| Nevada                                   | 33-0836954                 |
|------------------------------------------|----------------------------|
| (State or other jurisdiction             | (IRS Employer File Number) |
| Of incorporation)                        |                       |
|                                     |                       |
| 32963 Calle Perfecto                     |                       |
| San Juan Capistrano, California          | 92675                      |
| (Address of principal executive offices) | (zip code)                 |
|                                     |                       |

| Large accelerated filer []                                                                        | Accelerated filer []                     |
|-----------------------------------------------------------------------------------------------------------------------|------------------------------------------|
| Non-accelerated filer   [] (Do not check if a smaller reporting company)      | Smaller reporting company  [X] |

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| PART I                                                                                                                                                                                       |   Page |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------|
|                                                                                                                                                                                         |        |
|      Item 1. Business                                                                                                                                               | 3           |
|                                                                                                                                                                                         |        |
|     Item 1A. Risk Factors                                                                                                                                                | 7           |
|                                                                                                                                                                                         |        |
|      Item 1B. Unresolved Staff Comments                                                                                                                             | 11          |
|                                                                                                                                                                                         |        |
|      Item 2. Properties                                                                                                                                             | 11          |
|                                                                                                                                                                                         |        |
|      Item 3. Legal Proceedings                                                                                                                                      | 11          |
|                                                                                                                                                                                         |        |
|      Item 4. Removed and Reserved                                                                                                                                   | 11          |
|                                                                                                                                                                                         |        |
| PART II                                                                                                                                                                                      |        |
|                                                                                                                                                                                         |        |
|       Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases      of Equity Securities | 11          |
|                                                                                                                                                                                         |        |
|       Item 6. Selected Financial Data                                                                                                                               | 12          |
|                                                                                                                                                                                         |        |
|       Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations                                                                 | 12          |
|                                                                                                                                                                                         |        |
|       Item 7A. Quantitative and Qualitative Disclosures About Market Risk                                                                                           | 19          |
|                                                                                                                                                                                         |        |
|       Item 8. Financial Statements and Supplementary Data                                                                                                           | 16          |
|                                                                                                                                                                                         |        |
|       Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures                                                                 | 35          |
|                                                                                                                                                                                         |        |
|       Item 9A(T). Controls and Procedures                                                                                                                           | 38          |
|                                                                                                                                                                                         |        |
|       Item 9B. Other Information                                                                                                                               | 38          |
|                                                                                                                                                                |        |
| PART III                                                                                                                                                                                     |        |
|                                                                                                                                                                                         |        |
|      Item 10. Directors, Executive Officers and Corporate Governance                                                                                                | 38          |
|                                                                                                                                                                                         |        |
|      Item 11. Executive Compensation                                                                                                                                | 40          |
|                                                                                                                                                                                         |        |
|      Item 12. Security Ownership of Certain Beneficial Owners and Management and Related     Stockholder Matters                      | 42          |
|                                                                                                                                                                                         |        |
|      Item 13. Certain Relationships and Related Transactions, and Director Independence                                                                             | 42          |
|                                                                                                                                                                                         |        |
|      Item 14. Principal Accounting Fees and Services                                                                                                                | 43          |
|                                                                                                                                                                                         |        |
|      Item 15. Exhibits, Financial Statement Schedules                                                                                                               | 44          |
|                                                                                                                                                                                         |        |
| Financial Statements                                                                                                                                                                         | 16-36       |
|                                                                                                                                                                                         |        |
| Signatures                                                                                                                                                                                   | 46          |

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| • |  authorize the issuance of  “blank check” preferred stock that could be issued by our board of directors to increase the number of outstanding shares and discourage a takeover attempt; and |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|    |                                                                                                                                                                                                                    |
| • |  limit who may call special meetings of stockholders.                                                                                                                                                              |

----

|    |                                                                                                                                               |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------|
| • | future announcements about our Company or our competitors, including the results of testing, technological innovations or new commercial products; |
|    |                                                                                                                                               |
| • | negative regulatory actions with respect to our potential products or regulatory approvals with respect to our competitors’ products;        |
|    |                                                                                                                                               |
| • |  changes in government regulations;                                                                                                           |
|    |                                                                                                                                               |
| • | developments in our relationships with our partners including customers, vendors and distributors                                                  |
|    |                                                                                                                                               |
| • | developments affecting our partners; including customers, vendors and distributors                                                                 |
|    |                                                                                                                                               |
| • | our failure to acquire or maintain proprietary rights to the products we develop;                                                                  |
|    |                                                                                                                                               |
| • |  litigation; and                                                                                                                              |
|    |                                                                                                                                               |
| • | public concern as to the safety of our products.                                                                                                   |

----

|    Fiscal Year 2011 | High Bid | Low Bid |
|------------------------------------|----------|---------|
|                               |     |    |
| Quarter Ended:                     |     |    |
|                               |     |    |
| First Quarter May 2010             | $0.34    | $0.23   |
|                               |     |    |

| Fiscal Year 2010             | High Bid | Low Bid |
|------------------------------|----------|---------|
|                         |     |    |
| Quarter Ended:               |     |    |
|                         |     |    |
| First Quarter May 2009       | $0.40    | $0.10   |
|                         |     |    |
|                         |     |    |
| Second Quarter August 2009   | $0.40    | $0.22   |
|                         |     |    |
|                         |     |    |
| Third Quarter November 2009  | $0.30    | $0.18   |
|                         |     |    |
|                         |     |    |
| Fourth Quarter February 2010 | $0.31    | $0.16   |
|                         |     |    |

----

|    Fiscal Year 2009 | High Bid | Low Bid |
|------------------------------------|----------|---------|
|                               |     |    |
| Quarter Ended:                     |     |    |
|                               |     |    |
| First Quarter May 2008             | $0.44    | $0.21   |
|                               |     |    |
|                               |     |    |
| Second Quarter August 2008         | $0.40    | $0.09   |
|                               |     |    |
|                               |     |    |
| Third Quarter November 2008        | $0.55    | $0.21   |
|                               |     |    |
|                               |     |    |
| Fourth Quarter February 2009       | $0.25    | $0.10   |
|                               |     |    |

----

----

|                                                |   | Years Ended  |      |   |         |   |      |       |   |
|-----------------------------------------------------|--------|--------------|-----------|--------|--------------|--------|-----------|------------|--------|
|                                                |   | February 28, |      |   | February 28, |   |      |       |   |   | Percentage |   |
|                                                |   | 2010         |      |   | 2009         |   |      | Difference |   |   | Change |   |
|                                                |   |         |      |   | (Restated *) |   |      |       |   |   |   |   |
| Sales                                               |   | $            | 2,743,671 |   |         | $      | 1,172,998 |       |   |   | 1,570,673 |   |   |   | 134 | % |
| Cost of sales                                       |   |         | 1,354,121 |   |         |   | 602,256   |       |   |   | 751,865 |   |   |   | 125 | % |
| Gross profit                                        |   |         | 1,389,550 |   |         |   | 570,742   |       |   |   | 818,808 |   |   |   | 143 | % |
| Gross profit percentage                             |   |         | 51        | %      |         |   | 49        | %          |   |   |   |   |   |   | 4 | % |
|                                                |   |         |      |   |         |   |      |       |   |   |   |   |   |   |   |   |
| General and administrative expenses                 |   |         | 755,333   |   |         |   | 845,621   |       |   |   | (90,288 | ) |   |   | -11 | % |
| Income (Loss) from operations                       |   |         | 615,271   |   |         |   | (289,705  | )          |   |   | 904,976 |   |   |   | 312 | % |
| Interest expense (including related party)          |   |         | (50,281   | )      |         |   | (47,040   | )          |   |   | 3,241 |   |   |   | -7 | % |
| Interest income                                     |   |         | 551       |   |         |   | 56        |       |   |   | 495 |   |   |   | 884 | % |
| Other income (expense)                              |   |         | (2,661    | )      |         |   | 24,001    |       |   |   | (26,662 | ) |   |   | -111 | % |
| Net Income (Loss)                                   |   |         | 562,930   |   |         |   | (312,688  | )          |   |   | 875,618 |   |   |   | 280 | % |
|                                                |   |         |      |   |         |   |      |       |   |   |   |   |   |   |   |   |
| Net cash provided by (used in) operating activities |   |         | 490,666   |   |         |   | 182,710   |       |   |   | 673,376 |   |   |   | -369 | % |
| Net cash provided by (used in) investing activities |   |         | (36,982   | )      |         |   | (58,396)  |       |   |   | (21,414 | ) |   |   | 36 | % |
| Net cash provided by (used in) financing activities |   |         | (111,932  | )      |         |   | 381,671   |       |   |   | (493,603 | ) |   |   | -129 | % |

