United States

Securities and Exchange Commission

Washington, D.C. 20549





---



FORM 20-F



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



OR



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



| |  | For the fiscal year ended April 30, 2012
| |  | ----------------------------------------



OR



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



For the fiscal year ended: N/A



OR



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



Date of event requiring this shell company
report: N/A



Commission File Number 0-24342



Reg Technologies Inc.

(Exact name of Registrant as specified in its
charter)

(Translation of Registrant’s name into
English)



British Columbia, Canada

(Jurisdiction of incorporation or organization)



240-11780 Hammersmith Way

Richmond, British Columbia
V7A 5E9, Canada

(Address of principal executive offices)



John Robertson, President, jr@ihiway.com

240-11780 Hammersmith Way, Richmond, British
Columbia V7A 5E9, Canada

Phone: 604-278-5996 Fax 604-278-3409

(Name, Telephone, E-mail and/or Facsimile number
and Address of Company Contact Person)



Securities registered or to be registered pursuant
to Section 12(b) of the Act. None



Securities registered pursuant to Section 12(g)
of the Act:

Common Stock, no par value

(Title of Class)



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

None



Indicate the number of outstanding shares of
each of the issuer’s class of capital or common stock as of the close of the period covered by the annual report.



|Title of Each Class         |  | Outstanding at April 30, 2012
|--------------------------- |  | -----------------------------
|Common Shares, no par value |  | 34,883,793                   



Indicate by check mark if the registration
is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act

[  ] Yes [X] No



If this report is an annual
or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934.

[  ]Yes[X]No



Note – Checking the
box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934 from their obligations under those Sections.



Indicate by check mark whether
the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days.

Yes [X] No [  ]



Indicate by check mark whether the registrant has submitted electronically
and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit and post such files).

[  ] Yes [  ]
No



Indicate by check mark whether
the registrant is a large accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated
filer” in Rule 12b-2 of the Exchange Act.





|Large accelerated filer [  ] | Accelerated file [  ] | Non-accelerated filer [X]
|---------------------------- | --------------------- | -------------------------



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





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



If “Other” has
been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected
to follow.

Item 17. [X]
Item 18. [  ]



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


















TABLE OF CONTENTS



|PART I        
|--------------
|ITEM 1.       
|ITEM 2.       
|ITEM 3.       
|A.            
|B.            
|C.            
|D.            
|ITEM 4.       
|A.            
|B.            
|C.            
|D.            
|ITEM 4A.      
|ITEM 5.       
|A.            
|B.            
|C.            
|D.            
|E.            
|F.            
|G.            
|ITEM 6.       
|A.            
|B.            
|C.            
|D.            
|E.            
|ITEM 7.       
|A.            
|B.            
|C.            
|ITEM 8.       
|A.            
|B.            
|ITEM 9.       
|ITEM 10.      
|A.            
|B.            
|C.            
|D.            
|E             
|F.            
|G.            
|H.            
|I.            
|ITEM 11.      
|ITEM 12.      
|              
|PART II       
|ITEM 13.      
|ITEM 14.      
|A.            
|B.            
|ITEM 15.      
|ITEM 16.      
|ITEM 16A.     
|ITEM 16B.     
|ITEM 16C.     
|ITEM 16D.     
|ITEM 16E.     
|ITEM 16F.     
|ITEM 16G.     
|              
|PART III      
|ITEM 17.      
|ITEM 18.      
|ITEM 19.      
|              
|SIGNATURE PAGE



2







BUSINESS OF REG TECHNOLOGIES INC.



Reg Technologies Inc. (“Reg Tech”
or “the Company”) is a development stage company engaged in the business of developing and building an improved axial
vane-type rotary engine known as the RadMax® rotary technology (the “Technology” or the “RadMax® Engine”),
used in the design of lightweight and high efficiency engines, compressors and pumps. Since no marketable product has yet been
developed, we have not received any revenues from operations.



Our ongoing operation is dependent upon cash
flow from successful operations and equity financing. We have incurred a loss of $385,880 in the year ended April 30, 2012 (2011
-$250,136 (transitioned from Canadian GAAP to IFRS); 2010 - $454,902 (restated, Canadian GAAP)). These consolidated financial statements
do not include adjustments that would be necessary should it be determined that we may be unable to continue as a going concern.



FINANCIAL AND OTHER INFORMATION



In this Annual Report, unless otherwise specified,
all dollar amounts are expressed in Canadian Dollars (“CDN$” or “$”). The Government of Canada
permits a floating exchange rate to determine the value of the Canadian Dollar against the U.S. Dollar (“US$”).



FOREIGN PRIVATE ISSUER STATUS



We are a Canadian corporation incorporated
under the laws of the Province of British Columbia. Less than 50% of our common stock is held by United States citizens and residents;
our business is administered principally outside the United States; and more than 50% of its assets are located outside the United
States. As a result, we believe that we qualify as a “foreign private issuer” for continuing to report regarding the
registration of the common stock using this Form 20-F annual report format.



FORWARD-LOOKING STATEMENTS



Certain statements
in this document constitute “forward-looking statements”. Some, but not all, forward-looking statements can be identified
by the use of words such as “anticipate,” “believe,” “plan,” “estimate,” “expect,”
and “intend,” statements that an action or event “may,” “might,” “could,” “should,”
or “will” be taken or occur, or other similar expressions. Although we have attempted to identify important factors
that could cause actual results to differ materially from expected results, such forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events,
to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.
Such factors include, among others, the following risks: the risks associated with outstanding litigation, if any, risks associated
with project development; the need for additional financing; operational risks; uncertainties and risks related to carrying on
business in foreign countries; reliance on key personnel; the potential for conflicts of interest among certain officers, directors
or promoters with certain other projects; the absence of dividends; currency fluctuations; competition; dilution; the volatility
of our common share price and volume; and tax consequences to U.S. Shareholders. All forward-looking statements speak only as of
the date on which they are made.We do not intend to update the forward-looking information to reflect actual results or
changes in the factors affecting such forward-looking information. We advise you to carefully review the reports and documents
we file from time to time with the Securities and Exchange Commission (the “SEC”), particularly our Annual Reports
on Form 20-F and our Current Reports on Form 6-K.



3







PART I



|ITEM 1. | IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS
|------- | -----------------------------------------------------



This Form 20-F is
being filed as an annual report under theSecurities Exchange Act of 1934 (“Exchange
Act”), and accordingly, the information called for in Item 1 is not required. Please see “Item 6 – Directors,
Senior Management and Employees – Directors and Senior Management”.



|ITEM 2. | OFFER STATISTICS AND EXPECTED TIMETABLE
|------- | ---------------------------------------



This Form 20-F is being filed as an annual
report under the Exchange Act, and accordingly, the information called for in Item 2 is not required.



|ITEM 3. | KEY INFORMATION
|------- | ---------------



|A. | SELECTED FINANCIAL DATA
|-- | -----------------------



The summary consolidated financial information
set forth below should be read in conjunction with, and is qualified in its entirety by reference to, our consolidated financial
statements, as of and for the years ended April 30, 2012 and 2011, together with the notes thereto, which appear elsewhere in this
annual report. The consolidated financial statements as of and for the year ended April 30, 2012 and April 30, 2011 have been audited
by ACAL Group, Chartered Accountants. The consolidated financial statements are prepared in accordance with International Financial
Reporting Standards (“IFRS”).



The information in the following table is derived
from our financial statements and is expressed in Canadian dollars. Since June 1, 1970, the Government of Canada has permitted
a floating exchange rate to determine the value of the Canadian dollar as compared to the United States dollar. At April 30, 2012,
US$1.00 was equal to approximately C$0.9810. The exchange rates for the past five fiscal years ended April 30, are presented below.



The following represents our selected financial
data for each of the past five fiscal years, ending on April 30. The data presented is prepared in accordance with generally accepted
accounting principles in Canada (“GAAP”) for 2008, 2009 and 2010, and IFRS for 2011 and 2012.



Fiscal Years Ended April 30



|                                                     |  | 2012 |            |   | 2011 |  |            | 2010 |  |  | 2009       |   |  | 2008 |           
|---------------------------------------------------- |  | ---- | ---------- | - | ---- |  | ---------- | ---- |  |  | ---------- | - |  | ---- | ----------
|Accounting Standards                                 |  | IFRS |            |   | IFRS |  |            | GAAP |  |  | GAAP       |   |  | GAAP |           
|Net Revenues                                         |  |      | -          |   |      |  | -          |      |  |  | -          |   |  |      | -         
|Loss from continuing operations                      |  |      | (385,880   | ) |      |  | (250,136   | )    |  |  | (454,902   | ) |  |      | (785,625  
|Net loss                                             |  |      | (385,880   | ) |      |  | (250,136   | )    |  |  | (454,902   | ) |  |      | (456,090  
|Loss from continuing operations per share            |  |      | (0.01      | ) |      |  | (0.01      | )    |  |  | (0.02      | ) |  |      | (0.02     
|Current assets                                       |  |      | 1,552,335  |   |      |  | 1,058,759  |      |  |  | 625,976    |   |  |      | 567,868   
|Total assets                                         |  |      | 1,872,417  |   |      |  | 1,293,881  |      |  |  | 629,322    |   |  |      | 574,765   
|Working Capital                                      |  |      | 1,075,173  |   |      |  | 678,065    |      |  |  | 215,870    |   |  |      | 290,087   
|Capital stock (excluding redeemable preferred stock) |  |      | 12,746,997 |   |      |  | 12,372,889 |      |  |  | 12,082,039 |   |  |      | 11,800,964
|Weighted average number of shares                    |  |      | 32,787,710 |   |      |  | 29,000,177 |      |  |  | 26,123,280 |   |  |      | 24,849,721



Reference is made to “Item 4. Information
on the Company” and “Item 5. Operating and Financial Review and Prospects” for a description of the initiation
and progression of our activities since incorporation.



4







Currencies and Exchange Rates:



Unless otherwise indicated, all monetary references
herein are denominated in Canadian Dollars. References to “$” or “Dollars” are to Canadian Dollars and
references to “US$” or “U.S. Dollars” are to United States Dollars.



The following table sets forth, for the periods indicated, the exchange
rates based on the noon buying rate with the Federal Reserve Bank of New York for cable transfers in Canadian dollars. Such rates
are the number of Canadian dollars per one (1) U.S. Dollar.



|                   |  | 2012
$ |        |  | 2011
$ |  |        | 2010
$ |  |  | 2009
$ |  |  | 2008
$ |       
|------------------ |  | ------ | ------ |  | ------ |  | ------ | ------ |  |  | ------ |  |  | ------ | ------
|Average for Period |  |        | 0.9961 |  |        |  | 1.0124 |        |  |  | 1.0721 |  |  |        | 1.1444



The high and low exchange rates for each month
during the previous six months are as follows:



|                |  | Month Ended |       
|--------------- |  | ----------- | ------
|                |  | July        |       
|                |  | 2012
$      |       
|High for Period |  |             | 1.0212
|Low for Period  |  |             | 1.0034



On September 11, 2012, the exchange rate in
effect for Canadian dollars exchanged for United States dollars, expressed in terms of Canadian dollars, and based on the noon
buying rates in New York City, for cable transfers in Canadian dollars, as certified for customs purposes by the Federal Reserve
Bank of New York was $0.9778.



|B. | CAPITALIZATION AND INDEBTEDNESS
|-- | -------------------------------



This Form 20-F is being filed as an annual
report under the Exchange Act, and accordingly, the information called for in this Item 3.B is not required.



|C. | REASON FOR THE OFFER AND USE OF PROCEEDS
|-- | ----------------------------------------



This Form 20-F is being filed as an annual
report under the Exchange Act, and accordingly, the information called for in Item 3.C is not required.



|D. | RISK FACTORS
|-- | ------------



The occurrence of any of the following risks
could hurt our business, financial condition or results of operations. In such case, the trading price of our shares could decline
and you could lose all or part of your investment. You should carefully consider the following risks and the other information
in this Report and our other filings with the SEC before you decide to invest in us or to maintain or increase your investment.
The risks and uncertainties described below are not the only ones facing us. Additional risks and uncertainties not now known to
us or that we think are immaterial may also adversely impact and impair our business. If any of the following risks actually occur,
our business, results of operations, or financial condition would likely suffer. In such case, the trading price of our common
stock could decline, and you may lose all or part of your investment.



5







RISK FACTORS RELATED TO OUR BUSINESS AND
OPERATIONS



We are a development stage enterprise.



We are a development stage enterprise and are
subject to all of the attendant business risks associated with a development stage enterprise, including constraints on financial
and personnel resources, lack of established credit facilities, and uncertainties regarding product development and future revenues.
We will continue to be subject to all the risks attendant to a development stage enterprise for the foreseeable future, including
competition, complications and setbacks in the development program, and the need for additional capital.



We have reported losses in each year since
its inception. At April 30, 2012, we had an accumulated deficit of $22,015,992. Our history consists almost entirely of development
of its products funded entirely from the sale of our Common Stock in the absence of revenues. We anticipate that it will continue
to incur substantial additional operating losses for at least the next 12 months and expects cumulative losses to increase as our
development efforts expand.



Although we anticipate receiving future revenues
fromthe sales of engines or the licensing of our technology or pursuant to a joint venture, we have received minimal revenues
in preparation for licensing or joint venture activities, and there are no assurances that significant revenues will be derived
from this activity in the future. We have received no revenues from sales of any of the products under development. There can be
no assurance as to when or if we will be able to develop significant sources of revenue or whether our operations will become profitable,
even if we are able to commercialize any product. See “Operating and Financial Review and Prospects,” and Notes to Financial
Statements.



We have no assurance that we will be
able to develop a commercially feasible product.



We have no assurance at this time that a commercially
feasible design will ever be perfected, or if it is, that it will become profitable. Our profitability and survival will depend
upon our ability to develop a technically and commercially feasible product which will be accepted by end users. The RadMax®
Engine which we are developing must be technologically superior or at least equal to other engines that competitors offer
and must have a competitive price/performance ratio to adequately penetrate its potential markets. If we are not able to achieve
this condition or if we do not remain technologically competitive, we may be unprofitable and our investors could lose their entire
investment. There can be no assurance that we or potential licensees will be able to achieve and maintain end user acceptance of
our engine.



We will require additional financing
and we may not be able to secure the financing necessary to continue our development and operations.



There is no assurance that we will be able
to secure the financing necessary to continue our development and operations. Our expectations as to the amount of funds needed
for development and the timing of the need for these funds is based on our current operating plan, which can change as a result
of many factors, and we could require additional funding sooner than anticipated. Our cash needs may vary materially from those
now planned because of results of development or changes in the focus and direction of our development program, competitive and
technological advances, results of laboratory and field testing, requirements of regulatory agencies and other factors.



We have no credit facility or other committed
sources of capital. To the extent capital resources are insufficient to meet future capital requirements, we will have to raise
additional funds to continue our development and operations. There can be no assurance that such funds will be available on favorable
terms, or at all. To the extent that additional capital is raised through the sale of equity or convertible debt securities, the
issuance of such securities could result in dilution to our shareholders. If adequate funds are not available, we may be required
to curtail operations significantly or to obtain funds on unattractive terms. Our inability to raise capital would have a material
adverse effect on us.



6







We expect to incur significant losses
for the foreseeable future.



We expect to incur significant losses for the
foreseeable future and cannot be certain when or if we will achieve profitability. Failure to become and remain profitable will
adversely affect the value of our common shares and our ability to raise capital and continue operations.



We have no assurance that our products
will receive market acceptance.



Our profitability and survival will depend
upon our ability to develop a technically and commercially feasible product which will be accepted by end users. The RadMax®
Engine which we are developing must be technologically superior or at least equal to other engines which our competitors
offer and must have a competitive price/performance ratio to adequately penetrate our potential markets.A number of rotary
engines have been designed over the past 80 years but only one, the Wankel, has been able to achieve mechanical practicality and
any significant market acceptance. If we are not able to achieve this condition or if we do not remain technologically competitive,
we may be unprofitable and our investors could lose their entire investment. There can be no assurance that we or our potential
licensees will be able to achieve and maintain end user acceptance of our engine.



Our officers lack of experience to manufacture
or market our products.



Assuming we are successful in developing the
RadMax® Engine, we presently have no proven ability either to manufacture or market the engine.
There is no assurance that we will be able to profitably manufacture and market engines.



Our auditors have indicated that our
losses raise substantial doubt about our ability to continue a going concern.



The report of our independent auditors with
respect to our financial statements included in this Form 20-F includes a “going concern” qualification, indicating that
our losses and deficits in working capital and shareholders’ equity raise substantial doubt about our ability to continue as a
going concern. See ” Operating and Financial Review and Prospects” and Notes to Financial Statements.



We are dependent upon certain members
of our staff, the loss of which could adversely affect our business.



We are dependent on certain members of our
management and engineering staff, the loss of services of one or more of whom could adversely affect our business. The loss of
any of these key individuals could hamper the successful development of the engine. Our present officers and directors have other
full-time positions or part-time employment unrelated to our business. Some officers and directors will be available to participate
in management decisions on a part-time or as-needed basis only. Our management may devote time to other companies or projects which
may compete directly or indirectly with us. We do not have “key man” life insurance on such officers and currently have
no plans to obtain such insurance. See “Management”. Our success also depends on our ability to attract and retain additional
skilled employees.



7







Certain of our directors and officers
are also directors and/or officers and/or shareholders of our potential competitors, giving rise to potential conflicts of interest.



Several of our directors and officers are also
directors, officers or shareholders of other companies. In particular, Mr. Robertson, and Mr. Vandeberg are directors and/or officers
of both REGI U.S., Inc. and IAS Energy, Inc., each a public company. Additionally, Mr. Robertson is a director and officer of Linux
Gold Corp. and Teryl Resources Corp., each a public natural resource exploration company that shares office space and administrative
staff with our company. Mr. Robertson is a director and officer of SMR Investments Ltd., which holds approximately 17% of our common
shares. Some of our directors and officers are engaged and will continue to be engaged in the search for additional business opportunities
on behalf of other corporations, and situations may arise where these directors and officers will be in direct competition with
our company. Such associations may give rise to conflicts of interest from time to time. Such a conflict poses the risk that we
may enter into a transaction on terms which could place us in a worse position than if no conflict existed. Conflicts, if any,
will be dealt with in accordance with the relevant provisions of the British Columbia Business Corporations Act. The Board
has resolved that any transaction involving a related party to our company is required to be reviewed and approved by our Audit
Committee. Our directors are required by law to act honestly and in good faith with a view to our best interests and to disclose
any interest which they many have in any project or opportunity in respect of which we are proposing to enter into a transaction.



As a“foreign private issuer”,
we are exempt from the Section 14 proxy rules and Section 16 of the Securities Act, which may result in shareholders having
less complete and timely data.



The submission of proxy and annual meeting
of shareholder information (prepared to Canadian standards) on Form 6-K may result in shareholders having less complete and timely
data. The exemption from Section 16 rules regarding sales of common shares by insiders may result in shareholders having less data.



We are dependent upon consultants and
outside manufacturing facilities.



Since our present plans do not provide for
a significant technical staff or the establishment of manufacturing facilities, we will be primarily dependent on others to perform
these functions and to provide the requisite expertise and quality control. There is no assurance that such persons or institutions
will be available when needed at affordable prices. It will likely cost more to have independent companies do research and manufacturing
than for us to handle these resources.



Our business may suffer if we are unable
to adequately protect our intellectual property.



Our business depends on the protection of our
intellectual property and may suffer if we are unable to adequately protect our intellectual property. The success of our business
depends on our ability to patent our engine. Currently, we have been granted several U.S. Patents. We cannot provide assurance
that our patents will not be invalidated, circumvented or challenged, that the rights granted under the patents will give us competitive
advantages or that our patent applications will be granted.



Our engines and planned applications
may contain product errors which could adversely affect our operations.



Engines such as the ones proposed by us and
our related planned applications may contain errors or defects, especially when first introduced, or when new versions are released.
Our products may not be free from errors after commercial release has occurred. Any errors that are discovered after such commercial
release could result in loss of revenue or delay in market acceptance, diversion of development resources, damage to our reputation,
increased service and warranty costs and liability claims. Any defects in these products could adversely affect the operation of
and market for our products, reduce revenue, increase costs and damage our reputation.



Our competition possesses greater technical
resources and market recognition than us and there is no assurance that we will be able to compete effectively with these companies.



While not a highly competitive business in
terms of numbers of competitors, the business of developing engines of a new design and attempting to either license or produce
them is nonetheless difficult because most existing engine producers are large, well financed companies which are very concerned
about maintaining their market position. These companies possess greater technical resources and market recognition than us, and
have management, financial and other resources not yet available to us. Existing engines are likely to be perceived by many customers
as superior or more reliable than any new product until it has been in the marketplace for a period of time. There is no assurance
that we will be able to compete effectively with these companies.



8







Market prices for our products may decline
in the future, which would have a material adverse effect on our business, financial condition and results of operations.



We anticipate that market prices for our main
products may decline in the future due to increased competition. We expect significant competition among local and international
companies, including from new entrants, may continue to drive equipment prices lower. We also expect that there may be increases
in promotional spending by companies in our industry which would also contribute to increasing movement of customers between competitors.
Such increased competition and the resulting decline of market prices for our products would have a material adverse effect on
our business, financial condition and results of operations.



New technology or refinement of existing
technology could render our Rand Cam products less attractive or obsolete.



New technology or refinement of existing technology
could render our Rand Cam products less attractive or obsolete. Our success depends in part upon its ability to anticipate changes
in technology and industry standards and to successfully develop and introduce new and improved engines on a timely basis. There
is no assurance that we will be able to do so.



Product liability claims asserted
against us in the future could hurt our business.



Product
liability claims asserted against us in the future could hurt our business. If a customer suffers damage from our products, the
customer could sue us on product liability or related grounds, claim damages for data loss or make other claims. We currently do
not carry product liability insurance. While we have not been sued on product liability grounds to date, a successful product liability
or related claim brought against us could harm our business.



Our success may be dependent on the
timing of new product introductions and lack of market acceptance for our new products.



Our
future success may be dependent on the success of our products and services. The success of our business depends on a variety of
factors, including:



| | ● | the quality and reliability of our products and services;
| | - | ---------------------------------------------------------

| | ● | our ability to develop new products and services superior to that of our competitors;
| | - | -------------------------------------------------------------------------------------

| | ● | our ability to establish licensing relationships and other strategic alliances;
| | - | -------------------------------------------------------------------------------

| | ● | our pricing policies and the pricing policies of our competitors;
| | - | -----------------------------------------------------------------

| | ● | our ability to introduce new products and services before our competitors;
| | - | --------------------------------------------------------------------------

| | ● | our ability to successfully advertise our products and services; and
| | - | --------------------------------------------------------------------

| | ● | general economic trends.
| | - | ------------------------



UNCERTAINTIES AND RISKS RELATING TO COMMON
SHARES



There
is only a limited public market for our common shares on the OTC Bulletin Board and theTSX Venture Exchange
and those markets are extremely volatile.



There is only a limited public market for our
common shares on the OTC Bulletin Board (“OTCBB”) and the TSX Venture Exchange (“TSX.V”),
and there is a risk that a broader or more active public trading market for our common shares will never develop, or be sustained,
or that current trading levels will not be sustained.



9







The market price for our common shares on the
OTCBB and the TSX.V has been and we anticipate will continue to be extremely volatile and subject to significant price and volume
fluctuations in response to a variety of external and internal factors. This is especially true with respect to emerging companies
such as ours. Examples of external factors, which can generally be described as factors that are unrelated to the operating performance
or financial condition of any particular company, include changes in interest rates and worldwide economic and market conditions,
as well as changes in industry conditions, such as regulatory and environment rules, and announcements of technology innovations
or new products by other companies. Examples of internal factors, which can generally be described as factors that are directly
related to our consolidated financial condition or results of operations, would include release of reports by securities analysts
and announcements we may make from time-to-time relative to our operating performance, advances in technology or other business
developments.



Because we have a limited operating history
and no profits to date, the market price for the common shares is more volatile than that of a seasoned issuer. Changes in the
market price of the common shares, for example, may have no connection with our operating results or prospects. No predictions
or projections can be made as to what the prevailing market price for the common shares will be at any time, or as to what effect,
if any, that the sale of shares or the availability of common shares for sale at any time will have on the prevailing market price.



You will be subject to the penny stock
rules to the extent our stock price on the OTCBB is less than $5.00.



Since our common shares are not listed on a
national stock exchange or quoted on the NASDAQ Market within the United States, trading in the common shares on the OTCBB is subject,
to the extent the market price for the common shares is less than $5.00 per share, to a number of regulations known as the “penny
stock rules”. The penny stock rules require a broker-dealer to deliver a standardized risk disclosure document prepared by
the SEC, to provide the customer with additional information including current bid and offer quotations for the penny stock, the
compensation of the broker-dealer and its salesperson in the transaction, monthly account statements showing the market value of
each penny stock held in the customer’s account, and to make a special written determination that the penny stock is a suitable
investment for the purchaser and receive the purchaser’s written agreement to the transaction. To the extent these requirements
may be applicable they will reduce the level of trading activity in the secondary market for the common shares and may severely
and adversely affect the ability of broker-dealers to sell the common shares.



You should not expect to receive dividends.



We intend to retain any future earnings to
finance our business and operations and any future growth. Therefore, we do not anticipate paying any cash dividends in the foreseeable
future.



We may be affected by other factors which
may have an adverse effect on our business.



Our areas of business may be affected from
time to time by such matters as changes in general economic conditions, changes in laws and regulations, taxes, tax laws, prices
and costs, and other factors of a general nature which may have an adverse effect on our business.



10







|ITEM 4. | INFORMATION ON THE COMPANY
|------- | --------------------------



|A. | HISTORY AND DEVELOPMENT OF THE COMPANY
|-- | --------------------------------------



We were incorporated in British Columbia on
October 6, 1982 as Reg Resources Corp. under a perpetual charter pursuant to the British Columbia Business Corporations Act.
On February 23, 1993, we changed our name to Reg Technologies Inc. in order to better reflect our main area of business development.
We did not consolidate our shares at the time our name was changed.



Our authorized capital consists of 65,000,000
shares consisting of 50,000,000 common shares without par value, 10,000,000 preferred shares with a par value of $1.00 per share
and 5,000,000 Class “A” non-voting shares without par value. Of the 50,000,000 common shares without par value, 34,883,793
common shares were issued and outstanding as of April 30, 2012, and as ofSeptember 12, 2012. There are no Preferred or
Class “A” shares currently outstanding. They are not subject to any future call or assessment and they all have equal
voting rights. There are no special rights or restrictions of any nature attached to any of the shares and they all rank equally,
as to all benefits that might accrue to the holder thereof.



Our head office is located at #240 -11780 Hammersmith
Way, Richmond, B.C., V7A 5E9, Canada. Our telephone number is 604-278-5996 and our fax number is 604-278-3409.



We were initially involved in the mineral development
and oil and gas business. The mineral development business produced no revenues from operations and the oil and gas business produced
only limited revenues.



On May 23, 1986, we entered an agreement which
was amended October 20, 1986 (“Initial Agreement”) among ourselves, Rand Cam-Engine Corp. (a private company owned
by James L. McCann, the inventor of the RadMax® Engine, and James L. McCann). Under the Initial
Agreement, we acquired a 40% interest in a company to be formed, by paying $50,000 and agreeing to expend $200,000 on research
and development pertaining to the Rand Cam Engine, which utilizes a new type of design for a rotary internal combustion engine.



The new company was formed and incorporated
in British Columbia in November 1989, as Rand Energy Group Inc. (“Rand Energy”), which would hold all the rights,
agreements and patents to the RadMax® Engine. We acquired 1,200,000 of the issued and outstanding
shares of Rand Energy Group Inc. while Rand Cam-Engine Corp. acquired 1,800,000 of the issued and outstanding shares.



The Initial Agreement was superseded by an
Energy Group Acquisition Agreement dated March 28, 1990 and a Share Purchase Agreement dated March 28, 1990, whereby James L. McCann
and Rand Cam- Engine Corp. agreed to transfer all rights, title and interest in and to the RadMax®
Engine to Rand Energy for 1,800,000 common shares of Rand Energy in consideration for certain covenants and warranties along
with the $250,000 expended in accordance with the Initial Agreement. We were allotted 1,200,000 common shares of Rand Energy.



