##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 
 FORM 20-F
 
 o
    
    REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF
1934
 OR
 o
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE FISCAL YEAR ENDED FEBRUARY 28, 2006
 OR
 þ
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 OR
 o
    
    SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Date of event requiring this shell company report
 For the transition period from March 1, 2006 to December 31, 2006
 Commission File Number 0-20420
 CALCITECH LTD.
  A CORPORATION FORMED UNDER THE LAWS OF BERMUDA
  Switzerland
   Common Shares
   o Yes       þ No
 þ Yes       o No
 þ o
  o o þ
 þ o
 o þ




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##### Table of Contents



PagePART IItem 1.
    
    Identity of Directors, Senior Management and Advisors
    
    
    1Item 2.
    
    Offer Statistics and Expected Timetable
    
    
    1Item 3.
    
    Key Information
    
    
    1A.
    
    Selected Financial Data
    
    
    1B.
    
    Capitalization and Indebtedness
    
    
    2C.
    
    Reasons for the Offer and Use of Proceeds
    
    
    3D.
    
    Risk Factors
    
    
    3Item 4A.
    
    Unresolved Staff Comments
    
    
    5Item 4.
    
    Information on the Company
    
    
    5A.
    
    History and Development of the Company
    
    
    5B.
    
    Business Overview
    
    
    6C.
    
    Property, Plant and Equipment
    
    
    19Item 5.
    
    Operating and Financial Review and Prospects
    
    
    19A.
    
    Operating Results
    
    
    24B.
    
    Liquidity and Capital Resources
    
    
    26C.
    
    Research and Development, Patents and Licenses, etc.
    
    
    28D.
    
    Trend Information
    
    
    28E.
    
    Off Balance Sheet Arrangements
    
    
    28F.
    
    Tabular Disclosure of Contractual Obligations
    
    
    29Item 6.
    
    Directors, Senior Management and Employees
    
    
    29A.
    
    Directors, Senior Management
    
    
    29B.
    
    Compensation
    
    
    31C.
    
    Board Practices
    
    
    31D.
    
    Employees
    
    
    32E.
    
    Share Ownership
    
    
    32Item 7.
    
    Major Shareholders and Related Party Transactions
    
    
    33A.
    
    Major Shareholders
    
    
    33B.
    
    Related Party Transactions
    
    
    33C.
    
    Interest of Experts and Counsel
    
    
    34Item 8.
    
    Financial Statements
    
    
    34A.
    
    Consolidated Statements and Other Financial Information
    
    
    34B.
    
    Significant Changes
    
    
    34Item 9.
    
    The Offer and Listing
    
    
    35A.
    
    Price History of Stock
    
    
    35B.
    
    Plan of Distribution
    
    
    36C.
    
    Markets
    
    
    36D.
    
    Selling Shareholders
    
    
    37E.
    
    Dilution
    
    
    37F.
    
    Expenses of the Issue.
    
    
    37Item 10.
    
    Additional Information
    
    
    37A.
    
    Share Capital
    
    
    37B.
    
    Memorandum and Articles of Association
    
    
    37C.
    
    Material Contracts
    
    
    38D.
    
    Exchange Controls
    
    
    39




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PageE.
    
    Taxation
    
    
    39F.
    
    Dividends and Paying Agents
    
    
    43G.
    
    Statement of Experts
    
    
    43H.
    
    Documents on Display
    
    
    43I.
    
    Subsidiary Information
    
    
    43Item 11.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    43Item 12.
    
    Description of Securities Other than Equity Securities
    
    
    43Item 13.
    
    Defaults, Dividend Arrearages and Delinquencies
    
    
    43Item 14.
    
    Material
Modifications to the Rights of Security Holders and Use of Proceeds
    
    
    44Item 15.
    
    Controls and Procedures
    
    
    44Item 16.
    
    [Reserved]
    
    
    44ITEM 16A.
    
    Audit Committee Financial Report
    
    
    44ITEM 16B.
    
    Code Of Ethics
    
    
    44ITEM 16C.
    
    Principal Accountant Fees And Services
    
    
    45ITEM 16D.
    
    Exemptions From The Listing Standards For Audit Committees
    
    
    45ITEM 16E.
    
    Purchases Of Equity Securities By The Issuer And Affiliated Purchasers
    
    
    45Item 17.
    
    Financial Statements
    
    
    46Item 18.
    
    Financial Statements
    
    
    46Item 19.
    
    Exhibits
    
    
    46EXHIBIT 12.1EXHIBIT 12.2EXHIBIT 13.1




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##### Table of Contents



PART I
 The following discussion contains forward-looking statements regarding events and financial
trends, which may affect CalciTech Ltds (CalciTech, the Company, we, our or us) future
operating results and financial position. Such statements are subject to risks and uncertainties
that could cause our actual results and financial position to differ materially from those
anticipated in forward-looking statements. These factors include, but are not limited to, the fact
that we are in the development stage, will need additional financing to build our proposed plants
and will be subject to certain technological risks associated with scaling up production to a
commercial level, all of which factors are set forth in more detail in the section entitled Risk
Factors in Item 3.D. and Operating and Financial Review and Prospects at Item 5.
 Calcitech has historically prepared its consolidated financial statements on the basis of a
fiscal year beginning on March 1 and ending on the last day of February. On March 7, 2006 the
Board of Directors of the Company approved a change of the Companys fiscal year end from a
twelve-month period ending on the last day of February to a ten-month period ending on December 31.
The Company is making this change in order to align its fiscal year end with the calendar year.
As a requirement of this change, the Company is reporting results for the ten-month period from
March 1, 2006 to December 31, 2006 as a separate transition period in this Transition Report filed
on Form 20-F . As of January 1, 2007, the Companys fiscal year will begin on January 1 and end on
December 31 and its fiscal quarters will end on the last day of March, June, September and December
of each year.
 