----

|                                                                                     |   | Total  |      |   | Less Than 1 Year |   |    | 1- 3 Years |   |   | 3-5 Years |   |   | More Than 5 Years |   |   | Convertible to Stock or Warrants |   |
|------------------------------------------------------------------------------------------|--------|--------|-----------|--------|------------------|--------|---------|------------|--------|--------|-----------|--------|--------|-------------------|--------|--------|----------------------------------|--------|
| Accounts payable and accrued liabilities                                                 |   | $      | 134,292   |   |             | $      | 134,292 |       |   | $      | -         |   |   | $                 | -      |   |                             | $      | - |   |   | $ | - |   |
| Customer deposits                                                                        |   |   | 110,538   |   |             |   | 110,538 |       |   |   | -         |   |   |              | -      |   |                             |   | - |   |   |   | - |   |
| Accrued interest to related party                                                        |   |   | 50,034    |   |             |   | 50,034  |       |   |   | -         |   |   |              | -      |   |                             |   | - |   |   |   | - |   |
| Note payable to related party                                                            |   |   | 471,088   |   |             |   | -       |       |   |   | 299,175   |   |   |              | -      |   |                             |   | 171,913 |   |   |   | - |   |
| Note payable                                                                             |   |   | 14,870    |   |             |   | 14,870  |       |   |   | -         |   |   |              | -      |   |                             |   | - |   |   |   | - |   |
|                                                                                     |   |   | 780,822   |   |             |   | 309,734 |       |   |   | 299,175   |   |   |              | -      |   |                             |   | 171,913 |   |   |   | - |   |
| Other contractual commitments (1)                                                        |   |   | 354,121   |   |             |   | 102,960 |       |   |   | 250,675   |   |   |              | 486    |   |                             |   | - |   |   |   | - |   |
| Total contractual obligations                                                            |   | $      | 1,134,943 |   |             | $      | 412,694 |       |   | $      | 549,850   |   |   | $                 | 486    |   |                             | $      | 171,913 |   |   | $ | - |   |
|                                                                                     |   |   |      |   |             |   |    |       |   |   |      |   |   |              |   |   |                             |   |   |   |   |   |   |   |
| (1) Office lease commitment expiring June 2014 and office equipment lease expiring 2015. |   |   |      |   |             |   |    |       |   |   |      |   |   |

----

----

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| ASSETS                                                                                          |   |         |       |
|-------------------------------------------------------------------------------------------------|--------|--------------|------------|
|                                                                                            |   | February, 28 |       |
|                                                                                            |   | 2010         |       |   | 2009 (Restated)* |   |
| CURRENT ASSETS                                                                                  |   |         |       |   |   |   |
| Cash and cash equivalents                                                                       |   | $            | 502,167    |   |   | $ | 160,415 |   |
| Accounts receivable, net of allowance for doubtful accounts of $11,537 and $3,986, respectively |   |         | 224,468    |   |   |   | 61,447 |   |
| Inventory, net                                                                                  |   |         | 383,675    |   |   |   | 409,353 |   |
| Prepaids, deposits and other current assets                                                     |   |         | 34,079     |   |   |   | 21,584 |   |
|       Total current assets                                        |   |         | 1,144,389  |   |   |   | 652,799 |   |
|                                                                                            |   |         |       |   |   |   |   |   |
| PROPERTY AND EQUIPMENT, NET                                                                     |   |         | 117,016    |   |   |   | 129,963 |   |
|                                                                                            |   |         |       |   |   |   |   |   |
| OTHER ASSETS                                                                                    |   |         |       |   |   |   |   |   |
| Intangible assets, net                                                                          |   |         | 9,742      |   |   |   | 16,374 |   |
| Other assets                                                                                    |   |         | 8,514      |   |   |   | 6,624 |   |
|                                                                                            |   |         |       |   |   |   |   |   |
|          TOTAL ASSETS          |   | $            | 1,279,661  |   |   | $ | 805,760 |   |
|                                                                                            |   |         |       |   |   |   |   |   |
| LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)                                                  |   |         |       |   |   |   |   |   |
|                                                                                            |   |         |       |   |   |   |   |   |
| CURRENT LIABILITIES                                                                             |   |         |       |   |   |   |   |   |
|    Accounts payable and accrued expenses                                         |   | $            | 134,292    |   |   | $ | 92,818 |   |
|    Customer deposits                                                             |   |         | 110,538    |   |   |   | 177,325 |   |
|    Accrued interest payable to related party                                     |   |         | 50,034     |   |   |   | 20,115 |   |
|    Notes payable and capital lease obligation                                    |   |         | 14,870     |   |   |   | 111,932 |   |
|       Total current liabilities                                   |   |         | 309,734    |   |   |   | 402,190 |   |
|                                                                                            |   |         |       |   |   |   |   |   |
| LONG-TERM LIABILITIES                                                                           |   |         |       |   |   |   |   |   |
|      Capital lease obligation                                          |   |         | -          |   |   |   | 14,870 |   |
|      Long-term notes payable – related party                     |   |         | 471,088    |   |   |   | 471,088 |   |
|       Total long-term liabilities                                 |   |         | 471,088    |   |   |   | 485,958 |   |
|                                                                                            |   |         |       |   |   |   |   |   |
|       Total liabilities                                           |   |         | 780,822    |   |   |   | 888,148 |   |
|                                                                                            |   |         |       |   |   |   |   |   |
| Commitments and contingencies                                                                   |   |         |       |   |   |   |   |   |
|                                                                                            |   |         |       |   |   |   |   |   |
| STOCKHOLDERS' EQUITY (DEFICIT)                                                                  |   |         |       |   |   |   |   |   |
| Preferred stock, 6,000,000 shares authorized,                                                   |   |         |       |   |   |   |   |   |
|     none issued or outstanding                                              |   |         | -          |   |   |   | - |   |
| Common stock $0.001 par value, 50,000,000 shares                                                |   |         |       |   |   |   |   |   |
| authorized, 25,854,146 and 25,824,146 shares                                                    |   |         |       |   |   |   |   |   |
| issued and outstanding, respectively                                                            |   |         | 25,854     |   |   |   | 25,824 |   |
| Additional paid-in capital                                                                      |   |         | 6,925,904  |   |   |   | 6,907,637 |   |
| Accumulated deficit                                                                             |   |         | (6,452,919 | ) |   |   | (7,015,849 | ) |
|                                                                                            |   |         |       |   |   |   |   |   |
|       Total Stockholders' Equity(Deficit)                         |   |         | 498,839    |   |   |   | (82,388 | ) |
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)                                      |   | $            | 1,279,661  |   |   | $ | 805,760 |   |