These agreements resulted in us owning 40%
of the issued and outstanding shares of Rand Technologies Inc., with the balance of 60% being owned by Rand Cam-Engine Corp. Pursuant
to an amalgamation agreement between the shareholders of Rand Technologies Inc. and Rand Energy, the two companies were amalgamated,
effective July 31, 1993. The amalgamated company is called Rand Energy Group Inc. (“Rand Group”) and retains
the same ownership structure.



Under an agreement dated April 27, 1993, between
ourselves, Rand Group, Rand Cam-Engine Corp. and James L. McCann, Rand Cam-Engine Corporation agreed to sell to us 330,000 shares
of Rand Group, representing a further 11% interest in Rand Group. In consideration for a controlling interest in Rand Group, we
agreed to pay Rand Cam-Engine Corporation $50,000 (paid), issue 600,000 shares (expired) of our common shares and grant a participating
royalty to a maximum amount of $10,000,000, (“Participating Royalty”). The Participating Royalty is to be paid
in minimum annual installments of $50,000 per year beginning on the date the first revenues are derived from the license or sale
of the patented technology and after shares are issued per above. As part of the minimum payment, we are to pay 5% of all net profits
from sales, licenses, royalties or income derived from the patented technology.



11







Pursuant to an agreement with Brian Cherry
(“Cherry Agreement”) dated July 30, 1992 , Rand Group was assigned all right, title and interest in the RadMax®
Engine for all countries excluding the United States of America. Also under the Cherry Agreement, REGI U.S., Inc. was assigned
from Brian Cherry all right, title and interest in and to the RadMax® Engine for the United
States. Pursuant to a letter of understanding among our company, REGI U.S., Inc. and Rand Group (collectively called the “Grantors”)
and West Virginia University Research Corporation (“WVURC”), the Grantors have agreed that WVURC shall own 5%
of all patented technology and will receive 5% of all net profits from sales, licenses, royalties or income derived from the patented
technology. A 1% net profit royalty will be payable to Brian Cherry on all U.S. based sales.



REGI U.S., INC.



REGI U.S., Inc. (“REGI”) was,
until April 30, 2008, controlled by Rand Group.REGI was formerly controlled our company by way of a
voting trust arrangement, which was cancelled on April 30, 2008.



Our direct investment in REGI, together with
its 51% ownership in Rand Group, gives us control over approximately 3,378,183 shares of REGI, with a carrying value of US$Nil
as of April 30, 2012. We can sell, through a registered broker, up to 287,768 shares of REGI U.S., Inc., being 1% of the issued
shares, during any 90 day period. During the year ended April 30, 2011, Rand Group sold 163,000 REGI share for US$57,050, and we
sold 295,300 REGI shares for US$73,825. During the year ended April 30, 2012 Rand Group did not sell any REGI shares.



At April 30, 2012, the market value of the
REGI shares owned by us and Rand Group was US$574,291.



REGI was organized under the laws of the State
of Oregon on July 27, 1992 as Sky Technologies, Inc. with its name changed on August 1, 1994. It has a total authorized capital
of 100,000,000 common shares. As of April 30, 2012, a total of 28,776,824 shares of common stock of REGI were issued and outstanding,
of which 633,483 are owned by Rand Group and 2,744,700 shares are owned by Reg Tech.



Together with REGI, we are in the business
of developing and commercially exploiting an improved axial vane type rotary engine known as the RadMax®
Engine. The world-wide marketing and intellectual rights, other than the U.S., are held by Rand Group (our Canadian subsidiary
51% owned by us) which holds approximately a 2.12% interest in REGI. REGI owns the U.S. marketing and intellectual rights. Rand
Group and REGI have a project cost sharing agreement whereby these companies each fund 50% of the development of the Technology.



As at April 30, 2012, REGI owes us $1,025,086
(2011 - $865,607) which will be fully repaid prior to royalty obligations due, and prior to dividends being paid to the owners
of Rand Group.



Minewest Silver and Gold
Inc.



In July, 2010 we incorporated our 80% owned
subsidiary Minewest Gold and Silver Corp. Inc. (“Minewest”), a private company incorporated in British Columbia
for the purpose of acquiring and exploring mineral properties. During the year ended April 30, 2011, we transferred to Minewest
our 100% ownership in our undivided 50% interest subject to a 5% net smelter return in 33 mining claims (the “Silverknife
Property”) in the Tootsee River area of the province of British Columbia for cash payment of $25,000 and issuance of 8,000,000
common shares of Minewest. Effective December 15, 2010 Minewest purchased 100% of Rapitan Resources Inc.’s ownership in 25%
interest of the Silverknife Property for cash payment of $10,000 and issuance of 2,0000,000 common shares of Minewest.



Effective November 17, 2011 Reg Tech obtained
court approval for the Plan of Arrangement. On December 14, 2011, Reg Tech declared Minewest shares as dividend for Reg Tech shareholders
on the record date of December 21, 2011, whereby one Minewest shares is distributed for seven Reg Tech shares. The distribution
is subject to Minewest being listed on the CNSX. As a result of the dividend declaration, the Company expects to retain approximately
3,287,737 shares of Minewest.



12







Our stock trades on the OTC BB under the symbol
REGRF.OB and on the TSX.V as RRE.V.



|B. | BUSINESS OVERVIEW
|-- | -----------------



Nature
of Our Operations



We are engaged in the business of developing
and building an improved axial vane-type rotary engine used in the design of lightweight and high efficiency engines, compressors
and pumps. We hold the worldwide intellectual and marketing rights to the RadMax® Engine, exclusive of the United States, which
are held by REGI. REGI owns the U.S. marketing and intellectual rights and has a project cost sharing agreement, whereby it will
fund 50% of the further development of the RadMax® Engine and we will fund 50%.



Based upon testing work performed by independent
organizations on prototype models, we believe that the RadMax® Engine holds significant potential in a number of other applications
ranging from small stationary equipment to automobiles and aircraft. In additional to its potential use as an internal combustion
engine, the RadMax® Engine design is being employed in the development of several types of compressors, pumps, expanders and
other applications.



To date, several prototypes of the RadMax®
Engine have been tested and additional development and testing work is continuing. We believe that such development and testing
will continue until a commercially feasible design is perfected. There is no assurance at this time, however, that such a commercially
feasible design will ever be perfected, or if it is, that it will become profitable. If a commercially feasible design is perfected,
we do, however, expect to derive revenues from licensing the Technology relating to the RadMax® Engine regardless of whether
actual commercial production is ever achieved. There is no assurance at this time, however, that revenues will ever be received
from licensing the Technology even if it does prove to be commercially feasible.



We believe that a large market would exist
for a practical rotary engine which could be produced at a competitive price and which could provide a good combination of fuel
efficiency, power density and exhaust emissions.



Based on the market potential, we believe the
RadMax® Engine is well suited for application to internal combustion engines, pumps, compressors and expansion engines. The
mechanism can be scaled to match virtually any size requirement. This flexibility opens the door to large markets being developed.



Products and Projects



The RadMaxTM Rotary Technology



The worldwide marketing and intellectual rights
to the Technology, other than in the US, are held by us and REGI owns the US marketing and intellectual rights. We own 3,378,183shares
of REGI, representing an 11.74% interest. We have a project cost sharing agreement with REGI, whereby we each fund 50% of the costs
of developing the Technology.



Based upon testing work performed by independent
organizations on prototype models, we believe that the RadMax® Engine holds significant potential
in a number of other applications ranging from small stationary equipment to automobiles and aircraft. In additional to its potential
use as an internal combustion engine, the RadMax® Engine design is being employed in the
development of several types of compressors, pumps, expanders and other applications. The mechanism can be scaled to match virtually
any size requirement.



13







To date, several prototypes of the RadMax®
Engine have been tested and additional development and testing work is continuing. We believe that such development and testing
will continue until a commercially feasible design is perfected. There is no assurance at this time, however, that such a commercially
feasible design will ever be perfected, or if it is, that it will become profitable. If a commercially feasible design is perfected,
we do, however, expect to derive revenues from licensing the Technology, regardless of whether actual commercial production is
ever achieved. There is no assurance at this time, however, that revenues will ever be received from licensing the Technology,
even if it does prove to be commercially feasible.



Based on the market potential, we believe the
RadMax® Engine is well suited for application to internal combustion engines, pumps, compressors
and expansion engines.



The RadMax®
Engine must be technologically superior to other engines that competitors offer and must have a competitive price/performance ratio
to adequately penetrate its potential markets. A number of rotary engines have been designed over the past 80 years but only one,
the Wankel, has been able to achieve mechanical practicality and any significant market acceptance.



RadMax®
Engine



We believe that the RadMax® Diesel Engine
could achieve improved fuel consumption when compared to gasoline and turbine engines. This was based on a review by our thermodynamics
engineer, Dr. Allen MacKnight, PhD, of published industry literature. Specifically, a given volume of diesel fuel contains approximately
30% more energy that the same volume of gasoline and diesel engines consume approximately 0.4 pounds of fuel for every horsepower
hour. As a point of reference, all turbine engines consume approximately 0.8 pounds of fuel for every horsepower hour.



To bring the RadMax® Diesel Engine from
concept to reality, a number of milestones, or steps, are required for ultimate qualification. These start with concept drawings
and presentations, and lead to testing by independent agencies to validate the emissions, horsepower, and other critical metrics.



On August 12, 2010, following two years of
technical assessments and design reviews, the engineering team confirmed that the RadMax Engine engineering drawings were complete,
additional technical reviews were not necessary and we would proceed with building the RadMax demonstration prototype. Commercial
item procurement, parts fabrication and preparation for prototype testing were underway.



After completion of our Request for Proposals
to three pre-qualified bidders to provide a fixed-price quotation we selected Path Technologies Inc. (“Path Tech”),
of Painesville, Ohio, to fabricate the prototype RadMax Engine. Upon the commencement of the fabrication stage, we integrated those
parts, along with other commercial items (fuel injection, for example) to produce the prototype engine.



In February, 2011, we paid Path Technologies
for the purchase order to commence fabrication to complete the cam and actuator for the RadMaxTM demonstration diesel engine
model.



On March 8, 2011 we provided a fabrication
progress report of the RadMaxTM assembly via news release, reporting the following initial fabrication progress:



| | ● | All specified material has been ordered
| | - | ---------------------------------------

| | ● | All connecting tubes have been final machined to their outside and inside geometric tolerances
| | - | ----------------------------------------------------------------------------------------------

| | ● | The connecting tubes have been masked for subcontracted flame spray plating services
| | - | ------------------------------------------------------------------------------------

| | ● | Each of the 24 vane blocks have been trued, which means three axis sides are perfectly parallel
to their opposite sides and perpendicular to each other
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | The outside dimensions of the vane portion has been fabricated in a wire EDM Process
| | - | ------------------------------------------------------------------------------------



14







On May 18, 2011 we had the second fabrication
progress report for the prototype RadMaxTM Diesel Engine, whereby we estimated that approximately one-third of all fabrication
work was complete, resulting in us being ahead of schedule and under budget. The fabrication progress was as follows:



| | ● | The Rotors had completed their first-pass rough turning process within .030-inch of final. The following Rotor fabrication
operations had been completed: Outer surface, Neck, Driveshaft Slot, and Combustion Chamber.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | The Cams had completed their initial rough turning passes. The reason for the two-pass turning process was because the metal
“moves” (stretches or deforms) after the machining process. To maintain our high-tolerance requirements, the two-passes
were required.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | Fabrication of the 24 Vane-Actuator assemblies was complete. This included completion of the Vanes, Connecting Tubes, Axles,
Wheels, Wrist Pins, and integration with commercial wheel bearings.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



During August, 2011 we had successful transfer
directly from 3D cad model to CNC machine code for the prototype RadMaxTM Diesel Engine.



This was a significant event, as we proved
our capability to go from 3D computer models of the cam surface to deriving the cutter path for the CNC milling center and fabricating
the complex cam surface.

This successful transfer
applies directly to the RadMax cam and stator surfaces; both of which are implementations of complex transcendental formulas.



A detailed thermodynamic analysis of the patented
RadMax engine had been performed in conjunction with Belcan Engineering Services. As a result, the cam was fabricated from lightweight
aircraft Aluminum and weighs approximately 12 pounds. This is in sharp contrast to earlier implementations in steel that weighed
more than 50 pounds each. This capability is one of the major contributing factors to RadMax engine weight reduction, which naturally
leads to enhanced fuel economy in every application.



On September 29, 2011 we announced that they
have integrated a rotary union into the RadMaxTM fabrication process, to reduce temperature in the RadMaxTM demonstration
model. This device allows us to provide continuous high-pressure lubrication and cooling oil to moving and rotating parts of RadMax,
thus allowing the engine to operate at a lower temperature. Oil is injected by this device into a hollow driveshaft, with exit
ports inside the rotor. This in turn allows us to use lighter components made from Aluminum which further reduces the weight of
the engine.



On November 22, 2011 we announced that we have
completed fabrication of the RadMaxTM drive shaft for the demonstration model. The drive shaft is similar to a crank shaft
in a reciprocating engine as it delivers rotational power to the transmission; however, the center is hollow and provides a path
for oil to cool rotating components. The drive shaft works in conjunction with the rotary union. The detailed thermodynamic analysis
of the patented RadMax engine was performed last year in conjunction with Belcan Engineering Services. As a result, a design decision
was finalized to create a hollow drive shaft to provide a means to lubricate internal rotating components. Without this device,
the internal engine heat would make adoption of aluminum components impossible. By reducing heat, and weight, this leads to enhanced
fuel economy in every RadMaxTM application. The drive shaft features include mounting provisions for the Rotary Union, Shaft
Lock Nut which preloads the Rotor, main bearings, and tight pilots for securing the rotor in position. It includes key slots for
securing the load to RadMax (such as a transmission).



On January 30, 2012, following completion of
the complex drive shaft announced on November 22, 2012, we reached the position to estimate all remaining fabrication tasks leading
up to the assembly and test phases and could start to use the dimensions and tolerances to specify the requirements of the remaining
component interfaces.



15







The status of the remaining fabrication tasks,
which represent the balance of the fabrication, was as follows:



| | ● | Rotors: Remaining operations for each rotor include drilling the final tight tolerance turns and
other finishing operations. (as announced on May 18, 2011.)
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | Cam: Remaining operations for each cam include final surface grinding and polishing, final milling
and boring to insert other machined features. (as announced on August 15, 2011.)
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | Rotary Union: Work is complete. (as announced on September 29, 2011.)
| | - | ---------------------------------------------------------------------

| | ● | Driveshaft: Work is complete. (as announced on November 22, 2011.)
| | - | ------------------------------------------------------------------

| | ● | End plates: Remaining operations for each end plate include cutting air and water plenum holes,
final milling and bore.
| | - | -----------------------------------------------------------------------------------------------------------------------

| | ● | Stator frame: Remaining operations for the stator frame include final milling and bore.
| | - | ---------------------------------------------------------------------------------------

| | ● | Enclosure: Remaining operations for the enclosure include standard machining operations to mount
latches and catches.
| | - | ---------------------------------------------------------------------------------------------------------------------

| | ● | Oil coolers: Material has been received. Initial machining work is the next step.
| | - | ---------------------------------------------------------------------------------

| | ● | Bearings: Material has been received. Initial machining work is the next step.
| | - | ------------------------------------------------------------------------------

| | ● | Air and Water Flanges: Initial machining work is the next step.
| | - | ---------------------------------------------------------------

| | ● | Gaskets for air and water flanges: These will be sent to vendor who already produced and delivered
other gaskets for us.
| | - | ------------------------------------------------------------------------------------------------------------------------

| | ● | Nameplates: Fabricating and plating the nameplates. Initial machining work is the next step.
| | - | --------------------------------------------------------------------------------------------



The Company and Reg Technologies Inc. received
a quote to complete the fabrication of the RadMaxTM diesel engine for a total of $139,783 including $75,000 for the final
fabrication.



Funds are planned to be raised through a private
placement. Following fabrication, we plan to build an assembly fixture. Once this fixture is fabricated and verified, the Company
will perform the assembly operations followed by prototype dry (non-fuel) and fueled testing.



On March 12, 2012 we announced that the Radmax
engine parts arrived at Williams and White Machine Inc. facilities from Path Technologies in Painesville, Ohio. Radmax engine parts
machining has commenced at Williams and White Machine Inc. to complete the fabrication of the Radmax demonstration model.



Williams and White is a world
class manufacturing organization comprising of three independent business units; Equipment, Machining, and Automation. Williams
and White equipment manufactures specialized grinding equipment used in the cutting tool and machining industry and access to
only the most advanced tooling in the world. The Automation division is specialized in development of Mechatronic solutions for
custom project applications. Website www.williamsandwhite.com.



As a result of the development, Paul Porter,
our Chief Engineer, is managing the final fabrication, assembling and testing of the prototype. Mr. Porter of Spokane, Washington
has extensive experience as an expert mechanical engineer. He was previously a manufacturing manager for Parker Seal Group, a Fortune
500 company and was the founder of JetSeal, Inc., which was sold to Heico Corp., an aerospace company.



RadMax®Pump



The Company actively pursued the development
of the RadMax® Pump from early 2007 until March 2008. From September 2007 until March 2008, the Company worked with an industry
partner in the water pump industry. The partner evaluated the Pump as a potential new product offering as part of its fire engine
chemical dispersant product line. The evaluation and test period ended when the partner had a change in its senior management and
their leading advocate left the company. Until there is further interest established in the RadMax® Pump by an end user, no
further work is anticipated.



The Company then focused all of its technical
resources on validating the seals for a compressor application, leading towards the technology incorporation in the RadMax®
engine.



16







In February 2009 the pump was set up in the
Company’s Richmond, B.C. laboratory, for demonstration to interested parties. It is a fully functional prototype capable
of pumping twice its internal volume every revolution. Future development would take the form of customization based on interest
from another industry partner. Commercialization requires tooling to significantly reduce the cost of the pump in a production
environment. Until there is further interest established in the RadMaxTM Pump by an end user, no further work is anticipated.



RadMax®Compressor



The Company actively pursued the development
of high pressure metal seals using the RadMax® Compressor from July 2007 until September 2007. The technical concept of high
pressure metal seals was validated in a prototype compressor test bed that was fabricated from residual hardware. There was no
immediate interest by an industry partner to continue a joint development of the RadMax® Compressor. Until there is further
interest established in the RadMax® Compressor by an end user, no further work will be conducted.



The compressor is
a fully functional prototype design capable of 48 individual compression events every revolution, which represent twice its internal
volume. Future development would take the form of customization based on interest from another industry partner. Commercialization
requires tooling to significantly reduce the cost of the compressor in a production environment.Until there is further
interest established in the RadMaxTM Compressor by an end user, no further work will be conducted.



Description
of the Markets in Which We Compete



We currently face and will continue to face
competition in the future from established companies engaged in the business of developing, manufacturing and marketing engines
and other products. While not a highly competitive business in terms of numbers of competitors, the business of developing engines
of a new design and attempting to either license or produce them is nonetheless difficult because most existing engine producers
are large, well financed companies which are very concerned about maintaining their market position. Such competitors are already
well established in the market and have substantially greater resources than us. Internal combustion engines are produced by automobile
manufacturers, marine engine manufacturers, heavy equipment manufacturers and specialty aircraft and industrial engine manufacturers.
We expect that our engine would be used mainly in industrial and marine applications.



Except for the Wankel rotary engine built by
Mazda of Japan, no competitor, that we are aware of, presently produces in a commercial quantity any rotary engine similar to the
engines we are developing. The Wankel rotary engine is similar only in that it is a rotary engine rather than a reciprocating piston
engine. Without substantially greater financial resources than is currently available to us, however, it is very possible that
it may not be able to adequately compete in the engine business. One competitor, Rotary Power International, is presently producing
the first production SCORE rotary (Wankel type) engines. Our RadMax® Engine is more fuel
efficient, smaller, quieter, costs less to produce and will have fewer exhaust emissions.



We believe that if and when our engine is completely
developed, in order to be successful in meeting or overcoming competition which currently exists or may develop in the future,
our engine will need to offer superior performance and/or cost advantages over existing engines used in various applications.



We believe strong competition can be expected
in the engine market with new patents being taken out on a continuous basis and that we may have a time advantage over some of
the competitive products as far as niche markets which we may enter, however there is no way to accurately determine or predict
whether this situation is or will continue to be true.



The conventional piston type internal combustion
engine is the prime competitor of the RadMax® Engine. Due to the substantial infrastructure
built up to support the standard combustion engine, substantial barriers to entry exist into this market.



17







A number of the new engine designs over the
last decade have offered advantages on the thermodynamics front (e.g. more efficient use of energy through better combustion, better
heat transfer, etc.). In the case of the RadMax® Engine, its strong point it believed to
be in its mechanism, not in its thermodynamics. Whether or not the engine’s mechanism alone will provide the competitive edge necessary
to result in a marketable and successful product is unknown at this time.



Since we do not have management experience
in manufacturing engines, it hopes to be able to follow the same strategy as that of other companies such as Orbital and Wankel,
where it would be licensing its technology and would therefore not be directly engaged in manufacturing.



An extensive manufacturing study has not been
performed to date and it could turn out that the costs to manufacture are prohibitive for one or more reasons. However, the computer
modeling done can be utilized to generate manufacturing drawings which could be used to obtain preliminary costing estimates.



The development of our business and our ability
to maintain our competitive and technical position has depended and will depend, in part, upon our ability to attract and retain
qualified scientific, engineering, managerial and manufacturing personnel.



Significant competition exists from engine
manufacturers and engineering firms specializing in the development of internal combustion engines technology for the automotive,
marine, motorcycle and small engine industry. Such competition also exists in the pump and compressor markets which may utilize
the Rand Cam technology in their products. Many of these companies have substantially greater resources for research, development
and manufacturing than us. It is possible that our competitors may succeed in developing technologies and products that are more
effective or commercially acceptable. We believe, based on the testing of the RadMax® Engine
that the engine is a superior overall engine package to the reciprocating piston engine. This assessment is made on the basis of
the RadMax® Engine’s potential for reduced engine weight and packaging volume, improved
performance, and possibly lower manufacturing costs.



Technology development is taking place on many
fronts and competitors may have, unknown to us, a product or products under development which may be technologically superior to
ours which may be more acceptable to the market. Competition with engines employing Rand Cam technology may also include other
lean burn engines, electric motors, gas turbine engines, solar power and hybrid vehicles, and may include concepts not yet known
to us.



Seasonality



We believe that there is no seasonality which
affects our products.



Availability
of Raw Materials



Since we are not in production and there are
no plans at this time for us to enter the actual engine manufacturing business, raw materials are not of present concern. At this
time, however, there does not appear to be any foreseeable problem with obtaining any materials or components, which may be required
in the manufacture of its potential products.

Marketing
Strategy



We intend to pursue the development of the
RadMax® Engine by entering into licensing and/or joint venture arrangements with other larger
companies, which have the financial resources to maximize the potential of the technology. We have no current plans to become actively
involved in either manufacturing or marketing any engine or other product which it may ultimately develop to the point of becoming
a commercial product.



Our current objective is to complete and test
the RadMax® Engine. Based on the successful testing, the prototypes will be used for presentation
purposes to potential license and joint venture partners.



18







We expect revenue from license agreements with
the potential end users based on the success of the design from the compressor, pump, and diesel engine prototypes. Based on of
successful testing of the Rand Cam prototypes, we expect to have joint venture or license agreements finalized, which would result
in royalties to us. However, there is no assurance that the tests will be successful or that we will ever receive any such royalties.



Dependence
on Certain Commercial Agreements



We do not have any material agreements upon
which we are dependent.



Patents
and Licenses



Patents



U.S. patent 5,429,084 was granted on July 4,
1995, to James McCann, Brian Cherry, Patrick Badgley and four other individuals for various improvements incorporated in the RC/DC
Engine, This patent has been assigned to us. The patent to the original Rand Cam engine, U.S. Patent 4,401,070, was issued on August
30, 1983 to James McCann and the marketing rights are held by Rand Energy.



The RC/DC Engine is composed basically of a
disk shaped rotor with drive shaft, which turns, and the housing or stator, which remains stationary. The rotor has two or more
vanes that are mounted perpendicular to the direction of rotation and slide back and forth through it. As the rotor turns, the
ends of the vanes ride along the insides of the stator housing which have wave-like depressions, causing the vanes to slide back
and forth. In the process of turning and sliding, combustion chambers are formed between the rotor, stator walls and vanes where
the fuel/air mixture is injected, compressed, burned and exhausted.



Two additional patents have been issued for
improvements to the engine including: U.S. Patents 5,509,793 “Rotary Device with Slidable Vane Supports, issued April 24,
1996 and 5,551,853 “Axial Vane Rotary Device and Sealing System” issued September 3, 1996.



The worldwide patents cover Canada and several
countries in Europe, namely, Germany, France, Great Britain, and Italy.



The U.S. Patent
and Trademark office has been in contact with our patent attorney to commence a review of 24 Claims in the new patent application
for the RadMaxTMapplication. The new design claims
are far more advanced than the existing Rand Cam technology patents, and once approved will give us an additional 20 years of patent
technology protection.



Royalty Payments



We are required to pay Rand Group semi-annually
a royalty of 5% of any net profits to be derived by us from revenues received as a result of our license of the RadMax®
Engine. We are required to pay Brian Cherry a royalty of 1% semi-annually on any net profits derived by us from revenue received
as a result of our licensing the RadMax® Engine.



Other provisions of the April 1993 Agreement
call for is (a) to pay to Rand Group a continuing royalty of 5% of the net profits derived from the Technology by us and (b) to
pay to Brian Cherry a continuing royalty of 1% of the net profits derived by us from the Technology.



Pursuant to the letter of understanding dated
December 13, 1993, among us, Rand Group, REGI and WVURC, WVURC will receive 5% of all net profits from sales, licenses, royalties
or income derived from the patented technology relating to the RadMax® Engine and the RC/DC
Engine.



19







Material Effects of Government Regulation



Our engine products will be subject to various
exhaust emissions standards depending upon the application and the country in which it is produced and/or sold. As each product
becomes ready for sale, it will be necessary to have the engine certified according to the standards in effort at that time.



|C. | ORGANIZATIONAL STRUCTURE
|-- | ------------------------



We own approximately 26.10% interest in Minewest
Silver and Gold Inc., a private British Columbia company, and a 51% interest in Rand Energy Group Inc., which owns a 2.2% interest
in REGI. We also own a 9.53% interest in REGI.



|D. | PROPERTY, PLANTS AND EQUIPMENT
|-- | ------------------------------



We own no properties. We currently utilize
office space in a commercial business park building located in Richmond, British Columbia, Canada, a suburb of Vancouver, shared
by several companies related by common officers and directors. The monthly rent for our portion of this office space is $1,259
which is shared with REGI. There are no current plans to purchase or lease any properties in the near future.



Plan of Operations



The following contains forward-looking statements
relating to revenues, expenditures and sufficiency of capital resources. Actual results may differ from those projected in the
forward-looking statements for a number of reasons, including those described in this Form 20-F Annual Report. We do not intend
to update the forward-looking information to reflect actual results or changes in the factors affecting such forward-looking information.



Source of Funds for Fiscal 2011and 2012



Our primary source of funds since incorporation
has been through the issuance of equity securities.



We have been successful in the past in acquiring
capital through the issuance of common shares and through advances from related parties. Although we intend to continue utilizing
these sources, there has been no assurance in the past that these sources and methods would continue to be available in the future.



The audited consolidated financial statements
have been prepared assuming that we will continue as a going-concern. As discussed in Note 1 to the audited consolidated financial
statements, we have no revenues and limited capital, which together raise substantial doubt about our ability to continue as a
going-concern. Management plans in regard to these matters are also described in Note 1. The audited consolidated financial statements
do not include any adjustments that might result from the outcome of this uncertainty.