 Item 1. Identity of Directors, Senior Management and Advisors
  
 Item 2. Offer Statistics and Expected Timetable
  
 Item 3. Key Information
   
 A.
    
    Selected Financial Data
  1




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##### Table of Contents



(unaudited)10 months to
    
    
    10 months to
    
    
    year to
    
    
    year to
    
    
    year to
    
    
    year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005
    
    
    Feb 28, 2004
    
    
    Feb 28, 2003Operations Data
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $Revenue
    
    
    47,640
    
    
    
    13,632
    
    
    
    59,805
    
    
    
    75,000
    
    
    
    51,000
    
    
    NILIncome (loss) from operations
    
    
    (394,000
    )
    
    
    (1,169,000
    )
    
    
    (1,438,000
    )
    
    
    (1,319,000
    )
    
    
    (2,025,000
    )
    
    
    (1,723,000
    )Net loss
    
    
    (620,000
    )
    
    
    (1,620,000
    )
    
    
    (1,858,000
    )
    
    
    (1,668,000
    )
    
    
    (2,244,000
    )
    
    
    (2,188,000
    )Number of shares
    
    
    88,899,675
    
    
    
    88,899,675
    
    
    
    88,899,675
    
    
    
    79,899,675
    
    
    
    63,899,675
    
    
    
    53,889,165Loss per Common Share
    
    
    (0.007
    )
    
    
    (0.02
    )
    
    
    (0.02
    )
    
    
    (0.03
    )
    
    
    (0.04
    )
    
    
    (0.04
    )Balance Sheet DataCumulative DeferredDevelopment Expenditure
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Total Assets
    
    
    3,244,000
    
    
    
    1,390,000
    
    
    
    2,507,000
    
    
    
    1,481,000
    
    
    
    1,036,000
    
    
    
    397,000Long Term Obligations
    
    
    1,993,000
    
    
    
    2,261,000
    
    
    
    847,000
    
    
    
    1,577,000
    
    
    
    1,443,000
    
    
    
    1,378,000Capital stock
    
    
    1,813,000
    
    
    
    1,805,000
    
    
    
    1,813,000
    
    
    
    1,805,000
    
    
    
    1,792,000
    
    
    
    1,784,000Total Stockholders Equity
    
    
    (76,000
    )
    
    
    (2,167,000
    )
    
    
    730,000
    
    
    
    (1,141,000
    )
    
    
    (2,571,000
    )
    
    
    (2,574,000
    )/ (Deficiency)U.S. GENERALLY ACCEPTED ACCOUNTING PRINCIPLESOperations Data
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $Revenue
    
    
    47,640
    
    
    
    13,632
    
    
    
    59,805
    
    
    
    75,000
    
    
    
    51,000
    
    
    NILIncome (Loss) from operations
    
    
    (394,000
    )
    
    
    (1,169,000
    )
    
    
    (1,438,000
    )
    
    
    (1,319,000
    )
    
    
    (2,025,000
    )
    
    
    (1,676,000
    )Net Profit (Loss)
    
    
    251,000
    
    
    
    (2,086,000
    )
    
    
    (4,278,000
    )
    
    
    (797,000
    )
    
    
    (2,803,000
    )
    
    
    (3,019,000
    )Loss Per Common Share
    
    
    0
    
    
    
    (0.03
    )
    
    
    (0.05
    )
    
    
    (0.03
    )
    
    
    (0.05
    )
    
    
    (0.06
    )Balance Sheet DataDeferred Development Expenditure
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Total Assets
    
    
    3,244,000
    
    
    
    1,390,000
    
    
    
    2,507,000
    
    
    
    1,481,000
    
    
    
    1,036,000
    
    
    
    397,000Long Term Obligations
    
    
    6,606,000
    
    
    
    6,874,000
    
    
    
    5,459,000
    
    
    
    5,497,000
    
    
    
    5,363,000
    
    
    
    5,307,000Total Stockholders Deficiency
    
    
    (5,874,000
    )
    
    
    (9,267,000
    )
    
    
    (5,015,000
    )
    
    
    (6,919,000
    )
    
    
    (8,942,000
    )
    
    
    (6,756,000
    )
 
 B.
    
    Capitalization and Indebtedness
  2




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C.
    
    Reasons for the Offer and Use of Proceeds
  
 D.
    