----

|                                                        |   |                |       |
|-------------------------------------------------------------|--------|---------------------|------------|
|                                                        |   |                |       |
|                                                        |   | For the Years Ended |       |
|                                                        |   | February 28,        |       |
|                                                        |   |                |       |   | (Restated*) |   |
|                                                        |   | 2010                |       |   | 2009 |   |
|                                                        |   |                |       |   |   |   |
| SALES                                                       |   | $                   | 2,743,671  |   |   | $ | 1,172,998 |   |
| COST OF SALES                                               |   |                | 1,354,121  |   |   |   | 602,256 |   |
| GROSS PROFIT                                                |   |                | 1,389,550  |   |   |   | 570,742 |   |
|                                                        |   |                |       |   |   |   |   |   |
| OPERATING EXPENSES                                          |   |                |       |   |   |   |   |   |
| Selling, general and administrative expenses                |   |                | 755,333    |   |   |   | 845,621 |   |
| Depreciation and amortization                               |   |                | 18,946     |   |   |   | 14,826 |   |
|                                                        |   |                |       |   |   |   |   |   |
|      Total operating expenses      |   |                | 774,279    |   |   |   | 860,447 |   |
|                                                        |   |                |       |   |   |   |   |   |
| INCOME (LOSS) FROM OPERATIONS                               |   |                | 615,271    |   |   |   | (289,705 | ) |
|                                                        |   |                |       |   |   |   |   |   |
| OTHER INCOME (EXPENSES)                                     |   |                |       |   |   |   |   |   |
| Interest income                                             |   |                | 551        |   |   |   | 56 |   |
| Interest expense-related party                              |   |                | (37,829    | ) |   |   | (35,266 | ) |
| Interest expense                                            |   |                | (12,452    | ) |   |   | (11,774 | ) |
| Other income (expense)                                      |   |                | (2,611     | ) |   |   | 24,001 |   |
|                                                        |   |                |       |   |   |   |   |   |
|      Total other income (expenses) |   |                | (52,341    | ) |   |   | (22,983 | ) |
|                                                        |   |                |       |   |   |   |   |   |
| NET INCOME (LOSS) BEFORE INCOME TAXES                       |   |                | 562,930    |   |   |   | (312,688 | ) |
|                                                        |   |                |       |   |   |   |   |   |
| Provision for income taxes                                  |   |                |  -    |   |   |   |  - |   |
|                                                        |   |                |       |   |   |   |   |   |
| NET INCOME (LOSS)                                           |   | $                   | 562,930    |   |   | $ | (312,688 | ) |
| NET INCOME (LOSS) PER SHARE                                 |   |                |       |   |   |   |   |   |
| Basic                                                       |   | $                   | 0.02       |   |   | $ | (0.01 | ) |
| Diluted                                                     |   | $                   | 0.02       |   |   | $ | (0.01 | ) |
| WEIGHTED AVERAGE NUMBER OF                                  |   |                |       |   |   |   |   |   |
| SHARES OUTSTANDING                                          |   |                |       |   |   |   |   |   |
| Basic                                                       |   |                | 25,833,105 |   |   |   | 25,773,953 |   |
| Diluted                                                     |   |                | 26,825,605 |   |   |   | 25,773,953 |   |
|                                                        |   |                |       |   |   |   |   |   |

----

|                                      |   |         |       |   |       |   |   |            |   |   |      |   |   |   |       |
|-------------------------------------------|--------|--------------|------------|--------|------------|--------|--------|-----------------|--------|--------|-----------|--------|--------|--------|------------|
|                                      |   |         |       |   |       |   |   |            |   |   |      |   |   |   |       |
|                                      |   | Common Stock |       |   | Additional |   |   | Accumulated     |   |   |      |   |
|                                      |   | Shares       |       |   | Amount     |   |   | Paid-In Capital |   |   | Deficit   |   |   | Total  |       |
|                                      |   |         |       |   |       |   |   |            |   |   |      |   |   |   |       |
| Balance at February 29, 2008 (restated)   |   |         | 25,613,670 |   |       | $      | 25,614 |            |   | $      | 6,322,685 |   |   | $      | (6,703,161 | ) |   | $ | (354,862 | ) |
|                                      |   |         |       |   |       |   |   |            |   |   |      |   |   |   |       |   |   |   |   |   |
| Contributed services                      |   |         | -          |   |       |   | -      |            |   |   | 10,000    |   |   |   | -          |   |   |   | 10,000 |   |
| Issuance of common stock for compensation |   |         | 40,000     |   |       |   | 40     |            |   |   | 11,960    |   |   |   | -          |   |   |   | 12,000 |   |
| Issuance of common stock as               |   |         |       |   |       |   |   |            |   |   |      |   |   |   |       |   |   |   |   |   |
| for accounts payable and notes payable    |   |         | 230,476    |   |       |   | 230    |            |   |   | 66,504    |   |   |   | -          |   |   |   | 66,734 |   |
| Warrants issued for                       |   |         |       |   |       |   |   |            |   |   |      |   |   |   |       |   |   |   |   |   |
| interest due to related party             |   |         | -          |   |       |   | -      |            |   |   | 224,970   |   |   |   | -          |   |   |   | 224,970 |   |
| Warrants issued for services              |   |         | -          |   |       |   | -      |            |   |   | 287,208   |   |   |   | -          |   |   |   | 287,208 |   |
| Common stock repurchase and cancellation  |   |         | (60,000    | )      |       |   | (60    | )               |   |   | (15,690   | )      |   |   | -          |   |   |   | (15,750 | ) |
| Net loss (restated) for the year          |   |         |       |   |       |   |   |            |   |   |      |   |   |   |       |   |   |   |   |   |
|                                      |   |         | -          |   |       |   | -      |            |   |   | -         |   |   |   | (312,688   | ) |   |   | (312,688 | ) |
| Balance at February 28, 2009 (restated)   |   |         | 25,824,146 |   |       |   | 25,824 |            |   |   | 6,907,637 |   |   |   | (7,015,849 | ) |   |   | (82,388 | ) |
|                                      |   |         |       |   |       |   |   |            |   |   |      |   |   |   |       |   |   |   |   |   |
| Issuance of common stock for compensation |   |         | 30,000     |   |       |   | 30     |            |   |   | 6,570     |   |   |   | -          |   |   |   | 6,600 |   |
| Warrants issued for services              |   |         |       |   |       |   |   |            |   |   | 1,697     |   |   |   |       |   |   |   | 1,697 |   |
| Contributed services                      |   |         |       |   |       |   |   |            |   |   | 10,000    |   |   |   |       |   |   |   | 10,000 |   |
| Net income                                |   |         |       |   |       |   |   |            |   |   |      |   |   |   |       |   |   |   |   |   |
|                                      |   |         | -          |   |       |   | -      |            |   |   | -         |   |   |   | 562,930    |   |   |   | 562,930 |   |
| Balance at February 28, 2010              |   |         | 25,854,146 |   |       | $      | 25,854 |            |   | $      | 6,925,904 |   |   | $      | (6,452,919 | ) |   | $ | 498,839 |   |