In the event that no other sources of capital
were available to us in the future, on a reasonable financial basis, we would face the same obstacles as many small, undercapitalized
companies do, and, in the worst case, we could be forced to reorganize or liquidate, either of which consequence would likely have
an adverse financial effect upon our shareholders.



Use of Funds for Fiscal 2012/2013



We anticipate that our cash requirements for
the fiscal year ending April 30, 2013 will remain consistent with those for the fiscal year ended April 30, 2012.



20







Anticipated Changes to Facilities/Employees



We anticipate there will not be any changes
to either facilities or employees in the near future.



|ITEM 4A. | UNRESOLVED STAFF COMMENTS
|-------- | -------------------------



This section is not applicable as we are not
an accelerated filer or a large accelerated filer, as defined in Rule 12b-2 of the Exchange Act, or a well-known seasoned issuer
as defined in Rule 405 of the Securities Act.



|ITEM 5. | OPERATING AND FINANCIAL REVIEW AND PROSPECTS
|------- | --------------------------------------------



The following discussion should be read in
conjunction with the audited consolidated financial statements and notes thereto included elsewhere herein. The audited consolidated
financial statements have been prepared in accordance with IFRS for fiscal 2011 and 2012. See Note 2 and Note 3 to the consolidated
financial statements for accounting policies and Note 14 for the transition from Canadian GAAP to IFRS effective May 1, 2010



Overview



We are a development stage company engaged
in the business of developing and commercially exploiting an improved axial vane type rotary engine known as the RadMax® Engine.



As a development stage company, we devote most
of our activities to establishing our business. Planned principal activities have not yet produced significant revenues. We have
undergone losses to date totaling $22,015,992 and further losses are expected until we complete a licensing agreement with a manufacturer
and reseller. We had cash balance of $650. These factors raise substantial doubt about our ability to continue as a going concern.
Our ability to emerge from the development stage with respect to our planned principal business activity is dependent upon our
successful efforts to raise additional equity financing, receive funding from affiliates and controlling shareholders, and develop
a market for our products.



|A. | OPERATING RESULTS
|-- | -----------------



Results of Operations



Fiscal year ended April 30, 2012 compared
to fiscal year ended April 30, 2011 (under IFRS)



For the year ended April 30, 2012, we had a
net and comprehensive loss of $385,880 or $0.01 per share, as compared to a net and comprehensive loss of $250,136 or $0.01 per
share for the year ended April 30, 2011.



We have generated no revenue from our operations.
We have incurred a loss of $385,880 in the year ended April 30, 2012 (2011 - $260,453).



Significant changes from 2011 to 2012 are as
follows:



| | ● | In 2011 we had a convertible debenture of principal amount of $50,000 which was reduced to $20,000
after payment on principal amount of $30,000. Interest expense of $3,786 was recorded on the loan during 2010; throughout 2012
we had a convertible loan of $20,000 with the same terms and recorded interest expense of $1,856;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | We increased shareholder communication expenses from $41,106 in 2011 to $57,123 due to our costs
in 2012 on preparing and disseminating information related to our spin off of Silverknife property and Our subsidiary Minewest;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | From 2011 to 2012 office expenses increased from $27,286 to $29,559 largely due to additional website
maintenance costs;
| | - | ------------------------------------------------------------------------------------------------------------------------



21







| | ● | Consulting fees decreased from $32,309 in 2011 to $15,919 in 2012, because we stopped consolidation
of Minewest accounts after November 17, 2011;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | Office rent decreased from $15,680 in 2011 to $6,871 in 2012; Professional fees decreased from
$99,670 in 2011 to $73,316 in 2012, travel and promotion decreased from 7,605 in 2011 to $3,446 in 2012, all due to our continuing
effort to streamline our operations and share costs with our associated companies;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | Transfer agent and filing fees increased $15,101 in 2011 to $34,804 in 2012 due to our increased
disclosure and transfer agent services for the spin-off of our subsidiary Minewest;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | We had net mineral property maintenance recovery of $7,254 in 2011, but did not have mineral exploration
costs or recover in 2012;
| | - | ----------------------------------------------------------------------------------------------------------------------------------

| | ● | Research and development expenses increased from $107,700 in 2011 to $113,554, as we are starting
our last phase of developing our Rand Engine technologies;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | Wages and benefits decreased from $26,750 in 2011 to $19,891 due to our severance payments in 2011
when we downgraded our operations;
| | - | -------------------------------------------------------------------------------------------------------------------------------------

| | ● | In 2011 we had stock based compensation for options granted of $20,296; in 2012 we did not grant
options or had any options vest;
| | - | ---------------------------------------------------------------------------------------------------------------------------------

| | ● | Management and director fees increased from $61,200 in 2011 to $75,072 in 2012, largely as a result
of increased services provided for our subsidiary Minewest that were consolidated in our financial statements prior to November
18, 2011 .
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In 2011 we recognized a gain
of $102,966 on private sale of our holdings of REGI shares when the shares were transferred to the purchasers; in 2012 we had no
such gain as we did not sell any REGI shares.



We recorded a net gain of
$126,404 in 2011 and $20,923 in 2012 on expiration and modification of warrants issued for purchase of our REGI shares, due to
the fact that most of the warrants issued in 2010 expired in 2011.



Unrealized gain on our warrants
for issued for our REGI shares were recorded at $5,872 in 2011 and $5,679 in 2012. The calculations were using Black Scholes model
which is dependent on our stock performances and the market condition.



In 2012 we recorded loss
of $8,718 for equity pick up of our investment in Minewest for the period from Nov 18, 2011 to April 30 2012, and gain on our investment
in Minewest of $80,295 which resulted from loss of Minewest from its inception to Nov 17, 2011. These were absent in 2011.



Fiscal year ended April 30, 2011 compared
to fiscal year ended April 30, 2010 (under GAAP)



For the year ended April 30, 2011, we had a
net and comprehensive loss of $(257,244) or $(0.01) per share, as compared to a net and comprehensive loss of $(454,902) or $(0.02)
per share for the year ended April 30, 2010. The decrease in the net loss during fiscal 2011 is mainly due to a gain of $27,048
in foreign exchange, compared to a loss of $(81,608) in fiscal 2010, and decreased research and developments costs of $107,700,
compared to $227,402 in fiscal 2010, which is offset by an increase in consulting fees of $32,209, compared to $16,542 in fiscal
2010 and stock based compensation of $89,776, compared to $1,348 in fiscal 2010.



22







Other significant changes from fiscal 2010
to fiscal 2011 are as follows:



| | ● | In 2011 we had a convertible debenture of principal amount of $50,000. Interest expense of $10,894
was recorded on the loan during the period, while we did not have such debt or related interest expense in 2010;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | We decreased shareholder communication expenses from $82,026 in 2010 to $41,106 in 2011 due to
our continued utilization of efficient channels for shareholder communication during theweak world economy;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | From 2010 to 2011 office expenses decreased from $33,719 to $27,286, professional fees decreased
from $105,851 to $99,670, and travel and promotion decreased from $15,211 to 7,605, all due to our continuing effort to streamline
our operations and share costs with our associated companies;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | Transfer agent and filing fees decreased from $26,925 in 2011 to $15,101 in 2010 due to our lowered
equity financing activities in 2011;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------



| | ● | We had net mineral property maintenance costs of $7,254 in 2011 instead of costs of $8,060 in 2010
due to reimbursement by Teryl Resources Inc. for their portion of the property maintenance costs;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | Wages and benefits increased slightly from $22,541 in 2010 to $26,750 in 2011 due to our severance
pay while we streamline our office operations;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | Management and director fees increased from $54,700 in 2010 to $61,200 in 2011 and consulting fees
increased from $16,542 in 2010 to $32,209, as a result of services provided for our new subsidiary Minewest incorporated in 2011.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In 2010 we recognized a gain of $142,815 on
private sale of our holdings of REGI shares when the shares were transferred to the purchasers; in 2011 we recognized the gain
of $102,966. The difference is largely due to the fact that we sold fewer REGI shares in 2011 (485,300 shares) than in 2010 (621,725
shares).



We recorded a net gain of $126,404 in 2011
and $6,971 in 2010 on expiration and modification of warrants issued for purchase of our REGI shares, due to the fact that most
of the warrants issued in 2010 expired in 2011.



Unrealized gain on our warrants for issued
for our REGI shares were recorded at $62,916 in 2010 and $5,872 in 2011, largely because we had fewer such warrants outstanding
at the end of 2011 than at the end of 2010.



Fiscal year ended April 30, 2010 compared
to fiscal year ended April 30, 2009 (under GAAP)



For the year ended April 30, 2010, we had a
net loss of $454,902 or $0.02 per share, as compared to a net loss of $456,090 or $0.02 per share for the year ended April 30,
2009. This increase in net loss is mainly due to the increase of research and development fees from $185,955 to $227,402 and foreign
exchange loss of $81,608 in 2010 versus foreign exchange gain of $59,268 in 2009 as a result of our advances to REGI denominated
in US dollar which weakened against Canadian dollar over the year. During 2010, we had income tax recovery on Rand’s REGI
US shares sold in 2009, while in 2009 we had income tax expense related to the sales.



Mineral property maintenance costs remain at
2009’s $8,060. Director and management fees as reported in the financial statements increased by $4,650 from $50,050 in 2009
to $54,700, because fees of $2,000 for services provided in 2009 is paid and recorded in 2010, and there was no actual change in
remuneration from 2009. Staff salaries and wages decreased slightly from $24,313 in 2009 to $22,541 in 2010.



All other expenses, including professional,
shareholder communication, travel and promotion all decreased significantly from 2009 due to the reduced operations as a result
of the world economy and Company’s continuing effort to streamline its operations.



23







During 2010 we had gain on sale of REGI US
shares of $142,815 compared to $347,099 in 2009 because we sold fewer shares in 2010. In 2010 we had realized net gain of $6,971
on expiration and modification of warrants attached to the private sale of REGI US units in 2009; this gain was absent in 2009.
In 2010 we had unrealized gain of $62,916 on warrants issued to private sale of REGI US units as a result of valuation calculations
using the Black-Scholes model, compared to $14,815 in 2009.



|B. | LIQUIDITY AND CAPITAL RESOURCES
|-- | -------------------------------



Liquidity



Fiscal year ended April 30, 2012



As of April 30, 2012 we had a cash position
of $650, compared to $88,684 as at the year ended April 30, 2011, representing a decrease of $88,034. As at April 30, 2012, we
had a working capital of $1,075,173, compared to a working capital of $678,684 as at April 30, 2011.



During the year ended April 30, 2012, we issued
3,178,675 units of private placements and 980,000 common shares for gross proceeds of $513,533, and advanced $80,742 from Minewest.



We are owed $1,025,086 by REGI, includes REGI’s
50% share of recent project costs for the RadMax Engine pursuant to the project cost sharing agreement. REGI currently lacks the
liquidity to fund its share of the costs.



Fiscal year ended April 30, 2011



As of April 30, 2011, we had a cash position
of $88,684, compared to $364 as at the year ended April 30, 2010, representing a significant increase of $88,320. As at April 30,
2011, we had a working capital of $678,684, compared to a working capital of $219,216 as at April 30, 2010.



During the year ended April 30, 2011, we issued
a convertible debenture for $50,000, which bears interest at 8% per annum, payable monthly, is unsecured and due on June 1, 2011.
The unpaid amount of principal can be converted at any time at the holder’s option into common shares at a price of $0.20
per share. We had the option to repay the principal and accrued interest before the due date with 30 days advance notice. We repaid
principal of $30,000 during February, 2011.



During the year ended April 30, 2011, we issued
1,894,333 common shares for gross proceeds of $272,187.



During the year ended April 30, 2011, we raised
$289,200 from sale of our private placement subscriptions and those of our 80% owned subsidiary Minewest.



During the year ended April 30, 2011, we raised
$76,466 from sale of our holdings of REGI shares and warrants for purchase of REGI shares from us.



We are owed $865,607 by REGI, includes REGI’s
50% share of recent project costs for the RadMax Engine pursuant to the project cost sharing agreement. REGI currently lacks the
liquidity to fund its share of the costs.



24







Fiscal year ended April 30, 2010



During the year ended April 30, 2010, we financed
our operations with $567,503 from the following activities:



| | ● | Private placement for net proceeds of $375,786 after share issuance costs of $22,603;
| | - | -------------------------------------------------------------------------------------



| | ● | $240,395 from investing activities through the sale of our investee’s shares and warrants
in the open market and through private sales, which was reduced by $49,421 advanced to REGI, our equity accounted investee.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Our cash position decreased by $743 from $1,107
at April 30, 2009 to $364 at April 30, 2010.



As at April 30, 2010, we had working capital
of $215,870 (2009 - $290,087) of which $585,859 is due from REGI (2009-$536,438). This receivable relates mainly to project costs
as REGI owns the U.S. marketing and intellectual rights and has a project cost sharing agreement, whereby it will fund 50% of the
further development of RadMax® Engine and we will fund 50%. REGI had US$NIL cash and a US$1,587,723 working capital deficiency
at April 30, 2010.



During the year ended April 30, 2010, we used
cash in the amount of $567,503 on operating activities as compared to $658,830 for the same period last year resulting in a decrease
of $91,327. This is a result of our incurring less operating expenses during 2010 in comparison to 2009.



On January 26, 2010, we completed a private
placement, whereby we issued 1,012,596 units at $0.15 per unit for proceeds of $151,889. Each private placement unit consisted
of one common share and share purchase warrant. Each warrant entitles the holder to purchase one additional share of common stock
at a price of $0.20 per share for one year. Finders’ fees of $7,050 were paid in connection with the private placement.



On March 28, 2010, we completed a private placement,
whereby we issued 1,643,333 units at $0.15 per unit for proceeds of $246,500. Each private placement unit consisted of one common
share and share purchase warrant. Each warrant entitles the holder to purchase one additional share of common stock at a price
of $0.20 per share for one year. Finders’ fees of $12,068 were paid in connection with the private placement, which are included
in share issuance costs.



Capital Resources



We are still in the development stage of our
business and expect to continue with research and development activities and mineral exploration activities for the near future.
We do not expect to generate significant revenues in the near future and will have to continue to rely upon the sale of equity
securities to raise capital or shareholder loans. Fluctuations in our share price may affect our ability to obtain future financing
and the rate of dilution to existing shareholders.



We have no funding commitments or arrangements
for additional financing at this time and there is no assurance that we will be able to obtain any additional financing on terms
acceptable to us, if at all. Any additional funds raised will be used for general and administrative expenses, and to continue
with our research and development activities. The quantity of funds to be raised and the terms of any equity financing that may
be undertaken will be negotiated by management as opportunities to raise funds arise.



We estimate that we will require approximately
$250,000 to fund our general and administrative expenses for the next twelve months. We will also require approximately $250,000
to fund our share of the costs for the RadMax® Engine, being the master design integrator, prototype fabrication and labour
expense. We do not currently have sufficient working capital to carry out our current operations. In order to continue, we will
need to raise funds by way of an equity financing. The quantity of funds to be raised and the terms of any equity financing that
may be undertaken will be negotiated by management as opportunities to raise funds arise.



25







Since our incorporation, we have financed our
operations almost exclusively through the sale of our common shares to investors and by borrowing from related parties. We expect
to finance operations through the sale of equity in the foreseeable future as we do not currently generate any revenues from business
operations. There is no guarantee that we will be successful in arranging financing on acceptable terms. To a significant extent,
our ability to raise capital is affected by trends and uncertainties beyond our control. Our ability to attain our business objectives
may be significantly impaired if the Technology cannot be commercialized.



Our objectives when managing capital are to
safeguard our ability to continue as a going concern in order to pursue the development of the Technology and to maintain a flexible
capital structure for our projects for the benefit of our stakeholders. As we are not earning any revenues from operations, our
principal source of funds is from the issuance of common shares.



|C. | RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES, ETC.
|-- | ----------------------------------------------------



The basic research and development work on
the RadMax® Engine is being coordinated and funded by our company and REGI as to 50% each.



We plan to contract with outside individuals,
institutions and companies to perform most of the additional research and development work which we may require to benefit from
our rights to the RadMax® Engine.



During the last two fiscal years, we spent
$113,554 and $107,700 on research and development in fiscal 2012 and 2011 respectively.



26







|D. | TREND INFORMATION
|-- | -----------------



See “Item 4. - Information on the Company
- Part B., Business Overview”



|E. | OFF-BALANCE SHEET ARRANGEMENTS
|-- | ------------------------------



There are no known significant off-balance
sheet arrangements other than those disclosed in this Form 20-F and in our audited consolidated financial statements for the year
ended April 30, 2011.



|F. | TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS
|-- | ---------------------------------------------



The following table provides information as
of the latest fiscal year end balance sheet date with respect to our known contractual obligations specified below. We
expect to fund these obligations from operating income and equity financing:



|Contractual Obligations                                                        |  | Total |  | Less than 1 year |  | 1-3 years |  | 3-5 years |  | More than 5 years | 
|------------------------------------------------------------------------------ |  | ----- |  | ---------------- |  | --------- |  | --------- |  | ----------------- | 
|Long-term debt obligations                                                     |  | Nil   |  | Nil              |  | Nil       |  | Nil       |  | Nil               | 
|Capital (Finance) Lease obligations                                            |  | Nil   |  | Nil              |  | Nil       |  | Nil       |  | Nil               | 
|Operating lease obligations                                                    |  | Nil   |  | Nil              |  | Nil       |  | Nil       |  | Nil               | 
|Purchase Obligations                                                           |  | Nil   |  | Nil              |  | Nil       |  | Nil       |  | Nil               | 
|Other Long-term liabilities reflected on the balance sheet under Canadian GAAP |  | Nil   |  | Nil              |  | Nil       |  | Nil       |  | Nil               | 
|Total                                                                          |  | Nil   |  | Nil              |  | Nil       |  | Nil       |  | Nil               | 



|G. | SAFE HARBOR
|-- | -----------



All statements, other than statements of historical
facts, included in this annual report that address activities, events or developments which we expect or anticipate will or may
occur in the future are forward-looking statements. The words “believe”, “intend”, “expect”, “anticipate”,
“project”, “estimate”, “predict” and similar expressions are also intended to identify forward-looking
statements.



Our estimated or anticipated future results
or other non-historical facts are forward-looking and reflect our current perspective of existing trends and information. The statements
involve risks and uncertainties that cannot be predicted or quantified, and consequently actual results may differ materially from
those expressed or implied by such forward-looking statements. Such factors include, among others, the following risks: the risks
associated with outstanding litigation, if any, risks associated with project development; the need for additional financing; operational
risks associated with developing and testing an engine; reliance on key personnel; the potential for conflicts of interest among
certain officers, directors or promoters with certain other projects; the absence of dividends; currency fluctuations; competition;
dilution; the volatility of our common share price and volume; and tax consequences to U.S. Shareholders, and other risks and uncertainties
detailed in this report and from time to time in our other SEC filings.



Consequently, all of the forward-looking statements
made in this annual report are qualified by these cautionary statements. We cannot assure you that the actual results or developments
anticipated by us will be realized or, even if substantially realized, that they will have the expected effect on us or our business
or operations.



Forward-looking statements are subject to a
variety of risks and uncertainties in addition to the risks referred to in “Risk Factors” under Item 3.D above.



27







|ITEM 6. | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
|------- | ------------------------------------------



|A. | DIRECTORS AND SENIOR MANAGEMENT
|-- | -------------------------------



As of April 30, 2012, our Board of Directors
consisted of four directors, two of whom are independent (or “outside”) non-executive directors. The following table
provides certain information about the members of our Board of Directors as of April 30, 2012.



|Name                |  | Position with Registrant             |  | Office Held Since
|------------------- |  | ------------------------------------ |  | -----------------
|John G. Robertson   |  | President, Secretary and Director    |  | 1982             
|James Vandeberg *   |  | Chief Financial Officer and Director |  | 2004             
|Susanne Robertson * |  | Director                             |  | 1984             
|Suzan El-Khatib *   |  | Director                             |  | 2011             



* Indicates member of the Audit
Committee.



The present and principal occupations of our
directors and executive officers and their business experience, function and area of experience for the Past Five Years are as
follows.



John G. Robertson, Richmond, B.C. Since
October 1982, Mr. Robertson has been President and a director of the Company. He is also the Chairman of the Board, founder and
a director of Linux Gold Corp. since its inception. Mr. Robertson has been the Chairman, President and Chief Executive Officer
of REGI since July 1992. Mr. Robertson has been the President and a director of IAS Energy, Inc. since its formation in December
1994, n Oregon public company quoted on the OTC Pink Sheets under symbol “IASCA.PK”. Mr. Robertson is also the President
and founder of Teryl Resources Corp. (TSX.V: TRC) (OTCBB: TRYLF), a British Columbia company involved in mineral exploration. Since
May 1977, Mr. Robertson has been President and a member of the Board of Directors of SMR Investments Ltd., a private British Columbia
corporation engaged in management of public companies. Mr. Robertson is also President and a director of the following private
companies: JGR Petroleum, Inc. (since July 1991), Access Information Services, Ltd. (since September 1993), 394754 B.C. Ltd., dba
SOVO Computer Centre (since October 1990), Pavlik Travel Services Ltd. (since November 2000), International Diamond Syndicate Ltd.
(since May 1993), KLR Enterprises Inc. (since 1999), Rainbow Networks Inc. (since 2000), Rand Energy Group Inc. (since 1993), 540330
B.C Ltd. (since April 1997), Minewest Silver and Gold Inc. (since 2010). Mr. Robertson is a citizen and resident of Canada.



Susanne M. Robertson, Richmond, B.C.
Mrs. Robertson has been a director of our company since 1984 and is also the spouse of John Robertson, our President. She has been
active in the management of our company since incorporation. She is also a director of Linux Gold Corp. Minewest Silver and Gold
Inc. and Teryl Resources Corp., and is the principal shareholder of SMR Investments Ltd. Mrs. Robertson is a citizen and resident
of Canada.



28







James L. Vandeberg, Sammamish, WA Mr.
Vandeberg became a Director of the Company and its Chief Operating Officer in 2004. He was appointed as a director of the Company
due to his extended experiences with the security laws, regulatory requirements and operations of public companies. Mr. Vandeberg
is an attorney in Seattle, Washington. Mr. Vandeberg’s practice focuses on the corporate finance area, with an emphasis on securities
and acquisitions. Mr. Vandeberg was previously general counsel and secretary of two NYSE companies Carter Hawley Stores, Inc. from
1978 to 1993, and Denny’s Inc. from 1973 to 1978. He is a director of Information-Highway.com, Inc., a Florida corporation
traded on the Pink Sheets. He is also a director of IAS Energy, Inc. an Oregon corporation traded
on the PinkSheets. Mr. Vandeberg is also a director of REGI. Mr. Vandeberg is currently also vice president, corporate secretary
and a director of Legend Oil & Gas Ltd. and a director of American Sierra Gold Corp. and ASAP Expo, Inc., all three companies
trading on the OTCBB.He is a member and former director of the American Society of Corporate
Secretaries. He became a member of the Washington Bar Association in 1969 and of the California Bar Association in 1973. Mr. Vandeberg
graduated cum laude from the University of Washington with a Bachelor of Arts degree in accounting in 1966, and from New York University
School of Law in 1969, where he was a Root-Tilden Scholar. Mr. Vandeberg devotes approximately 10% of his time to our operations.



Suzan El-Khatib – Ms. El-Khatib
has been a director since April, 2011. Ms. El-Khatib began her career at Bull, Housser Tupper LLP and moved on to a boutique firm
before joining Wiebe Douvelos Wittmann LLP. She advises and acts for both individual and corporate clients on a broad variety of
matters including corporate governance and commercial litigation. Ms. El-Khatib has experience as a corporate solicitor and as
a litigator, appearing at all levels of court. She is a current member of the Law Society of British Columbia, the Canadian Bar
Association, and the Trial Lawyers Association of British Columbia. Ms. El-Khatib has been a director of Teryl Resources Corp.
and Linux Gold Corp. since April, 2011.



The directors have served in their respective
capacities since their election and/or appointment and will serve until the next annual meeting of shareholders or until a successor
is duly elected, unless the office is vacated in accordance with our Articles.



The Board of Directors appoints senior management
who serves at the discretion of the Board of Directors.



Cease Trade Orders



On December 6, 2011 the BCSC issued a CTO against
Teryl Resources Corp. (“Teryl”), a company with related directors and officers, for failure to file its interim
unaudited financial statements and related MD&A. The CTO was revoked on December 12, 2012 following the filing of its interim
financial statements and related MD&A. Additionally, Teryl received notification from the TSX Venture Exchange (“TSX.V”)
that it had suspended trading in Teryl’s shares as a result of the CTO. The TSX.V concluded its reinstatement review to ensure
Teryl had satisfactorily complied with its requirements and reinstated Teryl’s shares for trading on January 27, 2012.



On September 4, 2009, the British Columbia
Securities Commission (“BCSC”) issued a cease trade order against us for failure to file our annual audited
financial statements and related Management’s Discussion & Analysis (“MD&A”). We filed the required
documents on SEDAR on September 11, 2009, to comply with the requirements to rectify the continuous disclosure deficiencies and
the cease trade order was revoked by the BCSC on September 15, 2009.



On September 4, 2009, the BCSC issued a cease
trade order against IAS Energy, Inc. (“IAS”), a company with related directors and officers, for failure to
file its annual audited financial statements and related MD&A. The cease trade order was revoked on September 16, 2009 following
filing of its annual financial statements and related MD&A. On October 2, 2009, a cease trade order was issued by the BCSC
against IAS for failure to file its interim unaudited financial statements for the three months ended July 31, 2009. The cease
trade order was revoked on November 30, 2009 following filing of its annual financial statements and related MD&A. On January
1, 2010, a cease trade order was issued by the BCSC against IAS for failure to file its interim unaudited financial statements
for the six months ended October 31, 2009. The cease trade order was revoked on January 18, 2010 following filing of its interim
financial statements and related MD&A. On September 7, 2010, the BCSC issued a cease trade order against IAS for failure to
file its annual audited financial statements and related MD&A. The cease trade order was revoked on October 8, 2010 following
filing of its annual financial statements and related MD&A.



29







On September 9, 2008, the BCSC issued a cease
trade order against us for failure to file our annual audited financial statements and related MD&A. We filed the required
documents on SEDAR on September 22, 2008, to comply with the requirements to rectify the continuous disclosure deficiencies and
the cease trade order was revoked by the BCSC on September 24, 2008.



On December 3, 2007, the BCSC issued a cease
trade order against Linux Gold Corp. (“Linux”), a company with related directors and officers, for failure to
file a technical report and non-compliant disclosure. The BCSC staff found that the technical report filed on SEDAR on February
22, 2006 was not prepared by a qualified person. The BCSC also found that Linux’s disclosure in the offering memorandum dated
April 5, 2007 did not disclose repayment of debt to related parties. Linux filed the required documents on SEDAR to comply with
the requirements to rectify the continuous disclosure deficiencies and the cease trade order was revoked by the BCSC on February
8, 2008.



Other than the disclosed above, to our knowledge,
no proposed director is, or has, within the 10 years before the date of this Information Circular, been a director or executive
office of any company that, while that person was acting in that capacity:



| | (a) | was the subject of a cease trade order or similar order or an order that denied relevant company
access to any exemptions under securities legislation, for a period of more than 30 consecutive days; or
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | was subject to an event that resulted, after the director or executive officer ceased to be a director
or executive officers, in the company being the subject of a cease trade or similar order that denied the relevant company access
to any exemption under securities legislation, for a period of more than 30 consecutive days; or
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | within a year of that person ceasing to act in that capacity, became bankrupt, make a proposal
under any legislation relating to bankruptcy or insolvency, or was subject to or instituted any proceedings, arrangement or compromise
with creditors or had a receiver, receiver manager or trustee appointed to hold its assets.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Penalties or Sanctions



No director or officer of our company is or
has, within the past ten years:



| | (a) | been subject to any penalties or sanctions imposed by a court relating to Canadian securities legislation
or Canadian securities regulatory authority or has entered into a settlement agreement with a Canadian securities regulatory authority,
or
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | been subject to any other penalties or sanctions imposed by a court or regulatory body that would
be likely to be considered important to a reasonable investor making an investment decision.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Individual Bankruptcies



No director or officer of our company is or
has, within the preceding 10 years, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency
or been subject to or instituted any proceedings, arrangement, or compromise with creditors or had a receiver, receiver manager
or trustee appointed to hold the assets of that individual.