    Risk Factors
   We Have Incurred Net Losses Since Our Inception and Expect Losses to Continue . .
 If We Are Unable to Raise Funds Our Growth May Be Adversely Affected. 
  Our Inability to Protect Our Patents and Other Proprietary Rights Could Adversely Impact Our
Competitive Position.
 3




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Failure to Protect Our Trade Secrets May Assist Our Competitors.
 We Have Never Produced SCC on a Commercial Scale.
 Our Competitors May Develop a Competing Technology.
 Our SCC Product is at Initial Market Introduction and We Are Not Sure the Market Will Accept
it.
 All of our operations are located outside of the United States, substantially all of our
sales from samples are generated outside of the United States and all of our assets are located
outside of the United States, subjecting us to risks associated with international operations.
 
    
    difficulties in collecting accounts receivable and longer collection periods,
    
    changes in overseas economic conditions,
    
    fluctuations in currency exchange rates,
    
    potentially weaker intellectual property protections,
 4




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
    
    changing and conflicting local laws and other regulatory requirements,
    
    political and economic instability,
    
    war, acts of terrorism or other hostilities,
    
    potentially adverse tax consequences,
    
    difficulties in staffing and managing foreign operations, or
    
    tariffs or other trade regulations and restrictions.
 Our results of operations may be adversely impacted by currency fluctuations.
 Penny stock rules may make it more difficult to trade our common shares .
 
 Item 4A. Unresolved Staff Comments
  
 Item 4. Information on the Company
 
 A.
    
    History and Development of the Company
   5




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B.
    
    Business Overview
 Synthetic Calcium Carbonate (SCC)
    6




---



##### Table of Contents



Our SCC Process
  
 Conventional PCC Process
  SCC Versus PCC Production Process
  7




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The SCC Process
 
 8




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##### Table of Contents



Conventional PCC Production
 
  
    
    The SCC process does not require lime slaking and classification steps. This gives
us significant advantages in both quality and cost effectiveness.
    
    The SCC process includes a digester circuit that facilitates the use of any waste
lime, such as carbide lime, thereby removing the need to purchase lime as is required
in the conventional process.
    
    The SCC process includes a promoter recycle loop to enhance the process economics.
Any impurities in the lime feed are rejected as insolubles in the digester resulting in
a final SCC product of the highest purity. SCC is independent of the purity of the
starting material and is always superior to that of the starting material.
 9




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
    
    In the SCC process, the total lime content is present in solution whereas in the
conventional process the lime is present in suspension (milk-of-lime). The reaction
times in the SCC process are therefore much shorter than in the conventional process as
the SCC process eliminates the slow lime dissolution step. This advantage allows for
the use of smaller equipment as well as providing a much higher degree of control over
the process. The SCC solution process is therefore more flexible and easier controlled
than the conventional suspension process enabling a narrower particle size
distribution. Additionally, the higher level of control enables SCC to tailor make
products in a wide range of crystal sizes, from nano-sized product (< 0.1micron) up
to 20micron, so that various markets can be served.
 Patents
  Development of the SCC Technology
    10




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2
  TM TM
 Development and Marketing of SCC Product
 2
  Paper Industry
 TM TM TM TM TM
 CalciLS TM Products. TM TM 2 TM TM TM
 11




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TM TM
 CalciSG TM Products. TM TM
 CalciRG TM Products. TM TM TM
  TM
 TM TM
   
    
    Is the only product to show consistent low viscosity at all shear levels:applying
our SCC in a coatings mix will positively influence the running behaviour of the paper
producing machinery, leading to increased productivity and lower costs.
    
    Imparts superior whiteness and brightness: these are essential product quality
parameters, required to produce high quality high-end paper.
 12




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
    
    Leads to greater opacity:another very important quality parameter, especially
important for light-weight papers.
    
    Has superior print gloss:this parameter greatly determines the quality of the
printed product. Our SCC imparts a higher gloss on the coated paper, but over and
above that, the contrast between the print and background shows superiority as well.
    
    Gives slow ink settling:this leads to lower ink consumption and hence significant
cost savings for the printer.
    
    Provides superior rotogravure printability.
 TM TM
 TM TM .
 TM TM
 Food, Pharmaceutical and Cosmetic Industries
 CalciSP TM Product TM TM
 13




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TM
 TM
 Plastic, Sealant, Rubber and Adhesives Industry
 CalciRC TM Product TM TM
 Paint Industry
  Business Activity: Small scale production plant
  Business Activity: Norway
   14




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Business Activity: Germany
 2
     Business Activity: Republic of Slovakia
    15




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##### Table of Contents



Business Activity: Americas
  Bubbletube
     Other Products, Patents and Licenses
  16




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Financing
       Revenue
  17




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Dependence on Customers and Suppliers
  Project and Product Development
   Organizational Structure:
 
 18




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C.
    
    Property, Plant and Equipment
   
 
 Item 5. Operating and Financial Review and Prospects
   Overview
    
    
    Grant from European Structural fund: up to 50% of the capital expenditure for the
first plant;
    
    50% arranged by HSN Nordbank AG of Hamburg;
    
    a state guarantee provided by the State of Sachsen Anhalt of up to 80% over the
non-grant portion
 19




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Critical accounting policies
  Going concern
   Research and Development
  
    
    the technical feasibility of completing the intangible asset so that it will be
available for use or sale;
    
    its intention and ability to use or sell the intangible asset;
    
    the existence of a market for the output of the intangible asset or the intangible
asset itself;
    
    the availability of adequate technical resources to complete the development;
    
    the availability of adequate financial and other resources to complete the
development and to use or sell the intangible asset, subject to our ability to continue
as a going concern, as described in Note 2.1 to our financial statements;
    
    its ability to measure the expenditure attributable to the intangible asset during
its development reliably.
 20




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U.S. GAAP Reconciliation
   10 months
    