----

|                                                     |   |                |     |   |        |    |
|----------------------------------------------------------|--------|---------------------|----------|--------|-------------|---------|
|                                                     |   | For the Years Ended |     |
|                                                     |   | February 28,        |     |
|                                                     |   |                |     |   | (Restated*) |    |
|                                                     |   | 2010                |     |   | 2009        |    |
|                                                     |   |                |     |   |        |    |
| CASH FLOW FROM OPERATING ACTIVITIES:                     |   |                |     |   |        |    |
| Net income (loss)                                        |   | $                   | 562,930  |   |        | $       | (312,688 | ) |
| Adjustments to reconcile net income (loss) to net cash   |   |                |     |   |        |    |   |   |
| provided by operating activities:                        |   |                |     |   |        |    |   |   |
| Depreciation and amortization                            |   |                | 54,671   |   |        |    | 47,623 |   |
| Contributed services                                     |   |                | 10,000   |   |        |    | 10,000 |   |
| Stock-based compensation                                 |   |                | 8,297    |   |        |    | 302,442 |   |
| Return of common shares to treasury                      |   |                | -        |   |        |    | (15,750 | )  |
| Provision for doubtful accounts                          |   |                | 7,551    |   |        |    | 1,892 |   |
| Changes in operating assets and liabilities:             |   |                |     |   |        |    |   |   |
| Accounts receivable                                      |   |                | (170,572 | )      |        |    | (42,630 | ) |
| Inventory                                                |   |                | 25,678   |   |        |    | (25,981 | ) |
| Prepaids, deposits and other current assets              |   |                | (12,495  | )      |        |    | 1,802 |   |
| Accounts payable and accrued expenses                    |   |                | 41,474   |   |        |    | (44,840 | ) |
| Accrued interest payable to related party                |   |                | 29,919   |   |        |    | 29,915 |   |
| Customer deposits                                        |   |                | (66,787  | )      |        |    | 110,374 |   |
|                                                     |   |                |     |   |        |    |   |   |
| Net Cash Provided by Operating Activities                |   |                | 490,666  |   |        |    | 62,159 |   |
|                                                     |   |                |     |   |        |    |   |   |
| CASH FROM INVESTING ACTIVITIES:                          |   |                |     |   |        |    |   |   |
| Purchase of property and equipment                       |   |                | (34,152  | )      |        |    | (28,071 | ) |
| Purchase of intangible assets                            |   |                | (940     | )      |        |    | (326 | )  |
| Other long-term assets                                   |   |                | (1,890   | )      |        |    | - |   |
|                                                     |   |                |     |   |        |    |   |   |
| Net Cash Used in Investing Activities                    |   |                | (36,982  | )      |        |    | (28,397 | ) |
|                                                     |   |                |     |   |        |    |   |   |
| CASH FROM FINANCING ACTIVITIES:                          |   |                |     |   |        |    |   |   |
| Proceeds from related party notes payable                |   |                | -        |   |        |    | 75,000 |   |
| Proceeds from notes payable                              |   |                | -        |   |        |    | 35,000 |   |
| Repayment of notes payable and capital lease obligation  |   |                | (111,932 | )      |        |    | (3,198 | ) |
| Repurchase of common stock                               |   |                | -        |   |        |    | - |   |
|                                                     |   |                |     |   |        |    |   |   |
| Net Cash Provided by (Used in) Financing Activities      |   |                | (111,932 | )      |        |    | 106,802 |   |
|                                                     |   |                |     |   |        |    |   |   |
| NET INCREASE IN CASH                                     |   |                | 341,752  |   |        |    | 140,564 |   |
| CASH AT BEGINNING OF YEAR                                |   |                | 160,415  |   |        |    | 19,851 |   |
|                                                     |   |                |     |   |        |    |   |   |
| CASH AT END OF YEAR                                      |   | $                   | 502,167  |   |        | $       | 160,415 |   |
|                                                     |   |                |     |   |        |    |   |   |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:       |   |                |     |   |        |    |   |   |
|                                                     |   |                |     |   |        |    |   |   |
| CASH PAID FOR:                                           |   |                |     |   |        |    |   |   |
| Interest                                                 |   | $                   | 20,362   |   |        | $       | 29,623 |   |
| Income taxes                                             |   | $                   | -        |   |        | $       | - |   |
| NON-CASH INVESTING AND  FINANCING ACTIVITIES   |   |                |     |   |        |    |   |   |
| Equipment purchased under capital lease                  |   |                | -        |   |        |    | 30,000 |   |
| Stock issued for settlement of debt and accrued interest |   |                | -        |   |        |    | 66,734 |   |
|  Warrants issued for related party interest         |   | $              |  -  |   |        | $  |  224,970 |   |

----

----

----

----

|                    |   |   |  Years Ended  |   |
|-------------------------|--------|--------|--------------------|--------|
|                    |   |   |  February 28, |   |  February 28, |   |
|                    |   |   |  2010         |   |  2009 |   |
| Expected life in years  |   |   |  2            |   |  2 |   |
| Stock price volatility  |   |   | 139-161%           |   | 139-161% |   |
| Risk free interest rate |   |   | 2.3 - 3.1%         |   | 2.3 - 3.1% |   |
| Expected dividends      |   |   | None               |   | None |   |

|                                               |   | For the years ended |       |
|----------------------------------------------------|--------|---------------------|------------|
|                                               |   | February 28,        |       |
|                                               |   | 2010                |       |   | 2009 |   |
| Numerator:                                         |   |                |       |   |   |   |
| Net Income (loss) available to common shareholders |   | $                   | 562,930    |   |   | $ | (312,688 | ) |
| Weighted average shares - basic                    |   |                | 25,833,105 |   |   |   | 25,773,953 |   |
| Net income (loss) per share - basic                |   | $                   | 0.02       |   |   | $ | (0.01 | ) |
|                                               |   |                |       |   |   |   |   |   |
| Dilutive effect of common stock equivalents:       |   |                |       |   |   |   |   |   |
| Warrants                                           |   |                | 992,500    |   |   |   | - |   |
| Weighted average shares - diluted                  |   |                | 26,825,605 |   |   |   | 25,773,953 |   |
| Net income (loss) per share - diluted              |   | $                   | 0.02       |   |   | $ | (0.01 | ) |

----

|                                           |   | February 28, |           |
|------------------------------------------------|--------|--------------|----------------|
|                                           |   | 2010         |           |   | 2009 |   |
| Raw materials                                  |   | $            | 197,231        |   |   | $ | 230,018 |   |
| Work in Progress                               |   |         | 98,950         |   |   |   | 53,187 |   |
| Finished goods                                 |   |         | 158,156        |   |   |   | 260,461 |   |
|                                           |   |         | 454,337        |   |   |   | 543,666 |   |
| Reserve for obsolete and slow moving inventory |   |         |  (70,662) |   |   |   | (134,313 | ) |
|                                           |   | $            | 383,675        |   |   | $ | 409,353 |   |

| The following is a summary of property and equipment at February 28, 2010 and February 28, 2009: |   | February 28, |     |
|--------------------------------------------------------------------------------------------------|--------|--------------|----------|
|                                                                                             |   | 2010         |     |   | 2009 |   |
| Tooling                                                                                          |   | $            | 339,852  |   |   | $ | 311,918 |   |
| Equipment                                                                                        |   |         | 59,654   |   |   |   | 56,654 |   |
| Vehicles                                                                                         |   |         | 10,000   |   |   |   | 10,000 |   |
| Furniture and fixtures                                                                           |   |         | 15,775   |   |   |   | 15,775 |   |
| Computer equipment                                                                               |   |         | 16,520   |   |   |   | 16,520 |   |
| Leasehold equipment                                                                              |   |         | 7,928    |   |   |   | 4,709 |   |
|                                                                                             |   |         | 449,729  |   |   |   | 415,576 |   |
|  Less: accumulated depreciation                                                             |   |         | (332,713 | ) |   |   | (285,613 | ) |
|                                                                                             |   | $            | 117,016  |   |   | $ | 129,963 |   |

----

|                           |   | February 28, |    |
|--------------------------------|--------|--------------|---------|
|                           |   | 2010         |    |   | 2009 |   |
| Trademarks                     |   | $            | 24,100  |   |   | $ | 24,100 |   |
| Patents                        |   |         | 13,992  |   |   |   | 13,052 |   |
|                           |   |         | 38,092  |   |   |   | 37,152 |   |
| Less: accumulated amortization |   |         | (28,350 | ) |   |   | (20,778 | ) |
|                           |   | $            | 9,742   |   |   | $ | 16,374 |   |

|                                                                                                                                                                                                                                                                                                                                                                                               |   | February 28, |     |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------|----------|
|                                                                                                                                                                                                                                                                                                                                                                                               |   | 2010         |     |   | 2009 |   |
| Line of credit with a bank with a maximum borrowing of $100,000 is collateralized by all business assets. Any principal amounts outstanding accrue interest at the bank's index rate (approximately 5.785% as of February 28, 2010) plus 2% per annum.  There were no available borrowings as of February 28, 2009. This line of credit was paid in full during fiscal 2010.   |   | $            | -        |   |   | $ |           100,000 |   |
|                                                                                                                                                                                                                                                                                                                                                                                               |   |         |     |   |   |   |   |   |
| Bagging machine financed for production. Lease term is 27 months at an annual interest rate of 33%.                                                                                                                                                                                                                                                                                           |   |         | 14,870   |   |   |   |   26,802 |   |
|                                                                                                                                                                                                                                                                                                                                                                                               |   |         | 14,870   |   |   |   | 126,802 |   |
|   Less current portion                                                                                                                                                                                                                                                                                                                                                                        |   |         | (14,870) |   |   |   | (111,932) |   |
|   Long term portion                                                                                                                                                                                                                                                                                                                                                                           |   | $            | -        |   |   | $ | 14,870 |   |

| Initial Principal Amount |   | Remaining Principal Amount as of February 28, 2010 |   | Due Date          |
|--------------------------|--------|----------------------------------------------------|--------|-------------------|
| $350,000                 |   | $    243,080                   |   | May 1, 2011       |
|     12,189     |   |        12,189        |   | February 28, 2012 |
|    43,906      |   |        43,906        |   | February 28, 2013 |
|  100,000            |   |        96,913        |   | May 1, 2017       |
|    75,000      |   | $     75,000              |   | March 31, 2018    |
| $581,095                 |   | $   471,088                         |   |              |

