against our company,
directors and officers.

A majority of our directors and officers are nationals and/or
residents of countries other than the United States, and all or a substantial
portion of such persons assets are located outside the United States. As a
result, it may be difficult for investors to enforce within the United States
any judgments obtained against our company, officers, and directors, including
judgments predicated upon the civil liability provisions of the securities laws
of the United States or any state thereof.

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Because executive management is free to devote time to
other ventures, shareholders may not agree with their allocation of
time.

Our executive officers and directors will devote only that
portion of their time which, in their judgment and experience, is reasonably
required for the management and operation of our business. Management may have
conflicts of interest in allocating management time, services and functions
among our company and any present and future ventures which are or may be
organized by our officers or directors and/or their affiliates. Management will
not be required to direct us as their sole and exclusive function, and they may
have other business interests and engage in other activities in addition to
those relating to us. This includes rendering advice or services of any kind to
other investors and creating or managing other businesses.

Our board of directors may change our operating policies
and strategies without prior notice to shareholders or shareholder approval and
such changes could harm our business and results of operations, and the value of
our stock.

Our board of directors has the authority to modify or waive
certain of our current operating policies and strategies without prior notice
and without shareholder approval. We cannot predict the effect any changes to
our current operating policies and strategies would have on our business,
operating results and value of our stock. However, such changes could have a
material adverse effect on our financial position or otherwise.

Our Articles of Association contain provisions
indemnifying our officers and directors against all costs, charges and expenses
incurred by them.

Our Articles of Association contain provisions with respect to
the indemnification of our officers and directors against all costs, charges and
expenses, including an amount paid to settle an action or satisfy a judgment,
actually and reasonably incurred by them in a civil, criminal or administrative
action or proceeding to which they are made a party by reason of their being or
having been a director or officer of our company.

Risks Relating to Our Common Stock

If our business is unsuccessful, our shareholders may
lose their entire investment.

Although shareholders will not be bound by or be personally
liable for our expenses, liabilities or obligations beyond their total original
capital contributions, should we suffer a deficiency in funds with which to meet
our obligations, the shareholders as a whole may lose their entire investment in
our company.

Our common stock is illiquid and shareholders may be
unable to sell their shares.

There is currently a limited market for our common stock and we
can provide no assurance to investors that a market will develop. If a market
for our common stock does not develop, our shareholders may not be able to
re-sell the shares of our common stock that they have purchased and they may
lose all of their investment. Public announcements regarding our company,
changes in government regulations, conditions in our market segment and changes
in earnings estimates by analysts may cause the price of our common shares to
fluctuate substantially. In addition, the Over-the-Counter Bulletin Board is not
an exchange and, because trading of securities on the Over-the-Counter Bulletin
Board is often more sporadic than the trading of securities listed on an
exchange, you may have difficulty reselling any of the shares you purchase from
our shareholders.

Investors interests in our company will be diluted and
investors may suffer dilution in their net book value per share if we issue
additional shares or raise funds through the sale of equity securities.

Our constating documents currently authorize the issuance of
400,000,000 shares of common stock with a par value of $0.001 and 100,000,000
preferred shares with a par value of $0.001. If we are required to issue any
additional shares or enter into private placements to raise financing through
the sale of equity securities, investors interests in our company will be
diluted and investors may suffer dilution in their net book value per share
depending on the price at which such securities are sold. If we issue any such
additional shares, such issuances also will cause a reduction in the proportionate ownership and voting power of
all other shareholders. Further, any such issuance may result in a change in our
control.

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Penny stock rules will limit the ability of our
shareholders to sell their stock.

The Securities and Exchange Commission has adopted regulations
which generally define penny stock to be any equity security that has a market
price (as defined) less than $5.00 per share or an exercise price of less than
$5.00 per share, subject to certain exceptions. Our securities are covered by
the penny stock rules, which impose additional sales practice requirements on
broker-dealers who sell to persons other than established customers and
accredited investors. The term accredited investor refers generally to
institutions with assets in excess of $5,000,000 or individuals with a net worth
in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly
with their spouse. The penny stock rules require a broker-dealer, prior to a
transaction in a penny stock not otherwise exempt from the rules, to deliver a
standardized risk disclosure document in a form prepared by the Securities and
Exchange Commission which provides information about penny stocks and the nature
and level of risks in the penny stock market. The broker-dealer also must
provide the customer with current bid and offer quotations for the penny stock,
the compensation of the broker-dealer and its salesperson in the transaction and
monthly account statements showing the market value of each penny stock held in
the customers account. The bid and offer quotations, and the broker-dealer and
salesperson compensation information, must be given to the customer orally or in
writing prior to effecting the transaction and must be given to the customer in
writing before or with the customers confirmation. In addition, the penny stock
rules require that prior to a transaction in a penny stock not otherwise exempt
from these rules, the broker-dealer must make a special written determination
that the penny stock is a suitable investment for the purchaser and receive the
purchasers written agreement to the transaction. These disclosure requirements
may have the effect of reducing the level of trading activity in the secondary
market for the stock that is subject to these penny stock rules. Consequently,
these penny stock rules may affect the ability of broker-dealers to trade our
securities. We believe that the penny stock rules discourage investor interest
in and limit the marketability of our common stock.

The Financial Industry Regulatory Authority, or FINRA,
has adopted sales practice requirements which may also limit a shareholders
ability to buy and sell our stock.

In addition to the penny stock rules described above, FINRA
has adopted rules that require that in recommending an investment to a customer,
a broker-dealer must have reasonable grounds for believing that the investment
is suitable for that customer. Prior to recommending speculative low priced
securities to their non-institutional customers, broker-dealers must make
reasonable efforts to obtain information about the customers financial status,
tax status, investment objectives and other information. Under interpretations
of these rules, FINRA believes that there is a high probability that speculative
low priced securities will not be suitable for at least some customers. FINRA
requirements make it more difficult for broker-dealers to recommend that their
customers buy our common stock, which may limit your ability to buy and sell our
stock and have an adverse effect on the market for its shares.

We do not intend to pay dividends on any investment in
the shares of stock of our company.

We have never paid any cash dividends and currently do not
intend to pay any dividends for the foreseeable future. To the extent that we
require additional funding currently not provided for in our financing plan, our
funding sources may prohibit the payment of a dividend. Because we do not intend
to declare dividends, any gain on an investment in our company will need to come
through an increase in the stocks price. This may never happen and investors
may lose all of their investment in our company.

|ITEM 4 | Information on the Company
|------ | --------------------------

|A. | History and
Development
|-- | -----------------------

Name

Our legal and commercial name is Qwick Media Inc.. We are
governed by the corporate laws of the Cayman Islands. Our company is currently a
reporting issuer in the Province of British Columbia, Canada.

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Principal Office

Our principal executive offices are located at 3162 Thunderbird
Crescent, Burnaby, British Columbia, Canada V5A 3G4. Our telephone number at
this address is 778-370-1715 and our fax number is 778-370-1720. Our registered
office in the Cayman Islands is at 89 Nexus Way, Camana Bay, George Town, Grand
Cayman, Cayman Islands KY1-9007.

Investor inquiries should be directed to us at the address and
telephone number of our principal executive offices set forth above. Our website
address is http://www.qwickmedia.com. The information contained on our website
is not part of this Form 20-F.

Corporate Information and Important Events

We were incorporated on October 5, 2000 under the laws of the
state of Nevada. Effective June 26, 2006, we re-domiciled from the State of
Nevada to the State of Washington. Effective July 7, 2009, we re-domiciled from
the State of Washington to the State of Wyoming for the sole purpose of
effecting a continuance to the Cayman Islands. Effective July 28, 2009, we were
issued a certificate of registration by way of continuation by the Registrar of
Companies of the Cayman Islands. As a result of this transaction, we
re-domiciled to the Cayman Islands and became a foreign private issuer.

On October 6, 2009 we received approval from the Financial
Industry Regulatory Authority for the change in our name from Tuscany Minerals,
Ltd. to Tuscany Minerals Ltd. and the re-domiciling of our company from the
State of Wyoming to the Cayman Islands. Effective at the open of trading on
October 6, 2009, our new quotation symbol on the OTC Bulletin Board became
TUSMF.

On June 22, 2010, we changed our name to Qwick Media Inc.
with the Registrar of Companies of the Cayman Islands and, on July 15, 2010, we
received approval from the Financial Industry Regulatory Authority (FINRA) for
that name change. The name change was approved by the shareholders of the
Company at its annual and special meeting held on June 18, 2010. On March 15,
2011 we changed our trading symbol to QWIKF.

On January 28, 2011 we completed the acquisition of Qeyos Ad
Systems Inc. (Qeyos), pursuant to which we acquired all of the issued
and outstanding common shares of Qeyos from its shareholders in exchange for the
issuance of a total of 4,789,035 shares of our common stock on the basis of one
share of our common stock for each share of Qeyos. We issued all of such shares
to five Qeyos shareholders who are non-U.S. persons (as that term is defined in
Regulation S of the Securities Act of 1933, as amended) in an offshore
transaction relying on Regulation S and/or Section 4(2) of the Securities Act of
1933, as amended.

On the same day, we completed a private placement of 10,000,000
common shares at a price of $0.20 per share for aggregate gross proceeds of
$2,000,000. We issued these shares to a total of 98 persons, all of whom are
non-U.S. persons (as that term is defined in Regulation S of the Securities Act
of 1933, as amended) in an offshore transaction relying on Regulation S and/or
Section 4(2) of the Securities Act of 1933, as amended. We intend to use the net
proceeds from this private placement to fund further capital fund raising and
for other general corporate purposes, which may include strategic acquisitions
of businesses that could complement our existing capabilities and
businesses.

On the same day, we completed the issuance of 637,140 common
shares at a deemed price of $0.20 per share in settlement of US$127,428 debt
outstanding. We issued these shares to one person, who is a non-U.S. persons (as
that term is defined in Regulation S of the Securities Act of 1933, as amended)
in an offshore transaction relying on Regulation S and/or Section 4(2) of the
Securities Act of 1933, as amended.

Capital Expenditures

During the three fiscal years ended December 31, 2010, 2009 and
2008, we did not undertake any capital expenditures. Our planned capital
expenditures for the next twelve months are summarized below under the heading
Liquidity and Capital Resources  Anticipated Cash Requirements.

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Takeover offers

We are not aware of any indication of any public takeover
offers by third parties in respect of our common shares during our last or
current financial years.

|B. | Business Overview
|-- | -----------------

Overview

We develop interactive proprietary software, know-how and
hardware. QwickView touch screen software is built in C# programming language
on a Windows® multi-touch platform. Technically, there are no creative
boundaries, such as limits imposed by third party software applications,
intellectual bottle-neck, platform stability and external technical support. The
software design process is standardized and documented so new employees can be
readily integrated. The software development architecture team in Burnaby,
British Columbia, Canada provides technical and creative guidance for coders in
Wuxi and Beijing, China. It is the equivalent of artists working with engineers.
Due to time differences our company programs in a 24/7 environment. This
strategy leverages production outsourcing and high execution speed. QwickView
hardware is the physical product that acts as a point of service terminal for
end users. The hardware consists of a skeleton platform, chassis (outside
enclosure) and integrated PC equipment and peripherals. Hardware manufacturing
and development is managed from Shenzhen, China, thirty minutes west of Hong
Kong.

Our software and hardware is used in the DOOH advertising
industry. Therefore, our principal business is to provide our clients with
advertising opportunities through self-service interactive digital kiosks,
interactive window displays, interactive transit displays and other interactive
out-of-home advertising displays, such as digital wallscapes, spectaculars and
mall displays, that we own or operate in North American advertising markets and
in China. Our business in China is conducted via an agreement with Companion
Sino-net Technology Development (Beijing) Co., Ltd., which is an indirect 90%
corporate subsidiary and affiliate of R. J. Tocher Holdings Ltd., a company
owned by our Chief Executive Officer Ross James Tocher.

We go well beyond combining advertising content with
non-advertising content, such as news, weather, sports and comedy clips, in our
digital TV screen programs. Our interactive hardware is sleekly designed to
enhance any public environment and is configured to suit any marketing
communications need. QMs touch-screen interactive kiosks support mobile apps
and iPhone/smart phone integration, while enabling shoppers to access relevant
information and self-service their needs through interactive directories,
wayfinding, coupons and other instant, on-demand media. Marketers are learning
to project their brand channels beyond their Web pages. Brand awareness
strategies are extending from the home through to the point of sale using
digital signage. The emerging trend in advertising is to deliver Micro-broadcast
networks and new age advertising content management services to marketing
clientele and their consumers. Essentially, we plan to be a complete digital
signage company that builds state-of-the-art interactive kiosks and
point-of-sale (POS) systems, and provides advertising content and
Micro-broadcast solutions for private channel digital marketing into high
traffic, public spaces; thus, empowering advertisers to target and engage
audiences where and when they shop and socialize.

We believe this makes target audiences more receptive to the
advertisements to be included in our programs and ultimately makes our programs
more effective for Micro-broadcast sponsors and their advertising clients. We
intend to derive revenues principally by selling advertising time slots on our
Micro-broadcast network, deployed in approximately 80 locations across Canada
that we intend to expand to at least 100 locations across Canada, to advertising
clients such as Yokohama Tire (Canada) Inc. and direct third party advertisers
and advertising agencies.

DOOH advertising in North America and China has experienced
significant growth in recent years. By focusing on interactive advertising, we
enable our advertising clients to better target consumers, who we believe are an
attractive demographic for advertisers due to their higher-than-average
disposable income. We strategically place our interactive kiosks and interactive
digital TV screens in high-traffic locations of trade show exhibitions, shopping
malls, and in stores of large chain retailers, particularly in areas where there
tends to be significant waiting time.

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We combine advertising content with non-advertising content,
such as news, weather, sports and comedy clips, in our interactive digital TV
screen programs. We believe this makes consumers more receptive to the
advertisements included in our programs and ultimately makes our programs more
effective for our advertising clients. Our standard programs include, for each
advertiser, six 15-second spots of advertising content during each hour of
programming and are shown for approximately 10 hours per day.

We plan to derive revenues principally by selling advertising
time slots on our network to our advertising clients, including both direct
advertisers and advertising agencies.

Industry Background

The media and advertising industries have become fragmented in
the first decade of the new millennium. Traditional TV, radio and print
advertisers have dispersed into the Internet digital spectrum that targets
audiences through contextual marketing. The promoters are refining their target
market exposure and utilizing measurable means for gauging the success of their
campaigns. Many retailers and brands are specializing in search engine
optimization, online stores, social network marketing for reaching their online
audience and using direct sales channels to generate profits in a hyper
competitive marketplace.

Traditional media and advertising are referred to as analog
methods because they require physical means. Digital advertising has
significantly increased delivery speed and reduced cost of production.

The emerging marketing branches involve DOOH, mobile marketing
and interactive marketing. The growth of these marketing segments is rooted in a
rapidly growing technological framework and new means of reaching target
audiences. Key to our strategic planning is keeping a global perspective on a
dynamic and evolving market. Our market is a growth industry as more of us are
finding, viewing, and using digital signage more frequently in our daily lives.
Recognizing this, companies, organizations, and institutions worldwide are
stepping up deployments of digital signage in all its uses and forms. The
versatility of interactive kiosks and Micro-broadcasting  as effective,
targeted communications hubs  further appeals to this growing demand. This
opens several avenues of opportunity for our company. Among them are:

- Shopping malls
- Retail
- Transportation
- Hospitality and convention
- Healthcare
- Corporate
- Financial
- Government

Interactive Advertising.

We believe interactive advertising in North America and China
has the following key characteristics:

- Attractive target demographics. We believe the average consumer in
  North America and China presents an attractive audience group for advertisers
  who aim to reach consumers with higher-than-average disposable income to
  promote their products or services.

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- Effective audience reach. We believe the usage periods in time spent
  at an interactive kiosk or viewing interactive digital TV enables consumers to
  obtain the information they desire in real time and allows interactive
  advertising to engage consumers for extended periods of time, which may in
  turn increase the effectiveness of the advertisements.
- Increasing acceptance. The primary objective is to accomplish
  consumer engagement through provision of value, entertainment, convenience and
  communications. Through usability, the system adapts to the geographical
  target market and creates a virtual real estate for advertisers. We believe
  interactive digital media networks have been increasingly accepted by the
  three major groups in the advertising industry: trade show exhibitors and
  large chain retailers, consumers and advertisers. Interactive digital media
  networks empower consumers to obtain information they desire or otherwise
  provide an outlet to fill idle time, which may help to enhance the overall
  consumer experience and add value to the interactive services or products
  provided by Micro-broadcast network sponsors and advertisers. We believe
  advertisers have increasingly chosen interactive advertising due to its high
  receptivity among consumers and ability to reach favorable and exact
  demographics.

Our Strengths

Our digital platform allows people to comparison shop on a mass
scale, thus creating a consumer paradigm shift on what the product is worth
rather than how much it costs. This is analogous to free market bargaining,
negotiation and dynamic perception of value. The digital marketplace has eroded
retail systems into a bazaar marketplace: Wholesale or no sale mentality. To
exploit opportunities, we look to valid data and analysis along with other
important market clues to conditions, momentum, and trends. Reported figures are
read in context with expert opinion, forecasts, and strategic insight from those
inside advertising and digital signage, and from credible industry analysts. We
look for patterns, corroborate facts, and apply our own knowledge, experience
and collective wisdom. Being at the right place, at the right time is
critical. The compounding trends of technology, social, environmental and
economic factors present a unique timing opportunity for deployment of
Micro-broadcasting systems.

We believe we have the following competitive strengths:

- we are positioned to provide a unique interactive digital media network in
  North America and China dedicated to advertising with broad geographic network
  coverage, and to provide our advertising clients with the ability to reach a
  national audience through dedicated Micro-broadcast advertising network;
- our interactive digital media network provides a significant value
  proposition to Micro-broadcast clientele by offering programs that may enhance
  the consumer or end user experience, and by providing Micro- broadcast
  clientele with incremental revenue opportunities, an effective means of
  managing their consumers experience through a cost-effective media service;
- our interactive digital media network provides a significant value
  proposition to advertisers by offering them extensive viewer reach, social
  marketing analytics, cost-effective advertising, scheduling flexibility and
  quality client service;
- we have hired personnel with extensive experience in combining interactive
  advertising content with non- advertising content to make our Micro-broadcast
  programs more attractive to consumers and ultimately more effective for their
  Micro-broadcast sponsors and advertisers;
- we have a highly recognizable brand name in the DOOH sector and are
  developing strong relationships with potential advertisers; and
- we have a strong management team with extensive related industry
  experience.

Presented below is a summary of key findings of our market
research in four parts: Market Values, Consumer Engagement and Impacts,
Corporate Interest and Investment, and Trends.

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Together, they reveal a dynamic digital communications and
advertising industry that continues to outpace other sectors with remarkable
growth.

Market Values

Digital signage is a multi-billion dollar industry today. Right
now, across North America alone, and via approximately 200 networks, there are
well over 1.1 million distinct advertising spots playing on place-based screens
and kiosks. Sector growth is measured in double digits and deployment,
advertising rate cards, and advertising revenues all are pointing up. For a
total value estimate in Qwick Medias context as a full-spectrum digital signage
provider, we look to data from the hardware and software side, as well as to
revenue reports from the advertising sector and advertiser expenditures. Data
gives us a measure of the value of the industry today, and how it is expected to
grow.

Key Findings:

- 1,080,000 + : Conservatively estimated number of unique ad spots playing
  every day on digital out of home displays across US alone (State of Digital
  Signage Today).
- $3.9 billion: Current market estimate of the total value of the digital
  signage market, based on revenues of manufacturers of individual components
  that comprise the systems  primarily displays, media players, set top boxes,
  computers, networks and software (J Fox IMS DST).
- 20% annual growth: On target forecast of revenues commencing 2009 to 2013.
  Driving out-performance: new installations and replacement of static displays
  in retail and transport (J Fox IMS DST).
- + 25% : Revenue Growth rate for the digital place-based advertising sector
  for the first half of 2010 (M K Arase, DPAA).
- $3.7 billion: Amount DOOH advertising revenues are forecast to grow to by
  2013, up from 2.2 billion in 2009  a 13.5% compound annual growth rate
  (BIA/Kelsey).
- $1.4 billion: Advertising dollars dedicated to digital out-of-home
  advertising in 2008, growing 9% annually (State of Digital Signage Today).
- $1 billion + : Estimated digital place-based ad revenue today (M K Arase,
  DPAA).
- $740 billion: Total transaction value conducted at self-service interactive
  retail signage/POS/kiosks in 2009  set to be surpassed in 2010. North
  American consumers are continuing to embrace self-service technology (Stein,
  Buzzback, Digital Signage Today).

Increasingly Important Role of Out-of-Home Advertising

DOOH advertising accounts for a larger percentage of total
advertising spending in China compared to Europe, the United States and other
countries in Asia. Out-of-home advertising has seen rapid development and growth
in China in recent years. This form of advertising, which includes billboards,
street furniture displays and transit displays such as airport digital TV
screens, digital TV screens on airplanes and vehicle wrap display advertising,
allows advertisers to effectively target increasingly mobile and urbanized
target audiences in a flexible and cost-effective way. We believe that
advertisers increasingly choose alternative media over traditional media such as
television, radio broadcast and print media given the more limited geographic
reach of Chinas and North Americas traditional media outlets.

Consumer Engagement and Impacts - Significant Value
Proposition.