    
    Unaudited
    
    
    year to
    
    
    year toto Dec 31,
    
    
    10 months to
    
    
    Feb 28,
    
    
    Feb 28,
    
    
    Cumulative to2006
    
    
    Dec 31, 2005
    
    
    2006
    
    
    2005
    
    
    Dec 31, 2006Net loss in accordance with IFRS
    
    $
    (620
    )
    
    $
    (1,619
    )
    
    $
    (1,858
    )
    
    $
    (1,668
    )
    
    
    (43,690
    )Interest on convertible debentures
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    (895
    )Amortisation of debt discount for credit facility
    
    
    (65
    )
    
    
    (63
    )
    
    
    (409
    )
    
    
    (579
    )
    
    
    (4,059
    )Share options accounting
    
    
    0
    
    
    
    (86
    )
    
    
    (103
    )
    
    
    (67
    )
    
    
    (384
    )Change in fair value of derivative financial instruments
    
    
    947
    
    
    
    (405
    )
    
    
    (1,907
    )
    
    
    1,517
    
    
    
    152Net income (loss) in accordance with US GAAP
    
    $
    262
    
    
    $
    (2,173
    )
    
    $
    (4,277
    )
    
    $
    (797
    )
    
    $
    (48,876
    )Basic and dilutive net loss per share under US GAAP
    
    
    0.00
    
    
    
    (0.03
    )
    
    
    (0.05
    )
    
    
    (0.01
    )Shareholders equity (deficiency) under IFRS
    
    
    (76
    )
    
    
    (2,167
    )
    
    
    731
    
    
    
    (1,141
    )Convertible debentures
    
    
    (4,613
    )
    
    
    (4,613
    )
    
    
    (4,613
    )
    
    
    (3,920
    )Shareholders equity (deficiency) adjustment for opening
balance for derivative financial instruments
    
    
    (1,133
    )
    
    
    (1,858
    )
    
    
    (1,858
    )
    
    
    (1,870
    )Change in fair value of derivative financial instruments
    
    
    947
    
    
    
    (405
    )
    
    
    (1,907
    )
    
    
    1,517Conversion of credit facility
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    350To record derivative liability upon grant of 13.5 million
warrants in connection with private placement
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    (1,560
    )To remove derivative liability upon exercise of
9 million warrants
    
    
    0
    
    
    
    0
    
    
    
    2,612
    
    
    
    0Re-class of derivative liability to share premium,
holders option and contributed surplus for
repayments of credit facility
    
    
    79
    
    
    
    3
    
    
    
    429
    
    
    
    284Interest on convertible debentures
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Interest expense for amortisation of beneficial
conversion feature
    
    
    (65
    )
    
    
    (63
    )
    
    
    (409
    )
    
    
    (579
    )Reclass of derivative liability due to removal of
conversion option on facility on August 15, 2006
    
    
    241
    
    
    
    0
    
    
    
    0
    
    
    
    0Start up costs
    
    
    (1,254
    )
    
    
    0
    
    
    
    0
    
    
    
    0Shareholders deficiency under US GAAP
    
    $
    (5,874
    )
    
    $
    (9,103
    )
    
    $
    (5,015
    )
    
    $
    (6,919
    )
 21




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Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005Total assets: IFRS
    
    $
    3,244
    
    
    $
    1,390
    
    
    $
    2,508
    
    
    $
    1,481Start up costs
    
    
    (1,254
    )
    
    
    0
    
    
    
    0
    
    
    
    0Total assets: US GAAP
    
    $
    1,990
    
    
    $
    1,390
    
    
    $
    2,508
    
    
    $
    1,481Total liabilities: IFRS
    
    
    3,320
    
    
    
    3,557
    
    
    
    1,777
    
    
    
    2,622Convertible debentures
    
    
    4,613
    
    
    
    4,613
    
    
    
    4,613
    
    
    
    3,920Debt discount
    
    
    (69
    )
    
    
    (347
    )
    
    
    (55
    )
    
    
    (60
    )Derivative liability
    
    
    0
    
    
    
    2,652
    
    
    
    1,188
    
    
    
    1,899Total liabilities: US GAAP
    
    $
    7,864
    
    
    $
    10,475
    
    
    $
    7,523
    
    
    $
    8,381
    New accounting pronouncements under IFRS and U.S. GAAP
  22




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23




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##### Table of Contents



General
 
 A. Operating Results
 December 31, 2006 compared to December 31, 2005.
 Revenue
 Expenses
 Net Loss
 February 28, 2006 compared to February 29, 2005.
 Revenue
 24




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Expenses
 Net Loss
 February 28, 2005 compared to February 29, 2004.
 Revenue
 Expenses
 Net Loss
 February 29, 2004 compared to February 28, 2003.
 Revenue
 Expenses
 Net Loss
  Foreign Currency Exchange Rates
  25




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Inflation
  Interest Rate Sensitivity
  
 B. Liquidity and Capital Resources
      26




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27




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##### Table of Contents



C. Research and Development, Patents and Licenses, etc.
  
 D. Trend Information
  
 E. Off Balance Sheet Arrangements
  28




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##### Table of Contents



F. Tabular Disclosure of Contractual Obligations
  Dec 31, 2006
    
    
    Payments Due by PeriodContractual Obligations
    
    Total
    
    
    < 1 year
    
    
    1-3 years
    
    
    4-5 years
    
    
    > 5 yearsCredit facility
    
    $
    1,580
    
    
    $
    0
    
    
    $
    1,580
    
    
    $
    
    
    