30







There is a family relationship between two
of our directors. John Robertson and Susanne Robertson are spouses. Please refer to Item 7.B. – Related Party Transactions.



There are no arrangements or understandings
with major shareholders, customers, suppliers or others, pursuant to which any person referred to above was selected as a director
or member of senior management.



|B. | COMPENSATION
|-- | ------------



During the financial year ended April 30, 2012,
we had two Named Executive Officer (“NEO”) being John Robertson, Chief Executive Officer (“CEO”)
and President and James Vandeberg, Chief Financial Officer.



“Named Executive Officer”
or “NEO” means: (a) each CEO, (b) each CFO, (c) each of the three most highly compensated executive officers,
or the three most highly compensated individuals acting in a similar capacity, other than the CEO and CFO, at the end of the most
recently completed financial year whose total compensation was, individually, more than $150,000; and (d) each individual who
would be a NEO under (c) above but for the fact that the individual was neither an executive officer of a company, nor acting
in a similar capacity, at the end of that financial year.



Compensation Objectives and Principles



The primary goal of our executive compensation
program is to attract and retain the key executives necessary for our long term success, to encourage executives to further our
development and our operations, and to motivate top quality and experienced executives. The key elements of our executive compensation
program are: (i) base salary; (ii) potential annual incentive award; and (iii) incentive stock options. Our directors are of the
view that all elements of the total program should be considered, rather than any single element.



Compensation Discussion and Analysis



Our executive officers make recommendations
to the Board regarding compensation policies and the compensation of senior officers. We do not have a Compensation Committee.
The compensation of the senior executives comprises two components; namely, a base salary or consulting fees and the grant of stock
options pursuant to our stock option plan. . These forms of compensation are chosen to attract, retain and motivate the performance
of selected directors, officers, employees or consultants of high caliber and potential. Each senior executive is employed for
his or her skills to perform specific tasks and the base salary and number of options is fixed accordingly.



Senior executives generally enter into an employment
agreement, with standard clauses covering salaries and termination and change of control provisions. The highlights of the employment
agreements for the NEOs are outlined below under the section entitled “Management Contracts” and Narrative Discussionunder the Summary Compensation Table.



Option-based Awards



The grant of option-based awards to the senior
executives is determined by the recommendation of executive officers to the Board pursuant to the terms of our stock option plan.
Previous grants of option-based awards are taken into account when considering new grants. The options are always granted at market
price.



31







Benefits and Perquisites



Our NEOs do not receive any benefits or perquisites
other than as disclosed herein.



Summary Compensation Table



The following table provides a summary of the
compensation earned by, paid to, or accrued and payable to, each NEO during the fiscal years ended April, 2012, 2010 and 2009.
Amounts reported in the table below are in Canadian dollars, the currency that we use in our financial statements.



|                            |  |                     |  |             |  |                         |     |                             |  | Non-equity incentive
plan compensation
($) |                             |  |  |                                 |  |  |                   |     | 
|--------------------------- |  | ------------------- |  | ----------- |  | ----------------------- | --- | --------------------------- |  | ------------------------------------------ | --------------------------- |  |  | ------------------------------- |  |  | ----------------- | --- | 
|Name and
Principal
Position |  | Year
Ended
April 30 |  | Salary
 ($) |  | Share-
based Awards
($) |     | Option-
Based Awards ($)(6) |  |                                            | Annual
incentive
plans 
($) |  |  | Long-
term
incentive
plans 
($) |  |  | Pension
value
($) |     | 
|John G.                     |  | 2012                |  | Nil         |  |                         | Nil |                             |  | Nil                                        |                             |  |  | Nil                             |  |  |                   | Nil | 
|Robertson,                  |  | 2011                |  | Nil         |  |                         | Nil |                             |  | Nil                                        |                             |  |  | Nil                             |  |  |                   | Nil | 
|CEO (1)(2)(3)               |  | 2010                |  | Nil         |  |                         | Nil |                             |  | Nil                                        |                             |  |  | Nil                             |  |  |                   | Nil | 
|                            |  |                     |  |             |  |                         |     |                             |  |                                            |                             |  |  |                                 |  |  |                   |     | 
|James                       |  | 2012                |  | Nil         |  |                         | Nil |                             |  | Nil                                        |                             |  |  | Nil                             |  |  |                   | Nil | 
|Vandeberg,                  |  | 2011                |  | Nil         |  |                         | Nil |                             |  | Nil                                        |                             |  |  | Nil                             |  |  |                   | Nil | 
|CFO (4)                     |  | 2010                |  | Nil         |  |                         | Nil |                             |  | Nil                                        |                             |  |  | Nil                             |  |  |                   | Nil | 

| | (1) | Mr. Robertson is also a director and receives annual compensation of $6,000 in that capacity in 2010.
| | --- | -----------------------------------------------------------------------------------------------------

| | (2) | Mr. Robertson is a director of SMR Investments Ltd., which received or is to receive $2,500 per month for management services.
See “Management Contracts”.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------

| | (3) | Mr. Vandeberg is also a director but does not receive any compensation in that capacity.
| | --- | ----------------------------------------------------------------------------------------



Employment Contracts and Termination of
Employment



There are no employment agreements or
other compensating plans or arrangements with regard to any of the NEOs which provide for specific compensation in the event of
resignation, retirement, other termination of employment or from a change of control of our company or from a change in an NEO’s
responsibilities following a change in control.



Pursuant to a management agreement dated May
1, 1996, we engaged SMR Investments Ltd. (“SMR”) to provide services to us. SMR is a private company controlled by
Susanne Robertson, a director and the spouse of our President. Our President is also a director and officer of SMR. SMR provides
management services for a monthly fee of $2,500. These services consist of general management services. The agreement may be terminated
by the mutual consent of the parties. During the years ended April 30, 2012 and 2011, we paid or accrued to SMR total fees of $30,000.



Incentive Plan Awards



Outstanding Option-Based Awards and Share-Based
Awards



The following table sets out all stock option-based
awards granted to the NEOs and outstanding at the end of the most recently completed financial year ended April 30, 2012.



32







|                |  | Option-based Awards                                      |         | Stock-based Awards
|--------------- |  | -------------------------------------------------------- | ------- | ------------------
|Name            |  | Number of
securities
underlying
unexercised
options 
(#) |         |                   
|John Robertson  |  |                                                          | 750,000 |                   
|                |  |                                                          | 100,000 |                   
|James Vandeberg |  |                                                          | 50,000  |                   



(1)The closing price of our
shares on the TSX Venture Exchange (“TSX.V”) on April 30, 2012 was $0.10.



Incentive Plan Awards – value
vested or earned during the year



|Name            |  | Option-Based Awards – Value 
Vested During the Year 
($) |  | Share-Based Awards – Value 
Vested During the Year 
($) |  | Non-Equity Incentive Plan
Compensation – Value Earned 
During the Year 
($) | 
|--------------- |  | -------------------------------------------------------- |  | ------------------------------------------------------- |  | --------------------------------------------------------------------------- | 
|John Robertson  |  | Nil                                                      |  | Nil                                                     |  | Nil                                                                         | 
|James Vandeberg |  | Nil                                                      |  | Nil                                                     |  | Nil                                                                         | 



Pension Plan Benefits and Deferred
Compensation Plans



We do not offer any pension plan benefits
or deferred compensation plans for our NEOs or employees.



Termination of Employment or Change
of Control



We have no plans or arrangements with
respect to remuneration received or that may be received by the NEOs during our most recently completed financial year or current
financial year in view of compensating such officers in the event of termination of employment (as a result of resignation, retirement,
change of control, etc.) or a change in responsibilities following a change of control.



Director Compensation



For our most recently completed fiscal year
ended April 30, 2012:



| | (a) | no compensation of any kind was accrued, owing or paid to any of our directors for acting in their
capacity as such;
| | --- | --------------------------------------------------------------------------------------------------------------------



| | (a) | no arrangements of any kind existed with respect to the payment of compensation of any kind to
any of our directors for acting in their capacity as such;
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | excluding our NEOs, no compensation of any kind was accrued, owing or paid to any of the directors
for services rendered to us as consultants or experts, except for research and developments costs of $56,250 (2011 - $75,000) that
were paid to a company of which our former director Mr. Robert Grisar is a director and officer; and
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (d) | excluding our NEOs, no arrangements of any kind existed with respect to the payment of compensation
of any kind to any of our directors for services rendered, or proposed to be rendered, to us as consultants or experts.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



33







Outstanding Share-Based Awards and Option-Based Awards



The following table sets out all stock option-based
awards granted to the directors that were outstanding at the end of the most recently completed financial year ended April 30,
2010.



|                  |  | Option-based Awards                                      |         | Stock-based Awards
|----------------- |  | -------------------------------------------------------- | ------- | ------------------
|Name              |  | Number of
securities
underlying
unexercised
options 
(#) |         |                   
|Susanne Robertson |  |                                                          | 250,000 |                   



(1)	 The closing price of our common
shares on the TSX.V on April 30, 2012 was $0.10



Incentive Plan Awards – Value Vested or Earned During the
Year



The following table sets out the value vested or earned by our non-executive
directors during the financial year ended April 30, 2012.



|Name 
(a)         |  | Option-Based Awards – Value 
Vested During the Year 
($) 
(b) |  | Share-Based Awards – Value 
Vested During the Year 
($) 
(c) |  | Non-Equity Incentive Plan
Compensation – Value Earned 
During the Year 
($) 
(d) | 
|----------------- |  | ------------------------------------------------------------- |  | ------------------------------------------------------------ |  | -------------------------------------------------------------------------------- | 
|Susanne Robertson |  | Nil                                                           |  | Nil                                                          |  | Nil                                                                              | 
|Suzan El-Khatib   |  | Nil                                                           |  | Nil                                                          |  | Nil                                                                              | 



Indebtedness of Directors and Officers



None of our directors and senior officers,
proposed nominees for election or associates of such persons is or has been indebted to us or our subsidiaries, other than routine
indebtedness, at any time since the beginning of our the last completed financial year.



|C. | BOARD PRACTICES
|-- | ---------------



Under section 224 of the Business Corporations
Act,S.B.C. 2002, c. 57, the directors of a company must, at their first meeting on or after each annual reference date, elect
an audit committee, to hold office until the next annual reference date. The audit committee must be composed of at least three
directors, and a majority of the members of the committee must not be officers or employees of the company or of an affiliate of
the company. The members must elect a chair from among their number and determine their own procedures. The auditor of a company
must be given reasonable notice of, and has the right to appear before and to be heard at each meeting of the company’s audit
committee and must appear before the audit committee when request to do so by the committee and after being given reasonable notice
to do so. Our Board of Directors established an Audit Committee, which members consist of James Vandeberg, Susanne Robertson and
Suzan El-Khatib.



The directors are elected by the shareholders
to hold office for a term of one year or until re-elected at the next annual general meeting.



34







Audit Committee



As of the date of this annual report, the members
of our Audit Committee are James Vandeberg, Susanne Robertson and Suzan El-Khatib. Mrs. Robertson and Ms. El-Khatib are independent
directors who are not officers or employees of our company or our affiliates. Mr. Vandeberg is our Chief Financial Officer.



The Audit Committee must review our annual
financial statements before they are approved by our Board of Directors. Our Board of Directors must review, and if considered
appropriate, approve our annual financial statements before presentation to our shareholders.



|D. | EMPLOYEES
|-- | ---------



As of April 30, 2012, we did not have any employees.
Our legal, accounting, marketing and administrative functions are, and have been during the last three fiscal years, contracted
out to consultants who work closely with our management.



We have no employees; as such, no directors
of officers belong to any labor unions. We have not been subject to any strikes or other labor disturbances that have interfered
with our operations.



|E. | SHARE OWNERSHIP
|-- | ---------------



The following table sets forth the ownership
of our common shares by our directors and officers as at September 12, 2012:



|Shareholder           |  | Number of shares issued and outstanding |           |  | Percentage ownership (1) | 
|--------------------- |  | --------------------------------------- | --------- |  | ------------------------ | 
|John G. Robertson (2) |  |                                         | 4,517,635 |  |                          | 
|Susanne Robertson (3) |  |                                         | 5,567,728 |  |                          | 
|James Vandeberg (4)   |  |                                         | 50,000    |  |                          | 
|Suzan El-Khatib       |  |                                         | Nil       |  |                          | 

| | (1) | As at September 12, 2012 there were 34,883,793 issued and outstanding common shares. For detailed
information about the stock options held, if any, please see “Statement of Executive Compensation” above.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | Includes 2,203,769 common shares held directly by Mr. Robertson. 1,118,530 shares are registered
in the name of and beneficially owned by Access Information Services, Inc., a Washington corporation which is owned and controlled
by the Robertson Family Trust, the beneficiary of which is Kelly Robertson, daughter of John G. Robertson. Mr. Robertson is one
of three trustees of the Robertson Family Trust, which acts by the majority vote of the three trustees. Mr. Robertson disclaims
beneficial ownership of the shares owned or controlled by the Robertson Family Trust. This amount also includes 506,200 common
shares registered in the name of Rainbow Networks Inc., a British Columbia company controlled by Mr. Robertson, who is sole director,
president and secretary. Mr. Robertson disclaims beneficial ownership of the shares owned or controlled by Rainbow Networks. This
amount also includes 1, 392,905 shares held by JGR Petroleum Inc., a corporation controlled by the Robertson Family Trust. It also
includes 850,000 stock options and 650,000 warrants registered in the name of John Robertson.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (3) | Includes 589,975 held directly by Mrs. Robertson. SMR Investments Ltd., a company wholly-owned
by Susanne Robertson, is the beneficial owner of 4,427,753 common shares. This amount also includes 250,000 stock options registered
in the name of Mrs. Roberson and 300,000 warrants registered in the name of SMR Investments Ltd.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (4) | Includes
                                                                                                        50,000 stock options.                                                                                                                                                                                              





35









|ITEM 7. | MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
|------- | -------------------------------------------------



|A. | MAJOR SHAREHOLDERS.
|-- | -------------------



To the best of our knowledge, we are not indirectly
owned or controlled by any other corporation, foreign government or by any other natural or legal person, except as set out below.



At September 12, 2012, we are aware of two
shareholders who own 5% or greater of our voting shares.



|Name of Shareholder   |  | Number of
Common Shares |           |  | Percentage of
Outstanding
Common Shares (1) | 
|--------------------- |  | ----------------------- | --------- |  | ------------------------------------------- | 
|Susanne Robertson (1) |  |                         | 5,567,728 |  |                                             | 
|John Robertson (2)    |  |                         | 4,517,635 |  |                                             | 



Over the past three years, there has not been
a significant change in the percentage ownership held by any major shareholder.



Canadian Share Ownership.



As of September 11, 2012, our shareholders
list showed 34,883,793 common shares outstanding with 522 registered shareholders. The direct and indirect holding by depository
institutions and other financial institutions is estimated as 84 holders of record resident in Canada, holding an aggregate of
19,201,836 common shares; and 435 holders of record resident in the United States, holding an aggregate of 1,589,079 common shares.



Control of the Company



We are a publicly owned Canadian corporation,
with shareholders in Canada, the United States and other foreign jurisdictions. We are not controlled by any foreign government
or other person.



We do not know of any arrangements which could
result in a change in control of our company.



|B. | RELATED PARTY TRANSACTIONS.
|-- | ---------------------------



REGI



The Company’s investment in REGI has
been reduced to $nil as the Company’s share of past losses exceeded the carrying value of the investment in REGI.



At April 30, 2012, the Company is owed an aggregate
of $1,025,086 (2011 - $865,607) by REGI. The amounts owed are unsecured, non-interest bearing and due on demand.



During the year ended April 30, 2012, the Company
recognized a gain of $nil (2011 – $102,966) relating to the sale of nil (2011 – 458,300) of shares of REGI by the Company
and Rand.



Minewest



On July 20, 2010 the Company signed an asset
transfer agreement with its newly incorporated wholly owned subsidiary Minewest for the purpose of acquiring and exploring mineral
properties. In accordance with the agreement the Company transfers its 100% ownership in its undivided 45% interest subject to
a 5% net smelter return in 33 mining claims situated in the Tootsee River area in the Province of British Columbia for following
consideration:



| | ● | Cash payment of $25,000 on or before August 15, 2010 (paid);
| | - | ------------------------------------------------------------

| | ● | Issuance of 8,000,000 shares of Minewest voting common shares (issued).
| | - | -----------------------------------------------------------------------





Effective December 15, 2010 Minewest signed
a purchase agreement with Rapitan Resources Inc. (“Rapitan”), wherein Minewest purchased 100% of Rapitan’s 25%
interest in the Silverknife property for the following consideration:



| | ● | Cash payment of $10,000 (paid);
| | - | -------------------------------

| | ● | Issuance of 2,000,000 shares of common stocks of Minewest (issued).
| | - | -------------------------------------------------------------------



36







Effective November 18, 2011 Reg Tech obtained
court approval for the Plan of Arrangement. On December 14, 2011, Reg Tech declared approximately 4,712,263 Minewest shares to
be distributed to as dividend to Reg Tech shareholders on the record date of December 21, 2011, whereby one Minewest share is distributed
for seven Reg Tech shares. As at April 30, 2012 and the date of this report, these shares have not been distributed, which is subject
to Minewest being listed on the CNSX, and are recorded as assets held for distribution to shareholders, $471,200.



As a result of the dividend declaration, Reg
Tech retains approximately 3,287,737 shares of Minewest, representing approximately 26.10% of the issued and outstanding common
shares of Minewest at April 30, 2012, and has its controlling interest reduced to significant influence effective November 18,
2011.



As at April 30, 2012 the Company’s investment
in Minewest is recorded at $320,082 under equity method (investment of $328,800 less equity loss of $8,718) and held 26.10% ownership
in Minewest.



At April 30, 2012, the Company owed an aggregate
of $179,414 (2011 - $nil) to Minewest. The amounts owed are unsecured, non-interest bearing and due on demand.



At April 30, 2012, the Company is owed an aggregate
of $1,317 (2011 - $8,490) by related parties and owed an aggregate of $137,135 (2010 - $218,878) to related parties. The amounts
owed are unsecured, non-interest bearing and due on demand. These parties are companies that the President of the Company controls
or significantly influences.



During the year ended April 30, 2012, rent
of $6,871 (2011 - $15,680) incurred with a company having common officers and directors.



During the year ended April 30, 2012, management
fees of $30,000 (2011 - $30,000) were incurred to a company having common officers and directors.



During the year ended April 30, 2012, management
and directors’ fees of $26,972 (2011 - $31,200) were paid to officers, directors and companies controlled by officers and
directors for services rendered.



During the year ended April 30, 2012, research
and development costs of $56,250 (2011 - $75,000) were paid to a company having common officers and directors.



All related party transactions are in the normal
course of operations and have been measured at the agreed to amounts, which is the amount of consideration established and agreed
to by the related parties.



|C. | INTERESTS OF EXPERTS AND COUNSEL
|-- | --------------------------------



Not applicable.



37







|ITEM 8. | FINANCIAL INFORMATION
|------- | ---------------------



|A. | CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION
|-- | -------------------------------------------------------



Financial Statements



|Description                                                                   |  | Page       
|----------------------------------------------------------------------------- |  | -----------
|Consolidated Financial Statements for the years ended April 30, 2012 and 2011 |  | F-1 -  F-35



Legal Proceedings



We are not a party to any material legal proceedings.



Dividend Distribution Policy



We have not paid any cash dividends to date
and we do not intend to pay cash dividends in the foreseeable future.



|B. | SIGNIFICANT CHANGES
|-- | -------------------



None.



|ITEM 9. | THE OFFER AND LISTING
|------- | ---------------------



Not applicable, except for Item 9.A.4 and Item
9.C.



Our shares currently trade on the TSX.V under
the trading symbol RRE.V. In addition, we also trade on the OTCBB under the symbol REGRF.OB. The ranges of the low and high sales
prices for our shares traded on the TSX.V and OTCBB for the periods indicated are as follows:



|     |  |  |               |                  |  | TSX.V |  |      | OTC BB (1) | 
|---- |  |  | ------------- | ---------------- |  | ----- |  | ---- | ---------- | 
|     |  |  |               |                  |  | High  |  |      | Low        | 
|     |  |  | Quarter Ended |                  |  | CDN $ |  |      | CDN $      | 
|2012 |  |  |               |                  |  |       |  |      |            | 
|     |  |  |               | July 31, 2011    |  |       |  | 0.19 |            | 
|     |  |  |               | October 31, 2011 |  |       |  | 0.19 |            | 
|     |  |  |               | January 31, 2012 |  |       |  | 0.17 |            | 
|     |  |  |               | April 30, 2012   |  |       |  | 0.18 |            | 



|     |  |  |               |                  |  | TSX.V |  |       | OTC BB (1) | 
|---- |  |  | ------------- | ---------------- |  | ----- |  | ----- | ---------- | 
|     |  |  |               |                  |  | High  |  |       | Low        | 
|     |  |  | Quarter Ended |                  |  | CDN $ |  |       | CDN $      | 
|2011 |  |  |               |                  |  |       |  |       |            | 
|     |  |  |               | July 31, 2010    |  |       |  | 0.185 |            | 
|     |  |  |               | October 31, 2010 |  |       |  | 0.19  |            | 
|     |  |  |               | January 31, 2011 |  |       |  | 0.19  |            | 
|     |  |  |               | April 30, 2011   |  |       |  | 0.185 |            | 
|2010 |  |  |               |                  |  |       |  |       |            | 
|     |  |  |               | July 31, 2009    |  |       |  | 0.27  |            | 
|     |  |  |               | October 31, 2009 |  |       |  | 0.30  |            | 
|     |  |  |               | January 31, 2010 |  |       |  | 0.21  |            | 
|     |  |  |               | April 30, 2010   |  |       |  | 0.26  |            | 

| | (1) | Information provided by the Over The Counter Bulletin Board. The
quotations reflect inter-dealer prices, without retail mark-up, markdown, or commission and may not represent actual transactions.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                    

38









The following table shows the high and low
closing prices of our stock traded on the TSX.V and the OTCBB during the most recent six months, for each month as follows:



|           |  |  | TSX.V |      |  | OTC BB (1) | 
|---------- |  |  | ----- | ---- |  | ---------- | 
|           |  |  | High  |      |  | Low        | 
|           |  |  | CDN $ |      |  | CDN $      | 
|Month 2012 |  |  |       |      |  |            | 
|August     |  |  |       | 0.12 |  |            | 
|July       |  |  |       | 0.16 |  |            | 
|June       |  |  |       | 0.17 |  |            | 
|May        |  |  |       | 0.17 |  |            | 
|April      |  |  |       | 0.12 |  |            | 
|March      |  |  |       | 0.18 |  |            | 



| | (1) | Information provided by The Over The Counter Bulletin Board. The quotations reflect inter-dealer
prices, without retail mark-up, markdown, or commission and may not represent actual transactions.)
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



As a foreign private issuer, our officers,
directors and ten percent beneficial owners we will not be subject to the reporting obligations of the proxy rules of the Section
14 of the Exchange Act or the insider short-swing profit rules of Section 16 of the Exchange Act.



Common
Share Description



Our authorized capital consists
of 65,000,000 shares consisting of 50,000,000 common shares without par value, 10,000,000 preferred shares with a par value of
$1.00 per share and 5,000,000 Class “A” non-voting shares without par value. Of the 50,000,000 common shares without
par value, 34,883,793 and 30,725,118 shares were issued and outstanding as of April 30, 2012 and 2011 respectively. There are no
Preferred or Class “A” Shares currently outstanding. All the Issuer's outstanding shares are Common Shares. They are
not subject to any future call or assessment and they all have equal voting rights. There are no special rights or restrictions
of any nature attached to any of the shares and they all rank equally, as to all benefits that might accrue to the holder thereof.



Holders of common shares are entitled to one
vote for each share held of record on all matters to be acted upon by the shareholders. Holders of common shares are entitled to
receive such dividends as may be declared from time to time by the Board of Directors, in its discretion, out of funds legally
available therefore.



Upon our liquidation, dissolution or winding
up, holders of common shares are entitled to receive pro rata our assets, if any, remaining after payments of all debts
and liabilities.



No shares have been issued subject to call
or assessment. There are no pre-emptive or conversion rights and no provisions for redemption or purchase for cancellation, surrender,
or sinking or purchase funds.



Provisions as to the modification, amendment
or variation of such shareholder rights or provisions are contained in the Business Corporations Act (British Columbia).
Unless the Act or our Articles otherwise provide, any action to be taken by a resolution of the shareholders may be taken by an
ordinary resolution, being approved by a vote of a majority of the votes cast in respect of the matter at the shareholders’
meeting.



There are no restrictions on the repurchase
or redemption of our common shares while there is any arrearage in the payment of dividends or sinking fund installments.





39







|ITEM 10. | ADDITIONAL
INFORMATION
|-------- | ----------------------





|A. | SHARE CAPITAL
|-- | -------------



Not applicable.



|B. | MEMORANDUM AND ARTICLES OF ASSOCIATION
|-- | --------------------------------------



Our Memorandum and Articles are incorporated
by reference to the information in our registration statement on Form 20-F filed with the Securities and Exchange Commission, in
Washington, D.C. on June 15, 1994, to which our Articles of Incorporation and Memorandum were filed as exhibits.



We were originally incorporated on October
6, 1982 as Reg Resources Corp. under a perpetual charter pursuant to the British Columbia Business Corporations Act (formerly
the Company Act) by registration of our Memorandum and Articles. On February 23, 1993 we changed our name to Reg Technologies
Inc. in order to better reflect our main area of business development. We did not consolidate our shares at the time our name was
changed.



|C. | MATERIAL CONTRACTS
|-- | ------------------



During the past two years ended April 30, 2012
and April 30, 2011, we were not subject to or entered into any material contracts.



|D. | EXCHANGE CONTROLS
|-- | -----------------



There are no governmental laws, decrees or
regulations in Canada relating to restrictions on the export of capital affecting the remittance of interest, dividends or other
payments to nonresident holders of the Registrant's shares. Any such remittances, however, are subject to withholding tax. See
Item 7, "Taxation".



There are no limitations under the laws of
Canada, the Province of British Columbia or in the charter or any other constituent documents of our company on the right of foreigners
to hold or vote our shares. However, under the provisions of the Investment Canada Act, when control of a Canadian business
is acquired by a non- Canadian, the transaction may be reviewable in certain circumstances by Investment Canada, an agency of the
federal government of Canada. Reviewable transactions are those in which a non-Canadian acquires the assets of a Canadian business
or the voting shares of a Canadian corporation the value of which assets or shares exceeds $5 million (Canadian). Also, certain
transactions are specifically exempted from review.



40









|E | TAXATION
|- | --------



Certain Canadian Federal Income Tax Consequences



The discussion under this heading summarizes
the principal Canadian federal income tax consequences of acquiring, holding and disposing of shares of our common stock for a
shareholder of ours who is not a resident of Canada but is a resident of the U.S. and who will acquire and hold our common shares
as capital property for the purposes of the Income Tax Act(Canada) (the “Canadian Tax Act”). This summary
does not apply to a shareholder who carries on business in Canada through a “permanent establishment” situated
in Canada or performs independent personal services in Canada through a fixed base in Canada if the shareholder’s holding
in Reg Technologies Inc. is effectively connected with such permanent establishment or fixed base. This summary is based on the
provisions of the Canadian Tax Act and the regulations thereunder and on an understanding of the administrative practices of Canada
Revenue Agency, and takes into account all specific proposals to amend the Canadian Tax Act or regulations made by the Minister
of Finance of Canada as of the date hereof. It has been assumed that there will be no other relevant amendment of any governing
law although no assurance can be given in this respect. This discussion is general only and is not, nor is it intended to provide
a detailed analysis of the income tax implications of any particular shareholder’s interest. Investors are advised to obtain
independent advice from a shareholder’s own Canadian and U.S. tax advisors with respect to income tax implications pertinent
to their particular circumstances. The provisions of the Canadian Tax Act are subject to income tax treaties to which Canada is
a party, including the Canada-United States Income Tax Convention(1980), as amended (the “Convention”).