We believe our services provide the following significant
benefits to our network Micro-broadcast network sponsors and advertisers:

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- Enhanced Consumer Experience.The content provided in our
  interactive digital media network provides consumers with an entertaining
  means to pass time while obtaining relevant information they desire in real
  time. Our ads engage users by stimulating their curiosity and driving their
  fingertips onto our touch screen that in turn logs measurable data for
  evaluating the effectiveness of content engagement. It is a measurable traffic
  virtual real estate. Besides reward marketing principles, another powerful
  driver is pleasure through entertainment. Celebrities and their lifestyles are
  a public commodity. Popular culture news industry conditions users into
  repetitive consumption through familiarity. Entertainment news is an important
  engagement mechanism. We believe our digital media network enhances the
  consumer experience and adds value to the interactive services or products
  provided by our Micro-broadcast network.
- Incremental Revenue Opportunity.Under our cooperative services
  contracts, we offer Micro-broadcast sponsors a share in revenue as a means of
  cost recovery in exchange for the concession rights to play our programs in
  their venues. Through these contractual arrangements, individual
  Micro-broadcast sponsors can deploy a nationwide interactive digital media
  network to provide high-quality media content to their consumers and their
  affiliated marketing clientele, who desire to convey their own advertising
  message to such consumers, under cooperative marketing programs
- Effective Means of Managing Consumer Traffic. Some Micro-broadcast
  sponsors and advertisers also utilize non-advertising time of our network to
  provide other information to consumers. The ability to provide timely
  information to consumers allows our interactive digital media network to aid
  in the management of consumer traffic. The media broadcasting industry is
  driven by advertising dollars through ad placement in TV, radio, newsprint and
  Internet mediums. The reason for explosive Internet growth is the
  non-interruptive mechanism for delivering user driven on-demand content with
  targeted ads. Traditional media does not provide this instant freedom of
  interactivity and thus has appeared to experience loss of audience to
  alternative interactive digital mediums that converges content consumption
  through a digital format.
- Cost-Effective Media Service. The large scale of our planned network
  allows us to provide our network sponsors with a wide range of digital media
  programs on a cost-effective basis which may otherwise be costly and time
  consuming for each sponsor to procure individually.

Significant Value Proposition to Advertising Clients.

We operate an interactive digital media network that:

- Offers Extensive Viewer Reach.We strategically place our displays
  in high-traffic locations. This allows our interactive displays and programs
  to target consumers at multiple points during their shopping experience, from:
  do you have this? to where can I find it?.
- Offers Real Analytics.The raw user data compiled by our technology
  at shopping malls, transit stations, automotive dealerships and other specific
  locations can be analyzed to measure peak usage, seasonality trends, popular
  content, user feedback and any other statistical interpretation designed to
  measure interests and usability.
- Provides Cost-effective Advertising.Our network targets audiences
  with demographic profiles desirable to advertisers and allows advertisers to
  reach consumers in a more cost-effective way compared to traditional media. We
  believe the cost of reaching the same number of consumers with
  higher-than-average disposable income is significantly lower on our network
  than advertising through other more traditional media such as television,
  billboards or newspapers.
- Provides Flexibility for Advertisers.We generally update our
  programs on a daily and weekly basis, respectively. This gives advertisers
  scheduling flexibility by allowing them to change their advertising campaigns
  on short notice and run them for shorter time periods than other media, such
  as billboards.

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- Offers Quality Client Service.Our program production team consists
  of both advertising and television production professionals who are skilled in
  designing effective programming for our advertising clients based on the
  viewing preferences of consumers. We have also built a sales team experienced
  in presenting the value of our interactive digital media network and providing
  suitable advertising services to our potential clients, and we have
  established national operational synergies, all of which have enabled us to
  operate and further develop our interactive digital media network. We have
  also commissioned a third party to provide advertising research and analysis
  reports to our clients on a regular basis to help our advertising clients
  better understand the advertising market and various advertising media
  available to them.

Extensive Experience in Managing Content.

As an early-mover in interactive out of home digital media
content, we have accumulated extensive experience in designing, identifying,
acquiring and compiling content that is attractive to viewers and advertisers.
Our experience and our monitoring of the viewing preferences of consumers helps
us to create and update programs with an optimal blend of advertising and
non-advertising content for this market. Managing content allows us to improve
both the effectiveness of the advertisements in our programs and the
attractiveness of our network to our advertising clients.

How many of us are encountering the various digital video
displays and interactive media in our daily lives? How does the public feel
about interacting with public digital technology when at business, leisure, or
when shopping? To what extent does this new breed of marketing tool influence
purchase decisions? Does having a digital signage and shopper-focused marketing
strategy make a difference for retailers?

Consumers, shoppers, indeed, all of us  feel much the same way
about place-based media as we do about all digital media and devices: give us a
seamless interface, interactivity, brilliant graphics, relevant information,
self-serve functionality  even entertainment now and then  and there we are,
engaged, finding our way, searching products, connecting, communicating,
compelled and buying.

This receptiveness creates demand that is only encouraged by
on-going technological innovation to satisfy a seemingly limitless appetite for
connectedness and convenience. The more tools are advanced, the greater the
level of engagement.

For marketers, advertisers, and content sponsors, it is the
most valuable tool in the box. Companies with digital signage strategies enjoy
stronger customer relationships and build brand equity, while gaining valuable
shopper metrics to create efficiencies and tailor the customer experience. It
all adds up to higher return on investment for advertising.

Our partners have the opportunity to sponsor specific content
delivery in targeted locations. The information displayed on QwickViews
displays is current and it delivers instant news bits on community, regional and
world events. These are usually provided as content modules and they can be
enabled or disabled based on partner preferences.

Key Findings:

Engagement :

- 76% : Percentage of adult US residents who report viewing/using Digital out
  of home video displays and media in multiple venues, each month (Arbitron
  Out-of-Home).
- 72% : Percentage of Canadian adults seeing digital displays. Indoor
  place-based advertising had strongest recall at 63% (OMAC Mediaplanet Nat.
  Post).
- 62% : Overall percentage of consumers who are well receptive of digital
  display screen ads and infotainment (Nielsen survey).

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- 53% : Percentage of American adults reached each month by video displays in
  retail locations alone (Arbitron Out-of-Home).
- 88% : Percentage of U.S. consumers more likely to choose a company that
  gives them the ability to interact via online, with mobile, or self-service
  technologies (Buzzback Digital Signage Today).
- 71% : Percentage of shoppers who describe digital signage as Attention
  grabbing (OMAC Mediaplanet Nat. Post).Impact:
- + 28% : Increase in health and beauty departmental sales with integrated
  digital signage and POS strategy  other departments : over the counter + 23%,
  food + 13%, electronics + 7% (GMA/Deloitte Walmart).
- + 18% : Sales lift of seasonal push items  other product types : mature
  item + 7%, item launch + 9%, , rollback items (discounts) + 6% (GMA/Deloitte
  Walmart).
- + 13 % : Increase in customer advocacy/loyalty achieved by companies using
  digital signage  compared to an industry average of just 2% using only
  conventional media (Gladstone Aberdeen Marketwire).
- + 33% : Sales increase of four out of five product brands playing on
  digital signage media platforms (Nielsen survey).
- + 31% : Increase in awareness and recall rates of Display screen
  advertising at POS when prompted  14% unprompted (Nielsen survey).
- +15% : Brand awareness jump enjoyed by companies using digital signage
  strategies (Digital: A Path Marketwire).
- Expectations: What are changing among target audiences. Organizations are
  countering declining effects of traditional marketing by turning to digital
  signage (Gladstone Aberdeen Marketwire).
- The Nielsen study makes one thing perfectly clear: DOOH media have a direct
  effect on brand awareness and consumer buying patterns, directly boosting
  sales.

Dirk Hülserman, OVAB Europe (digitalsignageexpo).

Corporate Interest and Investment

Are corporate leaders, decision makers and planners embracing
digital signage conduits as the next wave of targeted shopper-centric marketing
solutions?

Getting a read on the intentions of executive decision makers
can be a challenge. Understandably, they can be somewhat cagey about revealing
even general information about marketing strategy, lest the competition gain an
advantage.

Questions of digital signage, interactive displays and
supporting technology, however, are met with enthusiasm  particularly over the
last several months. This suggests that, across sectors, digital systems and the
media strategies they support are advancing into marketing plans and onto
blueprints. Interactive digital signage is top-of-mind for retailers of every
size and shape.

Looking for attitudes and intentions, we find recognition among
business that digital signage and interactive media is critical to 21st century
marketing strategy. Capital investment to expand these strategies will take this
emerging sector into high gear.

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Key Findings:

- Impact: What advertisers understand about digital signage and why they are
  justifying increasingly greater investments (Hall Danaher Digital Signage
  Today) .
- 1000 plus: Screen deployment sizes becoming more common  more companies
  deploying digital signage because it works; a marketing essential within two
  to three years (State of Digital Porter Digital Signage Today).
- Market leaders: Are mobilizing shopper marketing efforts  allocating more
  funds, restructuring organizations, investing in tech and resources, and
  re-evaluating collaboration with partners and service providers
  (GMA/Deloitte).
- 21% and 26%: C.A.G.R growth rates for shopper marketing budgets of
  manufacturers and retailers respectively  retailers investing in redesign and
  improving the customer experience (GMA/Deloitte).
- Insights generation: What retailers are planning to increase dedicated
  resources to over the next three years (GMA/ Deloitte).
- Digital at retail media budgets: What more companies are growing  these
  strategies are becoming a standard component of well-rounded media plans
  (State of Digital Weidauer Digital Signage Today).
- Increased investments: What advertisers are justifying, given validated
  consumer engagement with digital signage over the last two years (Simpson
  Selfserviceworld).
- Shopper marketing growth: Why companies will employ better collaboration,
  insights, targeting tactics, measurements, and tech (GMA/Deloitte).

Industry articles, white papers, studies and expert analysis of
market activity and consumer behavior reveals the growing move toward
interactive digital signage and private broadcast content and creativities. The
most successful companies are seeking out more efficient direct-to-shopper
marketing channels that leverage advances in digital network and interactive
technology design.

Trends

Forecasting accurately is difficult enough, but when you have a
technological environment advancing at an accelerated rate and it can be even
more elusive. New developments can be game-changers, quickly rendering old
forecasts obsolete. Communications technology has a way of surprising and
delighting us.

So we continuously reassess and further develop our products
and services, and revise our forecasts to keep on top of an evolving, dynamic
market.

Over the next several years, the typical urban environment will
see a wholesale transition to digitally interactive kiosks and signage in
centers of retail, community, corporate, institutional and governmental activity
 virtually all focal points of commerce and community. Consumers and shoppers
will not venture far before engaging with an interactive Micro-broadcasting
kiosk.

Organizations slow to adopt innovation will follow suit to
compete with tech savvy rivals. New locations will be equipped with state-of-the
art technology that automates many routine sales functions, while creating an
enhanced experience for the shopper. For others, upgrading is cycling through
the industry; existing outlets will continue to retool with the latest in
interactive technology.

For the industry, increased strategic partnerships and some
consolidation moves are expected over the near and medium term.

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Research gives us an overview of market trends.

Key Findings:

- Kiosks: Large screen projects in the works (State of Digital Gerba Digital
  Signage Today).
- Mobile devices: Direct interaction with place-based media to continue rapid
  growth (State of Digital Gerba Digital Signage Today).
- Venues: Screens at gas stations, on buses, digitized billboards, in-store,
  bars, restaurants, health clubs, public spaces (BIA/Kelesy).
- Marketings holy grail: Potential digital signage/ interactive kiosks
  technology establish a cause and effect link between message and results.
  Expect mass adoption of DS and related tech (State of Digital Abbott Digital
  Signage Today).
- Design: What digital signage and media is becoming fundamental to  where
  screens are positioned and how they support the shopper will become more
  understood. Planners will start to integrate screens right from design of
  retail and environmental planning  already used in next generation and
  concept stores (State of Digital Gorrie Digital Signage Today).
- Interactive storefront windows: Several chains are leveraging the power of
  interactive displays to market their products, including Tommy Hilfiger and
  Nike, shoppers could upload images, even design their own shoe and save it
  for pick-up. Watch for more of this.
- Digital signage: Building on the foundations of this technology, the upturn
  in interactivity will continue. Expect floor screens, gesture enabled
  technology, and increased interactive capability between the display (kiosk)
  and cell phone.
- Self-checkout: Some surveys report that more than 90% of respondents have
  already used this technology  they appreciate the shorter lines and control
  of the transaction.
- Self service: Most consumers now perceive a well-designed self service
  interface as time saving and a way to access additional services at their
  convenience (Top 100 Customer experience).

Market Speak

| | There will be further development of strategic
      partnerships, helping drive the industry. Innovative tech, forward
      thinking and dedication will prevail.                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                          
| |                                                                                                                                                                                                                                                          
| |                                                                                                                                                                                                                                                          
| | We see increased interactivity between DS and POS, brands
      and retailers want to see the impact in their sales in real time. Many are
      already doing it  I believe it will become commonplace. Jose Avalos,
      Intel Corp (Mediaplanet WSJ)
| |                                                                                                                                                                                                                                                          
| | Kiosks will come to replace many ATMs and be used by
      banks more widely due to their mobility, interactive abilities, and
      because they are cheaper to operate than a branch  the next step is the
      digital commerce kiosk with video.  
| |                                                                                                                                                                                                                                                          
| |                                                                                                                                                                                                                                                          
| |                                                                                                                                                                                                                                                          
| | Just like innovations of the last decade, these (DS
      innovations) will invigorate and transform our world in ways we cannot yet
      comprehend.                                                                                                   
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The weight of informed opinion sees a digital media revolution
of public spaces. As far as can be reasonably seen, deployments will increase,
in frequency in size and in capability. Abundant data, specific analysis and
expert commentary support the premise that the out-of-home digital signage
market is set to outperform for years to come. Knowing all that we can of our
market allows us to anticipate trends, identify opportunities, and target our
creative resources. Our industry-leading systems reflect these efforts that,
ultimately, enable clients greater ROI in media marketing solutions. A resilient
digital signage market is largely credited with sustaining the advertising
sector through the worst of the last economic doldrums. And this powerful new
medium is attracting a still greater share of advertising dollars.

Our Strategies

We intend to build separate sales teams to focus on developing
the client base for each of these new advertising media platforms while
promoting the broader value that the overall network and these platforms
collectively provide to our advertising clients. We believe the creation of new
advertising media platforms within the interactive advertising sector and our
broadened service offerings will provide our advertising clients with more
choices in selecting and combining different interactive advertising platforms
that best suit their advertising needs and preferences. It will also expand the
reach of the advertisements shown on our network and allow us to cross-sell
different advertising services. We believe that the strong presence that we have
built through our existing network provides us with significant opportunities to
launch new platforms and services and test new initiatives in a reliable and
cost-effective manner. Ultimately, we anticipate these efforts will increase the
revenue we can generate.

In addition, with consumers increasing acceptance of
technology-driven advertising and entertainment media, we intend to identify and
take advantage of new opportunities in the China and North American advertising
market by developing innovative advertising techniques and media. For example,
we plan to explore the field of interactive advertising such as a shop assist
center in large retailer chain venues, which gives consumers the opportunity to
learn about and perhaps test new products or services in person.

Our goal is to extend our competitive position as the leading
interactive digital media network provider in North America and China and to
successfully expand into other areas of the DOOH advertising sector.
Accomplishing this goal requires the successful implementation of the following
strategies:

- We plan to broaden our service offerings through new Micro-broadcast
  advertising media platforms within the DOOH advertising sector, in particular
  by offering a interactive digital media replacement for traditional light box
  displays to passive digital frames and establish a Micro-broadcast platform,
  to broaden consumer reach, enhance the effectiveness of advertisements and
  provide our Micro-broadcast sponsors and their advertising clients with more
  choices in selecting and combining different interactive advertising platforms
  according to their advertising needs and preferences;
- We plan to grow our leading technology into a market position and revenues
  by building local sales teams in additional cities to increase our sales of
  advertising time slots and utilization rate in these cities and increase the
  number of interactive digital TV screens and other interactive displays in our
  emerging Micro- broadcast network opportunities;
- We will continue to secure high quality non-advertising content to make
  audiences more receptive to advertisements played on our network and
  ultimately bring greater value to our business in a cost-effective manner;
- We will continue to promote our brand name and the value of interactive
  DOOH advertising through proactive sales and marketing efforts to solidify and
  broaden our customer base and our emerging relationships with large retail
  chains and content providers; and
- We plan to pursue strategic relationships and acquisitions that expand our
  business within the DOOH advertising industry, although we are not currently
  negotiating any material acquisitions.

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Sales and Marketing

We provide a number of services in connection with each
clients advertising campaign. We rely on our experienced sales team to assist
advertisers in structuring advertising campaigns by analyzing advertisers
target audiences and consumer products and services. We conduct market research,
consumer surveys, demographic analysis and other advertising industry research
for internal use to help our advertisers to create effective advertisements. We
actively attend various public relation events to promote our brand image and
the value of interactive digital advertising. We also market our advertising
services by displaying our name and logo on all of our interactive kiosks and
digital TV screens.

We engage third-party agencies to help source advertising
clients. Agency fees are calculated based on a pre-set percentage of revenues
generated from the clients introduced to us by the agencies.

Increase Our Revenues by Leveraging Our Existing Digital
Media Network.

We have the broadest network coverage in China based on the
number of Micro-broadcast network sponsors and advertisers covered by our
network. We intend to leverage our leading market position to maintain our
market leadership, enhance our mass appeal to our advertising clients and
increase our fees and revenues. To achieve this goal, we intend to:

- Build Local Sales Teams in Major Additional Cities and Increase our
  Sales and Utilization Rate of Advertising Time Slots in these Cities.Currently, we have offices in Vancouver and Burnaby, Canada and in
  Beijing, Wuxi and Shenzhen China where we maintain our business development
  and sales network. We plan to build local sales teams in several additional
  cities associated with key locations of Micro-broadcast sponsors to strengthen
  our sales efforts in these cities, further develop relationships with local
  advertisers, increase our direct sales of advertising time slots in these
  cities and improve our utilization rate, or the percentage of available time
  slots that we sell to advertisers.
- Increase the Number of Locations Our Emerging Network.We intend to
  enter into further cooperative services contracts for concession rights to
  increase the number of locations that we can place or operate interactive
  kiosks and interactive digital TV screens or other displays in order to
  broaden the viewer reach of the advertisements shown on our network and
  enhance our current position in many of the most desirable locations.

We will continue to evaluate further opportunities in the
future to obtain new opportunities that are not currently in our network. This
will help to ensure that our network continues to include the most significant
venues in North America and in China. While the rates of advertising fees that
we charge our advertising clients are not directly tied to the number of
locations in our network, we believe that expanding our network will extend our
audience reach, make our digital media network more attractive to national
advertisers and ultimately lead to higher fee rates and increased revenues.

Continue to Secure High Quality Non-Advertising Content to
Enhance the Attractiveness of Our Network.

The heart of the Qwick Media system is the content production
system. Content is a consumable commodity and a renewable source of revenue that
supports the Micro-broadcasting system. QM has developed a proprietary engine
for production, aggregation and distribution of content throughout its
broadcasting network. The automated content such as news, time and weather is
pulled through the RSS Internet feeds.

As non-advertising content in our media network constitutes a
significant attraction for interactive audiences and makes our clients
advertisements more effective, we will continue to secure high quality
non-advertising content from third-party content providers. We will seek to
obtain more diversified content from content providers, develop relationships
with additional content providers, add exclusivity and automatic renewal clauses
into content provision contracts, and improve the quality of editing and
programming to enhance the overall attractiveness of our programs. We believe
providing high quality non-advertising content in our network is a
cost-effective way of making our programs more effective for our advertising
clients.

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Continue to Promote Our Brand Name and the Value of
Interactive Advertising.

We will continue to promote our brand name through proactive
sales and marketing efforts. We believe this will allow us to broaden our client
base as well as strengthen our relationships with Micro-broadcast sponsors,
advertisers and content providers. We also seek to extend our leading market
position by taking initiatives to highlight the value of interactive advertising
relative to other media. We will continue to utilize research tools that enable
our clients to better understand how our network can successfully reach their
target audiences and promote their advertising campaigns.

In addition, we are working closely with advertisers,
advertising agencies and other diversified media companies to develop more
sophisticated systems that will provide improved demographic tracking
measurements of interactive advertising. We believe that these measurement
systems will further enhance the attractiveness of interactive advertising for
both existing clients and new advertisers. We will also continue to promote our
network as an attractive means for content providers to showcase their programs.
The value we provide to our content providers allows us to limit our content
acquisition costs.

Pursue Strategic Relationships and Acquisitions.

We plan to pursue strategic relationships and acquisitions that
expand our business within the interactive advertising industry. We plan to
identify, execute and integrate acquisitions to build scale and enter into
complementary businesses and new media platforms that enhance our interactive
advertising network and reach. We plan to evaluate strategic acquisition
opportunities that we believe will further enhance our market leadership
position while also providing an attractive return on investment. When
evaluating potential acquisition targets, we will consider factors such as
market position, growth and earnings prospects and ease of integration. We are
not currently negotiating any material acquisitions.

Advertising and Related Services.

Whether it is shopping malls, trade show exhibitor listings,
car dealership inventory, in-store products, office building tenants or any
other aggregate information our universal directory engine allows users to
intuitively search, filter, sort, save and share information. The universal
customizability of our core operating platform allows for quick and personalized
deployments. We intend to generate incremental revenues from the advertising
services from the following platforms:

- Store and Product Directories
- Maps and Wayfinding
- Printing Coupons
- Price Scanning
- Biometric and RFID Logins
- Cueing software
- Tradeshow Software
- Event Manager
- Web browser and Email
- Keyword Search Engine
- Shop Assist and Gift Ideas

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- Widgets: calculator, weather, news, traffic, time, transportation
- VOIP communications

Touch screen usage enables our interactive QwickView software
to serve common audience needs in its geographic placement. Modular applications
formats allows for a high degree of customizability. The broadcast content
stream is loaded with psychological engagement cues. Provision of monetary value
is a powerful motivator. The desire for personal gain is also proliferated by
having a communication system built into our system, such as instant email, SMS
and VOIP so consumers can easily share the deals and invite more participating
audience. Such applications can be monetized through sponsorships, customization
and content production. It delivers the power of instant information and
communications to the users, but unlike (uncensored) Internet, the location
provider can control the provision of content.

QM provides software customization services that can enrich the
application by catering to advertising clients specific needs. This is another
source of potential revenue for QM and every customization project allows the
ability to resell the app as part of the expansion package. For example, if
transit authority wants a live transit scheduling system or if a hospital wants
a client check-in module, we can service the deployment by recovering our costs
and in exchange for wholesale service we can resell the software application in
other markets.

Pricing

The list prices of our advertising services vary by the size of
Micro-broadcast network and duration of venue in which the advertisement is
placed, the demand of advertising services for each sponsor and advertiser, as
well as by the duration of the time slot purchased and the duration of the
advertising campaign. Prices for the aggregate time slots on our network to be
purchased by each advertiser or advertising agency client are planned to be
obtained under sales contracts, perhaps at a discount to our list prices.