    $Convertible debentures
    
    
    0
    
    
    
    0Debenture Interest payable
    
    
    232
    
    
    
    232Equipment leasing
    
    
    0
    
    
    
    0Property rental
    
    
    22,441
    
    
    
    22,441Total Contractual Cash Obligations
    
    
    24,253
    
    
    
    22,673
    
    
    
    1,580
    
    
    
    0
    
    
    
    0
  Credit facility.
 Convertible Debentures
 Interest payable
  10 months to
    
    
    Unaudited
    
    
    year to
    
    
    year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005Total non-current liabilities: IFRS
    
    $
    1,993
    
    
    $
    2,261
    
    
    $
    846
    
    
    $
    1,577Convertible debentures
    
    
    4,613
    
    
    
    4,613
    
    
    
    4,613
    
    
    
    3,920Total non-current liabilities: US GAAP
    
    $
    6,606
    
    
    $
    6,874
    
    
    $
    5,459
    
    
    $
    5,497
 
 Item 6. Directors, Senior Management and Employees
 
 A. Directors, Senior Management
  29




---



##### Table of Contents



Name
    
    Age
    
    Positions Held
    
    PeriodRoger A. Leopard
    
    
    64
    
    
    Director
    
    June 2001-PresentPresident and Chief
Executive Officer
    
    February 2000  PresentAlan Edward Perkins
    
    
    69
    
    
    Director
    
    February 2005  PresentJohn M. Smith
    
    
    71
    
    
    Director
    
    August 1993  PresentHoward Edmund 
Browning
    
    
    63
    
    
    Director
    
    March 2005  PresentNicholas Meadmore
    
    
    56
    
    
    Chief Financial Officer
    
    September 2005  Present
 Roger A. Leopard.
 Alan Edward Perkins.
 John M. Smith.
 30




---



##### Table of Contents



Howard Edmund Browning.
 Nicholas Meadmore
 
 B. Compensation
  Directors Compensation
  Executive Compensation
  SUMMARY COMPENSATION TABLE
 Long Term CompensationAnnual Compensation
    
    Awards
    
    and PayoutsSecuritiesName and
    
    Fiscal
    
    Cash
    
    Other Annual
    
    Restricted
    
    Underlying
    
    LTIP
    
    All OtherPrincipal Position
    
    Period
    
    Compensation
    
    Compensation
    
    Stock
    
    Options
    
    Payouts
    
    Compensation$
    
    $
    
    Award(s)
    
    #
    
    $
    
    $Roger A. Leopard
    
    Dec 2006
    
    
    100,000
    
    
    Nil
    
    Nil
    
    
    500,000
    
    
    Nil
    
    NilC.E.O. & PresidentNicholas Meadmore
    
    Dec 2006
    
    
    75,486
    
    
    Nil
    
    Nil
    
    Nil
    
    Nil
    
    NilC.F.O.
 
 C. Board Practices
  31




---



##### Table of Contents



D. Employees
  
 E. Share Ownership
  Number ofName of Beneficial Owner
    
    Shares
    
    PercentRoger A. Leopard
    
    
    95,625
    
    
    
    0.12
    %John M. Smith
    
    
    225,668
    
    
    
    0.28
    %Alan Edward Perkins
    
    
    100,000
    
    
    
    0.10
    %Howard Edmund Browning
    
    
    0
    
    
    
    0Nicholas Meadmore
    
    
    0
    
    
    
    0
  Stock Option Plan/Equity Incentive Plans
    32




---



##### Table of Contents



Outstanding Options
 Shares Underlying
    
    
    
    
    
    Purchase Price, ifName
    
    Options
    
    Exercise Price
    
    any
    
    Expiration DateRoger A Leopard
    
    
    500,000
    
    
    CAD $0.33
    
    
    
    
    
    October 10, 2008H J M Tompkins
    
    
    250,000
    
    
    CAD $0.30
    
    
    
    
    
    February 25, 2010250,000
    
    
    CAD $0.45
    
    
    
    
    
    February 25, 2010100,000
    
    
    CAD $0.33
    
    
    
    
    
    February 25, 2010100,000
    
    
    CAD $0.24
    
    
    
    
    
    February 25, 2010John M Smith
    
    
    250,000
    
    
    CAD $0.45
    
    
    
    
    
    February 25, 2008100,000
    
    
    CAD $0.33
    
    
    
    
    
    October 10, 2008100,000
    
    
    USD $0.24
    
    
    
    
    
    February 25, 2010Marc Lakmaaker
    
    
    50,000
    
    
    CAD $0.33
    
    
    
    
    
    October 10, 2008Geoffrey Long
    
    
    100,000
    
    
    CAD $0.33
    
    
    
    
    
    October 10, 2008Alan E Perkins
    
    
    250,000
    
    
    USD $0.24
    
    
    
    
    
    February 25, 2010Howard E Browning
    
    
    250,000
    
    
    USD $0.23
    
    
    
    
    
    June 30, 2010
 
 Item 7. Major Shareholders and Related Party Transactions
 
 A. Major Shareholders
    
 B. Related Party Transactions
  33




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##### Table of Contents




  
 C.
    