Dividends on Common Shares and Other
Income



Under the Canadian Tax Act, a non-resident
of Canada is generally subject to Canadian withholding tax at the rate of 25 percent on dividends paid or deemed to have been paid
to him or her by a corporation resident in Canada. We are responsible for withholding of tax at the source. The Convention limits
the rate to 15 percent if the shareholder is a resident of the U.S. and the dividends are beneficially owned by and paid to such
shareholder, and to 5 percent if the shareholder is also a corporation that beneficially owns at least 10 percent of the voting
stock of the payor corporation.



The amount of a stock dividend (for tax purposes)
would generally be equal to the amount by which the paid up or our stated capital had increased by reason of the payment of such
dividend. We will furnish additional tax information to our shareholders in the event of such a dividend. Interest paid or deemed
to be paid on our debt securities held by non-Canadian residents may also be subject to Canadian withholding tax, depending upon
the terms and provisions of such securities and any applicable tax treaty.



The Convention generally exempts from Canadian income
tax dividends paid to a religious, scientific, literary, educational or charitable organization or to an organization constituted
and operated exclusively to administer a pension, retirement or employee benefit fund or plan, if the organization is a resident
of the U.S. and is exempt from income tax under the laws of the U.S.



Dispositions of Common Shares



Under the Canadian Tax Act, a taxpayer’s
capital gain or capital loss from a disposition of a share of our common stock is the amount, if any, by which his or her proceeds
of disposition exceed (or are exceeded by, respectively) the aggregate of his or her adjusted cost base of the share and reasonable
expenses of disposition. The capital gain or loss must be computed in Canadian currency using a weighted average adjusted cost
base for identical properties. The capital gains net of losses included in income are as follows. For gains net of losses realized
before February 28, 2000, as to 75%. For gains net of losses realized after February 27, 2000 and before October 18, 2000, as to
66 2/3%. For gains net of losses realized after October 17, 2000, as to 50%. There are special transitional rules to apply capital
losses against capital gains that arose in different periods. The amount by which a shareholder’s capital loss exceeds the
capital gain in a year may be deducted from a capital gain realized by the shareholder in the three previous years or any subsequent
year, subject to certain restrictions in the case of a corporate shareholder.



41









Under the Canadian Tax Act, a non-resident
of Canada is subject to Canadian tax on taxable capital gains, and may deduct allowable capital losses, realized on a disposition
of “taxable Canadian property.” Shares of our common stock will constitute taxable Canadian property of a shareholder
at a particular time if the shareholder used the shares in carrying on business in Canada, or if at any time in the five years
immediately preceding the disposition 25% or more of the issued shares of any class or series in our capital stock belonged to
one or more persons in a group comprising the shareholder and persons with whom the shareholder and persons with whom the shareholder
did not deal at arm’s length and in certain other circumstances.



The Convention relieves U.S. residents from
liability for Canadian tax on capital gains derived on a disposition of shares unless:



|(a) |  | the value of the shares is derived principally from “real property”
in Canada, including the right to explore for or exploit natural resources and rights to amounts computed by reference to production;
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(b) |  | the shareholder was resident in Canada for 120 months during any period of 20 consecutive
years preceding, and at any time during the 10 years immediately preceding, the disposition and the shares were owned by him when
he or she ceased to be resident in Canada; or
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(c) |  | the shares formed part of the business property of a “permanent establishment”
that the holder has or had in Canada within the 12 months preceding the disposition.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------



|F. | DIVIDENDS AND PAYING AGENTS
|-- | ---------------------------



Not applicable.



|G. | STATEMENT BY EXPERTS
|-- | --------------------



Our financial statements included in this Annual
Report for the year ended April 30, 2012 and April 30, 2011 were audited by ACAL Group, Chartered
Accountants; as stated in their report appearing herein (which report expresses an unqualified opinion), and are included
in reliance upon the reports of such firm given upon their authority as experts in accounting and auditing.



|H. | DOCUMENTS ON DISPLAY
|-- | --------------------



Material contracts and publicly available corporate
records may be viewed at our head office located at Suite 240, 11780 Hammersmith Way, Richmond, British Columbia.



We filed a registration statement on Form 20-F
filed the Securities and Exchange Commission in Washington, D.C. (Registration No. 000-30084) on June 15, 1994, which became effective
August 15, 1994. The Registration Statement contains exhibits and schedules. Any statement in this annual report about any of our
contracts or other documents is not necessarily complete. If the contract or document is filed as an exhibit to the Registration
Statement, the contract or document is deemed to modify the description contained in this annual report. You must review the exhibits
themselves for a complete description of the contract or documents.



We file annual reports and furnish other information
with the SEC. You may read and copy any document that we file at the SEC's Public Reference Room at 100 F Street, NE., Washington,
DC 20549, on official business days during the hours of 10 a.m. to 3 p.m. You may obtain information on the operation of the Public
Reference Room by calling the Commission at 1-800-SEC-0330. The Commission maintains an Internet site that contains reports, proxy
and information statements, and other information regarding issuers that file electronically with the Commission at (http://www.sec.gov). We
also file information with the Canadian Securities Administrators via SEDAR (www.sedar.com). Our
website is www.regtech.com.



42









|I. | SUBSIDIARY INFORMATION
|-- | ----------------------



We own approximately 26.10% interest in Minewest
Silver and Gold Inc., a private British Columbia company, and a 51% interest in Rand Energy Group Inc., which owns a 2.2% interest
in REGI. Reg Tech also own a 9.53% interest in REGI.



|ITEM 11. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|-------- | ----------------------------------------------------------



We are a smaller reporting company as defined
in Rule 405 of the Securities Act, and Rule 12b-2 of the Exchange Act and therefore need not provide the information requested
by this item.



|ITEM 12. | DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
|-------- | ------------------------------------------------------



Not applicable.



PART II



|ITEM 13. | DEFAULTS, DIVIDEND ARREARAGES AND DELIQUENCIES
|-------- | ----------------------------------------------



None.



|ITEM 14. | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
|-------- | ----------------------------------------------------------------------------



|A. | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS
|-- | --------------------------------------------------------



None.



|B. | USE OF PROCEEDS
|-- | ---------------



Not applicable



|ITEM 15. | CONTROLS AND PROCEDURES
|-------- | -----------------------



Disclosure Controls and Procedures



We maintain disclosure controls and procedures
that are designed to ensure that information required to be disclosed in the reports that we file with the SEC under the Exchange
Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that
such information is accumulated and communicated to our management, including our principal executive and financial officers, as
appropriate, to allow for timely decisions regarding required disclosure. As required by SEC Rule 15d-15(b), we carried out an
evaluation, under the supervision and with the participation of our management, including our principal executive and financial
officers, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period
covered by this report.



Based on the foregoing, our principal executive
and financial officers concluded that our disclosure controls and procedures are not effective to ensure the information required
to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed and reported properly within the
time periods specified in the SEC’s rules and forms.



43







Our management and board of directors strive
to remedy the deficiencies by thoroughly reviewing the requirements for filings and the contents of the filings. In addition, we
will consult accounting and legal experts on disclosure requirements, and engage them for extensive reviews prior to our filings
with the SEC.



Management’s Report on Internal Control
Over Financial Reporting



Management is responsible for establishing
and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange
Act. Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive
Officer and Chief Financial Officer, and effected by our Board of Directors, management and other personnel, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles, and includes those policies and procedures that:





|● |  | pertain to the maintenance of records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of our assets;
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------



|● |  | provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures
are being made only in accordance with authorizations of our management and directors; and
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|● |  | provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of our assets that could have a material effect on our financial statements.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





Management recognizes that there are inherent
limitations in the effectiveness of any system of internal control, and accordingly, even effective internal control can provide
only reasonable assurance with respect to financial statement preparation and may not prevent or detect material misstatements.
In addition, effective internal control at a point in time may become ineffective in future periods because of changes in conditions
or due to deterioration in the degree of compliance with our established policies and procedures.



Our management, including our principal executive
officer and principal financial officer, has used the framework set forth in the report entitled Internal Control Integrated Framework
published by the Committee of Sponsoring Organizations of the Treadway Commission to conduct an evaluation of the effectiveness
of our internal control over financial reporting. Based on its evaluation, our management concluded that our internal control over
financial reporting was not effective because certain deficiencies involving internal controls constituted a material weakness.
A material weakness is a deficiency, or a combination of control deficiencies, in internal control over financial reporting such
that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented
or detected on a timely basis.



We concluded that our internal control over
financial reporting was not effective as at April 30, 2012 due to inadequate segregation of duties and ineffective risk assessment.
Once we have adequate funding in place, we plan to commence a process to enhance and improve the design of our internal controls
over financial reporting. We intend to remediate the material weakness identified above. To remediate such weakness, we plan to
appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management, and adopt sufficient
written policies and procedures for accounting and financial reporting. These remediation efforts are largely dependent upon securing
additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation
efforts may be adversely affected.



44







Notwithstanding the foregoing, all internal
control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective
may not prevent or detect misstatements and can provide only reasonable assurance with respect to financial statement preparation
and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls
may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.



Attestation Report on Internal Control over
Financial Reporting



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



Changes in Internal Control over Financial
Reporting



During the fiscal year ended April 30, 2012,
there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely
to materially affect, our internal control over financial reporting.



|ITEM 16. | [RESERVED]
|-------- | ----------



|ITEM 16A. | AUDIT COMMITTEE FINANCIAL EXPERT
|--------- | --------------------------------



Committees of the Board and Financial Expert



Audit Committee



Our Board of Directors has only one committee,
being the Audit Committee. Our Audit Committee assists the Board in fulfilling its responsibilities relating to our corporate accounting
and reporting practices. The Audit Committee is responsible for ensuring that management has established appropriate processes
for monitoring our systems and procedures for financial reporting and controls, reviewing all financial information in disclosure
documents; monitoring the performance and fees and expenses of our external auditors and recommending external auditors for appointment
by shareholders. The Audit Committee is also responsible for reviewing our annual financial statements prior to approval by the
Board and release to the public. Our audit committee is comprised of three directors of the Company - Susanne Robertson, James
Vandeberg and Suzan El-Khatib.



Mr. Vandeberg is not “independent”
as he is an officer. Mrs. Robertson and Ms. El-Khatib are “independent” in that they are free from any interest and
any business or other relationship which could or could reasonably be perceived to, materially interfere with their ability to
act in our best interests, other than an interest or relationship arising from ownership of our shares. All of the audit committee
members are “financially literate”.



Since the commencement of our most recently
completed financial year, our Board of Directors has not failed to adopt a recommendation of the audit committee to nominate or
compensate an external auditor.



The audit committee has adopted specific policies
and procedures for the engagement of non-audit services. The engagement of non-audit services is considered by our audit committee,
and where applicable the Board of Directors, on a case-by-case basis.





45







Audit Committee Financial Expert





The Board of directors has determined that
it does not have a member that qualifies as an “audit committee financial expert” as defined in Form 20-F of the U.S.
Securities and Exchange Commission.



We have been unable to retain the services
of a person who qualifies as an “audit committee financial expert”. Until we appoint such a person, we believe that
the members of our Board of Directors are collectively capable of analyzing and evaluating our financial statements and understanding
internal controls and procedures for financial reporting.



Moreover, the audit committee is comprised
of seasoned business professionals, whereby two members have many years of experience in the investment business and are board
members of several corporations.



On this basis, we believe that the audit committee
has adequate resources available to it when financial expertise and advice are necessary.



|ITEM 16B. | CODE OF ETHICS
|--------- | --------------



Code of Ethics



Our Board of Directors’ is committed
to encouraging and promoting a culture of ethical business conduct and integrity throughout our company. In order to achieve this
objective, efforts are made to the implementation, monitoring and enforcement of our Code of Ethics (“Code”).
This is accomplished by: (a) taking prompt action against violations of the Code; ensuring employees and consultants are aware
that they may discuss their concerns with their supervisor or directly to the Compliance Officer; the Compliance Officer reporting
suspected fraud or securities law violations for review by the Audit Committee and reporting same to the Board of Directors. We
distribute to each new director, officer, employee and consultant our Code.



No waivers of any provision of this Code of
Ethics may be made except by the Board of Directors. Any waiver or amendment shall be reported as required by law or regulation. There
have been no waivers of the Code since its implementation.



A copy of the Code is available from us on
written request, and the text of the code of business conduct and ethics is attached as an exhibit hereto and posted on our website
at www.regtech.com.



Assessments



The Board of Directors is ultimately responsible
for our stewardship, which means that it oversees the day-to-day management delegated to the President and Chief Executive Officer
and our other officers. The Board is charged with the responsibility of assessing the effectiveness of itself, its committee(s)
and the contributions of individual directors.



The Nominating and Corporate Governance Committee
Charter was constituted by the Board of Directors to assist the Board and its officers, employees, and consultants to fulfill fundamental
issues including: (a) the regular assessment of our approach to corporate governance issues; (b) ensuring that such approach supports
our effective functioning with a view to the best interests of our shareholders and effective communication between the Board of
Directors and management; and (c) the process, structure and effective system of accountability by management to the board of directors
and by the board to the shareholders, in accordance with applicable laws, regulations and industry standards for good governance
practices. A copy of the Nominating and Corporate Governance Committee Charter is available on our website at www.regtech.com.



Additionally, directors and officers are subject
to the laws of the Province of British Columbia, Canada, whereby they are required to act honestly, in good faith and in our best
interests.



46











|ITEM 16C. | PRINCIPAL
ACCOUNTANT FEES AND SERVICES
|--------- | --------------------------------------









The following table discloses accounting fees
and services of the Registrant:



|Type of Services Rendered |  | 2012 Fiscal
                                                                                                                                                                                                                                              Year (CAD$) |        |  | 2011 Fiscal
                                                                                                                                                                                                                                              Year (CAD$) | 
|------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------ |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|                          |  |                                                                                                                                                                                                                                                                       |        |  |                                                                                                                                                                                                                                                                       | 
|(a)Audit Fees             |  |                                                                                                                                                                                                                                                                       | 20,000 |  |                                                                                                                                                                                                                                                                       | 
|                          |  |                                                                                                                                                                                                                                                                       |        |  |                                                                                                                                                                                                                                                                       | 
|(b)Audit-Related Fees     |  |                                                                                                                                                                                                                                                                       | 0      |  |                                                                                                                                                                                                                                                                       | 
|                          |  |                                                                                                                                                                                                                                                                       |        |  |                                                                                                                                                                                                                                                                       | 
|(c)Tax Fees               |  |                                                                                                                                                                                                                                                                       | 1,000  |  |                                                                                                                                                                                                                                                                       | 
|                          |  |                                                                                                                                                                                                                                                                       |        |  |                                                                                                                                                                                                                                                                       | 
|(d)All Other Fees         |  |                                                                                                                                                                                                                                                                       | 0      |  |                                                                                                                                                                                                                                                                       | 



Our Audit Committee
pre-approved all non-audit services (audit-related services, tax services, and all other services) provided to usprior
to the commencement of the services.



In the table above, and the disclosure below,
“audit fees” are fees billed by our external auditor for services provided in auditing our annual financial statements
for the subject year. “Audit-related fees” are fees not included in audit fees that are billed by the auditor for assurance
and related services that are reasonably related to the performance of the audit or review of our financial statements. “Tax
fees” are fees billed by the auditor for professional services rendered for tax compliance, tax advice and tax planning.
“All other fees” are fees billed by the auditor for products and services not included in the foregoing categories.



|ITEM 16D. | EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
|--------- | ----------------------------------------------------------



No disclosure required.



|ITEM 16E. | PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
|--------- | ----------------------------------------------------------------------



No disclosure required.



|ITEM 16F. | CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT
|--------- | --------------------------------------------



Not applicable.

|ITEM 16G. | CORPORATE GOVERNANCE
|--------- | --------------------



Not applicable.



PART III



|ITEM 17. | FINANCIAL STATEMENTS
|-------- | --------------------



We have elected to provide financial statements
pursuant to Item 18.



|ITEM 18. | FINANCIAL STATEMENTS
|-------- | --------------------



47







|Audited Financial Statements for the Years
        Ended April 30, 2012 and 2011 |  | F-1 – F-35
|-------------------------------------------------------------------------------- |  | ----------



Our consolidated financial statements are stated
in Canadian Dollars (CDN$) and are prepared in accordance with IFRS.



The consolidated financial statements, together
with the report of ACAL Group, Chartered Accountants, on the annual consolidated financial statements referred to below, are filed
as part of this annual report, and are included immediately following this text and include:



Report of Registered Public Accounting Firm
dated August 29, 2012 of ACAL Group, Chartered Accountants

Consolidated Balance Sheets as at April 30,
2012, April 30, 2011 and May 1, 2010

Consolidated Statements of Operations and Comprehensive
Loss for the years ended April 30, 2012 and April 30, 2011

Consolidated Statements of Cash Flows for the
years ended April 30, 2012 and April 30, 2011

Consolidated Statements of Stockholders’
Equity as at April 30, 2010 to April 30, 2012

Notes to the Consolidated Financial Statements
as at April 30, 2012 and April 30, 2011



48







Reg Technologies Inc.

(A Development Stage Company)



Consolidated Financial Statements

(Expressed in Canadian Dollars)

April 30, 2012



49







|SUITE 1850                |                            
|------------------------- | ---------------------------
|1066 WEST HASTINGS STREET |                            
|VANCOUVER, BC V6E 3X2     |                            
|                          |                            
|T:
    604.683.3850       | ACAL
    GROUP             
|F:
    604.688.8479       | CHARTERED
    ACCOUNTANTS  
|                          | PCAOB
    & CPAB Registrant



INDEPENDENT
AUDITORS’ REPORT



To:        the
Shareholders of

Reg Technologies Inc.



We have
audited the accompanying consolidated financial statements of Reg Technologies Inc. (the “Company”), which comprise
the statements of financial position as at April 30, 2012 and April 30, 2011 and May 1, 2010, and the statements of operations
and comprehensive loss, statements of cash flows and statements of changes in equity for the years ended April 30, 2012 and April
30, 2011, and a summary of significant accounting policies and other explanatory information.



Management’s
Responsibility for the Financial Statements

Management
is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International
Financial Reporting Standards as issued by the International Accounting Standards Board, and for such internal control as management
determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement,
whether due to fraud or error.



Auditors’
Responsibility

Our responsibility
is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance
with Canadian generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United
States). Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance
about whether the consolidated financial statements are free from material misstatement. We were not engaged to perform an audit
of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such
opinion.



An audit
involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. An audit also includes evaluating the appropriateness of accounting policies used and
the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial
statements.



We believe
that the audit evidence we have obtained in our audits is sufficient and appropriate to provide a basis for our audit opinion.



Opinion

In our
opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company
as at April 30, 2012 and April 30, 2011 and May 1, 2010, and its financial performance and its cash flows for the years ended April
30, 2012 and April 30, 2011 in accordance with International Financial Reporting Standards as issued by the International Accounting
Standards Board.



Emphasis
of Matter

Without
qualifying our opinion, we draw attention to Note 1 in the consolidated financial statements which indicates that the Company has
incurred losses to date. This condition, along with other matters as set forth in Note 1, indicates the existence of a material
uncertainty that may cast significant doubt about the Company’s ability to continue as a going concern.



“ACAL
Group”

Chartered
Accountants



Vancouver, British Columbia

August
28, 2012



50







Reg Technologies Inc.

(A Development Stage Company)

Consolidated Statements of Financial Position

|(Expressed
    in Canadian Dollars)
|-----------------------------------



|                                                      |  | As at 30 April, 2012 $ |             |   | As at 30 April, 2011 $ |  |             | As at 1 May, 2010 $ | 
|----------------------------------------------------- |  | ---------------------- | ----------- | - | ---------------------- |  | ----------- | ------------------- | 
|Assets                                                |  |                        |             |   |                        |  |             |                     | 
|                                                      |  |                        |             |   |                        |  |             |                     | 
|Current                                               |  |                        |             |   |                        |  |             |                     | 
|Cash                                                  |  |                        | 650         |   |                        |  | 88,684      |                     | 
|HST/GST and interest receivable                       |  |                        | 15,464      |   |                        |  | 14,926      |                     | 
|Prepaid expenses                                      |  |                        | 38,618      |   |                        |  | 81,052      |                     | 
|Due from related parties (Note 8)                     |  |                        | 1,317       |   |                        |  | 8,490       |                     | 
|Advances to REGI US (Note 8)                          |  |                        | 1,025,086   |   |                        |  | 865,607     |                     | 
|Assets held for distribution to shareholders (Note 8) |  |                        | 471,200     |   |                        |  | -           |                     | 
|                                                      |  |                        | 1,552,335   |   |                        |  | 1,058,759   |                     | 
|                                                      |  |                        |             |   |                        |  |             |                     | 
|Investment in Minewest(8)                             |  |                        | 320,082     |   |                        |  | -           |                     | 
|Equipment (Note 7)                                    |  |                        | -           |   |                        |  | 2,169       |                     | 
|Mineral Property (Note 8)                             |  |                        | -           |   |                        |  | 232,953     |                     | 
|                                                      |  |                        |             |   |                        |  |             |                     | 
|                                                      |  |                        | 1,872,417   |   |                        |  | 1,293,881   |                     | 
|Liabilities                                           |  |                        |             |   |                        |  |             |                     | 
|                                                      |  |                        |             |   |                        |  |             |                     | 
|Current                                               |  |                        |             |   |                        |  |             |                     | 
|Bank indebtedness                                     |  |                        | -           |   |                        |  | -           |                     | 
|Accounts payable                                      |  |                        | 105,860     |   |                        |  | 71,612      |                     | 
|Accrued liabilities                                   |  |                        | 25,500      |   |                        |  | 34,300      |                     | 
|Due to related parties (Note 8)                       |  |                        | 137,135     |   |                        |  | 218,878     |                     | 
|Due to Minewest (Note 8)                              |  |                        | 179,414     |   |                        |  | -           |                     | 
|Income taxes payable                                  |  |                        | -           |   |                        |  | -           |                     | 
|Share subscription payable                            |  |                        | -           |   |                        |  | -           |                     | 
|Convertible debt (Note 11)                            |  |                        | 19,938      |   |                        |  | 19,987      |                     | 
|Financial instrument liability (Note 10)              |  |                        | 9,315       |   |                        |  | 35,917      |                     | 
|                                                      |  |                        | 477,162     |   |                        |  | 380,694     |                     | 
|                                                      |  |                        |             |   |                        |  |             |                     | 
|Shareholders’ equity                                  |  |                        |             |   |                        |  |             |                     | 
|Share Capital (Note 6)                                |  |                        | 12,746,997  |   |                        |  | 12,372,889  |                     | 
|Subscription received                                 |  |                        | -           |   |                        |  | 289,200     |                     | 
|Warrants (Note 6)                                     |  |                        | 137,661     |   |                        |  | 237,714     |                     | 
|Contributed Surplus                                   |  |                        | 10,505,459  |   |                        |  | 9,441,987   |                     | 
|Equity component of convertible debt (Note 13)        |  |                        | 305         |   |                        |  | 758         |                     | 
|Deficit                                               |  |                        | (22,015,992 | ) |                        |  | (21,677,375 | )                   | 
|                                                      |  |                        | 1,374,430   |   |                        |  | 665,173     |                     | 
|                                                      |  |                        |             |   |                        |  |             |                     | 
|Non-controlling interest                              |  |                        | 20,825      |   |                        |  | 248,014     |                     | 
|                                                      |  |                        |             |   |                        |  |             |                     | 
|                                                      |  |                        | 1,872,417   |   |                        |  | 1,293,881   |                     | 

Nature and Continuance of Operations(Note 1)

Commitments(Note 9)

Subsequent events(Note 15)



On behalf of the Board:



|“John
    Robertson” |  | Director | “James
    L. Vandeberg” |  | Director
|-------------------- |  | -------- | ------------------------ |  | --------
|John Robertson       |  |          | James L. Vandeberg       |  |         



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



F-1







Reg Technologies Inc.

(A Development Stage Company)

Consolidated Statements of Operations and Comprehensive Income

|(Expressed
    in Canadian Dollars)
|-----------------------------------



|                                                                             |  | For the year ended April 30, 2012 $ |            |   | For the year ended April 30, 2011 $ | 
|---------------------------------------------------------------------------- |  | ----------------------------------- | ---------- | - | ----------------------------------- | 
|                                                                             |  |                                     |            |   |                                     | 
|Expenses                                                                     |  |                                     |            |   |                                     | 
|Amortization                                                                 |  |                                     | 1,459      |   |                                     | 
|Shareholder communication                                                    |  |                                     | 57,123     |   |                                     | 
|Consulting fees                                                              |  |                                     | 15,919     |   |                                     | 
|Foreign exchange loss (gain)                                                 |  |                                     | 51,191     |   |                                     | 
|Interest expense                                                             |  |                                     | 1,856      |   |                                     | 
|Management and directors’ fees (Note 8)                                      |  |                                     | 75,072     |   |                                     | 
|Mineral property maintenance costs                                           |  |                                     | -          |   |                                     | 
|Office expenses                                                              |  |                                     | 29,557     |   |                                     | 
|Professional fees (Note 8)                                                   |  |                                     | 73,316     |   |                                     | 
|Research and development                                                     |  |                                     | 113,554    |   |                                     | 
|Rent and utilities (Note 8)                                                  |  |                                     | 6,871      |   |                                     | 
|Stock-based compensation (Note 6)                                            |  |                                     | -          |   |                                     | 
|Transfer agent and filing fees                                               |  |                                     | 34,804     |   |                                     | 
|Travel and promotion                                                         |  |                                     | 3,446      |   |                                     | 
|Wages and benefits                                                           |  |                                     | 19,891     |   |                                     | 
|                                                                             |  |                                     |            |   |                                     | 
|Loss before other items and income taxes                                     |  |                                     | (484,059   | ) |                                     | 
|                                                                             |  |                                     |            |   |                                     | 
|Other income (expense)                                                       |  |                                     |            |   |                                     | 
|Gain on sale of investee’s shares (Note 10)                                  |  |                                     | -          |   |                                     | 
|Net gain on expiration and modification of financial instrument liability    |  |                                     | 20,923     |   |                                     | 
|Interest income                                                              |  |                                     | -          |   |                                     | 
|Gain on investment in Minewest                                               |  |                                     | 80,295     |   |                                     | 
|Loss in equity investment                                                    |  |                                     | (8,718     | ) |                                     | 
|Unrealized gain (loss) on financial instrument liability                     |  |                                     | 5,679      |   |                                     | 
|                                                                             |  |                                     |            |   |                                     | 
|Loss before income taxes                                                     |  |                                     | (385,880   | ) |                                     | 
|                                                                             |  |                                     |            |   |                                     | 
|Income tax recovery (expense) – current (Note 12)                            |  |                                     | -          |   |                                     | 
|                                                                             |  |                                     |            |   |                                     | 
|Net and comprehensive loss                                                   |  |                                     | (385,880   | ) |                                     | 
|                                                                             |  |                                     |            |   |                                     | 
|Net and comprehensive income (loss) attributable to:                         |  |                                     |            |   |                                     | 
|Shareholders of the Company                                                  |  |                                     | (338,617   | ) |                                     | 
|Non-controlling interest                                                     |  |                                     | (47,263    | ) |                                     | 
|                                                                             |  |                                     |            |   |                                     | 
|                                                                             |  |                                     | (385,880   | ) |                                     | 
|                                                                             |  |                                     |            |   |                                     | 
|Loss per share – basic and diluted                                           |  |                                     | (0.01      | ) |                                     | 
|                                                                             |  |                                     |            |   |                                     | 
|Weighted average number of common shares outstanding –
    basic and diluted |  |                                     | 32,787,710 |   |                                     | 



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



F-2







Reg Technologies Inc.