Customer Service

Our customer service team is responsible for compiling
monitoring reports to clients as evidence that their advertisements are played
on our network within one week after launching the advertising campaign. We also
provide our advertising clients with weekly reports prepared by third parties,
which verify the proper functioning of our displays and the proper dissemination
of the advertisement by conducting on-site evaluations and polls to analyze the
effectiveness of and public reaction to the advertisement. In addition, our
network sponsors and advertisers are also intended to be actively involved in
the monitoring process and our analytics back-end reporting systems can provide
our clients with reports of proof of performance certifying the playing of the
advertisements and relevant consumer engagement.

Competition

We compete primarily with several different groups of
competitors:

- advertising companies that operate advertising networks, such as CBSDecaux,
  and DOOH short of the interactive sector, such as Focus Media, Captivate,
  ClearChannel and others;
- in-house advertising companies of large retail chains that may operate
  their own advertising networks; and
- other advertising media companies, such as Internet, street furniture
  displays, billboard and public transport advertising companies, and with
  traditional advertising media, such as newspapers, television, magazines and
  radio, some of which may advertise in the large chain retail locations in
  which we have exclusive contract rights to operate digital TV screens.

We compete for advertising clients primarily on the basis of
network size and coverage, location, price, quality of our programs, the range
of services that we offer and our brand recognition. Many of our competitors
have a variety of competitive advantages over us, such as larger resources. Many
competitors have a longer history than us in the DOOH advertising industry and may have a more extensive network
that extends beyond the interactive sector and offers a more diversified
portfolio. This may make their network more attractive to advertising clients
and less reliant on a particular advertising sector. In addition, we may also
face competition from new entrants into the interactive advertising sector in
the future.

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Employees

We had 18 employees as of April 29, 2011. Generally we enter
into standard employment contracts with our officers, managers and other
employees. According to these contracts, all of our employees are prohibited
from engaging in any other employment during the period of their employment with
us. The employment contracts with officers and managers are subject to renewal
every three years and the employment contracts with other employees are subject
to renewal every year.

In addition, we enter into standard confidentiality agreements
with all of our employees including officers and managers that prohibit any
employee from disclosing confidential information obtained during their
employment with us. Furthermore, the confidentiality agreements include a
covenant that prohibits all employees from engaging in any activities that
compete with our business within three years after the period of their
employment with us.

None of our employees is a member of a labor union and we
consider our relationship with our employees to be good.

Intellectual Property

To protect our brand and other intellectual property, we rely
on a combination of trademark and trade secret laws as well as confidentiality
agreements with our employees, sales agents, contractors and others.

We do not hold any patents or copyrights and cannot be certain
that our efforts to protect our intellectual property rights will be adequate or
that third parties will not infringe or misappropriate these rights.

Legal Proceedings

We are currently not a party to any material legal proceeding.
From time to time, however, we may be subject to various claims and legal
actions arising in the ordinary course of business.

Regulation

Advertising regulation comprises laws and rules defining the
ways in which products can be advertised in a particular region. Rules can
define a wide number of different aspects, such as placement, timing, and
content. In the United States, false advertising and health-related ads are
regulated the most. Many communities have their own rules, particularly for
outdoor advertising.

Self Regulation Practices - Code of Advertising Practices in
Digital Media

We are committed to delivering our advertisers message to the
consumer. This role in the arena of public discourse requires both a defense of
free speech and sensitivity to contemporary standards and concerns. Qwick Media
recognizes the need to balance these demands and therefore adheres to the
following code of advertising practices:

- Establish exclusionary zones which prohibit advertisements of all products
  illegal for sale to minors that are intended to be read from or within 1000
  feet of established places of worship, primary and secondary schools or
  playgrounds.
- Continue to assert the right to reject creative content that is misleading,
  sexually explicit, overly suggestive, or in any way reflects upon the
  character, integrity, or standing of any organization or individual.

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- Continue our traditional commitment at both the national and local levels
  to display public service messages for worthy community causes.
- Encourage diversity of advertised goods and services in all markets.

Advertising Content in General

Advertising laws and regulations set forth certain content
requirements for advertisements in North America and China, which include
prohibitions on, among other things, misleading content; superlative wording; in
China, socially destabilizing content; or content involving obscenities,
superstition, violence, discrimination or infringement of the public interest.
Advertisements for anesthetic, psychotropic, toxic or radioactive drugs are also
prohibited. The dissemination of tobacco advertisements via media is also
prohibited as well as the display of tobacco advertisements in any waiting
lounge, theatre, cinema, conference hall, stadium or other public area. There
are also specific restrictions and requirements regarding advertisements that
relate to matters such as patented products or processes, pharmaceuticals,
medical instruments, agrochemicals, foodstuff, alcohol and cosmetics. In
addition, all advertisements relating to pharmaceuticals, medical instruments,
agrochemicals and veterinary pharmaceuticals advertised through radio, film,
television, newspaper, magazine, out-of-home and other forms of media, together
with any other advertisements which are subject to censorship by administrative
authorities according to relevant laws and administrative regulations, and in
China must be submitted to the relevant administrative authorities for content
approval prior to dissemination. We do not believe that advertisements
containing content subject to restriction or censorship comprise a material
portion of the advertisements displayed on our Micro-broadcast network.

Particular to Business in China

We operate our business in China under a legal regime
consisting of the State Council, which is the highest authority of the executive
branch of the National Peoples Congress, and several ministries and agencies
under its authority including the State Administration for Industry and Commerce
(SAIC).

Chinas Advertising Law was promulgated in 1994. In addition,
the State Council, SAIC and other ministries and agencies have issued
regulations that regulate our business. The principal regulations governing
foreign ownership in the advertising industry in China include the Catalogue for
Guiding Foreign Investment in Industry (2004); andthe Administrative
Regulations on Foreign-invested Advertising Enterprises (2004).

These regulations require foreign entities that directly invest
in the advertising industry to have at least three years of direct operations in
the advertising industry outside of China. Since December 10, 2005, foreign
investors have been permitted to directly own a 100% interest in advertising
companies in China, but must also have at least three years of direct operations
in the advertising industry outside of China. PRC laws and regulations do not
permit the transfer of any approvals, licenses or permits, including business
licenses containing a scope of business that permits engaging in the advertising
industry. In the event we are permitted to acquire the equity interests of our
variable interest entities under the rules allowing for complete foreign
ownership, our variable interest entities would continue to hold the required
advertising licenses consistent with current regulatory requirements.

Since we have not been involved in advertising outside of China
for the required number of years, our planned domestic PRC operating
subsidiaries are currently ineligible to apply for the required advertising
services licenses in China.

Our planned advertising business is currently mainly provided
through our contractual arrangements with our indirect affiliated entities in
China, including Companion Sino-net Technology Development (Beijing) Co., Ltd.
We hold a series of contractual arrangements with our PRC operating affiliates
and their respective subsidiaries and shareholders under which we are able to
exert effective control over our PRC operating affiliates and their respective
subsidiaries; a substantial portion of the economic benefits of our PRC
operating affiliates and their respective subsidiaries are transferred to us;
and we have an exclusive option to purchase all of the equity interests in our
PRC operating affiliates in each case when and to the extent permitted by PRC
law. See Corporate Structure and Related Party Transactions.

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Regulation of Advertising Services in China

The principal regulations governing advertising businesses in
China include: the Advertising Law (1994); the Advertising Administrative
Regulations (1987); and the Implementing Rules for the Advertising
Administrative Regulations (2004). These regulations stipulate that companies
that engage in advertising activities must obtain from the SAIC or its local
branches a business license which specifically includes within its scope the
operation of an advertising business. Companies conducting advertising
activities without such a license may be subject to penalties, including fines,
confiscation of advertising income and orders to cease advertising operations.
The business license of an advertising company is valid for the duration of its
existence, unless the license is suspended or revoked due to a violation of any
relevant law or regulation. We do not expect to encounter any difficulties in
maintaining our business licenses. Each of our variable interest entities, such
as Companion Sino-net Technology Development (Beijing) Co., Ltd., has obtained
or is in the process of obtaining such a business license from the local
branches of the SAIC as required by existing PRC regulations.

Advertisers, advertising operators and advertising distributors
are required by PRC advertising laws and regulations to ensure that the content
of the advertisements they prepare or distribute are true and in full compliance
with applicable law. In providing advertising services, advertising operators
and advertising distributors must review the prescribed supporting documents
provided by advertisers for advertisements and verify that the content of the
advertisements comply with applicable PRC laws and regulations. In addition,
prior to distributing advertisements for certain commodities which are subject
to government censorship and approval, advertising distributors are obligated to
ensure that such censorship has been performed and approval has been obtained.
Violation of these regulations may result in penalties, including fines,
confiscation of advertising income, orders to cease dissemination of the
advertisements and orders to publish an advertisement correcting the misleading
information. In circumstances involving serious violations, the SAIC or its
local branches may revoke violators licenses or permits for advertising
business operations. Furthermore, advertisers, advertising operators or
advertising distributors may be subject to civil liability if they infringe on
the legal rights and interests of third parties in the course of their
advertising business.

Regulations on Foreign Exchange in China

Foreign exchange regulation in China is primarily governed by
the following rules: the Foreign Currency Administration Rules (1996), as
amended, or the Exchange Rules; and the Administration Rules of the Settlement,
Sale and Payment of Foreign Exchange (1996), or the Administration Rules.

Under the Exchange Rules, the RMB is convertible for current
account items, including the distribution of dividends, interest payments, trade
and service-related foreign exchange transactions. Conversion of RMB for capital
account items, such as direct investment, loan, security investment and
repatriation of investment, however, is still subject to the approval of the
SAFE.

Under the Administration Rules, foreign-invested enterprises
may only buy, sell and/or remit foreign currencies at those banks authorized to
conduct foreign exchange business after providing valid commercial documents
and, in the case of capital account item transactions, obtaining approval from
the SAFE. Capital investments by foreign-invested enterprises outside of China
are also subject to limitations, including approval by the Ministry of Commerce,
the SAFE and the State Development and Reform Commission.

Regulations on Dividend Distribution in China

The principal regulations governing dividend distributions of
wholly foreign-owned companies include the Wholly Foreign-Owned Enterprise Law
(1986), as amended; and the Wholly Foreign-Owned Enterprise Law Implementing
Rules (1990), as amended. Under these regulations, wholly foreign-owned
companies in the PRC may pay dividends only out of their accumulated profits as
determined in accordance with PRC accounting standards. In addition, these
wholly foreign-owned companies are required to set aside at least 10% of their
respective accumulated profits each year, if any, to fund certain reserve funds,
until the accumulative amount of such fund reaches 50% of its registered
capital. At the discretion of these wholly foreign-owned companies, they may
allocate a portion of their after-tax profits based on PRC accounting
standards to staff welfare and bonus funds. These reserve funds and staff
welfare and bonus funds are not distributable as cash dividends.

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North American Regulation

Particular to Business in the United States

Over the past decade, federal and state governments have passed
advertising laws that protect consumer privacy and ensure fair and truthful
advertising practices online. The Federal Trade Commission Act allows the
Federal Trade Commission (the FTC) to act in the interest of all
consumers to prevent deceptive and unfair acts or practices. In interpreting
Section 5 of the Act, the Commission has determined that a representation,
omission or practice is deceptive if it is likely to mislead consumers and
affect consumers behavior or decisions about the product or service. In
addition, an act or practice is unfair if the injury it causes, or is likely to
cause, is substantial, not outweighed by other benefits and not reasonably
avoidable.

The FTC Act prohibits unfair or deceptive advertising in any
medium. That is, advertising must tell the truth and not mislead consumers. A
claim can be misleading if relevant information is left out or if the claim
implies something thats not true. Sellers are responsible for claims they make
about their products and services. Third parties - such as advertising agencies
also may be liable for making or disseminating deceptive representations if they
participate in the preparation or distribution of the advertising, or know about
the deceptive claims. Advertising agencies or website designers are responsible
for reviewing the information used to substantiate ad claims. They may not
simply rely on an advertisers assurance that the claims are substantiated. In
determining whether an ad agency should be held liable, the FTC looks at the
extent of the agencys participation in the preparation of the challenged ad,
and whether the agency knew or should have known that the ad included false or
deceptive claims.

Billboards are the most common example of commercial speech
that can be regulated at the local or state level. Additionally, many of the
newer out-of-home advertising methods, such as video displays, are also within a
city or states jurisdiction.

We currently do not operate any significant outdoor advertising
business, but may in the future do so with interactive outdoor window displays.
The outdoor advertising industry in the United States is subject to governmental
regulation at the federal, state and local levels. These regulations may
include, among others, restrictions on the construction, repair, maintenance,
lighting, upgrading, height, size, spacing and location of and, in some
instances, content of advertising copy being displayed on outdoor advertising
structures. In addition, the outdoor advertising industry outside of the United
States is subject to certain foreign governmental regulation.

Domestically, in recent years, outdoor advertising has become
the subject of targeted state and municipal taxes and fees. These laws may
affect prevailing competitive conditions in our markets in a variety of ways.
Such laws may reduce our expansion opportunities, or may increase or reduce
competitive pressure from other members of the outdoor advertising industry. No
assurance can be given that existing or future laws or regulations, and the
enforcement thereof, will not materially and adversely affect the outdoor
advertising industry. However, we contest laws and regulations that we believe
unlawfully restrict our constitutional or other legal rights and may adversely
impact the growth of our outdoor advertising business.

Federal law, principally the Highway Beautification Act of 1965
(the HBA), regulates outdoor advertising on Federal  Aid Primary,
Interstate and National Highway Systems roads. The HBA requires states to
effectively control outdoor advertising along these roads, and mandates a
state compliance program and state standards regarding size, spacing and
lighting. The HBA requires any state or political subdivision that compels the
removal of a lawful billboard along a Federal  Aid Primary or Interstate
highway to pay just compensation to the billboard owner.

All states have passed billboard control statutes and
regulations at least as restrictive as the federal requirements, including laws
requiring the removal of illegal signs at the owners expense (and without
compensation from the state). Although we believe that the number of our
billboards that may be subject to removal as illegal is immaterial, and no state
in which we operate has banned billboards entirely, from time to time
governments have required us to remove signs and billboards legally erected in accordance with
federal, state and local permit requirements and laws. Municipal and county
governments generally also have sign controls as part of their zoning laws and
building codes.

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Using federal funding for transportation enhancement programs,
state governments have purchased and removed billboards for beautification, and
may do so again in the future. Under the power of eminent domain, state or
municipal governments have laid claim to property and forced the removal of
billboards. Under a concept called amortization by which a governmental body
asserts that a billboard operator has earned compensation by continued operation
over time, local governments have attempted to force removal of legal but
nonconforming billboards (i.e., billboards that conformed with applicable zoning
regulations when built but which do not conform to current zoning regulations).
Although the legality of amortization is questionable, it has been upheld in
some instances. Often, municipal and county governments also have sign controls
as part of their zoning laws, with some local governments prohibiting
construction of new billboards or allowing new construction only to replace
existing structures.

We may introduce deployment of digital billboards that display
static digital advertising copy from various advertisers that change every 10 to
15 seconds. We have encountered some existing regulations that restrict or
prohibit these types of digital displays but it has not yet materially impacted
our digital deployment. Since digital billboards have only recently been
developed and introduced into the market on a large scale, however, existing
regulations that currently do not apply to them by their terms could be revised
to impose greater restrictions. These regulations may impose greater
restrictions on digital billboards due to alleged concerns over aesthetics or
driver safety.

In addition, due to their recent development, relatively few
large scale studies have been conducted regarding driver safety issues, if any,
related to digital billboards. The U.S. Department of Transportation Federal
Highway Administration is currently conducting a study on whether the presence
of digital billboards along roadways is associated with a reduction of driver
safety for the public. If the results of this study include adverse findings, it
may result in regulations at the federal or state level that impose greater
restrictions on digital billboards. For accounting purposes, the Share Exchange
was treated as a common control transaction at historical values in a manner
similar to the pooling of interests method since the chief executive officer and
controlling shareholder of our company is also the chief executive officer,
director and controlling shareholder of Qeyos Ad Systems Inc.

Plan of Operation

Our business model is predicated upon establishing
Micro-broadcast networks for large chain retailers and institutions that sponsor
their networks by paying for the cost of connectivity and/or paying for or
leasing hardware, systems, and customized software development comprising such
network. As such we require working capital to fund maintenance of a sufficient
amount of inventories of hardware comprising our interactive kiosks and digital
screens that are largely produced on a just in time basis, depending on the
scope and size of our future Micro-broadcast network deployments. Our practice
is to require advance deposits of up to fifty percent (50%) of purchase orders
received from Micro-broadcast sponsors.

Additional financing will be required. We have not generated
any revenues from our planned operations to date. As of December 31, 2010, we
had accumulated $1,141,243 in losses since inception. We require approximately
$2,000,000 per year to maintain operations at their current level, to fund the
costs attributed to wages, rents, general and administrative expenses.

|C. | Organizational
Structure
|-- | ------------------------

On July 7, 2009, we merged with and into our wholly-owned
subsidiary, Tuscany Minerals Ltd., a Wyoming company, with the surviving company
being Tuscany Minerals Ltd., the Wyoming company. As a result of this
transaction, we re-domiciled from the State of Washington to the State of
Wyoming. Our bylaws were amended in accordance with the Wyoming Business
Corporation Act. A majority of our shareholders approved the merger at our
annual and special meeting held on July 2, 2009.

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Upon the completion of the merger of our company with and into
our Wyoming subsidiary, we filed an application for continuance with the
Registrar of Companies of the Cayman Islands on July 28, 2009 and received a
certificate of registration by way of continuation from the Registrar, dated
July 28, 2009, on July 29, 2009. In accordance with the resolutions of our
shareholders at the meeting held on July 2, 2009, a new memorandum of
association and articles of association were adopted in substitution of our
existing constating documents, effective July 28, 2009, as a result of the
issuance of the certificate of registration. As a result of the continuation,
our company became a foreign private issuer as defined in Rule 3b-4(c)
promulgated under the Securities Exchange Act of 1934.

On January 28, 2011, we completed the acquisition of Qeyos and,
as a result, Qeyos is now a wholly-owned subsidiary of our company.

The following chart shows our current corporate structure:



|D. | Property, Plant and
  Equipment
|-- | -------------------------------

Our principal executive offices and operating headquarters are
located in Burnaby, British Columbia, where we lease approximately 3,000 square
meters of office and warehouse space. Our branch offices lease approximately 908
square meters of office space in three other locations, including Vancouver,
British Columbia and Beijing, Shenzhen and Wuxi, China.

|ITEM 4A | Unresolved Staff Comments
|------- | -------------------------

Not applicable.

|ITEM 5 | Operating and Financial Review and
      Prospects
|------ | --------------------------------------------------

The information in this section is presented in accordance with
United States generally accepted accounting principles.

|A. | Operating Results
|-- | -----------------

The following summary should be read in conjunction with our
audited financial statements for the years ended December 31, 2010, 2009 and
2008, which are included in this annual report on Form 20-F.

Year Ended December 31,
      2010 (audited)
    Year Ended December 31,
      2009 (audited)
    Year Ended December 31,
      2008 (audited)ExpensesFiling and stock transfer fees
    $
    838
    $                              8,088
    2,801Interest
    
    19,097
    34,311
    31,045Management fees
    
    78,903
    55,657
    15,287Office and sundry
    
    13,452
    3,968
    645


39

---

Year Ended December 31,
      2010 (audited)
    Year Ended December 31,
      2009 (audited)
    Year Ended December 31,
      2008 (audited)Professional fees
    
    75,726
    106,444
    54,634Loss on debt settlement foreign exchange
    
    -
    18,456
    -Total expenses
    
    188,016
    226,924
    104,412Net Loss
    
    (188,016 )
    (226,924 )
    (104,412 )


Revenue

We are a development stage company and have not generated any
revenues from our business operations since inception. Our company does not
currently own any property interests.

Expenses

Year Ended December 31, 2010 Compared to Year Ended December
31, 2009

Our operating expenses for the year ended December 31, 2010
were $188,016 compared to $226,924 for the year ended December 31, 2009. This
decrease in operating expenses of $38,908 was primarily due to decreases in
filing and stock transfer fees, interest, loss on debt settlement foreign
exchange and professional fees. Our company also incurred a $23,246 increase in
management fees and a $9,484 increase in office and sundry.

Year Ended December 31, 2009 Compared to Year Ended December
31, 2008

Our operating expenses for the year ended December 31, 2009
were $226,924 compared to $104,412 for the year ended December 31, 2008. This
increase in operating expenses of $122,512 was primarily due to increases in
filing and stock transfer fees, management fees and loss on debt settlement
foreign exchange. Our company also incurred a $51,810 increase in professional
fees which consisted mostly of legal fees incurred in connection with our
companys compliance with securities laws.

B.         
 Liquidity and Capital Resources

Our financial position as at December 31, 2010 and December 31,
2009 and the changes for the years then ended are as follows:

Working Capital

As at December 31, 2010
      (audited)
    As at December 31, 2009
      (audited)Current Assets
    $ 700,996
    $ 1,433Current Liabilities
    439,471
    297,030Working Capital (Deficiency)
    $ 261,525
    $ (295,597)


Our working capital deficiency decreased from ($295,597) at
December 31, 2009 to $261,525 at December 31, 2010 as a result of an increase in
cash, long-term investments, notes and accrued interest payable and promissory
note and accrued interest payable and a decrease in accounts payable. Subsequent
to the year ended December 31, 2010, we completed a private placement of
10,000,000 common shares at a price of $0.20 per share for aggregate gross
proceeds of $2,000,000 and the issuance of 637,140 common shares at a deemed
price of $0.20 per share in settlement of US$127,428 debt outstanding.

40

---

Cash Flows

Year Ended December 31,
      2010 (audited)
    Year Ended December 31,
      2009 (audited)
    Year Ended December 31,
      2008 (audited)Net cash used in Operating Activities
    $ (157,525)
    $ (166,466)
    $ (56,022)Net cash provided in Financing Activities
    1,496,950
    167,240
    55,447Net cash provided in Investment Activities
    $ (639,862)
    $ -
    $ -Increase (decrease) in Cash during the Year
    $ 699,563
    $ 774
    $ (575)Cash, Beginning of Year
    1,433
    659
    1,234Cash, End of Year
    $
      700,996
    $
      1,433
    $ 659


Operating activities used cash of $157,525 during the year
ended December 31, 2010 as compared to $166,466 during the year ended December
31, 2009. The decrease was primarily due to decreased filing and stock transfer
fees, interest fees and professional fees.