    Interest of Experts and Counsel.
  
 Item 8. Financial Statements
 
 A.
    
    Consolidated Statements and Other Financial InformationWe have attached the following financial statements to this Transition Report:
 
    
    Auditors Report.
    
    Consolidated Balance Sheet for years ended December 31, 2006 and December 31, 2005.
    
    Consolidated Statement of Operations for the years ended December 31, 2006, February
28, 2006, and February 28, 2005.
    
    Consolidated Statement of Shareholders Equity (Deficit) for the years ended December
31, 2006, February 28, 2006, and February 28, 2005.
    
    Consolidated Statement of Cash Flows for the years ended December 31, 2006, February
28, 2006, and February 28, 2005.
    
    Notes to Consolidated Financial Statements.
 Dividend Policy
  
 B.
    
    Significant Changes
  34




---



##### Table of Contents



Item 9. The Offer and Listing
 
 A.
    
    Price History of Stock
   
    
    The continuing obligations and resulting demands on our financial and personnel
resources required maintaining the TSX listing, were considered to be in no proportion
to the benefits received from this listing.
    
    Service levels received by us were considered to fall substantially short of those
to be expected from a professionally run exchange.
    
    The level of competence and swiftness of response from the TSX in relation to issues
raised by us were considered to be lacking. Example of aforementioned is the serious
delay by the TSX, of over one year, in approving newly issued CalciTech stock.
    
    During our time on the TSX, we had been confronted with a number of unjustifiable
trade halts. In these instances it was found that the TSX refused to communicate
clearly and in a timely fashion to the arguments brought up by us. The insistence by
the regulatory bodies in Canada on two occasions that we file a Quarterly Management
Discussion and Analysis as a prerequisite for resumption of trade, were wholly
unfounded under BCSC and ASC regulation. We were forced to expend significant
resources in resolving a situation it had been forced into unnecessary.
    
    We felt our resources were better spent in consolidating our North American listing
on the OTC Bulletin Board while focusing on implementing new and anticipated procedures
in compliance with the Sarbanes-Oxley Act.
    
    It was felt that a consolidation on the OTC Bulletin Board would concentrate trading
in our shares, thereby providing a more accurate picture to shareholders of trading
pattern on the North American market.
    
    The consolidation was also seen as a measure to reduce arbitrage trading on the
North American markets.
  35




---



##### Table of Contents



TSX Venture Exchange
    
    OTC Bulletin Board
    
    OFEXC$
    
    C$
    
    US$
    
    US$
    
    UK£
    
    UK£Period
    
    High
    
    Low
    
    High
    
    Low
    
    High
    
    LowMay 2007
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.32
    
    
    $
    0.25
    
    
    £
    0.205
    
    
    £
    0.185April 2007
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.43
    
    
    $
    0.34
    
    
    £
    0.235
    
    
    £
    0.190March 2007
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.51
    
    
    $
    0.41
    
    
    £
    0.235
    
    
    £
    0.230February 2007
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.52
    
    
    $
    0.40
    
    
    £
    0.250
    
    
    £
    0.225January 2007
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.46
    
    
    $
    0.35
    
    
    £
    0.230
    
    
    £
    0.225
 2006
    
    High
    
    Low
    
    High
    
    Low
    
    High
    
    Low4th Qtr ended December 31, 2006
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.44
    
    
    $
    0.25
    
    
    £
    0.205
    
    
    £
    0.1453rd Qtr ended September 30, 2006
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.30
    
    
    $
    0.18
    
    
    £
    0.170
    
    
    £
    0.1252nd Qtr ended June 30, 2006
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.51
    
    
    $
    0.25
    
    
    £
    0.280
    
    
    £
    0.1701st Qtr ended March 31, 2006
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.59
    
    
    $
    0.31
    
    
    £
    0.295
    
    
    £
    0.205
 2005
    
    High
    
    Low
    
    High
    
    Low
    
    High
    
    Low4th Qtr ended December 31, 2005
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.41
    
    
    $
    0.13
    
    
    £
    0.240
    
    
    £
    0.1053rd Qtr ended September 30, 2005
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.23
    
    
    $
    0.15
    
    
    £
    0.122
    
    
    £
    0.1172nd Qtr ended June 30, 2005
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.23
    
    
    $
    0.17
    
    
    
    N/A
    
    
    
    N/A1st Qtr ended March 31, 2005
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.28
    
    
    $
    0.17
    
    
    
    N/A
    
    
    
    N/A
 2004-2005, year end February
    
    High
    
    Low
    
    High
    
    Low
    
    High
    
    Low4th Qtr ended February 28, 2005
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.28
    
    
    $
    0.19
    
    
    
    N/A
    
    
    
    N/A3rd Qtr ended November 30, 2004
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.23
    
    
    $
    0.15
    
    
    
    N/A
    
    
    
    N/A2nd Qtr ended August 31, 2004
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.23
    
    
    $
    0.15
    
    
    
    N/A
    
    
    
    N/A1st Qtr ended May 31, 2004
    
    $
    0.49
    
    
    $
    0.31
    
    
    $
    0.23
    
    
    $
    0.17
    
    
    
    N/A
    
    
    
    N/A
 Period
    
    High
    
    Low
    
    High
    
    Low
    
    High
    
    LowJan 1, 2006 - Dec 31, 2006
    
    
    N/A
    
    
    