----

|                                                                                 |   |       |     |   | Weighted-  |     |
|--------------------------------------------------------------------------------------|--------|------------|----------|--------|------------|----------|
|                                                                                 |   |       |     |   | Average    |     |
|                                                                                 |   | Restricted |     |   | Grant Date |     |
|                                                                                 |   | Shares     |     |   | Fair Value |     |
|                                                                                 |   |       |     |   |       |     |
| Outstanding at February 29, 2008                                                     |   |       | 28,333   |   |       | $        | - |   |
| Granted                                                                              |   |       | 270,476  |   |       |     | 0.29 |   |
| Forfeited                                                                            |   |       | (60,000) |   |       |     | 0.26 |   |
| Vested                                                                               |   |       | -        |   |       |     | 0.00 |   |
| Outstanding at February 28, 2009                                                     |   |       | 238,809  |   |       |     |   |   |
| Granted                                                                              |   |       | 30,000   |   |       |     | 0.00 |   |
| Forfeited                                                                            |   |       | -        |   |       |     | 0.00 |   |
| Vested                                                                               |   |       | -        |   |       |     | 0.00 |   |
| Outstanding at February 28, 2010                                                     |   |       | 268,809  |   |       |   $ | 0.40 |   |
|                |   |       |     |   |       |     |   |   |

|                             |   |        |        |   | Weighted- |   |
|----------------------------------|--------|-------------|-------------|--------|-----------|--------|
|                             |   |        |        |   | Average   |   |
|                             |   | Warrants    |        |   | Exercise  |   |
|                             |   | Outstanding |        |   | Price     |   |
|                             |   |        |        |   |      |   |
| Outstanding at February 29, 2008 |   |        | 6,807,221   |   |      | $      | 0.23 |   |
| Granted                          |   |        | 1,742,500   |   |      |   | 0.330 |   |
| Exercised                        |   |        | -           |   |      |   | - |   |
| Forfeited                        |   |        | (2,000,000) |   |      |   | - |   |
| Outstanding at February 28, 2009 |   |        | 6,549,721   |   |      |   | 0.25 |   |
| Granted                          |   |        | -           |   |      |   | 0.00 |   |
| Exercised                        |   |        | -           |   |      |   | - |   |
| Forfeited                        |   |        | -           |   |      |   | - |   |
| Outstanding at February 28, 2010 |   |        | 6,549,721   |   |      |   | 0.25 |   |
| Vested at February 28, 2010      |   |        | 6,549,721   |   |      |   | 0.25 |   |
| Exercisable at February 28, 2010 |   |        | 6,549,721   |   |      |   | 0.25 |   |

----

|           |   |   | Warrants Outstanding |   |      | Warrants Exercisable |   |
|----------------|--------|--------|----------------------|--------|-----------|----------------------|--------|
|           |   |   |                 |   |      | Weighted             |   |   | Weighted |   |   |   |   |   | Weighted |   |
|           |   |   |                 |   |      | Average              |   |   | Average |   |   |   |   |   | Average |   |
|           |   |   |                 |   |      | Remaining            |   |   | Exercise |   |   | Number |   |   | Exercise |   |
| Exercise Price |   |   | Number               |   |      | Life (Years)         |   |   | Price |   |   | Outstanding |   |   | Price |   |
|           |   |   |                 |   |      |                 |   |   |   |   |   |   |   |   |   |   |
| $              | 0.19   |   |                 |   | 600,000   |                 |   |   | 0.51 |   |   | $ | 0.19 |   |   |   | 600,000 |   |   | $ | 0.19 |   |
|           | 0.23   |   |                 |   | 4,000,000 |                 |   |   | 0.83 |   |   |   | 0.23 |   |   |   | 4,000,000 |   |   |   | 0.23 |   |
|           | 0.29   |   |                 |   | 107,221   |                 |   |   | 0.51 |   |   |   | 0.29 |   |   |   | 107,221 |   |   |   | 0.29 |   |
|           | 0.40   |   |                 |   | 100,000   |                 |   |   | 0.17 |   |   |   | 0.40 |   |   |   | 100,000 |   |   |   | 0.40 |   |
|           | 0.33   |   |                 |   | 1,700,000 |                 |   |   | 0.51 |   |   |   | 0.33 |   |   |   | 1,700,000 |   |   |   | 0.33 |   |
|           | 0.16   |   |                 |   | 30,000    |                 |   |   | 0.17 |   |   |   | 0.16 |   |   |   |      30,000 |   |   |   | 0.16 |   |
|           | 0.25   |   |                 |   | 10,000    |                 |   |   | 0.29 |   |   |   | 0.25 |   |   |   |      10,000 |   |   |   | 0.25 |   |
|           | 0.40   |   |                 |   | 2,500     |                 |   |   | 0.19 |   |   |   | 0.40 |   |   |   |        2,500 |   |   |   | 0.40 |   |
|           |   |   |                 |   | 6,549,721 |                 |   |   |   |   |   | $ | 0.25 |   |   |   | 6,549,721 |   |   | $ | 0.25 |   |
|           |   |   |                 |   |      |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| Number of Vested Warrants "In the Money" |   | StrikePrices |   | IntrinsicValue                             |
|-----------------------------------------------|--------|--------------|--------|--------------------------------------------|
|                                          |   |
| 10,000                                        |   | 0.25         |   | $      2,500 |
| 15,000                                        |   | 0.16         |   | 2,400                                      |
| 15,000                                        |   | 0.16         |   | 2,400                                      |
| 250,000                                       |   | 0.19         |   | 47,500                                     |
| 100,000                                       |   | 0.19         |   | 19,000                                     |
| 250,000                                       |   | 0.19         |   | 47,500                                     |
| 2,500,000                                     |   | 0.225        |   | 562,500                                    |
| 750,000                                       |   | 0.225        |   | 168,750                                    |
| 750,000                                       |   | 0.225        |   | 168,750                                    |
| 4,640,000                                     |   |         |   | $1,021,300                                 |

----

|                   |   | February 28, |       |
|------------------------|--------|--------------|------------|
|                   |   | 2010         |       |   | 2009 |   |
| Deferred tax assets:   |   |         |       |   |   |   |
| NOL carryover          |   | $            | 2,119,088  |   |   | $ | 2,321,416 |   |
| Valuation allowance    |   |         | (2,119,088 | ) |   |   | (2,321,416 | ) |
| Net deferred tax asset |   | $            | -          |   |   | $ | - |   |

|                             |   | February 28, |     |
|----------------------------------|--------|--------------|----------|
|                             |   | 2010         |     |   | 2009 |   |
| Book income (loss)               |   | $            | 222,752  |   |   | $ | (123,512 | ) |
| Stock-based compensation         |   |         | 7,227    |   |   |   | 211,000 |   |
| Accrued interest related parties |   |         | 14,942   |   |   |   | 9,397 |   |
| Other non-deductible differences |   |         | 5,221    |   |   |   | 2,498 |   |
| Change in valuation allowance    |   |         | (249,748 | ) |   |   | (99,384 | ) |
|                             |   | $            | -        |   |   | $ | - |   |