During the year ended December 31, 2010, our net cash used in
investing activities increased over the period ended December 31, 2009 due to
intercorporate loans made to Qeyos Ad Systems Inc., now a wholly-owned
subsidiary of the company. Net cash received from financing activities increased
over the prior period ended December 31, 2009 due to funds received from private
placement subscriptions for 6,925,000 common shares of our company issued at a
price of $0.20 per share.

Anticipated Cash Requirements

We anticipate that we will incur the following expenses over
the next twelve months:

|1. | $100,000 in connection with locating, evaluating and
      negotiating potential business opportunities;                                                        
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                 
|2. | $1,900,000 for operating expenses; and                                                                                                                          
|   |                                                                                                                                                                 
|3. | $63,000 for management, advisory and administrative costs
      payable pursuant to the terms of the consulting agreement with CHM
      Financial Services Inc.

We require a minimum of approximately $2,000,000 to proceed
with our plan of operation over the next twelve months, exclusive of any
acquisition or development costs. This amount may also increase if we are
required to carry out due diligence investigations in regards to any prospective
investment or business opportunity or if the costs of negotiating the applicable
transaction are greater than anticipated. We have sufficient working capital to
enable us to carry out our stated plan of expanding operation over the next
twelve months. In addition, we plan to complete private placement sales of our
common stock in order to raise the funds necessary to pursue our plan of
operation and to fund our working capital deficit in order to enable us to carry
out expansion of our operation. We are currently in negotiation for the
completion of a further $500,000 in private placement financings but there is no
assurance that we will be successful in completing any private placement
financings.

41

---

There can be no assurance that additional financing will be
available when needed or, if available, on commercially reasonable terms. If we
are not able to obtain additional financing on a timely basis, we may not be
able to meet our expansion plans.

Going Concern

Due to the uncertainty of our ability to meet our current
operating and capital expenses, in their report on the annual financial
statements for the year ended December 31, 2010, our independent auditors
included an explanatory paragraph regarding concerns about our ability to
continue as a going concern.

There is substantial doubt about our ability to continue as a
going concern as the continuation of our business is dependent upon our company
locating and acquiring a business opportunity, and achieving a profitable level
of operation. The issuance of additional equity securities by us could result in
a significant dilution in the equity interests of our current shareholders.
Obtaining commercial loans, assuming those loans would be available, will
increase our liabilities and future cash commitments.

|C. | Research and Development, Patents and Licenses
      etc.
|-- | ---------------------------------------------------------

We do not currently, and did not previously, have research and
development policies in place. Over the past three fiscal years, no funds were
expended by our company on research and development activities.

|D. | Trend Information
|-- | -----------------

As we have just implemented a new business plan, we do not
currently know of any trends that would be material to our operations.

|E. | Off-Balance Sheet
  Arrangements
|-- | --------------------------------

We do not have any off-balance sheet arrangements that have or
are reasonably likely to have a current or future effect on our financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital resources that are
material to investors.

|F. | Contractual
Obligations
|-- | -----------------------

We do not have any contractual obligations.

|G. | Safe Harbor
|-- | -----------

Not applicable.

|ITEM 6 | Directors, Senior Management and Employees
|------ | ------------------------------------------

|A. | Directors and Senior
  Management
|-- | ---------------------------------

All directors of our company hold office until the next annual
meeting of our shareholders and until such directors successor is elected and
has been qualified, or until such directors earlier death, resignation or
removal. The following table sets forth the names, positions and ages of our
executive officers and directors. Our board of directors elects officers and
their terms of office are at the discretion of our board of directors.

Name
    Position Held
    Age
    Date First Elected orAppointedRoss J. Tocher
    President, Chief Executive Officer and
      Director
    49
    September 10, 2008, January 28, 2011
      (1)Barb Welsh
    Director
    58
    January 28, 2011


42

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Brian Petersen
    Director
    44
    January 28, 2011Kevin R. Kortje
    Chief Financial Officer
    53
    January 28, 2011Gregory G. Dureault
    Senior Vice President and General Counsel
    50
    January 28, 2011Alan Husejnagic
    Vice President of Operations
    35
    January 28, 2011Steve Owst
    Vice President of Sales
    50
    January 28, 2011Scott Lupien
    Vice President of Asian Operations
    44
    January 28, 2011


|(1) | Mr. Tocher has served as our president and chief
      executive officer since September 10, 2008. He has served as a director
      since January 28, 2011.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------

Ross J. Tocher

Mr. Tocher has held the positions of President and Chief
Executive Officer since he was appointed on September 10, 2008. Mr. Tocher has
over 30 years of experience managing investment strategies for a variety of
family holding companies with interests in different industries. He was one of
the founders of British Columbia based Pan-Canadian Mortgage Group Inc.,
specializing in commercial mortgage investment, and a co-founder of British
Columbia based Gateway Casinos Ltd. Mr. Tocher was a trustee of the Gateway
Casino Income Fund, Gateway Trust and director of Gateway G.P. Prior to January
2001, he was the President of Marsonn Packaging Ltd., a company specializing in
the repackaging of foods. He co-founded Brew King Ltd., a British Columbia
company, and manufacturer of commercial and consumer wine-making concentrates
that achieved worldwide sales as the largest non-commercial wine producer in
North America before being sold, in 1997, to Andres Wines Ltd. Previously, Mr.
Tocher was also a senior executive with the Tocher family business. Since 1998,
he has gained experience as a director of several private equity companies,
including British Columbia based Trian Equities Ltd., and he has been the
President of Knight Ventures, Ltd., an investment company.

Barb Welsh

Ms. Welsh is the President and founder of Welsh Sales Solutions
Ltd., which she founded in 2002. Ms. Welsh has a marketing background and was
successful radio sales person in Canada for over 25 years. From 1971-78 she rose
to the top as Senior Account Manager at The Pattison Group, and from 1978-87 as
Senior Account Manager at The Rogers Group. Ms. Welsh achieved top sales person
at Western International Communications Ltd. (WIC) (now Corus Entertainment
Inc.) during 1987-2002 where she sold advertising for CKNW, CFMI (Rock101),
CFOX, and CKLG along with selling the play by play for the Vancouver Canucks, BC
Lions, and the Vancouver Grizzlies. After selling traditional media for her
entire career Ms. Welsh decided to venture into new media and founded Welsh
Sales Solutions Ltd., which focuses on new media and the out-of-home video
industry. Welsh Sales Solutions Ltd. has become a leader in its emerging
industry and the companys main focus is to provide revenue for video screens
and has had exclusive contracts for many of the most successful out-of-home
video networks in Canada and the US.

Brian Petersen

Brian spent 16 years with RBC Capital Markets in Toronto,
Calgary and Houston where he was involved in all facets of the financing
industry gaining significant experience in initial public offerings, public and
private equity, public and private debt, trust unit financings and merger &
acquisition transactions. Brian has advised on over $20 billion of M&A
assignments and nearly $20 billion of equity and fixed income financings,
including over $6 billion of income trust IPOs in Canada and the US.

Brian joined RBC Capital Markets in 1989 after completing a
Bachelor of Commerce in Finance at the University of British Columbia. Brian
Petersen was responsible for the Income Trust Group which works with all
industry groups in the origination and execution of equity and merger and
acquisitions (M&A) mandates in the Income Trust and Royalty Trust sector.
The group also provided coverage support for accounts in the income trust
sector. Clients included Pengrowth Energy Trust, Bell Nordiq Income Fund,
Keyspan Facilities Income Fund and NAL Oil and Gas Trust. Brian is a member of
RBC Capital Markets New Names Committee. Brian has had extensive experience
in investment banking with RBC Capital Markets in Calgary from
1991 to 1999 and in Houston from 1999 to 2002. He has provided advice to
corporations in Canada and the U.S. regarding M&A assignments, debt and
equity financing, including an integral role in the Income Trust sector where he
has been involved in over $11 billion of equity offerings since 1993. He has
been active in the structuring and marketing of many IPOs in the sector.
Between 2005 and 2010 Brian Petersen provided his investment banking expertise
to Torontos Sprott Securities Inc. and he founded and sold to Versant Partners
Inc. his interests in a Calgary-based boutique banking firm Petersen Capital
Corp.

43

---

At the beginning of 2011, Brian is the recently announced
Managing Director - Head of Energy for the investment banking team at Toronto
based Stonecap Securities Inc. He is a Chartered Financial Analyst and a member
of the Association for Investment Management and Research. He is also a board
member of the Canadian Association of Income Funds (CAIF).

Kevin Kortje

Mr. Kortje was appointed as our chief financial officer on
January 28, 2011. Mr. Kortje is a Chartered Accountant with over 25 years
accounting, taxation and software development experience. As an entrepreneur, he
has been involved in the development of many unique software applications in
sports, gaming, lotteries, accounting, payroll, stock market analysis,
securities portfolio management, financial services and enterprise management.
He has extensive experience with electronic payment processing technologies, and
has recently been successful in pioneering the launch of a payroll cash card
program as an alternative to paper cheque payments for employees of businesses
in the temporary labor industry. Since 2002, Mr. Kortje has been the President
and founder of Middle Earth Technologies Ltd.

Gregory G. Dureault

Mr. Dureault holds Bachelors Degrees in Economics and Law from
the University of Saskatchewan earned in 1984 and has been a Member of the law
Society of British Columbia since June 14, 1985. Mr. Dureault has experience as
an international corporate and North American securities lawyer. In addition to
his legal experience, Mr. Dureault was founder and president of IBC Investments
Limited from 1995 to 2001 with former Canadian federal finance Minister the
Honorable Mr. Otto Jelinek, who was a co-director of IBC Investments Limited
between 1995 and 2000 based out of Prague, Czech Republic. IBC was involved in
the business of acquiring and licensing certain U.S. Patents, each entitled
Methods and Apparatus For Playing Bingo Over A Wide Geographic
Areaand registered in the U.S. including No. 5,351,970
issued October 24, 1994, No. 5,569,083 issued October 29, 1996, and No.
5,857,911 issued January 12, 1999, and developing tracking software and related
technology underlying such patented know-how that was offered to the government
lottery industry. At IBC Investments, Mr. Dureault gained experience in the
deployment of television lottery game show content and pattern recognition
lottery technologies, Web content and point of sales delivery programs over
closed intranet systems that are similar to those offered by the interactive
technologies of the Company.

Alan Husejnagic

Mr. Husejnagic is an accomplished professional in the fields of
Broadcasting, Marketing and Management. His primary role with the Company is to
implement operational strategies for deployment of interactive Kiosks, portable
marketing, content production and media distribution. In 2007-08 Mr. Husejnagic
specialized in television production as an executive producer of a weekly sports
series on The Score Television Network. From 2001-present, Mr. Husejnagic
co-founded a number of successful E-commerce ventures, most notably Vancouver
Media Group Inc., an agency for advanced digital marketing applications. Mr.
Husejnagic holds BSc. Degrees in Chemistry and Psychology from University of
British Columbia (1998). He joined Qeyos Ad Systems Inc. as Chief Operating
Officer at inception in January 2009.

Steve Owst

Mr. Owst holds a U.K. Royal Air Force Bachelors degree in
Aerospace Engineering, and has since become a leader in the creation and support
of innovative interactive TV applications for Cable Operators across North
America. Mr. Owst has over 25 years experience in the high-technology and
telecom sectors. From January 2005 to December 2006 he was employed as a Senior
Manager with Telus Corporation, one of Canadas largest telecom companies. From
May 2003 to January 2005 he was the Chief Technical Officer (CTO) of Alternet
Systems Inc. From January 2000 to May 2003 he was employed as an account manager
for Nokia, Canada. He joined Qeyos Ad Systems Inc. as Chief Technology Officer
at inception in January 2009.

44

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Scott Lupien

Our Vice President of Asian operations in Beijing has been CEO
of Companion Sino-net Technology Development (Beijing) Co., Ltd. since 2008 and
has eight years of business experience in Asia, six of which are in China. He
reads and writes Chinese fluently and brings 15 years of executive leadership to
the company. Mr. Lupien has an Economics degree from U.C. Berkeley and spent 14
years running sales and business development for investment information
companies in the U.S.A.

Mr. Lupien was a founder of SAM Group International. His
background is in security markets, sales of financial services and in real
estate development and investing. He moved to Beijing in April 2004 to develop
senior housing projects and formed Silver Age International Ltd. in 2005 for
this purpose, which has developed one facility in Xiao Tang Shan, Beijing. In
addition to forming SAM Group, Mr. Lupien has formed an international trading
company, Cazador Internacional Ltd., which specializes in exporting building
materials to the States.

Starting as a stock broker for MJT, Inc. in 1991, Mr. Lupien
moved into sales of information services for Bridge Information Systems, Inc. He
later became VP of West Coast Sales for OptiMark Technologies, Inc., which sold
securities trading technology to financial institutions, and VP of Business
Development for Risk Management Solutions, Inc., which sold trading and risk
management systems to energy trading firms. Since 2000 Mr. Lupien has been an
investor and developer of real estate in the western United States. He holds a
bachelors degree in Economics from The University of California at Berkeley and
speaks Mandarin, Spanish, Korean and English.

Relationships

There are no family relationships between any of the directors
or executive officers of our company.

There are no arrangements or understandings between any of the
directors and/or executive officers and any other person pursuant to which that
director and/or executive officer was selected.

|B. | Compensation
|-- | ------------

Executive Compensation

The following table sets forth all compensation received during
the two years ended December 31, 2010 and December 31, 2009 by our chief
executive officer, chief financial officer and each of the other most highly
compensated executive officers whose total compensation exceeded $100,000 in
such fiscal year.

SUMMARY
      COMPENSATION TABLENameand Principal Position
    Year
    Salary($)
    Bonus($)
    StockAwards($)
    OptionAwards($)
    Non-EquityIncentive PlanCompensation($)
    Change inPensionValue andNonqualifiedDeferredCompensationEarnings($)
    AllOtherCompensation($)
    Total($)J. Stephen BarleySecretary,
      Treasurer and Director(1)(2)
    2010 2009
    Nil Nil
    Nil Nil
    Nil Nil
    Nil Nil
    Nil Nil
    Nil Nil
    $63,885(4)55,287(4)
    $63,885(4)55,287(4)


45

---

Ross J. Tocher President and Chief
      Executive Officer and Director (3)
    2010 2009
    Nil Nil
    Nil Nil
    Nil Nil
    Nil Nil
    Nil Nil
    Nil Nil
    Nil Nil
    Nil NilKevin Kortje Chief Financial
      Officer(5)
    2010 2009
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/ABarb Welsh Director(6)
    2010 2009
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/ABrian Petersen
      Director(6)
    2010 2009
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/AGregory G. Dureault Senior Vice
      President and General Counsel(6)
    2010 2009
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/AAlan Husejnagic Vice President of
      Operations(6)
    2010 2009
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/ASteve Owst Vice President of
      Sales(6)
    2010 2009
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/AScott Lupien Vice President of
      Asian Operations(6)
    2010 2009
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A
    N/A N/A


|(1) | Mr. Barley was appointed president, chief executive
      officer, chief financial officer, secretary, treasurer and director of our
      company on October 5, 2000. He resigned as president and chief executive
      officer on September 10, 2008 and as chief financial officer on January
      28, 2011. Mr. Barley resigned as the Secretary, Treasurer and a director
      of our company on March 31, 2011.                                                                                                                                                     
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(2) | Compensation attributable to Mr. Barley is paid pursuant
      to a management agreement dated December 1, 2000, between our company and
      CHM Consulting Inc., a company wholly-owned by J. Stephen Barley. This
      agreement was terminated and superseded by a new consulting agreement
      dated November 1, 2008 with CHM Financial Services Inc. CHM Consulting
      Inc. received monthly payments of $750 pursuant to the former agreement
      and CHM Financial Services Inc. receives $5,600 (CDN$5,600) per month
      pursuant to the new agreement.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(3) | Mr. Tocher was appointed as our president and chief
      executive officer effective September 10, 2008.                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(4) | Representing consulting fees of $5,600 (CDN$5,600 per
      month, payable in Canadian dollars, to CHM Financial Services Inc., a
      company wholly-owned by Mr. Barley.                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(5) | Mr. Kortje was appointed as our chief financial officer
      effective January 28, 2011.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(6) | Ms. Welsh and Mr. Petersen were appointed as directors
      and Mr. Dureault, Mr. Husejnagic, Mr. Owst and Mr. Lupien were appointed
      officers each effective January 28, 2011.                                                                                                                                                                                                                                                                                                                                                                                        

Compensation Discussion and Analysis

There are no arrangements or plans in which we provide pension,
retirement or similar benefits for directors or executive officers. Our
directors and executive officers may receive stock options at the discretion of
our board of directors in the future. We do not have any material bonus or
profit sharing plans pursuant to which cash or non-cash compensation is or may
be paid to our directors or executive officers, except that stock options may be
granted at the discretion of our board of directors from time to time. We have
no plans or arrangements in respect of remuneration received or that may be
received by our executive officers to compensate such officers in the event of
termination of employment (as a result of resignation, retirement, change of
control) or a change of responsibilities following a change of control.

The services of J. Stephen Barley, a former director and
executive officer, were provided to us pursuant to a consulting agreement dated
November 1, 2008 with CHM Financial Services Inc. which replaced the former
agreement dated December 1, 2000 with CHM Consulting Inc., both companies being
wholly-owned by Mr. Barley. Pursuant to the consulting agreement, our company
pays CHM Financial Services Inc. a management fee of $5,600 (CDN$5,600) per
month, payable in Canadian dollars. The fee to CHM Consulting Inc. was $750 per
month under the former agreement. The agreement with CHM Consulting Inc.
terminated on February 28, 2011.

46

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Our compensation program for our executive officers is
administered and reviewed by our board of directors which acts as a compensation
committee. Historically, executive compensation consists of a combination of
base salary and bonuses. Individual compensation levels are designed to reflect
individual responsibilities, performance and experience, as well as the
performance of our company. The determination of discretionary bonuses is based
on various factors, including implementation of our business plan, acquisition
of assets, and development of corporate opportunities and completion of
financing.

Directors of our company may be paid for their expenses
incurred in attending each meeting of the directors. In addition to expenses,
directors may be paid a sum for attending each meeting of the directors or may
receive a stated salary as director. No payment precludes any director from
serving our company in any other capacity and being compensated for such
service. Members of special or standing committees may be allowed similar
reimbursement and compensation for attending committee meetings. During the year
ended December 31, 2010, we did not pay any compensation or grant any stock
options to our directors and officers.

Grants of Plan-Based Awards

There were no grants of plan-based awards made to our executive
officers during the year ended December 31, 2010.

Outstanding Equity Awards at Fiscal Year-End

As at December 31, 2010, there were no unexercised options,
stock that had not vested or equity incentive plan awards held by our executive
officers.

Option Exercises and Stock Vested

As of the end of our fiscal year ended December 31, 2010, we
had no form of an incentive stock option plan.

New Long-Term Incentive Plan

Our company did not have a prior long-term incentive plan in
favor of any director, officer, consultant or employee of our company. In
connection with the completion of the acquisition of Qeyos, on January 28, 2011,
our board of directors adopted the 2011 Stock Option Plan (the Plan),
providing for the issuance of up to 6,620,230 shares of our common stock to the
officers, directors, employees and consultants of our company and our
subsidiaries. Pursuant to the Plan, the Company granted options to purchase an
aggregate of 2,400,000 shares of common stock at $0.20 per share to our newly
appointed directors and officers that held options to purchase ordinary shares
of Qeyos.

The principal terms and conditions of the stock options granted
under the Plan are that vesting of the options will occur in three stages: (1)
50% on the date of grant; (2) 25% on January 1, 2012; and (3) 25% on January 1,
2013. The options granted are exercisable at $0.20 per share. Furthermore, the
stock options granted under the Plan are generally non transferable other than
to a legal or beneficial holder of the options upon the option holders death.
The rights to vested but unexercised options cease to be effective on the
earlier of: (1) 18 months after death of the stock options holder; (2) 6 months
after a change of control of our company; (3) 12 months after loss of office due
to health related incapacity or redundancy; or (4) 12 months after the
retirement of the options holder from a position with us.

The following table sets out particulars of stock options we
have granted as of April 29, 2011:

Name
    Stock Options Granted
    Exercise Price
    Expiry DateRoss J. Tocher Director and Chief Executive
      Officer
    300,000
    $0.20
    December 29, 2015Barb Welsh Director
    300,000
    $0.20
    December 29, 2015


47

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Brian Petersen Director
    300,000
    $0.20
    December 29, 2015Kevin R. Kortje Chief Financial Officer
    300,000
    $0.20
    December 29, 2015Gregory G. Dureault Senior Vice President and
      General Counsel
    300,000
    $0.20
    December 29, 2015Alan Husejnagic Vice President of Operations
    300,000
    $0.20
    December 29, 2015Steve Owst Vice President of Sales
    200,000
    $0.20
    December 29, 2015Scott Lupien Vice President of Asian Operations
    400,000
    $0.20
    December 29, 2015


Pension and Retirement Plans

Currently, we do not offer any annuity, pension or retirement
benefits to be paid to any of our officers, directors or employees, in the event
of retirement.

|C. | Board Practices
|-- | ---------------

Our directors are re-elected and our officers are re-appointed
at the annual general meeting of our shareholders. The last annual general
meeting was held on July 2, 2009 and each of our current directors and officers
will continue to hold his respective office until his successor is elected or
appointed, unless his office is earlier vacated under any of the relevant
provisions of our Articles or of the Cayman Islands Companies Law
(Revised) statute.

There are no service contracts between our company and any of
our officers, directors or employees providing for benefits upon termination of
employment.

As of the date of this annual company report, our entire board
functions as our audit committee. The audit committee reviews and approves the
scope of the audit procedures employed by our independent auditors, reviews the
results of the auditors examination, the scope of audits. The audit committee
also recommends the selection of independent auditors.