    N/A
    
    
    $
    0.60
    
    
    $
    0.13
    
    
    £
    0.295
    
    
    £
    0.125Jan 1, 2005 - Dec 31, 2005
    
    $
    0.40
    
    
    $
    0.30
    
    
    $
    0.29
    
    
    $
    0.15
    
    
    £
    0.240
    
    
    £
    0.105Jan 1, 2004 - Dec 31, 2004
    
    $
    0.49
    
    
    $
    0.24
    
    
    $
    0.31
    
    
    $
    0.18
    
    
    
    N/A
    
    
    
    N/AJan 1, 2003 - Dec 31, 2003
    
    $
    0.73
    
    
    $
    0.39
    
    
    $
    0.41
    
    
    $
    0.25
    
    
    
    N/A
    
    
    
    N/AJan 1, 2002 - Dec 31, 2002
    
    $
    0.65
    
    
    $
    0.21
    
    
    $
    0.45
    
    
    $
    0.12
    
    
    
    N/A
    
    
    
    N/A
 
 B. Plan of Distribution
  
 C. Markets
  36




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##### Table of Contents



D. Selling Shareholders
  
 E. Dilution
  
 F. Expenses of the Issue.
  
 Item 10. Additional Information
 
 A. Share Capital
  
 B. Memorandum and Articles of Association
  Common Shares
  Powers and Duties of Directors
   37




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##### Table of Contents



Shareholders
    
 C. Material Contracts
 Addendum to the Credit Facility Agreement between Epsom Investment Services N.V. and CalciTech
Ltd. dated February 27, 1998.
  Addendum to the Credit Facility Agreement between Epsom Investment Services N.V. and CalciTech
Ltd. dated February 27, 2006.
 38




---



##### Table of Contents



D. Exchange Controls
  
 E. Taxation
  Certain United States Federal Income Tax Considerations
    
    
    an insurance company;
    
    a tax-exempt organization;
    
    a financial institution;
 39




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##### Table of Contents




    
    a person subject to the alternative minimum tax;
    
    a person who is a broker-dealer in securities;
    
    an S corporation;
    
    an expatriate subject to Section 877 of the Code;
    
    an owner of, directly, indirectly or by attribution, 10% or more of the outstanding
Common Shares; or
    
    an owner holding Common Shares as part of a hedge, straddle, synthetic security or
conversion transaction.
  Dividends.
  Dispositions of Common Shares.
 40




---



##### Table of Contents



Special United States Federal Income Tax Considerations
 Passive Foreign Investment Company
  
    
    any excess distribution that the U.S. Investor receives on Common Shares, and
    
    any gain the U.S. Investor realizes from a sale or other disposition (including a
pledge) of the Common Shares, unless the U.S. Investor makes a mark-to-market
election as discussed below.
  
    
    the excess distribution or gain will be allocated ratably over your holding period
for the Common Shares,
    
    the amount allocated to the current taxable year, and any taxable year prior to the
first taxable year in which we were a passive foreign investment company, will be
treated as ordinary income, and
    
    the amount allocated to each other year will be subject to tax at the highest tax
rate in effect for that year and the interest charge generally applicable to
underpayments of tax will be imposed on the resulting tax attributable to each such
year.
 41




---



##### Table of Contents



Non-U.S. Investors
    42




---



##### Table of Contents



U.S. Information Reporting and Backup Withholding
   
 F. Dividends and Paying Agents.
  
 G. Statement of Experts.
  
 H. Documents on Display.
   
 I. Subsidiary Information
  
 Item 11. Quantitative and Qualitative Disclosures About Market Risk
  
 Item 12. Description of Securities Other than Equity Securities
  
 Item 13. Defaults, Dividend Arrearages and Delinquencies
  43




---



##### Table of Contents



Part II
 
 Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds
  
 Item 15. Controls and Procedures
    Changes in Internal Control Over Financial Reporting:
  
 Item 16. [Reserved]
 
 Item 16A. Audit Committee Financial Report
  
 Item 16B. Code Of Ethics
  44




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##### Table of Contents



Item 16C. Principal Accountant Fees And Services
  Audit Fees
    Audit-Related Fees
  Tax Fees
  All Other Fees
   
 ITEM 16D. Exemptions From The Listing Standards For Audit Committees
  
 ITEM 16E. Purchases Of Equity Securities By The Issuer And Affiliated Purchasers
  45




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##### Table of Contents



Part III
 
 Item 17. Financial Statements
  
    
    Auditors Report.
    
    Consolidated Balance Sheet for years ended December 31, 2006 and December 31, 2005.
    
    Consolidated Statement of Operations for the years ended December 31, 2006, February
28, 2006, and February 28, 2005.
    
    Consolidated Statement of Shareholders Equity (Deficit) for the years ended December
31, 2006, February 28, 2006, and February 28, 2005.
    
    Consolidated Statement of Cash Flows for the years ended December 31, 2006, February
28, 2006, and February 28, 2005.
    
    Notes to Consolidated Financial Statements.
 
 Item 18. Financial Statements
  
 Item 19. Exhibits
 Exhibit No.
    