----

|   | Year Ending        |   |    |
|--------|--------------------|--------|---------|
|   |  February 28, |   | Amount  |
|   |               |   |    |
|   | 2011               |   |  $ | 102,960 |
|   | 2012               |   |    | 102,960 |
|   | 2013               |   |    | 102,960 |
|   | 2014               |   |    | 45,241 |
|   |  Total        |   | $       | 354,121 |

----

|                                    |   | 2010   |      |   | 2009   |   |
|----------------------------------------------|--------|--------|-----------|--------|--------|--------|
| Water filtration products sold to            |   |   |      |   |   |   |
|    external customers (1) in: |   |   |      |   |   |   |
| The United States                            |   | $      | 2,689,555 |   |   | $      | 1,047,728 |   |
| China                                        |   |   | 102       |   |   |   | 3,573 |   |
| Asia, except China                           |   |   | 5,350     |   |   |   | 17,101 |   |
| United Kingdom                               |   |   | 27,528    |   |   |   | 74,180 |   |
| Other countries                              |   |   | 20,696    |   |   |   | 30,416 |   |
|                                         |   |   |      |   |   |   |   |   |
| Total                                        |   | $      | 2,743,231 |   |   | $      | 1,172,998 |   |

|                        |   | United |   |   |   |   |                                                                                                                      |   |   |
|-----------------------------|--------|--------|--------|--------|--------|--------|---------------------------------------------------------------------------------------------------------------------------|--------|--------|
|                        |   | States |   |   | China  |   |                                                                                                                      | Total  |   |
|                        |   |   |   |   |   |   |                                                                                                                      |   |   |
| Property and equipment, net |   | $      | 48,183 |   |   | $      | 68,833                                                                                                                    |   |   | $ | 117,016 |   |
|                        |   |   |   |   |   |   |                                                                                                                      |   |   |   |   |   |
| Intangible assets           |   |   | 9,742  |   |   |   |                     - |   |   |   | 9,742 |   |
|                        |   |   |   |   |   |   |                                                                                                                      |   |   |   |   |   |
| Other assets                |   |   | 8,514  |   |   |   |                    -       |   |   |   | 8,514 |   |
|                        |   | $      | 64,439 |   |   | $      | 68,883                                                                                                                    |   |   | $ | 135,272 |   |

|                        |   | United |   |   |   |   |                                                                                                                      |   |   |
|-----------------------------|--------|--------|--------|--------|--------|--------|---------------------------------------------------------------------------------------------------------------------------|--------|--------|
|                        |   | States |   |   | China  |   |                                                                                                                      | Total  |   |
|                        |   |   |   |   |   |   |                                                                                                                      |   |   |
| Property and equipment, net |   | $      | 64,260 |   |   | $      | 65,703                                                                                                                    |   |   | $ | 129,963 |   |
| Intangible assets           |   |   | 16,374 |   |   |   |                     - |   |   |   | 16,374 |   |
|                        |   |   |   |   |   |   |                                                                                                                      |   |   |   |   |   |
| Other assets                |   |   | 6,624  |   |   |   |                    -       |   |   |   | 6,624 |   |
|                        |   | $      | 87,258 |   |   | $      | 65,703                                                                                                                    |   |   | $ | 152,961 |   |

----

|                                  |   | Consolidated Balance Sheets     |       |
|---------------------------------------|--------|---------------------------------|------------|
|                                  |   |                            |       |
|                                  |   | For the Year Ended February 28, |       |
|                                  |   | 2009                            |       |   | 2009 |   |   | Difference |   |
|                                  |   | (As OriginallyReported)         |       |   | (Restated) |   |   |   |   |
| Total Current Assets                  |   | $                               | 709,042    |   |   | $ | 652,799 |   |   | $ | (56,243 | ) |
| Property and Equipment, net           |   |                            | 129,964    |   |   |   | 129,963 |   |   |   | (1 | ) |
| Intangible assets                     |   |                            | 16,374     |   |   |   | 16,374 |   |   |   | - |   |
| Other assets                          |   |                            | 6,624      |   |   |   | 6,624 |   |   |   | - |   |
| Total Assets                          |   |                            | 862,004    |   |   |   | 805,760 |   |   |   | (56,244 | ) |
|                                  |   |                            |       |   |   |   |   |   |   |   |   |   |
| Total Current Liabilities             |   |                            | 473,304    |   |   |   | 402,190 |   |   |   | (71,114 | ) |
| Notes payable                         |   |                            | -          |   |   |   | 14,870 |   |   |   | 14,870 |   |
| Long-term related party notes payable |   |                            | 471,088    |   |   |   | 471,088 |   |   |   | - |   |
| Total Liabilities                     |   |                            | 944,392    |   |   |   | 888,148 |   |   |   | (56,244 | ) |
|                                  |   |                            |       |   |   |   |   |   |   |   |   |   |
| Preferred stock                       |   |                            | -          |   |   |   | - |   |   |   | - |   |
| Common stock                          |   |                            | 25,824     |   |   |   | 25,824 |   |   |   | - |   |
| Additional paid-in capital            |   |                            | 6,907,637  |   |   |   | 6,907,637 |   |   |   | - |   |
| Accumulated deficit                   |   | $                               | (7,015,849 | ) |   | $ | (7,015,849 | ) |   | $ | - |   |
|                                  |   |                            | (82,388    | ) |   |   | (82,388 | ) |   |   | - |   |

----

|                                                   |   | Consolidated Statements of Operations |
|--------------------------------------------------------|--------|---------------------------------------|
|                                                   |   |                                  |   |   |   |   |   |   |   |
|                                                   |   | For the Years Ended February 28,      |   |
|                                                   |   | 2009                                  |   |   | 2009 |   |   | Difference |   |
|                                                   |   | (As Originally Reported)              |   |   | (Restated) |   |   |   |   |
| SALES                                                  |   | $                                     | 1,123,370 |   |   | $ | 1,172,998 |   |   | $ | 49,628 |   |
| COST OF SALES                                          |   |                                  | 594,766 |   |   |   | 602,256 |   |   |   | (7,490 | )  |
|    Gross profit                         |   |                                  | 528,604 |   |   |   | 570,742 |   |   |   | 42,138 |   |
| OPERATING EXPENSES                                     |   |                                  |   |   |   |   |   |   |   |   |   |   |
| Selling, general and administrative expenses           |   |                                  | 861,530 |   |   |   | 845,621 |   |   |   | (15,909 | )  |
| Depreciation and amortization                          |   |                                  | - |   |   |   | 14,826 |   |   |   | 14,826 |   |
|      Total operating expenses |   |                                  | 861,530 |   |   |   | 860,447 |   |   |   | (1,083 | )  |
| INCOME (LOSS) FROM OPERATIONS                          |   |                                  | (332,926 | ) |   |   | (289,705 | ) |   |   | 43,221 |   |
| Total Other income (expense)                           |   |                                  | 2,771 |   |   |   | (22,983 | ) |   |   | (25,754 | )  |
| NET INCOME (LOSS) BEFORE INCOME TAXES                  |   |                                  | (330,155 | ) |   |   | (312,688 | ) |   |   | 17,467 |   |
| NET INCOME (LOSS)                                      |   |                                  | (330,155 | ) |   |   | (312,688 | ) |   | $ | 17,467 |   |
| WEIGHTED AVERAGE NUMBER OF                             |   |                                  |   |   |   |   |   |   |   |   |   |   |
| SHARES OUTSTANDING                                     |   |                                  |   |   |   |   |   |   |   |   |   |   |
| Basic                                                  |   |                                  | (0.01 | )  |   |   | (0.01 | )  |   |   | - |   |
| Diluted                                                |   |                                  | (0.01 | )  |   |   | (0.01 | )  |   |   | - |   |