This annual company report does not include an attestation
report of our companys independent registered public accounting firm regarding
internal control over financial reporting. Managements report was not subject
to attestation by our companys independent registered public accounting firm
pursuant to temporary rules of the SEC that permit our company to provide only
managements report in this annual company report.

|D. | Employees
|-- | ---------

Our company is currently operated by Ross Tocher as our
president and chief executive officer and Kevin Kortje as our chief financial
officer. We anticipate that we will be conducting most of our business through
agreements with consultants and third parties. Neither of Messrs. Tocher or
Kortje has an employment agreement with us.

|E. | Share Ownership
|-- | ---------------

As of April 29, 2011, there were 66,739,541 common shares of
our company issued and outstanding. Of the shares issued and outstanding on that
date, our directors and officers owned the following common shares:

Name and Address of
      Beneficial Owner
    Position Held With the
      Company
    Amount and Nature of
      Beneficial Ownership
    Percentage of
      Class(1)Ross J. Tocher 780-333 Seymour Street
    President and Chief Executive Officer
    30,325,135(2)
    45.44%


48

---

Vancouver, BC V6B 5A6Kevin Kortje 780-333 Seymour Street Vancouver, BC
      V6B 5A6
    Chief Financial Officer
    300,000(3)
    0.45%Barb Welsh 780-333 Seymour Street Vancouver, BC V6B
      5A6
    Director
    300,000(3)
    0.45%Brian Petersen 780-333 Seymour Street Vancouver, BC
      V6B 5A6
    Director
    300,000(3)
    0.45%Gregory G. Dureault 780-333 Seymour Street
      Vancouver, BC V6B 5A6
    Senior Vice President and General
      Counsel
    300,000(3)
    0.45%Alan Husejnagic 780-333 Seymour Street Vancouver,
      BC V6B 5A6
    Vice President of Operations
    300,000(3)
    0.45%Steve Owst 780-333 Seymour Street Vancouver, BC V6B
      5A6
    Vice President of Sales
    200,000(4)
    0.30%Scott Lupien 780-333 Seymour Street Vancouver, BC
      V6B 5A6
    Vice President of Asian Operations
    400,000(5)
    0.60%Directors and Executive Officers as a Group
      (five persons)
    
    32,425,135(6)
    48.59%


|(1) | Percentage based on 66,739,541 shares of common stock
      outstanding on April 29, 2011.                                                                                                                                                                                                                                                                                                                                                                                                                                              
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Includes 6,171,021 shares of common stock held by R J
      Tocher Holdings Ltd., a private company wholly owned by Ross J. Tocher,
      15,594,628 shares of common stock held by Concept Financial Inc., a
      private company wholly owned by Ross J. Tocher, and 8,259,486 shares of
      common stock held by In Touch Digital Media, a private company wholly
      owned by Ross J. Tocher. Also includes options to acquire 300,000 common
      shares at an exercise price of $0.20 per share until December 29,
    2015.
|(3) | Includes options to acquire 300,000 common shares at an
      exercise price of $0.20 per share until December 29, 2015.                                                                                                                                                                                                                                                                                                                                                                                                                
|(4) | Includes options to acquire 200,000 common shares at an
      exercise price of $0.20 per share until December 29, 2015.                                                                                                                                                                                                                                                                                                                                                                                                                
|(5) | Includes options to acquire 400,000 common shares at an
      exercise price of $0.20 per share until December 29, 2015.                                                                                                                                                                                                                                                                                                                                                                                                                
|(6) | Includes options to acquire 2,100,000 common shares at an
      exercise price of $0.20 per share until December 29,
  2015.                                                                                                                                                                                                                                                                                                                                                                                                            

|ITEM 7 | Major Shareholders and Related Party
      Transactions
|------ | -------------------------------------------------------

|A. | Major Shareholders
|-- | ------------------

As of April 29, 2011, there were 66,739,541 common shares of
our company issued and outstanding. The following table sets forth persons known
to us to be the beneficial owner of more than five (5%) of our common shares as
of April 29, 2011:

Name
    Number of Common
      Shares Beneficially Owned
    Percentage(1)Ross J. Tocher(2)780-333 Seymour Street
      Vancouver, BC V6B 5A6
    30,325,135
    45.44%


| | (1) | Based on 66,739,541 shares of common stock issued and
      outstanding as of April 29, 2011. Beneficial ownership is determined in
      accordance with the rules of the SEC and generally includes voting or
      investment power with respect to securities. Except as otherwise
      indicated, we believe that the beneficial owners of the common stock
      listed above, based on information furnished by such owners, have sole
      investment and voting power with respect to such shares, subject to
  community property laws where applicable.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

49

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| | (2) | Includes 6,171,021 shares of common stock held by R J
      Tocher Holdings Ltd., a private company wholly owned by Ross J. Tocher,
      15,594,628 shares of common stock held by Concept Financial Inc., a
      private company wholly owned by Ross J. Tocher, and 8,259,486 shares of
      common stock held by In Touch Digital Media, a private company wholly
      owned by Ross J. Tocher. Also includes options to acquire 300,000 common
      shares at an exercise price of $0.20 per share until December 29,
    2015.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The voting rights of our major shareholder do not differ from
the voting rights of holders of our companys shares who are not major
shareholders.

As of April 29, 2011, our 66,739,541 issued and outstanding
common shares are held as follows:

Location
    Number of Shares
    Percentage of
      Shares
    Number of Registered
      Shareholders of RecordCanada
    27,296,166
    40.90%
    134Bahamas*
    600,000
    0.90%
    1Barbados
    8,259,486
    12.38%
    1Belize
    28,085,679
    42.08%
    6United States
    2,498,210
    3.74%
    1Total
    66,739,541
    100%
    143


* Less than 1%.

There are no arrangements known to us, the operation of which
may at a subsequent date result in a change in the control of our company.

|B. | Related Party
Transactions
|-- | --------------------------

For the period beginning on January 1, 2007 until the present,
we carried out a number of transactions with related parties in the normal
course of business. These transactions were recorded at their exchange amount,
which is the amount of consideration established and agreed to by the related
parties.

The following are related party transactions and amounts owing
that are not otherwise disclosed elsewhere:

| | a) | We paid a management fee of $63,885 (2009: $55,287; 2008:
      $15,287) to a company controlled by a director for the year ended December
      31, 2010. The management services were on a month to month basis at $750
      per month until September 30, 2008. On November 1, 2008, we entered into
      an agreement with the same party in which we agreed to pay $5,000 plus
      applicable sales tax in Canadian dollars, per month for management
      services on a month to month basis.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | b) | As of December 31, 2010, accounts payable of $120 (2009:
      $295) was owing to a director of our company and $Nil (2009: $10,037) was
      owing to a company controlled by the same director.                                                                                                                                                                                                                                                                                                      
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | c) | As of December 31, 2010, accounts payable of $5,209
      (2009: $Nil) was owing to a company controlled by an officer of our
      company.                                                                                                                                                                                                                                                                                                                                                            
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | d) | Interest expensed by the Company relating to notes
      payable due to a company with a common director amounted to $Nil (2009:
      $5,327; 2008: $6,868) for the year ended December 31, 2010.                                                                                                                                                                                                                                                                                                      
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | e) | Interest expensed by the Company relating to notes
      payable due to a company with a common officer amounted to $158 (2009:
      $6,100; 2008: $304) for the year ended December 31, 2010.                                                                                                                                                                                                                                                                                                         
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | f) | On September 30, 2009, we entered into debt settlement
      agreements with holders of promissory notes and an assignment of debt
      pursuant to which 21,287,895 shares of our common stock were issued to
      companies with a common officer to settle debt totaling
  $319,318.                                                                                                                                                                                                               

These transactions were in the normal course of operations.

50

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|ITEM 8 | Financial Information
|------ | ---------------------

|A. | Financial Statements and Other Financial
      Information
|-- | ----------------------------------------------------------

Our financial statements are stated in U.S. dollars and are
prepared in accordance with US GAAP. Financial statements included with this
annual company report are listed below:

Audited Annual Financial Statements for Qwick Media Inc. as
at December 31, 2010 and 2009, and for the fiscal years ended December 31, 2010,
2009 and 2008:

| | (a) | Independent Auditors Report of Morgan & Company
      dated May 2, 2011 on the Financial Statements as at December 31, 2010,
      2009 and 2008;                     
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                        
| | (b) | Balance Sheets at December 31, 2010 and 2009;                                                                                                                          
| |     |                                                                                                                                                                        
| | (c) | Statements of Operations for the years ended December 31,
      2010, 2009 and 2008, and for the period October 5, 2000 (Date of
      Inception) to December 31, 2010;
| |     |                                                                                                                                                                        
| | (d) | Statements of Cash Flows for the years ended December 31,
      2010, 2009 and 2008, and for the period October 5, 2000 (Date of
      Inception) to December 31, 2010;
| |     |                                                                                                                                                                        
| | (e) | Statement of Shareholders Equity (Deficiency) from
      October 5, 2000 (Date of Inception) to December 31, 2010; and                                                
| |     |                                                                                                                                                                        
| | (f) | Notes to Financial Statements.                                                                                                                                         

Legal Proceedings

There are no pending legal proceedings to which we are a party
or of which any of our property is the subject. There are no legal proceedings
to which any director, officer or affiliate of our company or any associate of
any such director, officer or affiliate of our company is a party or has a
material interest adverse to us.

Dividend Distributions

Holders of our common shares are entitled to receive such
dividends as may be declared from time to time by our board, in its discretion,
out of funds legally available for that purpose. We intend to retain future
earnings, if any, for use in the operation and expansion of our business and do
not intend to pay any cash dividends in the foreseeable future.

|B. | Significant Changes
|-- | -------------------

None.

|ITEM 9 | The Offer and Listing
|------ | ---------------------

|A. | Offer and Listing Details
|-- | -------------------------

Our common shares are quoted on the OTC Bulletin Board under
the trading symbol TUSMF.OB. Our shares have been quoted on the OTC Bulletin
Board since October 2001; however, there have been no trades in our shares of
common stock since January 1, 2003.

Our authorized capital consists of 400,000,000 common shares
with a par value of $0.001 per share and 100,000,000 preferred shares with a par
value of $0.001 per share. Our preferred shares may be issued in one or more
series and our directors may fix the number of shares which is to comprise each
series and the designation, rights, privileges, restrictions and conditions
attaching to each series.

51

---

Holders of our common shares are entitled to vote at all
meetings of shareholders, except meetings at which only holders of a specified
class of shares are entitled to vote, receive any dividend declared by our
companys board of directors and, subject to the rights, privileges,
restrictions and conditions attaching to any other class of shares, receive the
remaining property of our company upon dissolution.

All of our common shares are issued in registered form. The
transfer of our common shares is managed by our transfer agent, Pacific Stock
Transfer Company, 4045 South Spencer Street, Suite 403, Las Vegas, NV 89119
(Telephone: 702.361.3033; Facsimile: 702.433.1979) .

|B. | Plan of Distribution
|-- | --------------------

Not applicable.

|C. | Markets
|-- | -------

Since October 2001, our common shares have been quoted
exclusively on the OTC Bulletin Board, however the shares have not traded since
January 1, 2003.

|D. | Selling
Shareholders
|-- | --------------------

Not applicable.

|E. | Dilution
|-- | --------

Not applicable.

|F. | Expenses of the
Issue
|-- | ---------------------

Not applicable.

|ITEM 10 | Additional Information
|------- | ----------------------

|A. | Share Capital
|-- | -------------

|Issued and
      Outstanding  Common Shares |  |                  | 
|-------------------------------------------- |  | ---------------- | 
|                                             |  | Number of Shares | 
|Balance, December 31, 2010                   |  | 51,313,366       | 
|Issued since
      December 31, 2010         |  | 15,426,175       | 
|Balance, April 29, 2011                      |  | 66,739,541       | 

|Stock
      Options Outstanding       |  |           |  |   |                | 
|------------------------------------- |  | --------- |  | - | -------------- | 
|                                      |  |           |  |   | Weighted       | 
|                                      |  |           |  |   | Average        | 
|                                      |  | Number    |  |   | Exercise Price | 
|Balance, December 31, 2010            |  | Nil       |  |   | N/A            | 
|Granted
      since December 31, 2010 |  | 2,400,000 |  | $ | 0.20           | 
|Balance, April 30, 2011               |  | 2,400,000 |  | $ | 0.20           | 

52

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|B. | Memorandum and Articles of
    Association
|-- | ------------------------------------------

The information required by this item is incorporated herein by
reference from our prospectus filed on June 9, 2009.

|C. | Material Contracts
|-- | ------------------

The material contracts to which we are a party which were
entered into during the last two years are as follows:

- Share Exchange Agreement dated as of January 28, 2011 between the Company
  and the shareholders of Qeyos Ad Systems Inc.

|D. | Exchange Controls
|-- | -----------------

There are no government laws, decrees or regulations in Canada
which restrict the export or import of capital or which affect the remittance of
dividends, interest or other payments to non-resident holders of our common
shares. Any remittances of dividends to United States residents and to other
non-residents are, however, subject to withholding tax. See Taxation below.

|E. | Taxation
|-- | --------

Material Cayman Islands Taxation

The Cayman Islands currently levy no taxes on individuals or
corporations based upon profits, income, gains or appreciation and there is no
taxation in the nature of inheritance tax or estate duty. There are no other
taxes likely to be material to us levied by the Government of the Cayman Islands
except for stamp duties that may be applicable on instruments executed in, or
after execution brought within, the jurisdiction of the Cayman Islands. The
Cayman Islands are not party to any double tax treaties. There are no exchange
control regulations or currency restrictions in the Cayman Islands.

No stamp duties are payable on the issue or transfer of shares.
An agreement to transfer shares may be subject to stamp duty if the agreement is
executed in the Cayman Islands or, if executed outside the Cayman Islands,
subsequently brought into the Cayman Islands. The Stamp Duty Law (2007
Revision), as amended, does not provide who is liable to pay stamp duty on any
document but, in practice, the person who seeks to rely on the document in any
civil court proceedings will be required to pay stamp duty in order to have the
document admitted in evidence.

Material United States Federal Income Tax Consequences

The following is a general discussion of certain possible
United States Federal foreign income tax matters under current law, generally
applicable to a U.S. Holder (as defined below) of our common shares who holds
such shares as capital assets. This discussion does not address all aspects of
United States Federal income tax matters and does not address consequences
peculiar to persons subject to special provisions of Federal income tax law,
such as those described below as excluded from the definition of a U.S. Holder.
In addition, this discussion does not cover any state, local or foreign tax
consequences. See Certain Canadian Federal Income Tax Consequences above.

The following discussion is based upon the Internal Revenue
Code of 1986, as amended (the Code), Treasury Regulations, published Internal
Revenue Service (IRS) rulings, published administrative positions of the IRS
and court decisions that are currently applicable, any or all of which could be
materially and adversely changed, possibly on a retroactive basis, at any time.
In addition, this discussion does not consider the potential effects, both
adverse and beneficial, of any recently proposed legislation which, if enacted,
could be applied, possibly on a retroactive basis, at any time. No assurance can
be given that the IRS will agree with such statements and conclusions, or will
not take, or a court will not adopt, a position contrary to any position taken
herein.

The following discussion is for general information only and
is not intended to be, nor should it be construed to be, legal, business or tax
advice to any holder or prospective holder of our common shares, and no opinion
or representation with respect to the United States Federal income tax
consequences to any such holder orprospective holder is made. Accordingly, holders and
prospective holders of common shares are urged to consult their own tax advisors
with respect to Federal, state, local, and foreign tax consequences of
purchasing, owning and disposing of our common shares.

53

---

U.S. Holders

As used herein, a U.S. Holder includes a holder of less than
10% of our common shares who is a citizen or resident of the United States, a
corporation created or organized in or under the laws of the United States or of
any political subdivision thereof, any entity which is taxable as a corporation
for United States tax purposes and any other person or entity whose ownership of
our common shares is effectively connected with the conduct of a trade or
business in the United States. A U.S. Holder does not include persons subject to
special provisions of Federal income tax law, such as tax-exempt organizations,
qualified retirement plans, financial institutions, insurance companies, real
estate investment trusts, regulated investment companies, broker-dealers,
non-resident alien individuals or foreign corporations whose ownership of our
common shares is not effectively connected with the conduct of a trade or
business in the United States and shareholders who acquired their shares through
the exercise of employee stock options or otherwise as compensation.

Distributions

The gross amount of a distribution paid to a U.S. Holder will
generally be taxable as dividend income to the U.S. Holder for United States
federal income tax purposes to the extent paid out of our current or accumulated
earnings and profits, as determined under United States federal income tax
principles. Distributions which are taxable dividends and which meet certain
requirements will be qualified dividend income and taxed to U.S. Holders at a
maximum United States federal rate of 15%. Distributions in excess of our
current and accumulated earnings and profits will be treated first as a tax-free
return of capital to the extent the U.S. Holders tax basis in the common shares
and, to the extent in excess of such tax basis, will be treated as a gain from a
sale or exchange of such shares.

Capital Gains

In general, upon a sale, exchange or other disposition of
common shares, a U.S. Holder will generally recognize a capital gain or loss for
United States federal income tax purposes in an amount equal to the difference
between the amount realized on the sale or other distribution and the U.S.
Holders adjusted tax basis in such shares. Such gain or loss will be a United
States source gain or loss and will be treated as a long-term capital gain or
loss if the U.S. Holders holding period of the shares exceeds one year. If the
U.S. Holder is an individual, any capital gain will generally be subject to
United States federal income tax at preferential rates if specified minimum
holding periods are met. The deductibility of capital losses is subject to
significant limitations.

Foreign Tax Credit

A U.S. Holder who pays (or has had withheld from distributions)
Canadian income tax with respect to the ownership of our common shares may be
entitled, at the option of the U.S. Holder, to either a deduction or a tax
credit for such foreign tax paid or withheld. Generally, it will be more
advantageous to claim a credit because a credit reduces United States Federal
income taxes on a dollar-for-dollar basis, while a deduction merely reduces the
taxpayers income subject to tax. This election is made on a year-by-year basis
and generally applies to all foreign income taxes paid by (or withheld from) the
U.S. Holder during that year. There are significant and complex limitations
which apply to the tax credit, among which is an ownership period requirement
and the general limitation that the credit cannot exceed the proportionate share
of the U.S. Holders United States income tax liability that the U.S. Holders
foreign source income bears to his or its worldwide taxable income. In
determining the application of this limitation, the various items of income and
deduction must be classified into foreign and domestic sources. Complex rules
govern this classification process. The availability of the foreign tax credit
and the application of these complex limitations on the tax credit are fact
specific and holders and prospective holders of our common shares should consult
their own tax advisors regarding their individual circumstances.

54

---

Passive Foreign Investment
Corporation

We do not believe that we are a passive foreign investment
corporation (a PFIC). However, since PFIC status depends upon the
composition of a companys income and assets and the market value of its assets
and shares from time to time, there is no assurance that we will not be
considered a PFIC for any taxable year. If we were treated as a PFIC for any
taxable year during which a U.S. Holder held shares, certain adverse tax
consequences could apply to the U.S. Holder. If we are treated as a PFIC for any
taxable year, gains recognized by such U.S. Holder on a sale or other
disposition of shares would be allocated ratably over the U.S. Holders holding
period for the shares. The amount allocated to the taxable year of the sale or
other exchange and to any year before we became a PFIC would be taxed as
ordinary income. The amount allocated to each other taxable year would be
subject to tax at the highest rate in effect for individuals or corporations, as
applicable, and an interest charge would be imposed on the amount allocated to
such taxable year. Further, any distribution in respect of shares in excess of
125% of the average of the annual distributions on shares received by the U.S.
Holder during the preceding three years or the U.S. Holders holding period,
whichever is shorter, would be subject to taxation as described above. Certain
elections may be available to U.S. Holders that may mitigate some of the adverse
consequences resulting from PFIC status. However, regardless of whether such
elections are made, dividends paid by a PFIC will not be qualified dividend
income and will generally be taxed at the higher rates applicable to other
items of ordinary income.

U.S. Holders and prospective holders should consult their
own tax advisors regarding the potential application of the PFIC rules to their
ownership of our common shares.

|F. | Dividends and Paying
  Agents
|-- | -----------------------------

Not applicable.

|G. | Statements by
Experts
|-- | ---------------------

Not applicable.

|H. | Documents on
Display
|-- | --------------------

Documents concerning our company referred to in this annual
company report may be viewed by appointment during normal business hours at our
registered and records office at Suite 800 - 885 West Georgia Street, Vancouver,
British Columbia, Canada, V6C 3H1.

|I. | Subsidiary
Information
|-- | ----------------------

We have one subsidiary, Qeyos Ad Systems Inc., a British
Columbia corporation.

|ITEM 11 | Quantitative and Qualitative Disclosures
      About Market Risk
|------- | ----------------------------------------------------------------

Not applicable.

|ITEM 12 | Description of Securities Other Than Equity
      Securities
|------- | ------------------------------------------------------------

Not applicable.

PART II

|ITEM 13 | Defaults, Dividend Arrearages and
      Delinquencies
|------- | -----------------------------------------------------

Not applicable.

55

---

|ITEM 14 | Material Modifications to the Rights of
      Security Holders and Use of Proceeds
|------- | ----------------------------------------------------------------------------------

Not applicable.

|ITEM 15 | Controls and Procedures Controls and
      Procedures
|------- | -----------------------------------------------------

A. Disclosure Controls and Procedures

As required by paragraph (b) of Rules 13a-15 or 15d-15 under
the Exchange Act, our principal executive officer and principal financial
officer evaluated our companys disclosure controls and procedures (as defined
in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the
period covered by this annual report on Form 20-F. Based on this evaluation,
these officers concluded that as of the end of the period covered by this Annual
Report on Form 20-F, our disclosure controls and procedures were not effective
to ensure that the information required to be disclosed by our company in
reports it files or submits under the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in the rules and forms
of the Securities and Exchange Commission. These disclosure controls and
procedures include controls and procedures designed to ensure that such
information is accumulated and communicated to our companys management,
including our companys principal executive officer and principal financial
officer, to allow timely decisions regarding required disclosure. The conclusion
that our disclosure controls and procedures were not effective was due to the
presence of material weaknesses in internal control over financial reporting as
identified below under the heading Managements Report on Internal Control Over
Financial Reporting. Management anticipates that such disclosure controls and
procedures will not be effective until the material weaknesses are remediated.
Our company intends to remediate the material weaknesses as set out below.

Because of the inherent limitations in all control systems, no
evaluation of controls can provide absolute assurance that all control issues,
if any, within our company have been detected.