(A Development Stage Company)

Consolidated Statements of Cash Flows

|(Expressed
    in Canadian Dollars)
|-----------------------------------



|                                                                          |  | For the year  ended
April 30, 2012 |          |   | For the year ended
April 30, 2011 | 
|------------------------------------------------------------------------- |  | ---------------------------------- | -------- | - | --------------------------------- | 
|                                                                          |  | $                                  |          |   | $                                 | 
|                                                                          |  |                                    |          |   |                                   | 
|Cash flows used in operating activities                                   |  |                                    |          |   |                                   | 
|Net loss                                                                  |  |                                    | (385,880 | ) |                                   | 
|Adjustments to reconcile loss to net cash used by operating activities:   |  |                                    |          |   |                                   | 
|Amortization                                                              |  |                                    | 1,459    |   |                                   | 
|Gain on sale of investee’s shares                                         |  |                                    | -        |   |                                   | 
|Imputed interest                                                          |  |                                    | 255      |   |                                   | 
|Net gain on expiration and modification of financial instrument liability |  |                                    | (20,923  | ) |                                   | 
|Stock-based compensation                                                  |  |                                    | -        |   |                                   | 
|Unrealized (gain) loss on financial instrument liability                  |  |                                    | (5,679   | ) |                                   | 
|Loss in equity investment                                                 |  |                                    | 8,718    |   |                                   | 
|Gain on investment in Minewest                                            |  |                                    | (80,295  | ) |                                   | 
|Changes in non-cash working capital items:                                |  |                                    |          |   |                                   | 
|Bank indebtedness                                                         |  |                                    | -        |   |                                   | 
|HST/GST and interest receivable                                           |  |                                    | (2,755   | ) |                                   | 
|Prepaid expenses                                                          |  |                                    | 42,434   |   |                                   | 
|Due from related parties                                                  |  |                                    | 7,173    |   |                                   | 
|Accounts payable and accrued liabilities                                  |  |                                    | 36,519   |   |                                   | 
|Due to related parties                                                    |  |                                    | (80,922  | ) |                                   | 
|Income taxes payable                                                      |  |                                    | -        |   |                                   | 
|                                                                          |  |                                    |          |   |                                   | 
|                                                                          |  |                                    | (479,896 | ) |                                   | 
|                                                                          |  |                                    |          |   |                                   | 
|Cash flows provided by investing activities                               |  |                                    |          |   |                                   | 
|Advances to equity accounted investee                                     |  |                                    | (159,479 | ) |                                   | 
|Proceeds on sale of investee’s shares and warrants                        |  |                                    | -        |   |                                   | 
|Mineral property costs                                                    |  |                                    | -        |   |                                   | 
|Purchase of equipment                                                     |  |                                    | -        |   |                                   | 
|Deconsolidation of Minewest                                               |  |                                    | (36,671  | ) |                                   | 
|                                                                          |  |                                    |          |   |                                   | 
|                                                                          |  |                                    | (196,150 | ) |                                   | 
|                                                                          |  |                                    |          |   |                                   | 
|Cash flows provided by financing activities                               |  |                                    |          |   |                                   | 
|Advance from equity accounted investee                                    |  |                                    | 80,742   |   |                                   | 
|Proceeds on convertible debt                                              |  |                                    | -        |   |                                   | 
|Repayment on convertible debt                                             |  |                                    | -        |   |                                   | 
|Proceeds from share subscriptions                                         |  |                                    | -        |   |                                   | 
|Proceeds from share issuances                                             |  |                                    | 513,533  |   |                                   | 
|Share issuance cost                                                       |  |                                    | (6,263   | ) |                                   | 
|                                                                          |  |                                    | 588,012  |   |                                   | 
|                                                                          |  |                                    |          |   |                                   | 
|Increase (decrease) in cash                                               |  |                                    | (88,034  | ) |                                   | 
|Cash, beginning                                                           |  |                                    | 88,684   |   |                                   | 
|Cash, ending                                                              |  |                                    | 650      |   |                                   | 
|                                                                          |  |                                    |          |   |                                   | 
|Supplemental Disclosures                                                  |  |                                    |          |   |                                   | 
|Interest paid                                                             |  |                                    | 1,600    |   |                                   | 
|Income taxes paid                                                         |  |                                    | -        |   |                                   | 



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



F-3







Reg Technologies Inc.

(A Development Stage Company)

Consolidated Statements of Changes in Equity

|(Expressed
    in Canadian Dollars)
|-----------------------------------



|                                           |  |        |            |  |        |  |            |              |  |  |             |   |  |          |            |  |             |  |          | Non-        |  |  |         |   |  | Total         |         
|------------------------------------------ |  | ------ | ---------- |  | ------ |  | ---------- | ------------ |  |  | ----------- | - |  | -------- | ---------- |  | ----------- |  | -------- | ----------- |  |  | ------- | - |  | ------------- | --------
|                                           |  | Common |            |  | Common |  |            | Subscription |  |  | Contributed |   |  |          |            |  | Convertible |  |          | controlling |  |  |         |   |  | Shareholders’ |         
|                                           |  | Shares |            |  | Shares |  |            | Received     |  |  | Surplus     |   |  | Warrants |            |  | Debt        |  |          | Interest    |  |  | Deficit |   |  | Equity        |         
|                                           |  | #      |            |  | $      |  |            | $            |  |  | $           |   |  | $        |            |  | $           |  |          | $           |  |  | $       |   |  | $             |         
|                                           |  |        |            |  |        |  |            |              |  |  |             |   |  |          |            |  |             |  |          |             |  |  |         |   |  |               |         
|Balance – April 30, 2010                   |  |        | 28,369,856 |  |        |  | 12,082,039 |              |  |  | –           |   |  |          | 9,270,884  |  |             |  | 245,518  |             |  |  | –       |   |  |               | –       
|Warrants exercise                          |  |        | 460,929    |  |        |  | 108,610    |              |  |  | –           |   |  |          |            |  |             |  | (16,424  | )           |  |  | –       |   |  |               | –       
|Shares issued for cash                     |  |        | 1,894,333  |  |        |  | 182,240    |              |  |  | –           |   |  |          |            |  |             |  | 89,947   |             |  |  | –       |   |  |               | –       
|Warrants expiration                        |  |        | –          |  |        |  | –          |              |  |  | –           |   |  |          | 150,807    |  |             |  | (150,807 | )           |  |  | –       |   |  |               | –       
|Warrants extension                         |  |        | –          |  |        |  | –          |              |  |  | –           |   |  |          |            |  |             |  | 69,480   |             |  |  | –       |   |  |               | –       
|Option vested                              |  |        | –          |  |        |  | –          |              |  |  | –           |   |  |          | 20,296     |  |             |  | –        |             |  |  | –       |   |  |               | –       
|Subscription received                      |  |        | –          |  |        |  | –          |              |  |  | 289,200     |   |  |          | –          |  |             |  | –        |             |  |  | –       |   |  |               | –       
|Equity component of convertible debt       |  |        | –          |  |        |  | –          |              |  |  | –           |   |  |          | –          |  |             |  | –        |             |  |  | 758     |   |  |               | –       
|Non-controlling interest                   |  |        | –          |  |        |  | –          |              |  |  | –           |   |  |          | –          |  |             |  | –        |             |  |  | –       |   |  |               | 200,000 
|Net loss                                   |  |        | –          |  |        |  | –          |              |  |  | –           |   |  |          | –          |  |             |  | –        |             |  |  | –       |   |  |               | 48,014  
|Balance – April 30, 2011(Restated Note 14) |  |        | 30,725,118 |  |        |  | 12,372,889 |              |  |  | 289,200     |   |  |          | 9,441,987  |  |             |  | 237,714  |             |  |  | 758     |   |  |               | 248,014 
|Warrants expiration                        |  |        | –          |  |        |  | –          |              |  |  | –           |   |  |          | 237,714    |  |             |  | (237,714 | )           |  |  | –       |   |  |               | –       
|Shares issued for cash                     |  |        | 4,158,675  |  |        |  | 374,108    |              |  |  | (4,500      | ) |  |          | –          |  |             |  | 137,661  |             |  |  | –       |   |  |               | –       
|Deconsolidation of Minewest                |  |        | –          |  |        |  | –          |              |  |  | (284,700    | ) |  |          | 825,000    |  |             |  | –        |             |  |  | –       |   |  |               | (179,926
|Equity component of convertible debt       |  |        | –          |  |        |  | –          |              |  |  | –           |   |  |          | 758        |  |             |  | –        |             |  |  | (453    | ) |  |               | –       
|Net loss                                   |  |        | –          |  |        |  | –          |              |  |  | –           |   |  |          | –          |  |             |  | –        |             |  |  | –       |   |  |               | (47,263 
|Balance – April 30, 2012                   |  |        | 34,883,793 |  |        |  | 12,746,997 |              |  |  | –           |   |  |          | 10,505,459 |  |             |  | 137,661  |             |  |  | 305     |   |  |               | 20,825  



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



F-4







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|1. |  | Nature and Continuance of Operations
|-- |  | ------------------------------------



Reg
Technologies Inc. (“Reg Tech” or the “Company”) is a development stage company in the business of developing
and commercially exploiting an improved axial vane type rotary engine known as the Rand CamTM/Direct Charge Engine
and other RandCamTM / RadMax® applications, such as compressors and pumps (the “Technology”). The worldwide
marketing and intellectual rights, other than in the U.S., are held by the Company, which as at April 30, 2012 owns 3.38 million
shares of REGI U.S, Inc. (“REGI”) (a U.S. public company) representing a 11.74% interest in REGI. REGI owns the U.S,
marketing and intellectual rights. The Company and REGI have a project cost sharing agreement whereby these companies each fund
50% of the development of the Technology.



On
July 6, 2010, Reg Tech incorporated a wholly owned subsidiary Minewest Silver and Gold Inc. (“Minewest”) under the
laws of British Columbia. Pursuant to a Plan of Arrangement with Minewest, Reg Tech signed an asset transfer agreement (the “Transfer
Agreement”) on August 5, 2010 with Minewest to transfer Reg Tech’s undivided 45% interest in mineral claims in the
Liard Mining Division, located in northern British Columbia (the “Silverknife Claims”) to Minewest for consideration
of cash payment of $25,000 and issuance of 8,000,000 common shares of the Company.



Effective
November 17, 2011 Reg Tech obtained court approval for the Plan of Arrangement. On December 14, 2011, Reg Tech declared Minewest
shares as dividend for Reg Tech shareholders on the record date of December 21, 2011, whereby one Minewest shares is distributed
for seven Reg Tech shares. As a result of the dividend declaration, the Company expects to retain approximately 3,287,737 shares
of Minewest.



In
a development stage company, management devotes most of its activities to establishing a new business. Planned principal activities
have not yet produced any revenues and the Company has incurred recurring operating losses as is normal in development stage companies.
The Company has accumulated losses of $22,015,992 since inception. These factors raise substantial doubt about the Company’s
ability to continue as a going-concern. The ability of the Company to emerge from the development stage with respect to its planned
principal business activity is dependent upon its successful efforts to raise additional equity financing, receive funding from
affiliates and controlling shareholders, and develop a market for its products.



Management
is aware that material uncertainties exist, related to current economic conditions, which could adversely affect the Company’s
ability to continue to finance its activities. The Company receives interim support from affiliated companies and plans to raise
additional capital through debt and/or equity financings. There continues to be insufficient funds to provide adequate working
capital to fund ongoing operations for the next twelve months. The Company may also raise additional funds though the exercise
of warrants and stock options.



There
is no certainty that the Company’s efforts to raise additional capital will be successful. These financial statements do
not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of
liabilities that might be necessary should the Company be unable to continue in normal operations.



F-5







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|2. |  | Statement of compliance
|-- |  | -----------------------



These
consolidated financial statements of the Company and its subsidiaries, including comparatives, have been prepared in accordance
with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board
(“IASB”). As these consolidated financial statements represent the Company’s initial presentation of its annual
operating results and year-end financial position under IFRS, they were prepared in accordance with IFRS 1 (First time Adoption
of IFRS). The first date at which IFRS was applied was May 1, 2010. The policies set out below were consistently applied to all
the periods presented unless otherwise noted below.



The
Company’s consolidated financial statements were previously prepared in accordance with Canadian GAAP. Canadian GAAP differs
in certain respects from IFRS. In preparing these consolidated financial statements, management has amended certain accounting,
valuation and consolidation methods previously applied in the Canadian GAAP financial statements to comply with IFRS. The comparative
figures for 2010 were restated to reflect these adjustments. Note 14 contains reconciliations and descriptions of the effect of
the transition from Canadian GAAP to IFRS on equity, earnings and comprehensive income along with line-by-line reconciliations
of the statement of financial position as at April 30, 2011 and May 1, 2010, and the statement of operations and comprehensive
income for the year ended April 30, 2011. Subject to the transition elections, the Company has consistently applied the same accounting
policies in the opening IFRS statement of financial position at May 1, 2010 and throughout the periods presented, as if these
policies had always been in effect.



These
consolidated financial statements were reviewed by the Audit Committee and approved and authorized for issue by the Board of Directors
on August 28, 2012.



|3. |  | Significant Accounting Policies
|-- |  | -------------------------------



Basis
of preparation



These
consolidated financial statements were prepared on a going concern basis, under the historical cost convention, except for the
revaluation of certain financial instruments.



The
preparation of financial statements in accordance with IFRS requires the use of certain critical accounting estimates. It also
requires management to exercise judgment in applying the Company’s accounting policies. The areas involving a higher degree
of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed
in Note 4.



F-6







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|3. |  | Significant Accounting Policies (Cont’d)
|-- |  | ----------------------------------------



Basis
of consolidation and presentation



These
financial statements include the accounts of the Company, its 80% owned subsidiary Minewest Silver and Gold Inc. (“Minewest”)
until November 18, 2011 when the Company lost control (Note 1) and its 51% owned subsidiary, Rand Energy Group Inc. (“Rand”),
which owns a 2.19% (2011 – 2.2%) interest in REGI. The Company also owns a 9.54% (2011 – 9.55%) interest in REGI.
Prior to April 30, 2008, REGI was considered a controlled subsidiary for consolidation purposes by way of control through an annually
renewable voting trusts agreement, with other affiliated companies. This trusts agreement gave the Company 50% control of the
voting shares of REGI. The agreement could be cancelled by the President of the 51% owned subsidiary with seven days’ written
notice to the affiliated companies. Effective April 30, 2008, the voting trusts agreement was cancelled and consequently the investment
in REGI has been accounted for as investment in associates.



Starting
from November 18, 2011, the accounts of Minewest ceased to be consolidated as a result of Reg Tech’s loss of control in
Minewest and consequently were accounted for as investment in associates.



All
significant inter-company balances and transactions have been eliminated upon consolidation.



Investment
in associates



Investments
in which the Company has the ability to exert significant influence but does not have control are accounted for using the equity
method whereby the original cost of the investment is adjusted annually for the Company’s share of earnings, losses and
dividends during the current year.



Cash
equivalents



Cash
equivalents consist of highly liquid investments that are readily convertible to cash with original maturities of three months
or less when purchased.



Comparative
numbers



The
2011 and 2010 comparative numbers have been reclassified, where applicable, in order to conform with the presentation used in
the current year.



Equipment



Equipment
consists of office furniture and equipment, and computer hardware recorded at cost and amortized on a straight-line basis over
a five-year and three-year period, respectively.



Research
and development costs



The
Company carries on various research and development activities to develop its technology. Research costs are expensed in the periods
in which they are incurred. Development costs that meet all of the criteria to be recognized as an intangible asset, including
reasonable expectation regarding future benefits, are capitalized and are amortized over their expected useful lives. To date
the Company has not capitalized any development costs.



F-7







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|3. |  | Significant Accounting Policies (Cont’d)
|-- |  | ----------------------------------------



Foreign
currency translation



The
functional currency of an entity is the currency of the primary economic environment in which the entity operates. The functional
currency of the Company and each of its subsidiaries is the Canadian dollar. The functional currency determinations were conducted
through an analysis of the consideration factors identified in IAS 21, The Effects of Changes in Foreign Exchange Rates.



Transactions
in currencies other than the Canadian dollar are recorded at exchange rates prevailing on the dates of the transactions. At the
end of each reporting period, monetary assets and liabilities denominated in foreign currencies are translated at the year end
exchange rate while non-monetary assets and liabilities are translated at historical rates. Revenues and expenses are translated
at the exchange rates approximating those in effect on the date of the transactions. Exchange gains and losses arising on translation
are included in comprehensive loss.



Share - based
compensation



The
Company’s share option plan allows Company employees, directors, officers and consultants to acquire shares of the Company.
The fair value of options granted is recognized as share-based compensation expense with a corresponding increase in equity. An
individual is classified as an employee when the individual is an employee for legal or tax purposes (direct employee) or provides
services similar to those performed by a direct employee.



Fair
value is measured at grant date, and each tranche is recognized using the graded vesting method over the period during which the
options vest. The fair value of the options granted is measured using the Black-Scholes option pricing model, taking into account
the terms and conditions upon which the options were granted. At each financial position reporting date, the amount recognized
as an expense is adjusted to reflect the actual number of share options that are expected to vest. In situations where equity
instruments are issued to consultants and some or all of the goods or services received by the entity as consideration cannot
be specifically identified, they are measured at the fair value of the share-based payment. Otherwise, share-based payments are
measured at the fair value of goods or services received.



F-8







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|3. |  | Significant Accounting Policies (Cont’d)
|-- |  | ----------------------------------------



Income
taxes



Income
tax expense comprises current and deferred tax. Income tax is recognized in profit or loss except to the extent that it relates
to items recognized directly in equity. Current tax expense is the expected tax payable on taxable income for the year, using
tax rates enacted or substantively enacted at period end, adjusted for amendments to tax payable with regards to previous years.



Deferred
tax is recorded using the liability method, providing for temporary differences, between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for taxation purposes. Temporary differences are not provided for relating
to goodwill not deductible for tax purposes, the initial recognition of assets or liabilities that affect neither accounting or
taxable loss, and differences relating to investments in subsidiaries to the extent that they will probably not reverse in the
foreseeable future. The amount of deferred tax provided is based on the expected manner of realization or settlement of the carrying
amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date.



A
deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against
which the asset can be utilized. To the extent that the Company does not consider it probable that a deferred tax asset will be
recovered, it provides a valuation allowance against that excess.



Loss
per share



Basic
loss per share is calculated using the weighted average number of common shares outstanding during the year. The Company uses
the treasury stock method for calculating diluted loss per share. Under this method the dilutive effect on loss per share is recognized
on the use of the proceeds that could be obtained upon exercise of options, warrants and similar instruments. It assumes that
the proceeds would be used to purchase common shares at the average market price during the period. However, diluted loss per
share is not presented where the effects of various conversions and exercise of options and warrants would be anti-dilutive. Shares
held in escrow, other than where their release is subject to the passage of time, are not included in the calculation of the weighted
average number of common shares outstanding.



F-9







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|3. |  | Significant Accounting Policies (Cont’d)
|-- |  | ----------------------------------------



Financial
instruments



Initial
recognition and measurement



Financial
assets and liabilities are initially recognized at fair value. Financial assets are classified at initial recognition as financial
assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, or available-for-sale financial
assets. The Company does not use any hedging instruments. Financial instruments measured at fair value are classified into one
of three levels in the fair value hierarchy according to the reliability of the inputs used to estimate the fair values. The three
levels of the fair value hierarchy are:



Level
1 - unadjusted quoted prices in active markets for identical assets or liabilities;

Level
2 - inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and

Level
3 - inputs that are not based on observable market data.



At
April 30, 2012, all of the financial instruments measured at fair value are included in Level 1 except financial instrument liability
and convertible debts, which are in Level 3.



Subsequent
measurement



The
subsequent measurement of financial assets depends on their classification. Financial assets at fair value through profit or loss
includes financial assets held-for-trading which represent assets that are acquired for the purpose of selling or repurchasing
in the near term. These financial assets are initially recorded in the statement of financial position at fair value with changes
in fair value recognized in the statement of comprehensive loss.



Loans
and receivables are financial assets with fixed or determinable payments that are not quoted in an active market. After initial
measurement at fair value, such financial assets are subsequently measured at amortized cost using the effective interest rate
method, less impairment. Any amortization of the effective interest rate method and any impairment is recognized in the statement
of comprehensive loss.



Held-to-maturity
investments represent assets to be held until a specific time period and are initially measured at fair value, including transaction
costs. After initial measurement at fair value, such financial assets are subsequently measured at amortized cost using the effective
interest rate method, less impairment. Any amortization of the effective interest rate method and any impairment is recognized
in the statement of comprehensive loss.



Available-for-sale
financial assets are investments in equity instruments that are measured at fair value with gains and losses, net of applicable
taxes, included in other comprehensive income until the asset is removed from the statement of financial position. Once this occurs,
the resultant gains or losses are recognized in comprehensive loss. Any permanent impairment of available-for-sale financial assets
is also included in the statement of comprehensive loss.



F-10







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|3. |  | Significant Accounting Policies (Cont’d)
|-- |  | ----------------------------------------



Financial
instruments (Cont’d)



Financial
liabilities are initially recorded at fair value and are designated as fair value through profit or loss or other financial liabilities.
Derivative financial liabilities are classified as fair value through profit or loss and are initially recorded in the statement
of financial position at fair value with changes in fair value recognized in finance income or finance cost in the statement of
comprehensive loss. Non-derivative financial liabilities are recorded at amortized cost using the effective interest rate method.
Any amortization of the effective interest rate method is recognized in the statement of comprehensive loss.



Financial
assets, others than those at fair value through profit and loss are assessed for indicators of impairment at each period end.
Financial assets are impaired when there is objective evidence that, as a result of one or more events that occurred after initial
recognition of the financial asset, the estimated future cash flows of the investment have been impacted. The amount of impairment
loss is recognized in the statement of comprehensive loss. Any subsequent reversals of impairment is also recognized in the statement
of comprehensive income (loss), except for those related to available-for-sale financial assets.



Mineral
property or exploration and evaluation



The
Company follows the practice of capitalizing all costs relating to the acquisition of, exploration and development of mineral
claims and crediting all proceeds received for farm-out arrangements or recovery of costs against the cost of the related claims.
Such costs include, but are not exclusive to, geological, geophysical studies, exploratory drilling and sampling. At such time
as commercial production commences, these costs will be charged to operations on a unit-of-production method based on proven and
probable reserves. The aggregate costs related to abandoned mineral claims are charged to operations at the time of any abandonment
or when it has been determined that there is evidence of a permanent impairment. An impairment charge relating to a mineral property
is subsequently reversed when new exploration results or actual or potential proceeds on sale or farm-out of the property result
in a revised estimate of the recoverable amount but only to the extent that this does not exceed the original carrying value of
the property that would have resulted if no impairment had been recognized.



The
recoverability of amounts shown for exploration and evaluation assets is dependent upon the discovery of economically recoverable
reserves, the ability of the Company to obtain financing to complete development of the properties, and on future production or
proceeds of disposition.



The
Company recognizes in income the costs recovered on mineral properties when the amounts received or receivable are in excess of
the carrying amount.



Upon
transfer of “Exploration and evaluation costs” into “Mine Development”, all subsequent expenditure on
the construction, installation or completion of infrastructure facilities is capitalized within “Mine development”.
After production starts, all assets included in “Mine development” are transferred to “Producing Mines”.



F-11







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|3. |  | Significant Accounting Policies (Cont’d)
|-- |  | ----------------------------------------



Mineral
property or exploration and evaluation (Cont’d)



All
capitalized exploration and evaluation expenditure is monitored for indications of impairment. Where a potential impairment is
indicated, assessments are performed for each area of interest. To the extent that exploration expenditure is not expected to
be recovered, it is charged to the results of operations. Exploration areas where reserves have been discovered, but require major
capital expenditure before production can begin, are continually evaluated to ensure that commercial quantities of reserves exist
or to ensure that additional exploration work is underway as planned.



Asset
retirement and environmental obligations



The
fair value of a liability for an asset retirement or environmental obligation is recognized when a reasonable estimate of fair
value can be made. The asset retirement or environmental obligation is recorded as a liability with a corresponding increase to
the carrying amount of the related long-lived asset. Subsequently, the asset retirement or environmental cost is charged to operations
using a systematic and rational method and the resulting liability is adjusted to reflect period-to-period changes in the liability
resulting from the passage of time and revisions to either the timing or the amount of the original estimate of undiscounted cash
flow. As of April 30, 2012 and 2011, the Company does not have any asset retirement or environmental obligations.



Impairment
of assets



The
carrying amount of the Company’s assets (which includes the exploration and evaluation asset) are reviewed at each reporting
date to determine whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset
is estimated in order to determine the extent of the impairment loss. An impairment loss isrecognized whenever the carrying
amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognized in the statement
of comprehensive loss.



The
recoverable amount of assets is the greater of an asset’s fair value less cost to sell and value in use. In assessing value
in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects the
current market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate
cash inflows largely independent of those from other assets, the recoverable amount is determined for the cash-generating unit
to which the asset belongs. An impairment loss is only reversed if there is an indication that the impairment loss may no longer
exist and there has been a change in the estimates used to determine the recoverable amount, however, not to an amount higher
than the carrying amount that would have been determined had no impairment loss been recognized in previous years. Assets that
have an indefinite useful life are not subject to amortization and are tested annually for impairment.



F-12







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|3. |  | Significant Accounting Policies (Cont’d)
|-- |  | ----------------------------------------



New
standards and interpretations



New
accounting standards issued but not yet effective-Certain new standards, interpretations and amendments to existing
standards have been issued by the IASB or the International Financial Reporting Interpretations Committee (“IFRIC”)
that are mandatory for accounting periods beginning after January 1, 2011, or later periods. Some updates that are not applicable
or are not consequential to the Company may have been excluded from the list below.



New
accounting standards effective May 1, 2012



Amendments
to IFRS 7 Financial Instruments: Disclosures -In October 2010, the IASB issued amendments to IFRS 7 that improve
the disclosure requirements in relation to transferred financial assets. The amendments are effective for annual periods beginning
on or after July 1, 2011, with early adoption permitted. The Company does not anticipate this amendment to have a significant
impact on its consolidated financial statements.



IAS
12 Income taxes-In December 2010, the IASB issued an amendment to IAS 12 that provides a practical solution
to determining the recovery of investment properties as it relates to the accounting for deferred income taxes. This amendment
is effective for annual periods beginning on or after July 1, 2011, with early adoption permitted. The Company does not anticipate
this amendment to have a significant impact on its consolidated financial statements.



New
accounting standards effective May 1, 2013



IFRS
10 Consolidated Financial Statements-IFRS 10 requires an entity to consolidate an investee when it is exposed,
or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through
its power over the investee. Under existing IFRS, consolidation is required when an entity has the power to govern the financial
and operating policies of an entity so as to obtain benefits from its activities. IFRS 10 replaces SIC-12 Consolidation - Special
Purpose Entities and parts of IAS 27 Consolidated and Separate Financial Statements.



IFRS
11 Joint Arrangements-IFRS 11 requires a venturer to classify its interest in a joint arrangement as a joint
venture or joint operation. Joint ventures will be accounted for using the equity method of accounting whereas for a joint operation
the venturer will recognize its share of the assets, liabilities, revenue and expenses of the joint operation. Under existing
IFRS, entities have the choice to proportionately consolidate or equity account for interests in joint ventures. IFRS 11 supersedes
IAS 31 Interests in Joint Ventures and SIC-13 Jointly Controlled Entities - Non-monetary Contributions by Venturers.



IFRS
12 Disclosure of Interests in Other Entities-IFRS 12 establishes disclosure requirements for interests in
other entities, such as joint arrangements, associates, special purpose vehicles and off balance sheet vehicles. The standard
carries forward existing disclosures and also introduces significant additional disclosure requirements that address the nature
of, and risks associated with, an entity’s interests in other entities.