----

|                                                |   | Consolidated Statements of Cash Flows |     |
|-----------------------------------------------------|--------|---------------------------------------|----------|
|                                                |   |                                  |     |
|                                                |   | For the Year Ended February 28,       |     |
|                                                |   | 2010                                  |     |   | 2009 |   |   | Difference |   |
|                                                |   | (As OriginallyReported)               |     |   | (Restated) |   |   |   |   |
| CASH FLOW FROM OPERATING ACTIVITIES:                |   |                                  |     |   |   |   |   |   |   |
| Net income (loss)                                   |   | $                                     | (330,155 | ) |   | $ | (312,688 | ) |   | $ | 17,467 |   |
| Asset held for sale                                 |   |                                  | 149,111  |   |   |   | - |   |   |   | (149,111 | ) |
| Net Cash Provided by Operating Activities           |   |                                  | 255,424  |   |   |   | 62,159 |   |   |   | (178,447 | ) |
|  Net Cash (Used) in Investing Activities       |   |                                  | (42,466  | ) |   |   | (28,397 | ) |   |   | (54,931 | )  |
| Net Cash Provided by (Used) in Financing Activities |   |                                  | (72,394  | ) |   |   | 106,802 |   |   |   | 148,446 |   |
| NET INCREASE IN CASH                                |   |                                  | 140,564  |   |   |   | 140,564 |   |   |   | - |   |
| CASH AT BEGINNING OF YEAR                           |   |                                  | 19,851   |   |   |   | 19,851 |   |   |   | - |   |
|                                                |   |                                  |     |   |   |   |   |   |   |   |   |   |
| CASH AT END OF YEAR                                 |   | $                                     | 160,415  |   |   | $ | 160,415 |   |   | $ | - |   |

----

----

|    NAME | AGE    |                     POSITION HELD |   |
|-------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------|--------|
|              |   |                                                                                                                                  |   |
| Carl Palmer       | 75     | President, Chief Executive Officer and Director                                                                                       |   |
| Richard Parsons   | 75     | Executive Vice President, Secretary and Director                                                                                      |   |
| James Place       | 71     | Chief Operating Officer, Chief Financial Officer, Treasurer and Director                                                    |   |
|              |   |                                                                                                                                  |   |

----

----

| SUMMARY COMPENSATION TABLE         |
|-----------------------------------------|
|                                    |   | Long Term Compensation |   |   |
|                                    | Annual Compensation |   | Awards |   | Payouts |   |   |
| (a)                                     | (b) | (c) | (d) | (e) |   | (f) | (g) |   | (h) |   | (i) |
|   Name and Principle Position |   FiscalYear | Salary($) | Bonus($) | OtherAnnual Compensation($) |   | RestrictedStockAward(s)($) | SecuritiesUnderlyingOption/SARs(#) |   | LTIPPayouts($) |   | AllOtherCompensation($) |
|                                    |   |   |   |   |   |   |   |   |   |   |   |
| Carl PalmerPresident & CEODirector  | 201020092008  | $10,000(2)$10,000(2)$10,000(2)  | $0.00$0.00$0.00  | $0.00$0.00$0.00  |   | $0.00$0.00$0.00  | 000  |   | $0.00$0.00$0.00  |   | $0.00$0.00$0.00  |
|                                    |   |   |   |   |   |   |   |   |   |   |   |
| Richard Parsons (1)Executive VPDirector | 201020092008  | $36,000$0.00$0.00  | $0.00$0.00$0.00  | $0.00$0.00$0.00  |   |    $160,000 |   (4)  |   | $0.00$0.00$0.00  |   | $7,158(3)$23,883(3)$12,500(3)  |
|                                    |   |   |   |   |   |   |   |   |   |   |   |
| James Place (1)COO & CFODirector    | 201020092008  | $24,000$0.00$0.00  | $0.00$0.00$0.00  | $0.00$0.00$0.00  |   |   |      |   | $0.00$0.00$0.00  |   | $2,104(3)$14,160(3)$12,500(3)  |

| (1) | Elected to Board of Directors during November 2004. |
|-----|-----------------------------------------------------|

| (2) | Effective December 1, 2001, the Company entered into an employment agreement with the President of the Company.  The President of the Company has decided not to accept his salary until the Company becomes profitable accordingly, the Company recorded a contribution of capital of $10,000 per year in 2008, 2009.and 2010. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | During October 2006, the Company commenced paying an initial monthly stipend of $2,500 to J. Place and D. Parsons through December 2007.  The Company recorded compensation expense of $25,000 and $38,043 for the fiscal year ended February 29, 2009 and February 29, 2008, respectively. For the fiscal year ended February 28, 2010, monthly stipends paid to the directors totaled $69,262. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  (4) | During April 2008, Messr. Parsons was granted warrants for expanded management responsibilities to purchase 500,000 shares.  The warrants are exercisable any time after December 1, 2008 and expire December 1, 2010.  The fair market value of the warrants as of April 30, 2008 was estimated at approximately $160,000. |
|-----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|             Name |   Grant date |   Type |        Vesting      Schedule |  RestrictedSharesAwarded | GrantDatePrice |  GrantDateValue | TotalRestrictedShares atFebruary 28, 2010 |  YearEndValue |
|-------------------------------------------------------------------------|------------------------|------------------|-------------------------------------------------------------------------------------|-------------------------------|----------------|----------------------|-------------------------------------------|--------------------|
|                                                                    |                   |             |                                                                                |                          |           |                 |                                      |               |
| Richard Parsons                                                         | 11/30/2004             | RS               | 100% vested                                                                         | 240,000                       | $0.03          | $112,800             | 240,000                                   | $ 46,248           |
|                                                                    |                   |             |                                                                                |                          |           |                 |                                      |               |
| Richard Parsons                                                         | 03/29/2005             | RS               | 100% vested                                                                         | 316,312                       | $0.03          | $ 79,100             | 316,312                                   | $129,688           |
|                                                                    |                   |             |                                                                                |                          |           |                 |                                      |               |
| James Place                                                             | 11/30/2004             | RS               | 100% vested                                                                         | 240,000                       | $0.03          | $112,800             | 240,000                                   | $ 46,248           |

----

| NAME AND ADDRESS                                      | AMOUNT AND NATURE OF    |      | PERCENT OF |   |
|-------------------------------------------------------|----------------------------------------|-----------|------------|--------|
| OF BENEFICIAL OWNER                                   | BENEFICIAL OWNERSHIP (1)(2)(4)         |      | CLASS      |   |
|                                                  |                                   |      |       |   |
| The TAM Irrevocable Trust                             | 14,097,799                             |  (3) | 43.50%     |   |
| 4012 S. Rainbow #K111                                 |                                   |      |       |   |
| Las Vegas, NV 80103-2012                              |                                   |      |       |   |
|                                                  |                                   |      |       |   |
| Carl Palmer                                           | -0-                                    |      | -0-        |   |
| 251 Jeanell Dr., Ste 3                                |                                   |      |       |   |
| Carson City, NV 89703                                 |                                   |      |       |   |
|                                                  |                                   |      |       |   |
| Richard Parsons                                       | 2,109,763                              |      | 6.51%      |   |
| 251 Jeanell Dr., Ste 3                                |                                   |      |       |   |
| Carson City, NV 89703                                 |                                   |      |       |   |
|                                                  |                                   |      |       |   |
| James Place                                           | 1,255,000                              |      | 3.87%      |   |
| 251 Jeanell Dr., Ste 3                                |                                   |      |       |   |
| Carson City, NV 89703                                 |                                   |      |       |   |
|                                                  |                                   |      |       |   |
| All officers and directors as a Group (three persons) | 3,446,312                              |      | 10.38%     |   |

| (1) | All ownership is beneficial and of record, unless indicated otherwise. |
|-----|------------------------------------------------------------------------|

| (2) | Beneficial owners listed above have sole voting and investment power with respect to the shares shown, unless otherwise indicated. |
|-----|------------------------------------------------------------------------------------------------------------------------------------|

| (3) | The TAM  Irrevocable Trust is an irrevocable trust for the benefit of certain family members of Mr. Carl Palmer. Mr. Palmer disclaims any beneficial ownership or interest in this Trust. Cari Beck, his daughter, is the Trustee of the Trust and has total beneficiary rights, including all voting rights and investment power as the Trustee. The Trust is held in her name (50%) as well as that of Lindsay Helvey (25%) and Casey Helvey (25%), both granddaughters. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | There are no other financial instruments, including stock warrants, etc. that are issuable within sixty days from the filing of this document. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------|