B. Managements Report on Internal Control Over Financial
Reporting

Our companys management is responsible for establishing and
maintaining adequate internal control over financial reporting (as defined in
Rules 13a-15(f) and 15d-15(f) of the Exchange Act) for our company. Our
companys internal control over financial reporting is designed to provide
reasonable assurance, not absolute assurance, regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles in the
United States of America. Internal control over financial reporting includes
those policies and procedures that: (i) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of our companys assets; (ii) provide reasonable assurance that
transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles in the
United States of America, and that our companys receipts and expenditures are
being made only in accordance with authorizations of our management and
directors; and (iii) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of assets that could
have a material effect on our financial statements.

Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements. In addition,
projections of any evaluation of effectiveness to future periods are subject to
the risk that controls may become inadequate because of changes in conditions
and that the degree of compliance with the policies or procedures may
deteriorate.

Our management, including our principal executive officer and
principal financial officer, conducted an evaluation of the design and operation
of our internal control over financial reporting as of December 31, 2010 based
on the criteria set forth in Internal Control  Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission.
This evaluation included review of the documentation of controls, evaluation of
the design effectiveness of controls, testing of the operating effectiveness of
controls and a conclusion on this evaluation. Based on this evaluation, our
management concluded our internal control over financial reporting was not
effective as at December 31, 2010 due to the following material weaknesses: (i)
inadequate segregation of duties and effective risk assessment; and (ii) insufficient written
policies and procedures for accounting, financial reporting and corporate
governance.

56

---

Our company has taken steps to enhance and improve the design
of our internal controls over financial reporting, however these steps were not
complete as of December 31, 2010. During the period covered by this annual
report on Form 20-F, we have not been able to remediate the material weaknesses
identified above. To remediate such weaknesses, we plan to implement the
following changes during our fiscal year ending December 31, 2011: (i) address
inadequate segregation of duties and ineffective risk management; and (ii) adopt
sufficient written policies and procedures for accounting, financial reporting
and corporate governance. The remediation efforts set out above are largely
dependent upon our company securing additional financing to cover the costs of
implementing the changes required. If we are unsuccessful in securing such
funds, remediation efforts may be adversely affected in a material manner.

Our internal control over financial reporting was not subject
to attestation by our independent registered public accounting firm pursuant to
the rules of the Securities and Exchange Commission that permit us to provide
only managements report in this annual report.

Because of the inherent limitations in all control systems, no
evaluation of controls can provide absolute assurance that all control issues,
if any, within our company have been detected. These inherent limitations
include the realities that judgments in decision-making can be faulty and that
breakdowns can occur because of simple error or mistake.

C. Changes in Internal Controls Over Financial
Reporting

There were no changes in internal controls over financial
reporting during the year ended December 31, 2010. However, as a result of the
evaluation of our internal control over financial reporting as of December 31,
2010, conducted by our principal executive officer and principal financial
officer, we expect to make such changes in the year ended December 31, 2011.

|ITEM 15T | Controls and Procedures
|-------- | -----------------------

Not applicable.

|ITEM 16  | [Reserved]                      
|-------- | --------------------------------
|         |                                 
|ITEM 16A | Audit Committee Financial Expert

Our board of directors has determined that Brian Peterson qualifies as an audit committee financial
expert as defined in Item 16A(b) of Form 20-F, and is independent as the term
is defined by Nasdaq Marketplace Rule 4200(a)(15).

We believe that the members of our board of directors are
collectively capable of analyzing and evaluating our financial statements and
understanding internal controls and procedures for financial reporting. In
addition, we believe that retaining another independent director who would qualify as
an audit committee financial expert would be overly costly and burdensome and
is not warranted in our circumstances given the early stages of our development
and the fact that we have not generated revenues to date.

|ITEM 16B | Code of Ethics
|-------- | --------------

Code of Ethics

Effective March 15, 2004, our companys board of directors
adopted a Code of Business Conduct and Ethics that applies to, among other
persons, our companys president and secretary (being our principal executive
officer, principal financial officer and principal accounting officer), as well
as persons performing similar functions. As adopted, our Code of Business
Conduct and Ethics sets forth written standards that are designed to deter
wrongdoing and to promote:

57

---

|1. | honest and ethical conduct, including the ethical
      handling of actual or apparent conflicts of interest between personal and
      professional relationships;                                                          
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                              
|2. | full, fair, accurate, timely, and understandable
      disclosure in reports and documents that we file with, or submit to, the
      Securities and Exchange Commission and in other public communications made
      by us;
|   |                                                                                                                                                                                                                              
|3. | compliance with applicable governmental laws, rules and
      regulations;                                                                                                                                                   
|   |                                                                                                                                                                                                                              
|4. | the prompt internal reporting of violations of the Code
      of Business Conduct and Ethics to an appropriate person or persons
      identified in the Code of Business Conduct and Ethics; and                            
|   |                                                                                                                                                                                                                              
|5. | accountability for adherence to the Code of Business
      Conduct and Ethics.                                                                                                                                               

Our Code of Business Conduct and Ethics requires, among other
things, that all of our companys personnel shall be accorded full access to our
president and secretary with respect to any matter which may arise relating to
the Code of Business Conduct and Ethics. Further, all of our companys personnel
are to be accorded full access to our companys board of directors if any such
matter involves an alleged breach of the Code of Business Conduct and Ethics by
our president or secretary.

In addition, our Code of Business Conduct and Ethics emphasizes
that all employees, and particularly managers and/or supervisors, have a
responsibility for maintaining financial integrity within our company,
consistent with generally accepted accounting principles, and federal,
provincial and state securities laws. Any employee who becomes aware of any
incidents involving financial or accounting manipulation or other
irregularities, whether by witnessing the incident or being told of it, must
report it to his or her immediate supervisor or to our companys President or
Secretary. If the incident involves an alleged breach of the Code of Business
Conduct and Ethics by the President or Secretary, the incident must be reported
to any member of our board of directors. Any failure to report such
inappropriate or irregular conduct of others is to be treated as a severe
disciplinary matter. It is against our company policy to retaliate against any
individual who reports in good faith the violation or potential violation of our
companys Code of Business Conduct and Ethics.

Our Code of Business Conduct and Ethics was filed with the
Securities and Exchange Commission on March 30, 2004 as Exhibit 14.1 to our
annual report on Form 10-KSB. We will provide a copy of the Code of Business
Conduct and Ethics to any person without charge, upon request. Requests can be
sent to: Qwick Media Inc., 780  333 Seymour Street, Vancouver, British Columbia
V6B 5A6.

|ITEM 16C | Principal Accountant Fees and Services
|-------- | --------------------------------------

Audit Fees. This category includes the fees for the
audit of our financial statements and the quarterly reviews of interim financial
statements. This category also includes advice on audit and accounting matters
that arose during or as a result of the audit or the review of interim financial
statements and services in connection with Securities and Exchange Commission
filings.

Audit-Related Fees. This category includes assurance and
related services that are reasonably related to the performance of the audit or
review of the financial statements that are not reported under Audit Fees, and
describes the nature of the services comprising the fees disclosed under this
category.

Tax Fees. This category includes the fees for
professional services rendered for tax compliance, tax advice and tax planning,
and describes the nature of the services comprising the fees disclosed under
this category.

All Other Fees. This category includes products and
services provided by the principal accountant, other than the services reported
under Audit Fees, Audit-Related Fees or Tax Fees.

Our current independent public accountants provided audit and
other services during the fiscal years ended December 31, 2010 and 2009 as
follows:

58

---

2010
    
    
    2009($)
    
    
    ($)Audit Fees
    
    16,349
    
    
    22,200Audit-Related Fees
    
    9,741
    
    
    4,450Tax Fees
    
    -
    
    
    -All Other Fees
    
    -
    
    
    -Total Fees
    
    26,090
    
    
    26,650


We do not use Morgan & Company, Chartered Accountants, for
financial information system design and implementation. These services, which
include designing or implementing a system that aggregates source data
underlying the financial statements or generates information that is significant
to our financial statements, are provided internally or by other service
providers. We do not engage Morgan & Company, Chartered Accountants, to
provide compliance outsourcing services.

Effective May 6, 2003, the Securities and Exchange Commission
adopted rules that require that before Morgan & Company, Chartered
Accountants, is engaged by us to render any auditing or permitted non-audit
related service, the engagement be:

- approved by our audit committee (which consists of our entire board of
  directors); or
- entered into pursuant to pre-approval policies and procedures established
  by our board, provided the policies and procedures are detailed as to the
  particular service, our board is informed of each service, and such policies
  and procedures do not include delegation of the board of directors
  responsibilities to management.

Our board of directors pre-approves all services provided by
our independent auditors. All of the above services and fees were reviewed and
approved by our board either before or after the respective services were
rendered.

Our board of directors has considered the nature and amount of
fees billed by Morgan & Company, Chartered Accountants, and believes that
the provision of services for activities unrelated to the audit is compatible
with maintaining Morgan & Companys independence.

|ITEM 16D. | Exemption from the Listing Standards for
      Audit Committees
|--------- | ---------------------------------------------------------------

Not applicable.

|ITEM 16E | Purchases of Equity Securities the Company
      and Affiliated Purchasers
|-------- | --------------------------------------------------------------------------

Not applicable.

|ITEM 16F | Change in Registrants Certifying
      Accountant
|-------- | --------------------------------------------------

Not applicable.

|ITEM 16G | Corporate Governance
|-------- | --------------------

Not applicable.

|ITEM 17 | Financial Statements
|------- | --------------------

Financial Statements Filed as Part of this Report:

Audited Annual Financial Statements for Qwick Media Inc. as at
December 31, 2010, 2009 and 2008:

59

---

| | (a) | Independent Auditors Report of Morgan & Company
      dated May 2, 2011 on the Financial Statements as at December 31, 2010,
      2009 and 2008;                     
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                        
| | (b) | Balance Sheets at December 31, 2010 and 2009;                                                                                                                          
| |     |                                                                                                                                                                        
| | (c) | Statements of Operations for the years ended December 31,
      2010, 2009 and 2008, and for the period October 5, 2000 (Date of
      Inception) to December 31, 2010;
| |     |                                                                                                                                                                        
| | (d) | Statements of Cash Flows for the years ended December 31,
      2010, 2009 and 2008, and for the period October 5, 2000 (Date of
      Inception) to December 31, 2010;
| |     |                                                                                                                                                                        
| | (e) | Statement of Stockholders Equity (Deficiency) from
      October 5, 2000 (Date of Inception) to December 31, 2010; and                                                
| |     |                                                                                                                                                                        
| | (f) | Notes to Financial Statements.                                                                                                                                         

60

---



QWICK MEDIA INC.(Formerly TUSCANY MINERALS LTD. 
    An Exploration Stage Company)

FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 2010, 2009, and 2008

(Stated in U.S. Dollars)



---



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Directors and Stockholders of 
  Qwick Media Inc. 
  (formerly Tuscany Minerals Ltd. 
  An Exploration Stage Company)

We have audited the accompanying balance sheets of Qwick Media
  Inc. (formerly Tuscany Minerals Ltd., an exploration stage company) as of
  December 31, 2010 and 2009, and the related statements of operations and cash
  flows for each of the three years in the period ended December 31, 2010, and for
  the cumulative period from October 5, 2000 (date of inception) to December 31,
  2010, and stockholders equity (deficiency) for the cumulative period from
  October 5, 2000 (date of inception) to December 31, 2010. These financial
  statements are the responsibility of the Company's management. Our
  responsibility is to express an opinion on these financial statements based on
  our audits.

We conducted our audits in accordance with the standards of the
  Public Company Accounting Oversight Board (United States). Those standards
  require that we plan and perform the audit to obtain reasonable assurance
  whether the financial statements are free of material misstatement. The Company
  is not required to have, nor were we engaged to perform, an audit of its
  internal control over financial reporting. Our audits included consideration of
  internal control over financial reporting as a basis for designing audit
  procedures that are appropriate in the circumstances, but not for the purpose of
  expressing an opinion on the effectiveness of the Companys internal control
  over financial reporting. Accordingly, we express no such opinion. An audit
  includes examining, on a test basis, evidence supporting the amounts and
  disclosures in the financial statements. An audit also includes assessing the
  accounting principles used and significant estimates made by management, as well
  as evaluating the overall financial statement presentation. We believe that our
  audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above
  present fairly, in all material respects, the financial position of the Company
  as of December 31, 2010 and 2009, and the results of its operations and its cash
  flows for each of the three years in the period ended December 31, 2010, and for
  the cumulative period from October 5, 2000 (date of inception) to December 31,
  2010, in conformity with United States generally accepted accounting principles.

The accompanying financial statements have been prepared
  assuming the Company will continue as a going concern. As discussed in Note 1 to
  the financial statements, the Company has suffered recurring losses from
  operations, has negative cash flows, has a stockholders deficiency and is
  dependent upon obtaining adequate financing to fulfil its development activities
  and upon future profitable operations. These factors raise substantial doubt
  about its ability to continue as a going concern. Managements plans in regard
  to these matters are also discussed in Note 1. The financial statements do not
  include any adjustments that might result from the outcome of this uncertainty.

|Vancouver, Canada | Morgan & Company   
|----------------- | ---------------------
|                  |                      
|May 2, 2011       | Chartered Accountants



---

|QWICK MEDIA INC.               
|-------------------------------
|(formerly TUSCANY MINERALS LTD.
|An Exploration Stage Company)  
|                               
|BALANCE SHEETS                 
|(Stated in U.S. Dollars)       

|                                                       |   | DECEMBER 31 |  
|------------------------------------------------------ | - | ----------- | -
|                                                       |   | 2010        |  
|ASSETS                                                 |   |             |  
|Current                                                |   |             |  
|Cash                                                   | $ | 700,996     |  
|Promissory Notes Receivable                            |   | 639,862     |  
|                                                       | $ | 1,340,858   |  
|                                                       |   |             |  
|LIABILITIES                                            |   |             |  
|Current                                                |   |             |  
|Accounts payable and accrued liabilities               | $ | 36,260      |  
|Notes and accrued
      interest payable               |   | 127,428     |  
|Promissory note and accrued interest payable           |   | 275,783     |  
|                                                       |   | 439,471     |  
|STOCKHOLDERS EQUITY (DEFICIENCY)                      |   |             |  
|Capital Stock                                          |   | 51,313      |  
|Additional Paid-in Capital                             |   | 606,317     |  
|Share Subscriptions Received                           |   | 1,385,000   |  
|Deficit Accumulated During The
      Exploration Stage |   | (1,141,243  | )
|                                                       |   | 901,387     |  
|                                                       | $ | 1,340,858   |  

The accompanying notes are an integral part of these financial
  statements.

F-3

---

|QWICK MEDIA INC.               
|-------------------------------
|(formerly TUSCANY MINERALS LTD.
|An Exploration Stage Company)  
|                               
|STATEMENTS OF OPERATIONS       
|(Stated in U.S. Dollars)       

|                                                           |   |                         |   |   |            |   |   |            |   |   | PERIOD FROM |  
|---------------------------------------------------------- | - | ----------------------- | - | - | ---------- | - | - | ---------- | - | - | ----------- | -
|                                                           |   |                         |   |   |            |   |   |            |   |   | DATE OF     |  
|                                                           |   |                         |   |   |            |   |   |            |   |   | INCEPTION   |  
|                                                           |   |                         |   |   |            |   |   |            |   |   | OCTOBER 5   |  
|                                                           |   |                         |   |   |            |   |   |            |   |   | 2000 TO     |  
|                                                           |   |                         |   |   |            |   |   |            |   |   | DECEMBER    |  
|                                                           |   | YEARS ENDED DECEMBER 31 |   |   | 31,        |  
|                                                           |   | 2010                    |   |   | 2009       |   |   | 2008       |   |   | 2010        |  
|                                                           |   |                         |   |   |            |   |   |            |   |   |             |  
|Expenses                                                   |   |                         |   |   |            |   |   |            |   |   |             |  
|Consulting fee                                             | $ | −                       |   | $ | −          |   | $ | −          |   | $ | 3,193       |  
|Filing and stock transfer fees                             |   | 838                     |   |   | 8,088      |   |   | 2,801      |   |   | 17,018      |  
|Foreign exchange
      loss on debt settlement             |   | −                       |   |   | 18,456     |   |   | −          |   |   | 18,456      |  
|Interest (Note 7)                                          |   | 19,097                  |   |   | 34,311     |   |   | 31,045     |   |   | 213,326     |  
|Management fee
      (Note 7)                              |   | 78,903                  |   |   | 55,657     |   |   | 15,287     |   |   | 213,597     |  
|Mineral property exploration
      expenditure             |   | −                       |   |   | −          |   |   | −          |   |   | 8,500       |  
|Mineral property
      option payment                      |   | −                       |   |   | −          |   |   | −          |   |   | 3,428       |  
|Office and sundry                                          |   | 13,452                  |   |   | 3,968      |   |   | 645        |   |   | 23,941      |  
|Oil and gas
      property exploration expenditures        |   | −                       |   |   | −          |   |   | −          |   |   | 202,686     |  
|Professional fees                                          |   | 75,726                  |   |   | 106,444    |   |   | 54,634     |   |   | 398,610     |  
|Travel and
      business development                      |   | −                       |   |   | −          |   |   | −          |   |   | 38,488      |  
|                                                           |   | 188,016                 |   |   | 226,924    |   |   | 104,412    |   |   | 1,141,243   |  
|                                                           |   |                         |   |   |            |   |   |            |   |   |             |  
|Net Loss For The Period                                    | $ | (188,016                | ) | $ | (226,924   | ) | $ | (104,412   | ) | $ | (1,141,243  | )
|                                                           |   |                         |   |   |            |   |   |            |   |   |             |  
|Basic And Diluted Loss Per Common Share                    | $ | (0.00                   | ) | $ | (0.01      | ) | $ | (0.01      | ) |   |             |  
|                                                           |   |                         |   |   |            |   |   |            |   |   |             |  
|Weighted Average Number Of Common Shares
      Outstanding |   | 51,313,366              |   |   | 22,311,517 |   |   | 12,538,000 |   |   |             |  

The accompanying notes are an integral part of these financial
  statements.

F-4

---

|QWICK MEDIA INC.               
|-------------------------------
|(formerly TUSCANY MINERALS LTD.
|An Exploration Stage Company)  
|                               
|STATEMENTS OF CASH FLOWS       
|(Stated in U.S. Dollars)       

|                                                                                                              |   |                         |   |   |              |   |   |          |   |   | PERIOD FROM |  
|------------------------------------------------------------------------------------------------------------- | - | ----------------------- | - | - | ------------ | - | - | -------- | - | - | ----------- | -
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   | DATE OF     |  
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   | INCEPTION   |  
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   | OCTOBER 5,  |  
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   | 2000 TO     |  
|                                                                                                              |   | YEARS ENDED DECEMBER 31 |   |   | DECEMBER 31, |  
|                                                                                                              |   | 2010                    |   |   | 2009         |   |   | 2008     |   |   | 2010        |  
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   |             |  
|Cash Flows (Used In) Provided By:                                                                             |   |                         |   |   |              |   |   |          |   |   |             |  
|Operating Activities                                                                                          |   |                         |   |   |              |   |   |          |   |   |             |  
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   |             |  
|Net loss for the
      period                                                                                 | $ | (188,016                | ) | $ | (226,924     | ) | $ | (104,412 | ) | $ | (1,141,243  | )
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   |             |  
|Adjustment to reconcile
      net loss to net
      cash 
                used
      by operating activities: |   |                         |   |   |              |   |   |          |   |   |             |  
|Foreign exchange loss on debt settlement                                                                      |   | −                       |   |   | 18,456       |   |   | −        |   |   | 18,456      |  
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   |             |  
|Changes in
      non-cash operating working capital items:                                                    |   |                         |   |   |              |   |   |          |   |   |             |  
|Accounts payable and accrued liabilities                                                                      |   | 11,069                  |   |   | 7,691        |   |   | 17,345   |   |   | 127,916     |  
|Accrued interest payable                                                                                      |   | 19,422                  |   |   | 34,311       |   |   | 31,045   |   |   | 213,651     |  
|                                                                                                              |   | (157,525                | ) |   | (166,466     | ) |   | (56,022  | ) |   | (781,220    | )
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   |             |  
|Investing Activities                                                                                          |   |                         |   |   |              |   |   |          |   |   |             |  
|Promissory note advances                                                                                      |   | (639,862                | ) |   | −            |   |   | −        |   |   | (639,862    | )
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   |             |  
|Financing Activities                                                                                          |   |                         |   |   |              |   |   |          |   |   |             |  
|Proceeds from
      notes payable                                                                             |   | 111,950                 |   |   | 167,240      |   |   | 55,447   |   |   | 465,028     |  
|Proceeds from promissory note
      payable                                                                   |   | −                       |   |   | −            |   |   | −        |   |   | 196,050     |  
|Proceeds from
      issuance of common shares                                                                 |   | −                       |   |   | −            |   |   | −        |   |   | 76,000      |  
|Proceeds from share
      subscriptions received                                                              |   | 1,385,000               |   |   | −            |   |   | −        |   |   | 1,385,000   |  
|                                                                                                              |   | 1,496,950               |   |   | 167,240      |   |   | 55,447   |   |   | 2,122,078   |  
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   |             |  
|Net Increase (Decrease) In
      Cash                                                                         |   | 699,563                 |   |   | 774          |   |   | (575     | ) |   | 700,996     |  
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   |             |  
|Cash, Beginning Of
      Period                                                                               |   | 1,433                   |   |   | 659          |   |   | 1,234    |   |   | −           |  
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   |             |  
|Cash, End Of Period                                                                                           | $ | 700,996                 |   | $ | 1,433        |   | $ | 659      |   | $ | 700,996     |  
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   |             |  
|Non-cash Financing
      Activities                                                                           |   |                         |   |   |              |   |   |          |   |   |             |  
|Common stock issued to settle debt                                                                            | $ | −                       |   | $ | 581,630      |   | $ | −        |   | $ | 581,630     |  
|                                                                                                              |   |                         |   |   |              |   |   |          |   |   |             |  
|Supplemental Disclosure of Cash Flow
      Information                                                        |   |                         |   |   |              |   |   |          |   |  
|Interest paid                                                                                                 | $ | −                       |   | $ | −            |   | $ | −        |   | $ | −           |  
|Income taxes paid                                                                                             | $ | −                       |   | $ | −            |   | $ | −        |   | $ | −           |  

The accompanying notes are an integral part of these financial
  statements.