F-13







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|3. |  | Significant Accounting Policies (Cont’d)
|-- |  | ----------------------------------------



New
standards and interpretations (Cont’d)



IFRS
13 Fair Value Measurement-IFRS 13 is a comprehensive standard for fair value measurement and disclosure requirements
for use across all IFRS standards. The new standard clarifies that fair value is the price that would be received to sell an asset,
or paid to transfer a liability in an orderly transaction between market participants, at the measurement date. It also establishes
disclosures about fair value measurement. Under existing IFRS, guidance on measuring and disclosing fair value is dispersed among
the specific standards requiring fair value measurements and in many cases does not reflect a clear measurement basis or consistent
disclosures.



Amendments
to other standards-In addition, there have been other amendments to existing standards, including IAS 27 Separate
Financial Statementsand IAS 28 Investments in Associates and Joint Ventures. IAS 27 addresses accounting for subsidiaries,
jointly controlled entities and associates in non-consolidated financial statements. IAS 28 has been amended to include joint
ventures in its scope and to address the changes in IFRS 10 to IFRS 13.



Each
of the new standards, IFRS 10 to 13, IFRIC 20 and the amendments to other standards, is effective for the Company beginning on
May 1, 2013 with early adoption permitted. The Company has not yet begun the process of assessing the impact that the new standards
will have on its consolidated financial statements or whether to early adopt any of the new requirements.



Amendments
to IAS 1 Presentation of Financial Statements - The IASB has amended IAS 1 to require entities to separate items presented
in other comprehensive income (“OCI”) into two groups, based on whether or not items may be reclassified into profit
or loss in the future. Entities that choose to present OCI items before tax will be required to show the amount of tax related
to the two groups separately.



IFRIC
20 Stripping Costs in the Production Phase of a Surface Mine - IFRIC 20 addresses the accounting for overburden waste
removal (stripping) costs in the production phase of a surface mine. Stripping activity may result in two types of benefits: i)
inventory produced and ii) improved access to ore that will be mined in the future. Stripping costs associated with inventory
production should be accounted for as a current production cost in accordance with IAS 2 Inventories, and those associated with
improved access to ore should be accounted for as an addition to, or enhancement of, an existing asset.



F-14







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|3. |  | Significant Accounting Policies (Cont’d)
|-- |  | ----------------------------------------



New
standards and interpretations (Cont’d)



IFRS
9 Financial Instruments-IFRS 9 was issued in November 2009 and contained requirements for financial assets.
This standard addresses classification and measurement of financial assets and replaces the multiple category and measurement
models in IAS 39 for debt instruments with a new mixed measurement model having only two categories: Amortized cost and fair value
through profit or loss. IFRS 9 also replaces the models for measuring equity instruments and such instruments are either recognized
at the fair value through profit or loss or at fair value through other comprehensive income. Where such equity instruments are
measured at fair value through other comprehensive income, dividends are recognized in profit or loss to the extent not clearly
representing a return of investment; however, others gains and losses (including impairments) associated with such instruments
remain in accumulated other comprehensive income indefinitely.



Requirements
for financial liabilities were added in October 2010 and they largely carried forward existing requirements in IAS 39, Financial
Instruments – Recognition and Measurement, except that fair value changes due to credit risk for liabilities designated
at fair value through profit and loss would generally be recorded in other comprehensive income.



IFRS
9 is effective for annual periods beginning on or after January 2015 with early adoption permitted. The Company has not yet begun
the process of assessing the impact that the new and amended standards will have on its consolidated financial statements or whether
to early adopt any of the new requirements.



|4. |  | Significant accounting judgments and estimates
|-- |  | ----------------------------------------------



The
preparation of financial statements in conformity with IFRS requires management to make certain estimates, judgments and assumptions
that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported revenues and
expenses during the year.



Although
management uses historical experience and its best knowledge of the amount, events or actions to form the basis for judgments
and estimates, actual results may differ from these estimates.



The
preparation of financial statements in conformity with IFRS requires management to make certain estimates, judgments and assumptions
that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported revenues and
expenses during the period.



Although
management uses historical experience and its best knowledge of the amount, events or actions to form the basis for judgments
and estimates, actual results may differ from these estimates.



Critical
judgments exercised in applying accounting policies that have the most significant effect on the amounts recognized in the consolidated
financial statements are as follows:



F-15







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|4. |  | Significant accounting judgments and estimates (Cont’d)
|-- |  | -------------------------------------------------------



Determination
of functional currency



The
Company determines the functional currency through an analysis of several indicators such as expenses and cash flow, financing
activities, retention of operating cash flows, and frequency of transactions with the reporting entity.



Valuation
of share-based payments



The
Company uses the Black-Scholes Option Pricing Model for valuation of share-based payments. Option pricing models require the input
of subjective assumptions including expected price volatility, interest rate, and forfeiture rate. Changes in the input assumptions
can materially affect the fair value estimate and the Company’s earnings and equity reserves.



Income
taxes



In
assessing the probability of realizing income tax assets, management makes estimates related to expectations of future taxable
income, applicable tax opportunities, expected timing of reversals of existing temporary differences and the likelihood that tax
positions taken will be sustained upon examination by applicable tax authorities. In making its assessments, management gives
additional weight to positive and negative evidence that can be objectively verified.



Depreciation
for equipment



Depreciation
expense is allocated based on assumed asset lives. Should the asset life or depreciation rates differ from the initial estimate,
an adjustment would be made in the consolidated statements of comprehensive loss.



Economic
recoverability and probability of future economic benefits of mineral properties



Management
has determined that mineral property costs incurred which were capitalized have future economic benefits and are economically
recoverable. Management uses several criteria in its assessments of economic recoverability and probability of future economic
benefits including geological and metallurgic information, history of conversion of mineral deposits to proven and probable reserves,
scoping and feasibility studies, accessible facilities, existing permits and life of mine plans.



F-16







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|5. |  | Financial Instruments and Risk Management
|-- |  | -----------------------------------------



Foreign
exchange risk



The
Company is primarily exposed to currency fluctuations relative to the Canadian dollar through expenditures that are denominated
in US dollars. Also, the Company is exposed to the impact of currency fluctuations on its monetary assets and liabilities.



The
operating results and the financial position of the Company are reported in Canadian dollars. Fluctuations in exchange rates will,
consequently, have an impact upon the reported operations of the Company and may affect the value of the Company’s assets
and liabilities.



The
Company currently does not enter into financial instruments to manage foreign exchange risk.



The
Company is exposed to foreign currency risk through the following financial assets and liabilities that are denominated in United
States dollars:



|April
    30, 2012 |  | Cash |   | Due
                                                                                                                                to
                                                                                                                                Related
                                                                                                                                Party |   | Advances
    to
    Equity
    Accounted
    Investee |  | Accounts
    Payable
|------------------ |  | ---- | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ----------------------------------------------------- |  | --------------------
|                   |  | $    | 7 |                                                                                                                                                                                                                                                                                                                                                                                                                      | $ | 112                                                   |  | $                   



At
April 30, 2012 with other variables unchanged, a +/-10% change in exchange rates would increase/decrease pre-tax loss by approximately
+/- $57,948.



Interest
rate and credit risk



The
Company has minimal cash balances and no interest-bearing debt other than the convertible debt of $20,000. The Company has no
significant concentrations of credit risk arising from operations. The Company’s current policy is to invest any significant
excess cash in investment-grade short-term deposit certificates issued by reputable financial institutions with which it keeps
its bank accounts and management believes the risk of loss to be remote. The Company periodically monitors the investments it
makes and is satisfied with the credit ratings of its banks.



Receivables
consist of goods and services tax due from the Federal Government. Management believes that the credit risk concentration with
respect to receivables is remote.



Liquidity
Risk



Liquidity
risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company manages
liquidity risk through the management of its capital structure and financial leverage as outlined in Note 13.



F-17







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|6. |  | Common Stock
|-- |  | ------------



Authorized



50,000,000
Common shares without par value

10,000,000
Preferred shares with a $1 par value, redeemable for common shares on the basis of 1 common share for 2 preferred shares

5,000,000
Class A non-voting shares without par value. Special rights and restrictions apply.



Treasury
Shares



At
April 30, 2012, Rand owns 217,422 (2011 – 217,422) shares of the Company valued at $43,485 that have been deducted from
the total shares issued and outstanding. The value of these shares has been deducted from share capital.



Private
placements



On
April 24, 2011, the Company completed a private placement, whereby 1,894,333 units at $0.15 per unit were issued for proceeds
of $284,150. Each private placement unit consisted of one common share and share purchase warrant. Each warrant entitles the holder
to purchase one additional share of common stock at a price of $0.20 per share for one year. The fair value of the warrants included
in the units was estimated to be $0.07 using the Black-Scholes option pricing model using the following assumptions: risk free
interest rate of 1.69%, expected volatility of 144%, an expected life of 1 year and no expected dividends. Finders’ fees
of $8,500 and other related costs of $3,463 were paid in connection with the private placement, which are included in share issuance
costs.



On
June 9, 2011, the Company completed a private placement, whereby 2,043,300 units at $0.15 per unit were issued for gross proceeds
of $306,495. Each private placement unit consisted of one common share and share purchase warrant. Each warrant entitles the holder
to purchase one additional share of common stock at a price of $0.20 per share for one year. The fair value of the warrants included
in the units was estimated to be $0.05 using the Black-Scholes option pricing model using the following assumptions: risk free
interest rate of 1.53%, expected volatility of 144%, an expected life of 1 year and no expected dividends.



On
March 20, 2012, the Company completed a private placement, whereby 2,115,375 units at $0.10 per unit were issued for gross proceeds
of $211,538. Each private placement unit consisted of one common share and share purchase warrant. Each warrant entitles the holder
to purchase one additional share of common stock at a price of $0.15 per share for one year. The fair value of the warrants included
in the units was estimated to be $0.04 using the Black-Scholes option pricing model using the following assumptions: risk free
interest rate of 1.12%, expected volatility of 176%, an expected life of 1 year and no expected dividends.



Finders’
fees of $800 and other related costs of $5,463 were paid in connection with the private placements, which are included in share
issuance costs.



F-18







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|6. |  | Common Stock (Cont’d)
|-- |  | ---------------------



Stock
Options



The
Company has implemented a stock option plan (the “Plan”) to be administered by the Board of Directors. Pursuant to
the Plan, the Board of Directors has discretion to grant options for up to a maximum of 10% of the issued and outstanding common
shares of the Company at the date the options are granted. The option price under each option shall be not less than the discounted
market price on the grant date. The expiry date of an option shall be set by the Board of Directors at the time the option is
awarded, and shall not be more than five years after the grant date.



These
options have the following vesting schedule:

|i) |  | Up to 25% of the option may be exercised at any time during the term of the option;
such initial exercise is referred to as the “First Exercise”.
|-- |  | -------------------------------------------------------------------------------------------------------------------------------------------------

|ii) |  | The second 25% of the option may be exercised at any time after 90 days from the date
of First Exercise; such second exercise is referred to as the “Second Exercise”.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------

|iii) |  | The third 25% of the option may be exercised at any time after 90 days from the date
of Second Exercise; such third exercise is referred to as the “Third Exercise”.
|---- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------

|iv) |  | The fourth and final 25% of the option may be exercised at any time after 90 days
from the date of the Third Exercise.
|--- |  | ----------------------------------------------------------------------------------------------------------------------

|v) |  | The options expire 60 months from the date of grant.
|-- |  | ----------------------------------------------------



Options
granted to consultants engaged in investor relations activities will vest in stages over a minimum of 12 months with no more than
25% of the options vesting in any three-month period.



During
the year ended April 30, 2012, the Company recorded stock-based compensation of $nil (2011 - $20,296) as a general and administrative
expense.



On
October 21, 2010, the Company granted 750,000 stock options from the Plan to a director of the Company exercisable at $0.14 per
share, up to October 21, 2015. The fair value of options was estimated using the Black-Scholes option pricing model using the
following weighted average assumptions: risk free interest rate of 1.72%, expected volatility of 106%, an expected option life
of 5 years and no expected dividends. The weighted average fair value of options granted was $0.11 per option. During the year
ended April 30, 2011 the Company recognized $20,296 as stock-based compensation in relation to this grant, with $60,888 to be
recognized in future accounting periods as the options continue to vest.



As
at April 30, 2012, as the Company believes that it is not probable that any options would vest except the first 25% of the options
that vested immediately at a date of the First Exercise, the fair value of the first 25% of the options that vested were charged
to the consolidated statements of loss and comprehensive loss.



F-19







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|6. |  | Common Stock (Cont’d)
|-- |  | ---------------------



Stock
Options(Cont’d)



The
following is a summary of options activities during the years ended April 30, 2012 and 2011:



|                                                                     |  | Number of
options |           |   | Weighted
average
exercise
price | 
|-------------------------------------------------------------------- |  | ----------------- | --------- | - | ------------------------------- | 
|                                                                     |  |                   |           |   | $                               | 
|Outstanding at April 30, 2010                                        |  |                   | 1,575,000 |   |                                 | 
|Expired                                                              |  |                   | (750,000  | ) |                                 | 
|Granted                                                              |  |                   | 750,000   |   |                                 | 
|Outstanding at April 30, 2011                                        |  |                   | 1,575,000 |   |                                 | 
|Forfeited, unexercised                                               |  |                   | (100,000  | ) |                                 | 
|                                                                     |  |                   |           |   |                                 | 
|Weighted average fair value of options outstanding at April 30, 2012 |  |                   | 1,475,000 |   |                                 | 



The
following options were outstanding at April 30, 2012:



|Expiry Date         |  | Exercise
price |      |  | Numberof options |  |           | Remainingcontractual life | 
|------------------- |  | -------------- | ---- |  | ---------------- |  | --------- | ------------------------- | 
|                    |  | $              |      |  |                  |  |           | (years)                   | 
|                    |  |                |      |  |                  |  |           |                           | 
|August 1, 2013      |  |                | 0.40 |  |                  |  | 300,000   |                           | 
|April 22, 2014      |  |                | 0.21 |  |                  |  | 375,000   |                           | 
|April 19, 2015      |  |                | 0.21 |  |                  |  | 50,000    |                           | 
|October 21, 2015    |  |                | 0.14 |  |                  |  | 750,000   |                           | 
|                    |  |                |      |  |                  |  |           |                           | 
|Options Outstanding |  |                |      |  |                  |  | 1,475,000 |                           | 
|                    |  |                |      |  |                  |  |           |                           | 
|Options Exercisable |  |                |      |  |                  |  | 368,750   |                           | 



F-20







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|6. |  | Common Stock (Cont’d)
|-- |  | ---------------------



Share
Purchase Warrants



The
following is a summary of warrant activities during the years ended April 30, 2012 and 2011:



|                              |  | Number of
warrants |            |   | Weighted
average
exercise
price | 
|----------------------------- |  | ------------------ | ---------- | - | ------------------------------- | 
|                              |  |                    |            |   | $                               | 
|Outstanding at April 30, 2010 |  |                    | 3,971,097  |   |                                 | 
|Expired                       |  |                    | (1,315,168 | ) |                                 | 
|Exercised                     |  |                    | (460,929   | ) |                                 | 
|Issued                        |  |                    | 1,894,333  |   |                                 | 
|Outstanding at April 30, 2011 |  |                    | 4,089,333  |   |                                 | 
|Expired, unexercised          |  |                    | (4,089,333 | ) |                                 | 
|Issued                        |  |                    | 3,178,675  |   |                                 | 
|Outstanding at April 30, 2012 |  |                    | 3,178,675  |   |                                 | 



The
following warrants were outstanding at April 30, 2012:



|Expiry Date          |  | Exercise price |      |  | Number of warrants | 
|-------------------- |  | -------------- | ---- |  | ------------------ | 
|                     |  | $              |      |  |                    | 
|June 9, 2012         |  |                | 0.20 |  |                    | 
|March 20, 2013       |  |                | 0.15 |  |                    | 
|Warrants Outstanding |  |                |      |  |                    | 



|7. |  | Equipment
|-- |  | ---------



|                               |  | Cost |        |  | AccumulatedAmortization |   |        | 2012 Net | 
|------------------------------ |  | ---- | ------ |  | ----------------------- | - | ------ | -------- | 
|Computer hardware              |  | $    | 8,323  |  |                         | $ | 8,323  |          | 
|Office furniture and equipment |  |      | 8,849  |  |                         |   | 8,849  |          | 
|Total                          |  | $    | 17,172 |  |                         | $ | 17,172 |          | 



|                               |  | Cost |        |  | Accumulated Amortization |   |        | 2011 Net |  |   | 2010 Net | 
|------------------------------ |  | ---- | ------ |  | ------------------------ | - | ------ | -------- |  | - | -------- | 
|Computer hardware              |  | $    | 8,323  |  |                          | $ | 7,187  |          |  | $ | 1,136    | 
|Office furniture and equipment |  |      | 8,849  |  |                          |   | 7,816  |          |  |   | 1,033    | 
|Total                          |  | $    | 17,172 |  |                          | $ | 15,003 |          |  | $ | 2,169    | 





F-21







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|8. |  | Equity Accounted Investees and Related Party Transactions
|-- |  | ---------------------------------------------------------



REGI



The
Company’s investment in REGI has been reduced to $nil as the Company’s share of past losses exceeded the carrying
value of the investment in REGI.



At
April 30, 2012, the Company is owed an aggregate of $1,025,086 (2011 - $865,607) by REGI. The amounts owed are unsecured, non-interest
bearing and due on demand.



During
the year ended April 30, 2012, the Company recognized a gain of $nil (2011 – $102,966) relating to the sale of nil (2011
– 458,300) of shares of REGI by the Company and Rand.



Minewest



On
July 20, 2010 the Company signed an asset transfer agreement with its newly incorporated wholly owned subsidiary Minewest for
the purpose of acquiring and exploring mineral properties. In accordance with the agreement the Company transfers its 100% ownership
in its undivided 45% interest subject to a 5% net smelter return in 33 mining claims situated in the Tootsee River area in the
Province of British Columbia for following consideration:



|- |  | Cash payment of $25,000 on or before August 15, 2010
(paid);
|- |  | ------------------------------------------------------------

|- |  | Issuance of 8,000,000 shares of Minewest voting common
shares (issued).
|- |  | -----------------------------------------------------------------------



Effective
December 15, 2010 Minewest signed a purchase agreement with Rapitan Resources Inc. (“Rapitan”), wherein Minewest purchased
100% of Rapitan’s 25% interest in the Silverknife property for the following consideration:



|- |  | Cash payment of $10,000 (paid);
|- |  | -------------------------------

|- |  | Issuance of 2,000,000 shares of common stocks of Minewest
(issued).
|- |  | -------------------------------------------------------------------



Effective
November 18, 2011 Reg Tech obtained court approval for the Plan of Arrangement. On December 14, 2011, Reg Tech declared approximately
4,712,263 Minewest shares to be distributed to as dividend to Reg Tech shareholders on the record date of December 21, 2011, whereby
one Minewest share is distributed for seven Reg Tech shares. As at April 30, 2012 and the date of this report, these shares have
not been distributed and are recorded as assets held for distribution to shareholders, $471,200. The distribution is subject to
Minewest being listed on the CNSX.



As
a result of the dividend declaration, Reg Tech retains approximately 3,287,737 shares of Minewest, representing approximately
26.10% of the issued and outstanding common shares of Minewest at April 30, 2012, and has its controlling interest reduced to
significant influence effective November 18, 2011.



As
at April 30, 2012 the Company’s investment in Minewest is recorded at $320,082 under equity method (investment of $328,800
less equity loss of $8,718) and held 26.10% ownership in Minewest.



At
April 30, 2012, the Company owed an aggregate of $179,414 (2011 - $nil) to Minewest. The amounts owed are unsecured, non-interest
bearing and due on demand.



F-22







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|8. |  | Equity Accounted Investees and Related Party Transactions (Cont’d)
|-- |  | ------------------------------------------------------------------



At
April 30, 2012, the Company is owed an aggregate of $1,317 (2011 - $8,490) by related parties and owed an aggregate of $137,135
(2010 - $218,878) to related parties. The amounts owed are unsecured, non-interest bearing and due on demand. These parties are
companies that the President of the Company controls or significantly influences.



During
the year ended April 30, 2012, rent of $6,871 (2011 - $15,680) incurred with a company having common officers and directors.



During
the year ended April 30, 2012, management fees of $30,000 (2011 - $30,000) were incurred to a company having common officers and
directors.



During
the year ended April 30, 2012, management and directors’ fees of $26,972 (2011 - $31,200) were paid to officers, directors
and companies controlled by officers and directors for services rendered.



During
the year ended April 30, 2012, research and development costs of $56,250 (2011 - $75,000) were paid to a company having common
officers and directors.



All
related party transactions are in the normal course of operations and have been measured at the agreed to amounts, which is the
amount of consideration established and agreed to by the related parties.



|9. |  | Commitments
|-- |  | -----------



|a) |  | In connection with the acquisition of Rand, the Company
has the following royalty obligations:
|-- |  | ----------------------------------------------------------------------------------------------



|i) |  | A participating royalty is to be paid based on 5% of all net profits from sales, licenses,
royalties or income derived from the patented technology, to a maximum amount of $10,000,000. The participating royalty is to
be paid in minimum annual installments of $50,000 per year beginning on the date the first revenues are derived from the license
or sale of the patented technology.
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|ii) |  | Pursuant to a letter of understanding dated December 13, 1993, between the Company
and REGI (collectively called the grantors) and West Virginia University Research Corporation (“WVURC”), the grantors
have agreed that WVURC shall own 5% of all patented technology and will receive 5% of all net profits from sales, licenses, royalties
or income derived from the patented technology.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|iii) |  | A 1% net profit royalty will be payable to a former director on all U.S. – based
sales.
|---- |  | ---------------------------------------------------------------------------------------



|b) |  | The Company is committed to fund 50% of the further
development of the Rand CamTM/Direct Charge Engine Technology, with the remaining 50% funded by REGI.
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------



F-23







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|10. |  | Financial Instrument Liability
|--- |  | ------------------------------



Rand’s
private sales of REGI shares



On
November 9, 2009, Rand sold 238,000 units at US$0.25 per unit consisting one common share of REGI and one share purchase warrant
entitling the holder to purchase one additional share of REGI at US$0.35 per share expiring November 9, 2010. The warrants expired
on November 9, 2010.



During
March, 2010, 163,000 warrants issued in March, 2009 were exercised at US$0.35 per share of REGI shares and the additional 163,000
shares of REGI were sold by Rand for total proceeds of $58,877(US$57,050). These shares were transferred by Rand to the purchasers
on May 4, 2010.



On
March 12, 2010, 1,101,933 warrants issued on March 12, 2009 expired, of which 894,333 warrants were extended for one year expiring
March 12, 2011. The fair value of the extended warrants on March 12, 2010 was determined using the Black-Scholes option pricing
model using the following weighted average assumptions: risk free interest rate of 0.15%, expected volatility of 117%, an expected
option life of 1 year and no expected dividends. These warrants expired on March 12, 2011.



As
at April 30, 2012 the details of the share purchase warrants are as follows:



|Closing
    date of sale |  | #
    of warrants |  | Exercise
    price |  | Expiry
    date
|------------------------ |  | ----------------- |  | ------------------ |  | ---------------
|March 27, 2008 (Rand)    |  | 80,000            |  | US$        1.50    |  | March 27, 2013 
|May 6, 2008 (Rand)       |  | 40,000            |  | US$        1.50    |  | May 6, 2013    



The
fair value of the warrants as follows:



|Expiry
    date            |  | Fair
    value at April 30, 2012 |       |  | Fair
    value at April 30, 2011 |  
|-------------------------- |  | -------------------------------- | ----- |  | -------------------------------- | -
|March 27, 2013 (Rand)      |  | $                                | 6,121 |  |                                  | $
|May 6, 2013 (Rand)         |  |                                  | 3,194 |  |                                  |  
|October 5, 2011 (Reg Tech) |  |                                  | -     |  |                                  |  
|Total                      |  | $                                | 9,315 |  |                                  | $



Black-Scholes
Option-Pricing Model Assumptions



The
fair value of each warrant issued was calculated using the Black-Scholes option-pricing model with the following assumptions:



|                                  |  | 30
    April 2012 |             |   | 30
    April 2011 | 
|--------------------------------- |  | ----------------- | ----------- | - | ----------------- | 
|Expected dividend yield           |  |                   | 0.00        | % |                   | 
|Expected stock price volatility   |  |                   | 242% - 251% |   |                   | 
|Risk-free interest rate           |  |                   | 1.27        | % |                   | 
|Expected life of warrants (years) |  |                   | 0.91 – 1.02 |   |                   | 



F-24







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|10. |  | Financial Instrument Liability (Cont’d)
|--- |  | ---------------------------------------



Reg
Tech’s private sales of REGI shares



On
November 9, 2009, Reg Tech sold 280,000 units (2009 – nil units) at $0.25 per unit consisting one common share of REGI and
one share purchase warrant entitling the holder to purchase one additional share of REGI at $0.35 per share expiring November
9, 2010. The warrants expired on November 9, 2010.



The
warrants are a derivative, and the proceeds on the sale of the units were bifurcated between the fair value of the common shares
and the share purchase warrants. The proceeds allocated to the warrants were $21,304 (2009 - $nil) upon issuance. The fair value
of the warrants at the closing date was determined using the Black-Scholes option pricing model using the following weighted average
assumptions: risk free interest rate of 0.31%, expected volatility of 121%, an expected option life of 1 year and no expected
dividends. The fair value of the warrants at April 30, 2010 was determined at $21,373 using the Black-Scholes option pricing model
using the following weighted average assumptions: risk free interest rate of 0.24%, expected volatility of 121%, an expected option
life of 0.53 year and no expected dividends.



On
October 6, 2010, Reg Tech sold 295,300 units $0.25 per unit consisting one common share of REGI and one share purchase warrant
entitling the holder to purchase one additional share of REGI at $0.30 per share for one year, which expired on October 5, 2011.



The
warrants are a derivative, and the proceeds on the sale of the units were bifurcated between the fair value of the common shares
and the share purchase warrants. The proceeds allocated to the warrants were $32,377 upon issuance. The fair value of the warrants
at the closing date was determined using the Black-Scholes option pricing model using the following weighted average assumptions:
risk free interest rate of 1.21%, expected volatility of 222.74%, an expected option life of 1 year and no expected dividends.
The fair value of the warrants at April 30, 2011 was determined at $20,923 using the Black-Scholes option pricing model using
the following weighted average assumptions: risk free interest rate of 1.10%, expected volatility of 193%, an expected option
life of 0.44 year and no expected dividends.



|11. |  | Convertible Debenture
|--- |  | ---------------------



On
June 1, 2010, the Company issued a convertible debenture for total proceeds of $50,000 which bears interests at 8% per annum payable
monthly, is unsecured and due one year from date of issuance. The unpaid amount of principal can be converted at any time at the
holder’s option into shares of the Company’s common stock at a price of $0.20 per share. The Company has the option
to repay principal and accrued interest before the due date with 30 days’ notice.



The
fair value of the debt component of the convertible loan was estimated using discounted cash flow at 10% for equivalent debt without
the conversion feature. The fair value of equity component was estimated to be a difference between the fair value of the debt
and the face value of the instrument. The debt and equity components of the convertible loans were then measured using the residual
value method and were initially recorded at $49,242 and $758 respectively.



On
February 18, 2011 principal amount of $30,000 was repaid to the debt holder, with loss on early payment of $170 recorded as financing
cost.



F-25







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|11. |  | Convertible Debenture (Cont’d)
|--- |  | ------------------------------



On
June 1, 2011, the convertible debenture for total principal of $20,000 matured and renewed to June 1, 2012. The debenture bears
interests at 8% per annum payable monthly and is unsecured. The unpaid amount of principal can be converted at any time at the
holder’s option into shares of the Company’s common stock at a price of $0.20 per share.



The
fair value of the debt component of the convertible loan was estimated using discounted cash flow at 10% for equivalent debt without
the conversion feature. The fair value of equity component was estimated to be the fair value of the debt and the face value of
the instrument. The debt and equity components of the convertible loans were then measured using the proportional or relative
fair value method and were initially recorded at $19,695and $305 respectively.