----

|               |   | February 28,2010 |    |   | February 28,2009 |   |   |
|--------------------|--------|------------------|---------|--------|------------------|--------|--------|
|               |   |             |    |   |             |   |   |
| Audit fees         |   | $                | 68,800, |   |             | $      | 86,837 |   |   |
| Audit related fees |   |             | -0-     |   |             | $      | 2,632  |   |   |
| Tax fees           |   |             | -0-     |   |             |   | -0-    |   |   |
| All other fees     |   |             | -0-     |   |             |   | -0-    |   |   |
|               |   |             |    |   |             |   |   |   |   |

----

| Exhibit No. |                                                                        Description |
|-------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 2A*         | Plan of Exchange between Seychelle Environmental Technologies, Inc. and Seychelle Water Technologies, Inc. dated January 30, 1998 as filed with Form 10-SB 12 G on February 8, 2000.                                                                                                                                                                                                                                                                  |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 3A*         | Articles of Incorporation dated January 23, 1998 as filed with Form 10-SB 12 G on February 8, 2000.                                                                                                                                                                                                                                                                                                                                                   |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 3B*         | Articles of Merger of Royal Net, Inc. into Seychelle Environmental Technologies, Inc as filed with Form 10-SB 12 G on February 8, 2000.                                                                                                                                                                                                                                                                                                               |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 3C*         | Amendment to Articles of Incorporation re: Series "A" Preferred Stock as of January 31, 1998 as filed with Form 10-SB 12 G on February 8, 2000.                                                                                                                                                                                                                                                                                                       |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 3D*         | Amendment to Articles of Incorporation re: Series "AA" Preferred Stock as of June 5, 1998 as filed with Form 10-SB 12 G on February 8, 2000.                                                                                                                                                                                                                                                                                                          |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 3E*         | Amendment to Articles of Incorporation re: Series "AAA" Preferred Stock as of February 18, 1999 as filed with Form 10-SB 12 G on February 8, 2000.                                                                                                                                                                                                                                                                                                    |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 3F*         | Bylaws as filed with Form 10-SB 12 G on February 8, 2000.                                                                                                                                                                                                                                                                                                                                                                                             |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10A*        | Purchase Agreement with Aqua Vision as filed with Form 10-SB 12 G on February 8, 2000.                                                                                                                                                                                                                                                                                                                                                                |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10B*        | Amended Purchase Agreement with Aqua Vision as filed with Form 10-SB 12 G on February 8, 2000.                                                                                                                                                                                                                                                                                                                                                        |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10C*        | 2000 Stock Compensation Plan I, dated July 1, 2000 as filed with Registration Statement on Form S-8 on August 31, 2000.                                                                                                                                                                                                                                                                                                                               |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10D*        | 2002 Stock Compensation Plan I, dated February 12, 2002 as filed with Registration Statement on Form S-8 on February 27, 2002.                                                                                                                                                                                                                                                                                                                        |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10E*        | Purchase Agreement with Aqua Gear as filed with Annual Report on Form 10-K on June 14, 2002.                                                                                                                                                                                                                                                                                                                                                          |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10F*        | Employment Contract with Carl Palmer as filed with Annual Report on Form 10-K on June 14, 2002.                                                                                                                                                                                                                                                                                                                                                       |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10G*        | Management Consulting Contract with Richard Parsons                                                                                                                                                                                                                                                                                                                                                                                                   |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10H*        | Management Consulting Contract with James Place                                                                                                                                                                                                                                                                                                                                                                                                       |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10I*        | Joint Venture Agreement with Huanghua Plastic Co. Ltd. dated September 1, 2005                                                                                                                                                                                                                                                                                                                                                                        |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10J*        | ABMS Health Care Pvt. Ltd. Distribution Rights Agreement dated April 1, 2006                                                                                                                                                                                                                                                                                                                                                                          |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10K*        | Confident, Inc. Exclusive Distribution Rights Agreement dated January 1, 2006                                                                                                                                                                                                                                                                                                                                                                         |

----

| Exhibit No. |                                                                        Description |
|-------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10L*        | Continental Technologies. Inc., Purchase Agreement dated April 26, 2006                                                                                                                                                                                                                                                                                                                                                                               |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10M*        | Promissory Note to TAM Irrevocable Trust dated May 1, 2001                                                                                                                                                                                                                                                                                                                                                                                            |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10N*        | Promissory Note to TAM Irrevocable Trust dated February 28, 2002                                                                                                                                                                                                                                                                                                                                                                                      |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10O*        | Promissory Note to TAM Irrevocable Trust dated February 28, 2003                                                                                                                                                                                                                                                                                                                                                                                      |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10P*        | Promissory Note to TAM Irrevocable Trust dated November 1, 2003                                                                                                                                                                                                                                                                                                                                                                                       |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10Q*        | Promissory Note to TAM Irrevocable Trust dated February 28, 2004                                                                                                                                                                                                                                                                                                                                                                                      |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10R*        | Food For Health Purchase Agreement                                                                                                                                                                                                                                                                                                                                                                                                                    |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10S*        | Food For Health Distribution Agreement                                                                                                                                                                                                                                                                                                                                                                                                                |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10T*        | Seychelle Environmental Technologies, Inc. License Agreement with Mr. Gary Hess                                                                                                                                                                                                                                                                                                                                                                       |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 31.1**      | Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) (Section 302 of the Sarbanes Oxley Act of 2002)                                                                                                                                                                                                                                                                                                                               |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 31.1**      | Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) (Section 302 of the Sarbanes-Oxley Act of 2002)                                                                                                                                                                                                                                                                                                                               |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 32.1**      | Certification of the Chief Executive Officer pursuant to 18 U.S.C.ss.1350 (Section 906 of the Sarbanes-Oxley Act of 2002)                                                                                                                                                                                                                                                                                                                             |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 32.2**      | Certification of the Chief Financial Officer pursuant to 18 U.S.C.ss.1350 (Section 906 of the Sarbanes-Oxley Act of 2002)                                                                                                                                                                                                                                                                                                                             |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 99*         | Code of Ethics for Chief Executive Officer and Senior Financial Officers                                                                                                                                                                                                                                                                                                                                                                              |
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                  |

----

|                    |                                             |                 |
|-------------------------|--------------------------------------------------|----------------------|
|                    |  SEYCHELLE ENVIRONMENTAL TECHNOLOGIES, INC. |
|               |                                        |            |
| Date: June 8, 2010 | By:                                    | /s/ Carl Palmer |
|                    | Carl PalmerChief Executive Officer               |

|               |                                  |               |
|--------------------|---------------------------------------|--------------------|
|               |                                  |
|          |                             |          |
| Date: June 8, 2010 | By:                         | /s/ Jim Place |
|               | Jim PlaceChief Financial Officer |

|                      |   |         |   |
|---------------------------|--------|--------------|--------|
| /s/ Carl Palmer      |   |         |   |
| Carl Palmer, Director     |   | June 8, 2010 |   |
|                      |   |         |   |
| /s/  Jim Place       |   |         |   |
| Jim Place, Director       |   | June 8, 2010 |   |
|                      |   |         |   |
| /s/  Richard Parsons |   |         |   |
| Richard Parsons, Director |   | June 8, 2010 |   |

----

----