F-5

---

|QWICK MEDIA INC.                                                  
|------------------------------------------------------------------
|(formerly TUSCANY MINERALS LTD.                                   
|An Exploration Stage Company)                                     
|                                                                  
|STATEMENT OF STOCKHOLDERS EQUITY (DEFICIENCY)                    
|PERIOD FROM INCEPTION, OCTOBER 5, 2000, TO DECEMBER
      31, 2010
|(Stated in U.S. Dollars)                                          

|                                                                     |  |            |  |   | COMMON STOCK |  |   |            |  |   | DEFICIT       |  |   |             |   |   |             |  
|-------------------------------------------------------------------- |  | ---------- |  | - | ------------ |  | - | ---------- |  | - | ------------- |  | - | ----------- | - | - | ----------- | -
|                                                                     |  | NUMBER     |  |   |              |  |   |            |  |   |               |  |   | ACCUMULATED |   |   |             |  
|                                                                     |  | OF         |  |   |              |  |   | ADDITIONAL |  |   | SHARE         |  |   | DURING THE  |   |   | CUMULATIVE  |  
|                                                                     |  | COMMON     |  |   | PAR          |  |   | PAID-IN    |  |   | SUBSCRIPTIONS |  |   | EXPLORATION |   |   | TRANSLATION |  
|                                                                     |  | SHARES     |  |   | VALUE        |  |   | CAPITAL    |  |   | RECEIVED      |  |   | STAGE       |   |   | ADJUSTMENT  |  
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|                                                                     |  |            |  | $ |              |  | $ |            |  | $ | -             |  | $ |             |   | $ | -           |  
|Balance, October 5, 2000                                             |  | -          |  |   | -            |  |   | -          |  |   |               |  |   | -           |   |   |             |  
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|November 2000 - Shares issued for cash at
      $0.001               |  | 6,500,000  |  |   | 6,500        |  |   | -          |  |   | -             |  |   | -           |   |   | -           |  
|November 2000 - Shares issued for cash at $0.01                      |  | 6,000,000  |  |   | 6,000        |  |   | 54,000     |  |   | -             |  |   | -           |   |   | -           |  
|December 2000 - Shares issued for cash at
      $0.25                |  | 38,000     |  |   | 38           |  |   | 9,462      |  |   | -             |  |   | -           |   |   | -           |  
|Translation adjustment                                               |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | -           |   |   | 660         |  
|Net loss for the period                                              |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | (7,310      | ) |   | -           |  
|Balance, December 31, 2000                                           |  | 12,538,000 |  |   | 12,538       |  |   | 63,462     |  |   | -             |  |   | (7,310      | ) |   | 660         |  
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|Translation adjustment                                               |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | -           |   |   | (752        | )
|Net loss for the year                                                |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | (54,811     | ) |   | -           |  
|Balance, December 31, 2001                                           |  | 12,538,000 |  |   | 12,538       |  |   | 63,462     |  |   | -             |  |   | (62,121     | ) |   | (92         | )
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|Translation adjustment                                               |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | -           |   |   | 16          |  
|Net loss for the year                                                |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | (24,972     | ) |   | -           |  
|Balance, December 31, 2002                                           |  | 12,538,000 |  |   | 12,538       |  |   | 63,462     |  |   | -             |  |   | (87,093     | ) |   | (76         | )
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|Translation adjustment                                               |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | -           |   |   | (205        | )
|Net loss for the year                                                |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | (271,508    | ) |   | -           |  
|Balance, December 31, 2003                                           |  | 12,538,000 |  |   | 12,538       |  |   | 63,462     |  |   | -             |  |   | (358,601    | ) |   | (281        | )
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|Translation adjustment                                               |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | -           |   |   | 281         |  
|Net loss for the year                                                |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | (72,049     | ) |   | -           |  
|Balance, December 31, 2004                                           |  | 12,538,000 |  |   | 12,538       |  |   | 63,462     |  |   | -             |  |   | (430,650    | ) |   | -           |  
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|Net loss for the
      year                                          |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | (49,562     | ) |   | -           |  
|Balance, December 31, 2005                                           |  | 12,538,000 |  |   | 12,538       |  |   | 63,462     |  |   | -             |  |   | (480,212    | ) |   | -           |  
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|Net loss for the year                                                |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | (67,488     | ) |   | -           |  
|Balance, December 31, 2006                                           |  | 12,538,000 |  |   | 12,538       |  |   | 63,462     |  |   | -             |  |   | (547,700    | ) |   | -           |  
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|Net loss for the
      year                                          |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | (74,191     | ) |   | -           |  
|Balance, December 31, 2007                                           |  | 12,538,000 |  |   | 12,538       |  |   | 63,462     |  |   | -             |  |   | (621,891    | ) |   | -           |  
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|Net loss for the year                                                |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | (104,412    | ) |   | -           |  
|Balance, December 31, 2008                                           |  | 12,538,000 |  |   | 12,538       |  |   | 63,462     |  |   | -             |  |   | (726,303    | ) |   | -           |  
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|September 2009 - Shares issued for settling debt 
         at $0.015 |  | 38,775,366 |  |   | 38,775       |  |   | 542,855    |  |   | -             |  |   | -           |   |   | -           |  
|Net loss for the year                                                |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | (226,924    | ) |   | -           |  
|Balance, December 31, 2009                                           |  | 51,313,366 |  |   | 51,313       |  |   | 606,317    |  |   | -             |  |   | (953,227    | ) |   | -           |  
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|Share subscriptions received                                         |  | -          |  |   | -            |  |   | -          |  |   | 1,385,000     |  |   | -           |   |   | -           |  
|Net loss for the year                                                |  | -          |  |   | -            |  |   | -          |  |   | -             |  |   | (188,016    | ) |   | -           |  
|                                                                     |  |            |  |   |              |  |   |            |  |   |               |  |   |             |   |   |             |  
|Balance, December 31, 2010                                           |  | 51,313,366 |  | $ | 51,313       |  | $ | 606,317    |  | $ | 1,385,000     |  | $ | (1,141,243  | ) | $ | -           |  

The accompanying notes are an integral part of these financial
  statements.

F-6

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|1. | NATURE OF OPERATIONS AND GOING
      CONCERN
|-- | --------------------------------------------

| | a) | Organization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |    | Qwick Media Inc. (the Company) is governed by the
      corporate laws of the Cayman Islands. It is currently a reporting issuer
      in the Province of British Columbia, Canada. Principal executive offices
      are located in Vancouver, British Columbia, Canada. The registered office
      is in the Cayman Islands.                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |    | The Company was incorporated on October 5, 2000 under the
      laws of the State of Nevada. Effective June 26, 2006, it re-domiciled from
      the State of Nevada to the State of Washington. Effective July 7, 2009, it
      re-domiciled from the State of Washington to the State of Wyoming for the
      sole purpose of effecting a continuance to the Cayman Islands. Effective
      July 28, 2009, the Company re-domiciled to the Cayman Islands and became a
      foreign private issuer with the US Securities and Exchange Commission
      (SEC).
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |    | On October 6, 2009, the Company changed its name from
      Tuscany Mineral, Ltd. to Tuscany Minerals Ltd.. On June 22, 2010, the
      Company changed its name to Qwick Media Inc.                                                                                                                                                                                                                                                                                                                                                                            
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | b) | Exploration Stage Activities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |    | The Company had been in the exploration stage since its
      formation and has not realized any revenues. The Company had previous
      exploration activities in the natural gas and oil business in 2003 and in
      the acquisition and exploration of mining properties prior to 2003. As at
      December 31, 2010 and 2009, the Company was an inactive shell
      company.                                                                                                                                                                                
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |    | On January 28, 2011, the Company acquired Qeyos Ad
      Systems Inc., which is in the business of developing and customizing
      software for use in digital media kiosks. Accordingly, subsequent to
      December 31, 2010, the Company ceased to be an inactive shell company and
      became a development stage company.                                                                                                                                                                                                                                    
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | c) | Going Concern                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |    | The accompanying financial statements have been prepared
      assuming the Company will continue as a going
      concern.                                                                                                                                                                                                                                                                                                                                                                                                                                           

F-7

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|1. | NATURE OF OPERATIONS AND GOING CONCERN(Continued)
|-- | -------------------------------------------------
|   |                                                  
|   | c)                                               
|   |                                                  
|   |                                                  

|2. | SUMMARY OF SIGNIFICANT ACCOUNTING
      POLICIES                                                                                                                                                                                                                                                                                                                                                                       
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | The financial statements of the Company have been
      prepared in accordance with generally accepted accounting principles in
      the United States. Because a precise determination of many assets and
      liabilities is dependent upon future events, the preparation of financial
      statements for a period necessarily involves the use of estimates which
      have been made using careful judgement.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | The financial statements have, in managements opinion,
      been properly prepared within reasonable limits of materiality and within
      the framework of the significant accounting policies summarized
      below:                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | a)                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | b)                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                        

F-8

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(Continued)
|-- | -----------------------------------------------------
|   |                                                      
|   | c)                                                   
|   |                                                      
|   |                                                      

| | i)   | monetary items at the exchange rate prevailing at the
      balance sheet date;                                
| | ---- | ---------------------------------------------------------------------------------------------------------------
| | ii)  | non-monetary items at the historical exchange
      rate;                                                      
| | iii) | revenue and expense at the average exchange rate in
      effect during the applicable accounting
      period.

| |    | Gains and losses on foreign currency transactions are
      reported in the statements of operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | d) | Basic and Diluted Loss Per Share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    | The Company computes loss per share in accordance with
      Statement of Financial Accounting Standards (SFAS) No. 128  Earnings
      Per Share (codified in ASC Topic 260, Earnings Per Share). Under these
      provisions, basic loss per share is computed using the weighted average
      number of common stock outstanding during the periods. Diluted loss per
      share is computed using the weighted average number of common and
      potentially dilutive common stock outstanding during the period. As the
      Company generated net losses in the period presented, the basic and
      diluted loss per share is the same as the exercise of options or warrants
      would be anti-dilutive.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | e) | Fair Value of Financial Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    | ASC Topic 820-10 establishes a three-tier value
      hierarchy, which prioritizes the inputs used in measuring fair value. The
      hierarchy prioritizes the inputs into three levels based on the extent to
      which inputs used in measuring fair value are observable in the
      market.                                                                                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    | These tiers are:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

| |  | Level 1  defined as observable inputs such as
      quoted prices in active markets;                                                                       
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                             
| |  | Level 2  defined as inputs other than quoted
      prices in active markets that are either directly or indirectly
      observable; and                   
| |   |                                                                                                                                                             
| |  | Level 3  defined as unobservable inputs in
      which little or no market data exists, therefore requiring an entity to
      develop its own assumptions.

F-9

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(Continued)
|-- | -----------------------------------------------------

| | e) | Fair Value of Financial Instruments (Continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    | Cash consists of cash on deposit with a high quality
      major financial institution. The carrying cost approximates fair value due
      to the liquidity of these deposits. The carrying amounts of other
      financial assets and liabilities comprising amounts receivable, accounts
      payable and accrued liabilities, and notes payable, were a reasonable
      approximation of their fair value.                                                                                                                                                                                                                         
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | f) | Income Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    | The Company has adopted SFAS No. 109  Accounting for
      Income Taxes (codified in ASC Topic 740, Income Taxes). This standard
      requires the use of an asset and liability approach for financial
      accounting, and reporting on income taxes. If it is more likely than not
      that some portion or all of a deferred tax asset will not be realized, a
      valuation allowance is recognized.                                                                                                                                                                                                                        
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | g) | Asset Retirement Obligations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    | The Company follows SFAS No. 143 (codified in ASC Topic
      410 Asset Retirement Obligations), which requires that an asset retirement
      obligation (ARO) associated with the retirement of a tangible long-lived
      asset be recognized as a liability in the period which it is incurred and
      becomes determinable, with an offsetting increase in the carrying amount
      of the associated asset.                                                                                                                                                                                                                   
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    | The cost of the tangible asset, including the initially
      recognized ARO, is depleted, such that the cost of the ARO is recognized
      over the useful life of the asset. The ARO is recorded at fair value, and
      accretion expense is recognized over time as the discounted liability is
      accreted to its expected settlement value. The fair value of the ARO is
      measured using expected future cash flow, discounted at the Companys
      credit-adjusted risk-free interest rate. To date, no asset retirement
      obligations exist and no liability has been recorded.                                   
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | h) | Asset Impairment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    | Long-lived assets are tested for recoverability whenever
      events or changes in circumstances indicate the carrying amount may not be
      recoverable, pursuant to guidance established in SFAS No. 144, Accounting
      for the Impairment or Disposal of Long-lived Assets (codified in ASC
      Topic 360-50, Impairment or Disposal of Long- lived Assets). The Company
      determines impairment by comparing the undiscounted future cash flows
      estimated to be generated by its assets to their respective carrying
      amounts. If impairment is deemed to exist, assets are written down to fair
      value.

F-10

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(Continued)
|-- | -----------------------------------------------------

| | i) | Comprehensive Loss                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    | SFAS 130, Reporting Comprehensive Income,
      (codified in ASC Topic 220, Comprehensive Income) establishes
      standards for the reporting and display of comprehensive loss and its
      components in the financial statements. As at December 31, 2010 and 2009,
      the Company has no items that represent a comprehensive loss and,
      therefore, has not included a schedule of comprehensive loss in the
      financial statements.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | j) | Common Share Non-Monetary Consideration                                                                                                                                                                                                                                                                                                                                                                                                                
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    | In situations where common shares are issued and the fair
      value of the goods or services received is readily determinable, the fair
      value of the common shares is used to measure and record the transaction.
      The fair value of the common shares issued in exchange for the receipt of
      goods and services is based on the stock price as of the earliest
      of:                                                            
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    | i)                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    | ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |    | iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                   

|3. | RECENT ACCOUNTING
      PRONOUNCEMENTS
|-- | --------------------------------------

In February 2010, FASB issued
  Accounting Standards Update (ASU) 2010-09 Subsequent Events (Topic 855) Amendments to Certain Recognition and Disclosure Requirements. ASU
  2010-09 removes the requirement for an SEC filer to disclose a date of the
  subsequent event in both issued and revised financial statements. Revised
  financial statements include financial statements reissued as a result of either
  correction of an error or retrospective application of GAAP. All of the
  amendments in ASU 2010-09 are effective upon issuance of the final ASU, except
  for the use of the issued date for conduit debt obligors. That amendment is
  effective for interim or annual periods ending after June 15, 2010. The Company
  adopted ASU 2010-09 in February 2010, and it did not impact the Companys
  financial statements.

In January 2010, the FASB issued ASU
  2010-06, Fair Value Measurements and Disclosures (Topic 820),
    Improving Disclosures about Fair Value Measurements, amending ASC 820. ASU
  2010-06 requires entities to provide new disclosures and clarify existing
  disclosures relating to fair value measurements. The new disclosures and
  clarifications of existing disclosures are effective for interim and annual
  reporting periods beginning after December 15, 2009, except for the disclosures
  about purchases, sales, issuances, and settlements in Level 3 fair value
  measurements, which are effective for fiscal years beginning after December 15,
  2010, and for interim periods within those fiscal years. The Company is
  currently evaluating the impact of ASU 2010-06, but does not expect its adoption
  to have a material impact on the Companys financial position or results of
  operations.

F-11

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|4. | PROMISSORY NOTES RECEIVABLE                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | At December 31, 2010, two promissory notes aggregating
      $639,862 (2009 - $Nil) are due from a company having the same chief
      executive officer and controlling shareholder. These amounts are due on
      demand, are interest free and unsecured.                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|5. | NOTES AND ACCRUED INTEREST PAYABLE                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | Notes payable balance at December 31, 2010 was $127,428
      (2009 - $14,995), including accrued interest of $483 (2009 - $228). All
      notes payable were unsecured, payable on demand, and bore interest at 8%
      per annum. These amounts are due to a company with a common director or a
      common officer.                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | On September 30, 2009, the Company entered into debt
      settlement agreements with the note payable holder of principal and
      interest of $407,191 for shares in the Companys common stock.                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | Interest expense for the year ended December 31, 2010
      amounted to $158 (2009 - $15,372; 2008 - $12,055).                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|6. | PROMISSORY NOTE AND ACCRUED INTEREST
      PAYABLE                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | At December 31, 2010 the promissory note of $196,050
      (2009 - $196,050) bore interest at 8% per annum and was repayable in full
      on January 28, 2004.                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | The Company had entered into various loan extension
      agreements since the initial due date, including a required balloon payout
      amount of $25,000. At December 31, 2010, the expiry date is January 28,
      2011. Since advancement of funds to December 31, 2010 interest has accrued
      in the amount of $54,733 (2009- $35,794). Interest expensed for the year
      ended December 31, 2010 amounted to $18,939 (2009 - $18,939; 2008 -
      $18,991).
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | On September 30, 2009 the Company entered into a debt
      settlement agreement to settle $82,782 of the total accrued interest for
      5,518,778 shares in the Companys common stock.                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|7. | RELATED PARTY TRANSACTIONS AND AMOUNTS
      OWING                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | For the year ended December 31, 2010, the Company carried
      out a number of transactions with related parties in the normal course of
      business. These transactions were recorded at their exchange amount, which
      is the amount of consideration established and agreed to by the related
      parties.                                                                                                                                                     

F-12

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|7. | RELATED PARTY TRANSACTIONS AND AMOUNTS OWING(Continued)                                                                                    
|-- | -------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                            
|   | The following are related party transactions and amounts
      owing at December 31, 2010 that are not otherwise disclosed
      elsewhere:

| | a) | The Company paid management fees of $63,885 (2009 -
      $55,287; 2008 - $15,287) to a company controlled by a director for the
      year ended December 31, 2010. The management services were on a month to
      month basis at $750 per month until September 30, 2008. On November 1,
      2008, the Company entered into an agreement with the same party in which
      the Company agreed to pay $5,600 (CDN$5,600) per month for management
      services on a month to month basis.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | b) | As of December 31, 2010, accounts payable of $120 (2009 -
      $295) was owing to a director of the Company and $11,200 (2009 - $10,037)
      was owing to a company controlled by the same director.                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | c) | As of December 31, 2010, accounts payable of $5,209 (2009
      - $Nil) was owing to a company controlled by an officer of the
      Company.                                                                                                                                                                                                                                                                                                                                                    
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | d) | Interest expensed by the Company relating to notes
      payable due to a company with a common director amounted to $Nil (2009 -
      $5,327; 2008 - $6,868) for the year ended December 31, 2010.                                                                                                                                                                                                                                                                                             
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | e) | Interest expensed by the Company relating to notes
      payable due to a company with a common officer amounted to $158 (2009 -
      $6,100; 2008 - $304) for the year ended December 31, 2010.                                                                                                                                                                                                                                                                                                
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | f) | On September 30, 2009, the Company entered into debt
      settlement agreements with holders of promissory notes and an assignment
      of debt pursuant to which 21,287,895 shares of the Companys common stock
      were issued to companies with a common officer to settle debt totalling
      $319,318.                                                                                                                                                                                

|8. | INCOME TAXES
|-- | ------------

The provision for income taxes differs
  from the result which would be obtained by applying the statutory income tax
  rate of 34% (2009  34%) to income before income taxes. The difference results
  from the following items:

| |                                                |   | 2010    |   |   | 2009    |   |   | 2008    |  
| | ---------------------------------------------- | - | ------- | - | - | ------- | - | - | ------- | -
| |                                                |   |         |   |   |         |   |   |         |  
| | Computed expected (benefit)
      income taxes | $ | (64,000 | ) | $ | (77,100 | ) | $ | (35,500 | )
| | Increase in valuation allowance                |   | 64,000  |   |   | 77,100  |   |   | 35,500  |  
| |                                                | $ | -       |   | $ | -       |   | $ | -       |  

F-13

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|8. | INCOME TAXES(Continued)
|-- | -----------------------

Significant components of the Companys
  deferred income tax assets are as follows:

| |                           |   | 2010     |   |   | 2009     |   |   | 2008     |  
| | ------------------------- | - | -------- | - | - | -------- | - | - | -------- | -
| |                           |   |          |   |   |          |   |   |          |  
| | Deferred income tax asset | $ | 387,100  |   | $ | 323,100  |   | $ | 246,900  |  
| | Valuation allowance       |   | (387,100 | ) |   | (323,100 | ) |   | (246,900 | )
| |                           | $ | -        |   | $ | -        |   | $ | -        |  

The Company has net operating losses of
  approximately $1,141,000 (2009 - $953,000; 2008 - $726,000), which if
  unutilized, will expire through to 2030. Future tax benefits, which may arise as
  a result of these losses, have not been recognized in these financial statements
  and have been offset by a valuation allowance.

|9. | CAPITAL STOCK
|-- | -------------
|   |              
|   | a)           
|   |              
|   |              
|   |              
|   |              
|   |              
|   |              
|   |              
|   | b)           
|   |              
|   |              
|   |              
|   |              

F-14

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|10. | COMMITMENTS AND CONTRACTUAL OBLIGATIONS                                                                                                                                                                                                                                                  
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                          
|    | The Company had no significant commitments or contractual
      obligations with any parties respecting executive compensation, consulting
      arrangements, rental premises or other matters. Management services
      provided are on a month to month basis.                       
|    |                                                                                                                                                                                                                                                                                          
|11. | FINANCIAL INSTRUMENTS AND RISK
      MANAGEMENT                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                          
|    | The following table presents information about the
      Companys financial instruments that have been measured at fair value as
      of December 31, 2010 and 2009, and indicates the fair value hierarchy of
      the valuation inputs utilized to determine such fair
      values:

| | 2010                        |  | FAIR  |  |   |           |  |   | LOANS AND    |  |   |           |  |   |           | 
| | --------------------------- |  | ----- |  | - | --------- |  | - | ------------ |  | - | --------- |  | - | --------- | 
| |                             |  | VALUE |  |   |           |  |   | RECEIVABLES/ |  |   | TOTAL     |  |   |           | 
| |                             |  | INPUT |  |   | HELD-FOR- |  |   | AMORTIZED    |  |   | CARRYING  |  |   | FAIR      | 
| |                             |  | LEVEL |  |   | TRADING   |  |   | COST         |  |   | VALUE     |  |   | VALUE     | 
| | Financial assets            |  |       |  |   |           |  |   |              |  |   |           |  |   |           | 
| | Cash                        |  | 1     |  | $ | 700,996   |  | $ | -            |  | $ | 700,996   |  | $ | 700,996   | 
| | Promissory notes receivable |  | 3     |  |   | -         |  |   | 639,862      |  |   | 639,862   |  |   | 639,862   | 
| |                             |  |       |  |   |           |  |   |              |  |   |           |  |   |           | 
| |                             |  |       |  | $ | 700,996   |  | $ | 639,862      |  | $ | 1,340,858 |  | $ | 1,340,858 | 