As
at April 30, 2012, interest of $243 has been amortized with the renewed debt component carried at amortized cost of $19,938. As
at April 30, 2012, interest of $1,600 has been paid to the lender for the renewed debt.



|12. |  | Income Taxes
|--- |  | ------------



Income
tax expense differs from the amount that would result from applying the combined federal and provincial income tax rate to earnings
before income taxes. These differences result from the following items:



|                                                |  | For the year ended
April 30, 2012
$ |          |   | For the year ended
April 30, 2011
$ | 
|----------------------------------------------- |  | ----------------------------------- | -------- | - | ----------------------------------- | 
|Net loss before income taxes                    |  |                                     | (385,800 | ) |                                     | 
|Combined federal and provincial income tax rate |  |                                     | 26.00    | % |                                     | 
|Expected income tax recovery                    |  |                                     | (100,329 | ) |                                     | 
|                                                |  |                                     |          |   |                                     | 
|Increase (decrease) due to:                     |  |                                     |          |   |                                     | 
|Non-deductible expenses                         |  |                                     | 210,420  |   |                                     | 
|Change in long-term Canadian tax rate and other |  |                                     | 3,018    |   |                                     | 
|Change in valuation allowance                   |  |                                     | (111,631 | ) |                                     | 
|Non-taxable portion of gain                     |  |                                     | (1,478   | ) |                                     | 
|Income tax expense (recovery)                   |  |                                     | -        |   |                                     | 



F-26







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|12. |  | Income Taxes (Cont’d)
|--- |  | ---------------------



The
components of deferred income tax assets are as follows:



|                               |  | 2012
    $ |          |   | 2011
    $ | 
|------------------------------ |  | ---------- | -------- | - | ---------- | 
|Non-capital losses             |  |            | 811,782  |   |            | 
|Intangible assets and other    |  |            | 39,893   |   |            | 
|Equipment                      |  |            | 1,182    |   |            | 
|                               |  |            | 852,857  |   |            | 
|Valuation allowance            |  |            | (852,857 | ) |            | 
|Net deferred income tax assets |  |            | -        |   |            | 



The
Company has non-capital losses of approximately $3,247,131 that may be available to offset future income for income tax purposes.
These losses expire as follows:



|     |  | $ |          
|---- |  | - | ---------
|2014 |  |   | 145,129  
|2015 |  |   | 211,935  
|2026 |  |   | 402,253  
|2027 |  |   | 316,606  
|2028 |  |   | 432,893  
|2029 |  |   | 529,882  
|2030 |  |   | 396,986  
|2031 |  |   | 412,586  
|2032 |  |   | 398,861  
|     |  |   | 3,247,131



F-27







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|13. |  | Capital Management
|--- |  | ------------------



The
Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going concern in
order to pursue the development of its technologies and to maintain a flexible capital structure for its projects for the benefit
of its stakeholders. As the Company is in the development stage, its principal source of funds is from the issuance of common
shares.



In
the management of capital, the Company includes the share capital as well as cash, receivables, related party receivables and
advances to equity accounted investee.



The
Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics
of the underlying assets. To maintain or adjust the capital structure, the Company may attempt to issue new shares, acquire or
dispose of assets or adjust the amount of cash and short-term investments.



The
Company expects its capital resources, which include a share offering and the sale of investee shares and warrants, will be sufficient
to carry its research and development plans and operations through its current operating period.



The
Company is not subject to externally imposed capital requirements and there were no changes in its approach to capital management
during the year ended April 30, 2012.



F-28







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|14. |  | Transition to IFRS
|--- |  | ------------------



IFRS
1 First-time Adoption of International Financial Reporting Standards sets forth guidance for the initial adoption of IFRS.
Under IFRS 1 the standards are applied retrospectively at the transitional statement of financial position date with all adjustment
to assets and liabilities taken to retained earnings unless certain exemptions are applied.



The
Company has applied the following exemptions to its opening statement of financial position dated May 1, 2010:



(a)        Share-based
payment transactions



IFRS
1 encourages, but does not require, first-time adopters to apply IFRS 2 Share based Paymentto equity instruments that
were granted on or before November 7, 2002, or equity instruments that were granted subsequent to November 7, 2002 and vested
before the later of the date of transition to IFRS and January 1, 2005. The Company has elected not to apply IFRS 2 to awards
that vested prior to May 1, 2010.



(b)        Cumulative
translation differences



IFRS
1 allows a first-time adopter to not comply with the requirements of IAS 21 The Effects of Changes in Foreign Exchange Ratesfor cumulative translation differences that existed at the date of transition to IFRS. The Company has chosen to apply this
election and has eliminated the cumulative translation difference and adjusted retained earnings by the same amount at the date
of transition to IFRS. If, subsequent to adoption, a foreign operation is disposed of, the translation differences that arose
before the date of transition to IFRS will not affect the gain or loss on disposal.



(c)        Business
Combination and non-controlling interests



The
Company elected IFRS 1 that allows the application of the requirements of IFRS 3 and IAS 27 prospectively from the transaction
date.



(d)        Estimates



In
accordance with IFRS 1, an entity’s estimates under IFRS at the date of transition to IFRS must be consistent with estimates
made for the same date under previous GAAP, unless there is objective evidence that those estimates were in error. The Company’s
IFRS estimates as of May 1, 2010 are consistent with its Canadian GAAP estimates for that date.



IFRS
employs a conceptual framework that is similar to Canadian GAAP. However, significant differences exist in certain matters of
recognition, measurement and disclosure. While the first time adoption of IFRS did not have an impact on the total operating,
investing or financing cash flows, it has resulted in changes to the Company’s reported financial position and results of
operations. In order to allow the users of the financial statements to better understand these changes, the Company’s Canadian
GAAP consolidated statements of operations and comprehensive income (loss), for the year ended April 30, 2011 have been reconciled
to IFRS, with the resulting differences explained. In addition, the consolidated statements of financial position as at May 1,
2010 have been reconciled with the resulting differences explained.



F-29







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|14. |  | Transition to IFRS (Cont’d)
|--- |  | ---------------------------



(e)        Non-controlling
Interest



Under
GAAP the Company records non-controlling interest when the entity under the Company’s control incur net income; under IFRS
the Company records non-controlling interest when the entity under the Company’s control incur net income or loss.



(f)        Equity
component of convertible debt



GAAP
allows the proportional or relative value method in calculating the values of the equity and debt components of a convertible.
IFRS requires the residual method, whereby the fair value of the liability is calculated first and then the fair value of equity
is the residual face value of the instrument after deduction of the value of the liability component.



The
Company elected IFRS 1 exemption for not to retrospectively separate the liability and equity components of compound instruments
for.



F-30







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|14. |  | Transition to IFRS (Cont’d)
|--- |  | ---------------------------



The
May 1, 2010 Canadian GAAP statement of financial position has been reconciled to IFRS as follows:



|                                         |  | May 1, 2010   |            
|---------------------------------------- |  | ------------- | -----------
|                                         |  | Canadian GAAP |            
|Assets                                   |  |               |            
|                                         |  |               |            
|Current                                  |  |               |            
|Cash                                     |  |               | 364        
|GST and interest receivable              |  |               | 9,882      
|Prepaid expenses                         |  |               | 1,416      
|Due from related parties                 |  |               | 28,455     
|Advances to equity accounted investee    |  |               | 585,859    
|                                         |  |               | 625,976    
|Equipment                                |  |               | 3,346      
|                                         |  |               |            
|                                         |  |               | 629,322    
|Liabilities                              |  |               |            
|                                         |  |               |            
|Current                                  |  |               |            
|Bank indebtedness                        |  |               | 494        
|Accounts payable and accrued liabilities |  |               | 57,861     
|Due to related parties                   |  |               | 146,741    
|Income taxes payable                     |  |               | 10,317     
|Share subscription payable               |  |               | 58,877     
|Financial instrument liability           |  |               | 135,816    
|                                         |  |               | 410,106    
|                                         |  |               |            
|Shareholders’ equity                     |  |               |            
|Share Capital                            |  |               | 12,082,039 
|Warrants                                 |  |               | 245,518    
|Contributed Surplus                      |  |               | 9,270,884  
|Deficit                                  |  |               | (21,379,225
|                                         |  |               |            
|                                         |  |               | 219,216    
|                                         |  |               |            
|                                         |  |               | 629,322    



F-31







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|14. |  | Transition to IFRS (Cont’d)
|--- |  | ---------------------------



The
Canadian GAAP statement of financial position at April 30, 2011 has been reconciled to IFRS as follows:



|                                             |  | April 30, 2011 |            
|-------------------------------------------- |  | -------------- | -----------
|                                             |  | Canadian GAAP  |            
|Assets                                       |  |                |            
|                                             |  |                |            
|Current                                      |  |                |            
|Cash                                         |  |                | 88,684     
|GST and interest receivable                  |  |                | 14,926     
|Prepaid expenses                             |  |                | 81,052     
|Due from related parties                     |  |                | 8,490      
|Advances to REGI US                          |  |                | 865,607    
|Assets held for distribution to shareholders |  |                | -          
|                                             |  |                | 1,058,759  
|                                             |  |                |            
|Investment in Minewest                       |  |                | -          
|Equipment                                    |  |                | 2,169      
|Mineral Property                             |  |                | 232,953    
|                                             |  |                |            
|                                             |  |                | 1,293,881  
|Liabilities                                  |  |                |            
|                                             |  |                |            
|Current                                      |  |                |            
|Accounts payable and accrued liabilities     |  |                | 105,912    
|Due to related parties                       |  |                | 218,878    
|Convertible debt (14 (f))                    |  |                | 19,368     
|Financial instrument liability               |  |                | 35,917     
|                                             |  |                | 380,075    
|                                             |  |                |            
|Shareholders’ equity                         |  |                |            
|Share Capital                                |  |                | 12,372,889 
|Subscription received                        |  |                | 289,200    
|Warrants                                     |  |                | 237,714    
|Contributed Surplus                          |  |                | 9,441,987  
|Equity component of convertible debt         |  |                | 8,485      
|Deficit (14 (e) (f))                         |  |                | (21,625,225
|                                             |  |                | 725,050    
|                                             |  |                |            
|Non-controlling interest (14(e))             |  |                | 188,756    
|                                             |  |                |            
|                                             |  |                | 1,293,881  



F-32







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|14. |  | Transition to IFRS (Cont’d)
|--- |  | ---------------------------



The
Canadian GAAP income statement and statement of comprehensive income for year ended April 30, 2011 have been reconciled to IFRS
as follows:



|                                                                             |  | GAAP
    $ |            |   | IFRS
Adjustments
    $ |  |         | IFRS
    $ | 
|---------------------------------------------------------------------------- |  | ---------- | ---------- | - | ---------------------- |  | ------- | ---------- | 
|                                                                             |  |            |            |   |                        |  |         |            | 
|Expenses                                                                     |  |            |            |   |                        |  |         |            | 
|Amortization                                                                 |  |            | 2,128      |   |                        |  |         |            | 
|Shareholder communication                                                    |  |            | 41,106     |   |                        |  |         |            | 
|Consulting fees                                                              |  |            | 32,209     |   |                        |  |         |            | 
|Foreign exchange loss (gain)                                                 |  |            | (27,048    | ) |                        |  |         |            | 
|Interest expense (14 (f))                                                    |  |            | 10,894     |   |                        |  | (7,108  | )          | 
|Management and directors’ fees                                               |  |            | 61,200     |   |                        |  |         |            | 
|Mineral property maintenance costs                                           |  |            | (7,254     | ) |                        |  |         |            | 
|Office expenses                                                              |  |            | 27,286     |   |                        |  |         |            | 
|Professional fees                                                            |  |            | 99,670     |   |                        |  |         |            | 
|Research and development                                                     |  |            | 107,700    |   |                        |  |         |            | 
|Rent and utilities                                                           |  |            | 15,680     |   |                        |  |         |            | 
|Stock-based compensation                                                     |  |            | 89,776     |   |                        |  |         |            | 
|Transfer agent and filing fees                                               |  |            | 15,101     |   |                        |  |         |            | 
|Travel and promotion                                                         |  |            | 7,605      |   |                        |  |         |            | 
|Wages and benefits                                                           |  |            | 26,750     |   |                        |  |         |            | 
|                                                                             |  |            |            |   |                        |  |         |            | 
|Loss before other items and income taxes                                     |  |            | (502,803   | ) |                        |  | 7,108   |            | 
|                                                                             |  |            |            |   |                        |  |         |            | 
|Other income (expense)                                                       |  |            |            |   |                        |  |         |            | 
|Gain on sale of investee’s shares                                            |  |            | 102,966    |   |                        |  |         |            | 
|Net gain on expiration and modification of financial instrument liability    |  |            | 126,404    |   |                        |  |         |            | 
|Interest income                                                              |  |            | -          |   |                        |  |         |            | 
|Gain (Loss) on investment in Minewest                                        |  |            | -          |   |                        |  |         |            | 
|Unrealized gain (loss) on financial instrument liability                     |  |            | 5,872      |   |                        |  |         |            | 
|                                                                             |  |            |            |   |                        |  |         |            | 
|Loss before income taxes (14(f))                                             |  |            | (267,561   | ) |                        |  | 7,108   |            | 
|                                                                             |  |            |            |   |                        |  |         |            | 
|Income tax recovery (expense) – current                                      |  |            | 10,317     |   |                        |  |         |            | 
|                                                                             |  |            |            |   |                        |  |         |            | 
|Net and comprehensive loss                                                   |  |            | (257,244   | ) |                        |  | 7,108   |            | 
|                                                                             |  |            |            |   |                        |  |         |            | 
|Net and comprehensive income (loss) attributable to:                         |  |            |            |   |                        |  |         |            | 
|                                                                             |  |            |            |   |                        |  |         |            | 
|Non-controlling interest (14(e))                                             |  |            | (11,244    | ) |                        |  | 59,258  |            | 
|Shareholders of the Company                                                  |  |            | (246,000   | ) |                        |  | (52,150 | )          | 
|                                                                             |  |            | (257,244   | ) |                        |  | 7,108   |            | 
|                                                                             |  |            |            |   |                        |  |         |            | 
|Loss per share – basic and diluted                                           |  |            | (0.01      | ) |                        |  |         |            | 
|                                                                             |  |            |            |   |                        |  |         |            | 
|Weighted average number of common shares outstanding – basic
    and diluted |  |            | 29,000,177 |   |                        |  |         |            | 



F-33







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|14. |  | Transition to IFRS (Cont’d)
|--- |  | ---------------------------



The
Canadian GAAP income statement and statement of comprehensive income for the year ended April 30, 2011 have been reconciled to
IFRS as follows:



|                                                                          |  |      |          |   | IFRS        |  |        |      | 
|------------------------------------------------------------------------- |  | ---- | -------- | - | ----------- |  | ------ | ---- | 
|                                                                          |  | GAAP |          |   | Adjustments |  |        | IFRS | 
|                                                                          |  | $    |          |   | $           |  |        | $    | 
|                                                                          |  |      |          |   |             |  |        |      | 
|Cash flows used in operating activities                                   |  |      |          |   |             |  |        |      | 
|Net loss                                                                  |  |      | (257,244 | ) |             |  | 7,108  |      | 
|Adjustments to reconcile loss to net cash used by operating activities:   |  |      |          |   |             |  |        |      | 
|Amortization                                                              |  |      | 2,128    |   |             |  |        |      | 
|Gain on sale of investee’s shares                                         |  |      | (102,966 | ) |             |  |        |      | 
|Imputed interest                                                          |  |      | 7,853    |   |             |  | (7,108 | )    | 
|Net gain on expiration and modification of financial instrument liability |  |      | (126,404 | ) |             |  |        |      | 
|Stock-based compensation                                                  |  |      | 89,776   |   |             |  |        |      | 
|Unrealized (gain) loss on financial instrument liability                  |  |      | (5,872   | ) |             |  |        |      | 
|                                                                          |  |      |          |   |             |  |        |      | 
|Changes in non-cash working capital items:                                |  |      |          |   |             |  |        |      | 
|Bank indebtedness                                                         |  |      | (494     | ) |             |  |        |      | 
|GST and interest receivable                                               |  |      | (5,044   | ) |             |  |        |      | 
|Prepaid expenses                                                          |  |      | (79,636  | ) |             |  |        |      | 
|Due from related parties                                                  |  |      | 19,965   |   |             |  |        |      | 
|Accounts payable and accrued liabilities                                  |  |      | 48,051   |   |             |  |        |      | 
|Due to related parties                                                    |  |      | 72,137   |   |             |  |        |      | 
|Income taxes payable                                                      |  |      | (10,317  | ) |             |  |        |      | 
|                                                                          |  |      |          |   |             |  |        |      | 
|                                                                          |  |      | (348,067 | ) |             |  | -      |      | 
|                                                                          |  |      |          |   |             |  |        |      | 
|Cash flows provided by investing activities                               |  |      |          |   |             |  |        |      | 
|(Advances to) repayments from equity accounted investee                   |  |      | (279,748 | ) |             |  |        |      | 
|Proceeds on sale of investee’s shares and warrants                        |  |      | 76,466   |   |             |  |        |      | 
|Mineral property costs                                                    |  |      | (32,953  | ) |             |  |        |      | 
|Purchase of equipment                                                     |  |      | (951     | ) |             |  |        |      | 
|                                                                          |  |      |          |   |             |  |        |      | 
|                                                                          |  |      | (237,186 | ) |             |  | -      |      | 
|                                                                          |  |      |          |   |             |  |        |      | 
|Cash flows provided by financing activities                               |  |      |          |   |             |  |        |      | 
|Proceeds on convertible debt                                              |  |      | 50,000   |   |             |  |        |      | 
|Repayment on convertible debt                                             |  |      | (30,000  | ) |             |  |        |      | 
|Proceeds from share subscriptions                                         |  |      | 289,200  |   |             |  |        |      | 
|Proceeds from share issuances, net of issuance costs                      |  |      | 364,373  |   |             |  |        |      | 
|                                                                          |  |      | 673,573  |   |             |  | -      |      | 
|                                                                          |  |      |          |   |             |  |        |      | 
|Increase (decrease) in cash                                               |  |      | 88,320   |   |             |  |        |      | 
|Cash, beginning                                                           |  |      | 364      |   |             |  |        |      | 
|Cash, ending                                                              |  |      | 88,684   |   |             |  | -      |      | 
|                                                                          |  |      |          |   |             |  |        |      | 
|Supplemental Disclosures                                                  |  |      |          |   |             |  |        |      | 
|Interest paid                                                             |  |      | 2,844    |   |             |  |        |      | 
|Income taxes paid                                                         |  |      | -        |   |             |  |        |      | 



F-34







Reg Technologies Inc.

(A Development Stage Company)

Notes to Consolidated Financial Statements

(Expressed in Canadian Dollars)

|For
    the years ended April 30, 2012 and 2011
|-----------------------------------------------



|15. |  | Subsequent Events
|--- |  | -----------------



Convertible
Debenture



On
June 1, 2012, the convertible debenture for total principal of $20,000 matured and renewed to June 1, 2013. The debenture bears
interests at 8% per annum payable monthly and is unsecured. The unpaid amount of principal can be converted at any time at the
holder’s option into shares of the Company’s common stock at a price of $0.20 per share.



Warrants
extended



On
June 9, 2012, 1,063,300 warrants of the Company exercisable at $0.20 per share into the Company’s common stock were extended
to June 9, 2013.



F-35







|ITEM 19. | EXHIBITS
|-------- | --------



Documents filed as exhibits to this annual
report:



|Number    |  | Description                                                                                                                                                                                                                                                                                          |  |    
|--------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---
|          |  |                                                                                                                                                                                                                                                                                                      |  |    
|1.1       |  | Articles of Incorporation with Bylaws dated October 6, 1982                                                                                                                                                                                                                                          |  | (1)
|1.2       |  | Certificate of Name Change and Special Resolution dated February 23, 1993                                                                                                                                                                                                                            |  | (1)
|1.3       |  | Memorandum and articles of incorporation amended effective April 5, 2005                                                                                                                                                                                                                             |  | (9)
|2.1       |  | Special rights and restrictions attaching to the Common Shares without par value and the Class A non-voting shares without par value. Special resolution dated November 25, 1985                                                                                                                     |  | (1)
|4. (a) 1  |  | Contract among the Company, Rand Technologies Corp. and Rand Energy Group Inc. regarding formation of Rand Energy Group Inc. and arrangement of various inter- related matters, dated March 28, 1990                                                                                                 |  | (1)
|4. (a) 2  |  | Energy Group Acquisition Agreement among the Company, Rand Cam-Engine Corporation, James L. McCann and Rand Energy Group Inc. regarding acquisition of technology, and rights to the Rand Cam-Engine, dated March 28, 1990                                                                           |  | (1)
|4. (a) 3  |  | Contract among the Company, Rand Cam-Engine Corporation Rand Energy Group Inc. and James L. McCann regarding arrangement of various inter-related matters concerning issuance of shares, payments, royalties, etc., dated July 30, 1992                                                              |  | (1)
|4. (a) 4  |  | Agreement with Center for Industrial Research Applications (CIRA) regarding Year 2: Engine Refinement and Testing on the Rand-Cam Engine                                                                                                                                                             |  | (1)
|4. (a) 5  |  | Research & Development Agreement Between Members of the Consortium of Reg Technologies Inc., Rand Energy Group Inc., Hercules Incorporated and The West Virginia University Research Corporation, dated May 10, 1994                                                                                 |  | (1)
|4. (a) 6  |  | Agreement dated October 31, 1995 between the Company and REGI U.S., Inc. regarding assignment of Machine Vision Technology agreement with Integral Vision Systems, Inc.                                                                                                                              |  | (2)
|4. (a) 7  |  | Cooperative Agreement between the Company and Global Aircraft Corporation regarding NASA General Aviation Propulsion Program                                                                                                                                                                         |  | (3)
|4. (a) 8  |  | Agreement dated June 22, 1997 between John Weston and the Company regarding the acquisition of rights to Air/Vapour Flow Systems by the Company from Weston                                                                                                                                          |  | (4)
|4. (a) 9  |  | Agreement dated September 23, 1997 between the Company, REGI U.S., Inc. and SMR Investments Ltd. regarding the assignment of the above agreement by the Company to REGI and SMR pending regulatory approval of the original agreement                                                                |  | (4)
|4. (a) 10 |  | Agreement dated December 31, 1997 between the Company REGI U.S., Inc. and SMR Investments Ltd. regarding the Canadian rights to the AVFS and repayment of advances to Weston by SMR                                                                                                                  |  | (4)
|4. (a) 11 |  | Joint Venture Agreement dated July 28, 1998 between REGI U.S., Inc and Trans Air Manufacturing Corporation regarding development and manufacturing of a prototype Bus Compressor                                                                                                                     |  | (4)
|4. (a) 12 |  | Agreement dated August 5, 1998 between the Company and T.W. Blasingame Company, Inc. (Blasingame) regarding the licensing of certain Rand Cam/Direct Charge Engine manufacturing rights to Blasingame and licensing of certain rights to the "Vane Restraint Mechanism" by Blasingame to the Company |  | (5)
|4. (a) 13 |  | Cooperative and Licensing Agreement dated December 14, 1998 between the Company, REGI U.S., Inc. Rand Energy Group, Inc. USA and Global Aircraft Corporation regarding the NASA SBIR Phase I Contract for development of the Rand-Cam Diesel Aircraft Engine                                         |  | (5)
|4. (a) 14 |  | Agreement made as of October 27, 2000 with GHM Inc. regarding 50% interest in the rights to the hydrogen separator technology                                                                                                                                                                        |  | (7)
|4. (a) 15 |  | Agreement between Radian, Inc., Reg Technologies Inc., REGI U.S., Inc. and Rand Energy Group Inc. made as of April 24, 2002                                                                                                                                                                          |  | (8)





51









|Number    |  | Description                                                                                                                                                                               |  |     
|--------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----
|4. (a) 16 |  | Agreement between REGI and Advanced Ceramics Research dated March 20, 2002                                                                                                                |  | (8) 
|4. (a) 17 |  | Agreement between REGI U.S, Inc. and Reg Technologies Inc. and Anuvu Incorporation dated June 29, 2005                                                                                    |  | (9) 
|4. (b) 1  |  | Management Agreement between the Company and SMR Investments Ltd., dated April 2, 1993                                                                                                    |  | (1) 
|4. (b) 2  |  | Agreement between Brian Cherry, Sky Technologies, Inc. and Rand Energy Group Inc., regarding U.S. rights to the Rand Cam/Direct Charge Engine dated August 20, 1993                       |  | (1) 
|4. (b) 3  |  | Employment Agreement between Sky Technologies, Inc. and Patrick Badgley dated February 9, 1994                                                                                            |  | (1) 
|4. (b) 4  |  | Management Agreement between Sky Technologies, Inc. and Access Information Services, Inc., dated April 1, 1994                                                                            |  | (1) 
|4. (b) 5  |  | Agreement between the Company and Rand Energy Group Inc. granting the Company rights to negotiate and sell licenses and marketing rights for the Rand Cam Engine, dated February 27, 1992 |  | (1) 
|4. (b) 6  |  | Management Agreement dated May 1, 1996 between the Company and SMR Investments Ltd.                                                                                                       |  | (3) 
|8.1       |  | List of Parents and Subsidiaries of the Company                                                                                                                                           |  | (10)
|11.1      |  | Code of Ethics                                                                                                                                                                            |  | (11)
|12.1      |  | Certification pursuant to Title 18, United States Code, Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - CEO                                           |  | (12)
|12.2      |  | Certification pursuant to Title 18, United States Code, Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - CFO                                           |  | (12)
|13.1      |  | Certification pursuant to Title 18, United States Code, Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - CEO                                           |  | (12)
|13.2      |  | Certification pursuant to Title 18, United States Code, Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - CFO                                           |  | (12)
|15.1      |  | Consent of ACAL Group, Chartered Accountant                                                                                                                                               |  | (12)



|1) |  | Incorporated by reference to the Registrant’s Registration Statement on Form
20-F filed on June 15, 1994 with the US Securities and Exchange Commission
|-- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------

|2) |  | Incorporated by reference to the Registrant’s Annual Report on Form 20-F
for the fiscal year ended April 30, 1996
|-- |  | -----------------------------------------------------------------------------------------------------------------

|3) |  | Incorporated by reference to the Registrant’s Annual Report on Form 20-F
for the fiscal year ended April 30, 1997
|-- |  | -----------------------------------------------------------------------------------------------------------------

|4) |  | Incorporated by reference to the Registrant’s Annual Report on Form 20-F
for the fiscal year ended April 30, 1998
|-- |  | -----------------------------------------------------------------------------------------------------------------

|5) |  | Incorporated by reference to the Registrant’s Annual Report on Form 20-F
for the fiscal year ended April 30, 1999
|-- |  | -----------------------------------------------------------------------------------------------------------------

|6) |  | Incorporated by reference to the Registrant’s Annual Report on Form 20-F
for the fiscal year ended April 30, 2000
|-- |  | -----------------------------------------------------------------------------------------------------------------

|7) |  | Incorporated by reference to the Registrant’s Annual Report on Form 20-F
for the fiscal year ended April 30, 2001
|-- |  | -----------------------------------------------------------------------------------------------------------------

|8) |  | Incorporated by reference to the Registrant’s Annual Report on Form 20-F
for the fiscal year ended April 30, 2002
|-- |  | -----------------------------------------------------------------------------------------------------------------

|9) |  | Incorporated by reference to the Registrant’s Annual Report on Form 20-F
for the fiscal year ended April 30, 2006
|-- |  | -----------------------------------------------------------------------------------------------------------------

|10) |  | Incorporated by reference to the Registrant’s Annual Report on Form 20-F
for the fiscal year ended April 30, 2009
|--- |  | -----------------------------------------------------------------------------------------------------------------

|11) |  | Incorporated by reference to the Registrant’s Annual Report on Form 20-F
for the fiscal year ended April 30, 2010 filed on December 1, 2010
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------

|12) |  | Exhibits filed herewith.
|--- |  | ------------------------





52







SIGNATURE PAGE



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





|       |                    |  | REG TECHNOLOGIES INC.
|------ | ------------------ |  | ---------------------
|       |                    |  |                      
|Dated: | September 12, 2012 |  | By:                  
|       |                    |  |                      
|       |                    |  |                      





53