OTHER
      
      
      TOTALFINANCIAL
      
      
      CARRYING
      
      
      FAIRLEVEL
      
      
      LIABILITIES
      
      
      VALUE
      
      
      VALUEFinancial liabilitiesAccounts payable and accrued liabilities
      
      3
      
      $
      36,260
      
      $
      36,260
      
      $
      36,260Notes and accrued interest payable
      
      3
      
      
      127,428
      
      
      127,428
      
      
      127,428Promissory note and
        accrued interest payable
      
      3
      
      
      275,783
      
      
      275,783
      
      
      275,783$
      439,471
      
      $
      439,471
      
      $
      439,471


2009
      
      FAIRVALUE
      
      
      
      
      
      TOTALINPUT
      
      
      HELD-FOR-
      
      
      CARRYING
      
      
      FAIR VALUELEVEL
      
      
      TRADING
      
      
      VALUEFinancial assetsCash
      
      1
      
      $
      1,433
      
      $
      1,433
      
      $
      1,433


15

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|11. | FINANCIAL INSTRUMENT AND RISK MANAGEMENT(Continued)
|--- | ---------------------------------------------------

| | 2009                                               |  |       |  |   | OTHER       |  |   | TOTAL    |  |   |                  | 
| | -------------------------------------------------- |  | ----- |  | - | ----------- |  | - | -------- |  | - | ---------------- | 
| |                                                    |  |       |  |   | FINANCIAL   |  |   | CARRYING |  |   |                  | 
| |                                                    |  | LEVEL |  |   | LIABILITIES |  |   | VALUE    |  |   | FAIR
      VALUE | 
| | Financial liabilities                              |  |       |  |   |             |  |   |          |  |   |                  | 
| | Accounts payable
      and accrued liabilities     |  | 3     |  | $ | 25,191      |  | $ | 25,191   |  | $ | 25,191           | 
| | Notes and accrued interest
      payable           |  | 3     |  |   | 14,995      |  |   | 14,995   |  |   | 14,995           | 
| | Promissory note
      and accrued interest payable |  | 3     |  |   | 256,844     |  |   | 256,844  |  |   | 256,844          | 
| |                                                    |  |       |  |   |             |  |   |          |  |   |                  | 
| |                                                    |  |       |  | $ | 297,030     |  | $ | 297,030  |  | $ | 297,030          | 

Due to the nature of cash, promissory
  notes receivable, accounts payable and accrued liabilities, and notes and
  promissory note payable, the fair value of these instruments approximated their
  carrying value. Promissory notes receivable, notes and promissory note are
  recorded at estimated fair value on issue and at amortized cost on an ongoing
  basis.

|12. | SUBSEQUENT EVENTS
|--- | -----------------

| | a) | The Company has entered into negotiations respecting a
      loan extension agreement to settle the debt or to extend the expiry date
      of the promissory note and accrued interest due January 28,
      2011.                                                                                                                                                            
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                
| | b) | On January 28, 2011, the Company received a further
      $640,000 for share subscriptions under a private placement of common
      shares of the Company at a price of $0.20 per share. On January 28, 2011,
      the Board of Directors of the Company authorized the issuance of
      10,000,000 common shares of the Company.                                           
| |    |                                                                                                                                                                                                                                                                                                                                                                                
| | c) | On January 28, 2011, the Board of Directors of the
      Company authorized the issuance of 637,140 common shares at a deemed price
      of $0.20 per share in settlement of $127,428 notes and accrued interest
      payable .                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                                
| | d) | On January, 2011, the Company adopted a stock option plan
      providing for the issuance of up to 6,620,230 shares of its common stock
      to the officers, directors, employees and consultants of the Company.
      Pursuant to this plan, the Company granted 2,400,000 options to purchase
      common stock at $0.20 per share, expiring on December 29,
      2015.

F-16

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|12. | SUBSEQUENT EVENTS(Continued)
|--- | ----------------------------

| | e) | On January 28, 2011, the Company completed the
      acquisition of Qeyos Ad Systems Inc. (Qeyos), pursuant to which it
      acquired all of the issued and outstanding common shares of Qeyos from its
      shareholders in exchange for the issuance of a total of 4,789,035 shares
      of the Companys common stock on the basis of one share of common stock
      for each share of Qeyos. As a result of the acquisition of the Qeyos
      shares, the Company ceased to be a shell company and is now in the
      business of developing interactive proprietary software, intellectual
      property and hardware.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    | i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    | ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

F-17

---

|QWICK MEDIA INC.                            
|--------------------------------------------
|(formerly TUSCANY MINERALS LTD.             
|An Exploration Stage Company)               
|                                            
|NOTES TO FINANCIAL STATEMENTS               
|                                            
|YEARS ENDED DECEMBER 31, 2010, 2009 AND 2008
|(Stated in U.S. Dollars)                    

|12. | SUBSEQUENT EVENTS(Continued)
|--- | ----------------------------

| | ii) | Pro-Forma Adjustments (Continued)
| | --- | ---------------------------------
| |     |                                  
| |     | b)                               
| |     |                                  
| |     | c)                               
| |     |                                  
| |     | d)                               

F-18

---

|QWICK MEDIA INC.                    
|------------------------------------
|                                    
|PRO-FORMA CONSOLIDATED BALANCE SHEET
|                                    
|DECEMBER 31, 2010                   
|(Unaudited)                         
|(Stated in U.S. Dollars)            

|                                                   |   |             |   |   |             |   |             |   | PRO-FORMA   |   |   |             |  
|-------------------------------------------------- | - | ----------- | - | - | ----------- | - | ----------- | - | ----------- | - | - | ----------- | -
|                                                   |   | QWICK MEDIA |   |   | QEYOS AD    |   |             |   | ADJUSTMENTS |   |   | PRO-FORMA   |  
|                                                   |   | INC.        |   |   | SYSTEMS INC |   | Note        |   |             |   |   | CONSOLIDATE |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   | D           |  
|                                                   |   |             |   |   |             |   | **12e)ii)** |   |             |   |   |             |  
|ASSETS                                             |   |             |   |   |             |   |             |   |             |   |   |             |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|Current                                            |   |             |   |   |             |   |             |   |             |   |   |             |  
|Cash                                               | $ | 700,996     |   | $ | 176,852     |   | b)          | $ | 640,000     |   | $ | 1,517,848   |  
|Accounts receivable                                |   | -           |   |   | 3,136       |   |             |   | -           |   |   | 3,136       |  
|Recoverable
      taxes                            |   | -           |   |   | 47,944      |   |             |   | -           |   |   | 47,944      |  
|Inventory                                          |   | -           |   |   | 74,848      |   |             |   | -           |   |   | 74,848      |  
|                                                   |   | 700,996     |   |   | 302,780     |   |             |   | 640,000     |   |   | 1,643,776   |  
|Loan Term Investments                              |   |             |   |   |             |   |             |   |             |   |   |             |  
|Promissory note
      receivable                   |   | 639,862     |   |   | -           |   | d)          |   | (639,862    | ) |   | -           |  
|Investment in subsidiary                           |   | -           |   |   | -           |   | a)          |   | 957,807     |   |   | -           |  
|                                                   |   | -           |   |   | -           |   | d)          |   | (957,807    | ) |   | -           |  
|                                                   |   | 639,862     |   |   | -           |   |             |   | (639,862    | ) |   | -           |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|Property and Equipment                             |   | -           |   |   | 84,584      |   |             |   | -           |   |   | 84,584      |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|                                                   | $ | 1,340,858   |   | $ | 387,364     |   |             | $ | (138        | ) | $ | 1,728,360   |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|LIABILITIES                                        |   |             |   |   |             |   |             |   |             |   |   |             |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|Current                                            |   |             |   |   |             |   |             |   |             |   |   |             |  
|Accounts payable
      and accrued liabilities     | $ | 36,260      |   | $ | 18,630      |   |             | $ | -           |   | $ | 54,890      |  
|Promissory note payable                            |   | -           |   |   | 648,630     |   | d)          |   | (648,630    | ) |   | -           |  
|Notes and
      accrued interest payable           |   | 127,428     |   |   | -           |   | c)          |   | (127,428    | ) |   | -           |  
|Promissory note and accrued
      interest payable |   | 275,783     |   |   | -           |   |             |   | -           |   |   | 275,783     |  
|                                                   |   | 439,471     |   |   | 667,260     |   |             |   | (776,058    | ) |   | 330,673     |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|STOCKHOLDERS EQUITY (DEFICIENCY)                  |   |             |   |   |             |   |             |   |             |   |   |             |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|Capital Stock                                      |   | 51,313      |   |   | 957,886     |   | a)          |   | 4,789       |   |   | 56,739      |  
|                                                   |   |             |   |   |             |   | c)          |   | 637         |   |   |             |  
|                                                   |   |             |   |   |             |   | d)          |   | (957,886    | ) |   |             |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|Additional Paid-In Capital                         |   | 606,317     |   |   | -           |   | a)          |   | 953,018     |   |   | 1,686,126   |  
|                                                   |   |             |   |   |             |   | c)          |   | 126,791     |   |   |             |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|Share Subscriptions Received                       |   | 1,385,000   |   |   | -           |   | b)          |   | 640,000     |   |   | 2,025,000   |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|Deficit                                            |   | (1,141,243  | ) |   | (1,237,782  | ) | (d)         |   | 8,847       |   |   | (2,370,178  | )
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|                                                   |   | 901,387     |   |   | (279,896    | ) |             |   | 776,196     |   |   | 1,397,687   |  
|                                                   |   |             |   |   |             |   |             |   |             |   |   |             |  
|                                                   | $ | 1,340,858   |   | $ | 387,364     |   |             | $ | (138        | ) | $ | 1,728,360   |  

F-19

---

|QWICK MEDIA INC.                               
|-----------------------------------------------
|                                               
|PRO-FORMA CONSOLIDATED STATEMENTS OF OPERATIONS
|(Unaudited)                                    
|(Stated in U.S. Dollars)                       
|                                               
|YEAR ENDED DECEMBER 31, 2010                   

|                                                           |   |             |   |   |             |   |  |   | PRO-FORMA               |   |   |              |  
|---------------------------------------------------------- | - | ----------- | - | - | ----------- | - |  | - | ----------------------- | - | - | ------------ | -
|                                                           |   | QWICK MEDIA |   |   | QEYOS AD    |   |  |   | ADJUSTMENT              |   |   | PRO-FORMA    |  
|                                                           |   |             |   |   |             |   |  |   | S                       |   |   |              |  
|                                                           |   | INC.        |   |   | SYSTEMS INC |   |  |   | **(Note 12(e)(ii)(d))** |   |   | CONSOLIDATED |  
|Revenues                                                   |   |             |   |   |             |   |  |   |                         |   |   |              |  
|Advertising fees                                           | $ | -           |   | $ | 2,718       |   |  | $ | -                       |   | $ | 2,718        |  
|                                                           |   |             |   |   |             |   |  |   |                         |   |   |              |  
|Expenses                                                   |   |             |   |   |             |   |  |   |                         |   |   |              |  
|Amortization and
      depreciation                        |   | -           |   |   | 320         |   |  |   | -                       |   |   | 320          |  
|Advertising and promotion                                  |   | -           |   |   | 8,610       |   |  |   | -                       |   |   | 8,610        |  
|Consulting fees                                            |   | -           |   |   | 74,136      |   |  |   | -                       |   |   | 74,136       |  
|Filing
      and stock transfer fees                       |   | 838         |   |   | -           |   |  |   | -                       |   |   | 838          |  
|Foreign exchange                                           |   | -           |   |   | 71,045      |   |  |   | (8,847                  | ) |   | 62,198       |  
|Interest
      and bank charges                            |   | 19,097      |   |   | 572         |   |  |   | -                       |   |   | 19,669       |  
|Management fees                                            |   | 78,903      |   |   | 25,153      |   |  |   | -                       |   |   | 104,056      |  
|Office
      and administrative                            |   | 13,452      |   |   | 53,212      |   |  |   | -                       |   |   | 66,664       |  
|Professional fees                                          |   | 75,726      |   |   | 48,152      |   |  |   | -                       |   |   | 123,878      |  
|Salary,
      wages and benefits                           |   | -           |   |   | 445,834     |   |  |   | -                       |   |   | 445,834      |  
|Software development                                       |   | -           |   |   | 179,222     |   |  |   | -                       |   |   | 179,222      |  
|Travel                                                     |   | -           |   |   | 19,490      |   |  |   | -                       |   |   | 19,490       |  
|                                                           |   | 188,016     |   |   | 925,746     |   |  |   | (8,847                  | ) |   | 1,104,915    |  
|Net Loss                                                   | $ | (188,016    | ) | $ | (923,028    | ) |  | $ | 8,847                   |   | $ | (1,102,197   | )
|                                                           |   |             |   |   |             |   |  |   |                         |   |   |              |  
|Basic and Diluted Loss Per Common Share                    | $ | (0.00       | ) |   |             |   |  |   |                         |   | $ | (0.02        | )
|                                                           |   |             |   |   |             |   |  |   |                         |   |   |              |  
|Weighted Average Number of Common Shares Outstanding       |   | 51,313,366  |   |   | 100         |   |  |   |                         |   |   | 66,739,541   |  
|                                                           |   |             |   |   |             |   |  |   |                         |   |   |              |  
|                                                           |   |             |   |   |             |   |  |   |                         |   |   |              |  
|YEAR ENDED DECEMBER 31, 2009                               |  
|                                                           |   |             |   |   |             |   |  |   | PRO-FORMA               |   |   |              |  
|                                                           |   | QWICK MEDIA |   |   | QEYOS AD    |   |  |   | ADJUSTMENTS             |   |   | PRO-FORMA    |  
|                                                           |   | INC.        |   |   | SYSTEMS INC |   |  |   |                         |   |   | CONSOLIDATED |  
|Expenses                                                   |   |             |   |   |             |   |  |   |                         |   |   |              |  
|Consulting fees                                            | $ | -           |   | $ | 11,066      |   |  | $ | -                       |   | $ | 11,066       |  
|Filing and stock transfer
      fees                       |   | 8,088       |   |   | -           |   |  |   | -                       |   |   | 8,088        |  
|Foreign
      exchange                                     |   | 18,456      |   |   | 13,703      |   |  |   | -                       |   |   | 32,159       |  
|Interest and bank charges                                  |   | 34,311      |   |   | 361         |   |  |   | -                       |   |   | 34,672       |  
|Management fees                                            |   | 55,657      |   |   | 108,892     |   |  |   | -                       |   |   | 164,549      |  
|Office and administrative                                  |   | 3,968       |   |   | 24,416      |   |  |   | -                       |   |   | 28,384       |  
|Professional fees                                          |   | 106,444     |   |   | -           |   |  |   | -                       |   |   | 106,444      |  
|Software development                                       |   | -           |   |   | 156,316     |   |  |   | -                       |   |   | 156,316      |  
|                                                           |   | 226,924     |   |   | 314,754     |   |  |   | -                       |   |   | 541,678      |  
|Net Loss                                                   | $ | (226,924    | ) | $ | (314,754    | ) |  | $ | -                       |   | $ | (541,678     | )
|                                                           |   |             |   |   |             |   |  |   |                         |   |   |              |  
|Basic and
      Diluted Loss Per Common Share              | $ | (0.01       | ) |   |             |   |  |   |                         |   | $ | (0.01        | )
|                                                           |   |             |   |   |             |   |  |   |                         |   |   |              |  
|Weighted
      Average Number of Common Shares Outstanding |   | 22,311,517  |   |   | 100         |   |  |   |                         |   |   | 37,737,792   |  

F-20

---

|QWICK MEDIA INC.                                              
|--------------------------------------------------------------
|                                                              
|PRO-FORMA STATEMENT OF STOCKHOLDERS EQUITY
      (DEFICIENCY)
|YEAR ENDED DECEMBER 31, 2010                                  
|(Unaudited)                                                   
|(Stated in U.S. Dollars)                                      

|                                                                              |  | COMMON STOCK |  |     |        |  |         |           |  |          |           | 
|----------------------------------------------------------------------------- |  | ------------ |  | --- | ------ |  | ------- | --------- |  | -------- | --------- | 
|                                                                              |  | NUMBER       |  |     |        |  |         |           |  |          |           | 
|                                                                              |  | OF           |  |     |        |  |         |           |  | SHARE    |           | 
|                                                                              |  |              |  | PAR |        |  | PAID-IN |           |  |          |           | 
|                                                                              |  | SHARES       |  |     |        |  | CAPITAL |           |  | RECEIVED |           | 
|                                                                              |  |              |  |     |        |  |         |           |  |          |           | 
|Balance, December 31, 2009                                                    |  | 51,313,366   |  | $   | 51,313 |  | $       | 606,317   |  | $        | -         | 
|                                                                              |  |              |  |     |        |  |         |           |  |          |           | 
|Share subscription received                                                   |  |              |  |     |        |  |         |           |  |          |           | 
|(Note 12 e) ii) b)                                                            |  | -            |  |     | -      |  |         | -         |  |          | 2,025,000 | 
|                                                                              |  |              |  |     |        |  |         |           |  |          |           | 
|Pro-forma shares issued:                                                      |  |              |  |     |        |  |         |           |  |          |           | 
|Share exchange agreement for Qeyos 
              (Note 12 e) ii) a)          |  | 4,789,035    |  |     | 4,789  |  |         | 953,018   |  |          | -         | 
|Debt settlement -
      notes payable 
              (Note 12 e)
      ii) c) |  | 637,140      |  |     | 637    |  |         | 126,791   |  |          | -         | 
|                                                                              |  |              |  |     |        |  |         |           |  |          |           | 
|Pro-forma deficit accumulated:                                                |  |              |  |     |        |  |         |           |  |          |           | 
|Qeyos as
      at December 31, 2009                                           |  | -            |  |     | -      |  |         | -         |  |          | -         | 
|                                                                              |  |              |  |     |        |  |         |           |  |          |           | 
|Pro-forma net loss for the
      period                                       |  | -            |  |     | -      |  |         | -         |  |          | -         | 
|                                                                              |  |              |  |     |        |  |         |           |  |          |           | 
|Pro-forma balance, December 31, 2010                                          |  | 56,739,541   |  | $   | 56,739 |  | $       | 1,686,126 |  | $        | 2,025,000 | 

F-21

---

|ITEM 18 | Financial Statements
|------- | --------------------

Refer to Item 17. Financial Statements.

|ITEM 19 | Exhibits
|------- | --------

The following exhibits are being filed as part of this annual
company report, or are incorporated by reference where indicated:

Exhibit Number
      Description of Exhibit1.1
      Memorandum of Association (incorporated
          by reference from Exhibit 3.1 to our current report on Form 8-K as filed
          with the SEC on August 5, 2009)1.2
      Articles of Association (incorporated
          by reference from Exhibit 3.2 to our current report on Form 8-K as filed
          with the SEC on August 5, 2009)4.1
      Consulting Agreement with CHM
          Financial Services Inc. dated November 1, 2008 (incorporated by reference
          from our Annual Report on Form 20-F as filed with the SEC on April 29,
          2010)4.2
      Promissory
          Note with In Touch Digital Media Inc. dated February 18, 20094.3
      Promissory Note with In Touch
          Digital Media Inc. dated March 31, 2009 (incorporated by reference from
          Exhibit 10.5 to our registration statement on Form S-4 as filed with
          the SEC on April 9, 2009)4.4
      Promissory Note with In Touch
          Digital Media Inc. dated May 8, 2009 (incorporated by reference from
          Exhibit 10.9 to our quarterly report on Form 10-Q as filed with the
          SEC on May 15, 2009)4.5
      Form of Debt Settlement and
          Subscription Agreement, effective as of September 30, 2009 (incorporated
          by reference from our Annual Report on Form 20-F as filed with the SEC
          on April 29, 2010)4.6
      Share Exchange Agreement with
          Qeyos Ad Systems Inc. dated January 28, 2011 (incorporated by reference
          from our Annual Report on Form 20-F as filed with the SEC on February
          3, 2011)4.7
      Debt Settlement and Subscription
          Agreement dated January 28, 2011 with R. J. Tocher Holdings Ltd. (incorporated
          by reference from our Annual Report on Form 20-F as filed with the SEC
          on February 3, 2011)4.8
      Form of Private Placement Subscription
          Agreement (incorporated by reference from our Annual Report on Form
          20-F as filed with the SEC on February 3, 2011)4.9
      2011 Stock Option Plan (incorporated
          by reference from our Annual Report on Form 20-F as filed with the SEC
          on February 3, 2011)8.1
      Significant
          Subsidiary of our Company as at January 28, 2011 - Qeyos Ad Systems
          Inc., a British Columbia corporation12.1*
      Certification
          of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
          Act of 200212.2*
      Certification
          of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
          Act of 200213.1*
      Certification
          of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted
          pursuant to Section 906 of the Sarbanes-Oxley Act of 200213.2*
      Certification
          of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
          pursuant to Section 906 of the Sarbanes-Oxley Act of 2002


|* | Filed herewith
|- | --------------

61

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SIGNATURES

The registrant hereby certifies that it meets all of the
requirements for filing on Form 20-F and that it has duly caused and authorized
the undersigned to sign this annual company report on its behalf.

QWICK MEDIA INC.

|By:                                         | /s/Ross J. Tocher | 
|------------------------------------------- | ----------------- | 
|Ross J. Tocher,                             |                  
|President and Chief Executive
      Officer |                  
|(Principal Executive Officer)               |                  

Date: May 2, 2011

|By:                               | /s/Kevin Kortje | 
|--------------------------------- | --------------- | 
|Kevin Kortje                      |                
|Chief Financial Officer           |                
|(Principal Financial Officer      |                
|and Principal Accounting Officer) |                

Date: May 2, 2011

62

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