    Name1.1
    
    Articles of Kemgas Ltd. (1)1.2
    
    Altered Memorandum of Kemgas. (1)1.3
    
    Altered Memorandum of Kemgas, dated July 29, 1994 (2)1.4
    
    Certificate of Continuance to Bermuda, dated February 13, 1995 (2)1.5
    
    Bye-Laws of Kemgas, as adopted June 1995 (2)1.6
    
    Certificate of Incorporation on Change of Name dated September 11, 2000 (3)4.1
    
    Addendum to Credit Facility Agreement between Epsom Investment Services N.V.
and CalciTech Ltd. dated February 28, 2005 (4)4.2
    
    Addendum to Credit Facility Agreement between Epsom Investment Services N.V.
and CalciTech Ltd. dated April 2006 (5)4.3
    
    Addendum to Credit Facility Agreement between Epsom Investment Services N.V.
and CalciTech Ltd. dated August 15, 2006 (5)
 46




---



##### Table of Contents



Exhibit No.
    
    Name4.4
    
    Form of 5% Convertible Debenture due February 28, 2005 (4)4.5
    
    Form of Addendum to 5% Convertible Debenture Due February 28, 2005 (4)4.6
    
    Consulting Agreement between CalciTech Ltd. and H.J. Mark Tompkins dated
February 25, 2005 (4)8.1
    
    List of Subsidiaries (4)12.1
    
    Certification of the Principal Executive Officer under the Sarbanes-Oxley Act*12.2
    
    Certification of the Principal Financial Officer under the Sarbanes-Oxley Act*13.1
    
    Certification under Section 1350*
 
 *
    
    To be filed herewith(1)
    
    Previously filed with Registration Statement on Form 20-F under the Securities Exchange Act
of 1934on June 29, 1992.(2)
    
    Previously filed with the Form 20-F submitted for the fiscal year ended February 28, 1997.(3)
    
    Previously filed with the Form 20-F submitted for the fiscal year ended February 29, 2000.(4)
    
    Previously filed with the Form 20-F submitted for the fiscal year ended February 28, 2005.(5)
    
    Previously filed with the Form 20-F submitted for the fiscal year ended February 28, 2006. 47




---



##### Table of Contents



SIGNATURE
  DATED: May 31, 2007
    CALCITECH LTD.By:
    /s/ Roger A. LeopardRoger A. LeopardPresident and Chief Executive Officer 48




---



##### Table of Contents



CONSOLIDATED FINANCIAL STATEMENTS
 December 31, 2006
 49




---



##### Table of Contents



th st
     
  50




---



##### Table of Contents



TM
    
 51




---



##### Table of Contents



To the shareholders and board of directors of CalciTech Ltd
      
 52




---



##### Table of Contents



Comments by Auditor for United States Readers on International Standards and United States
Standards on Audit Reporting
  53




---



##### Table of Contents



To the shareholders and board of directors of CalciTech Ltd
      MRI Moores Rowland LLP
    
    September 1, 2005Chartered Accountants
    
    except for Note 15, which has3 Sheldon Square
    
    been updated as at October 31, 2005LondonW2 6PSUnited Kingdom
 54




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##### Table of Contents



CALCITECH LTD
(a Company in the development stage)
CONSOLIDATED BALANCE SHEET
As of December 31, 2006, and December 31, 2005 (unaudited)
and as of February 28, 2006 and February 28, 2005
 Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toASSETS
    
    Notes
    
    Dec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Current assetsCash and cash equivalents
    
    2.6
    
    
    385
    
    
    
    75
    
    
    
    1,313
    
    
    
    407Stock
    
    
    
    
    6
    
    
    
    10
    
    
    
    6
    
    
    
    11Receivables, prepaid expenses
and other current assets
    
    3
    
    
    238
    
    
    
    221
    
    
    
    235
    
    
    
    268Total current assets
    
    
    
    
    629
    
    
    
    306
    
    
    
    1,554
    
    
    
    686Non-current assetsProperty, plant and
equipment, net
    
    4
    
    
    972
    
    
    
    725
    
    
    
    600
    
    
    
    671Intangible assets
    
    2.8 and 5
    
    
    1,643
    
    
    
    359
    
    
    
    354
    
    
    
    124Total non-current assets
    
    
    
    
    2,615
    
    
    
    1,084
    
    
    
    954
    
    
    
    795TOTAL ASSETS
    
    
    
    $
    3,244
    
    
    $
    1,390
    
    
    $
    2,508
    
    
    $
    1,481
  55




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##### Table of Contents



CALCITECH LTD
(a Company in the development stage)
CONSOLIDATED BALANCE SHEET
As of December 31, 2006, and December 31, 2005 (unaudited)
and as of February 28, 2006 and February 28, 2005
 UnauditedLIABILITIES AND
    
    
    
    
    
    10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toSHAREHOLDERS DEFICIENCY
    
    Notes
    
    
    Dec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Current liabilitiesAccounts payable
    
    
    
    
    
    
    757
    
    
    
    363
    
    
    
    217
    
    
    
    322Accruals
    
    
    
    
    
    
    192
    
    
    
    474
    
    
    
    254
    
    
    
    245Convertible debentures  current portion
    
    
    2.14 & 8.1
    
    
    
    92
    
    
    
    92
    
    
    
    92
    
    
    
    195Deferred gain on sale and leaseback  current portion
    
    
    
    
    
    
    99
    
    
    
    99
    
    
    
    99
    
    
    
    99Other loans
    
    
    7
    
    
    
    0
    
    
    
    100
    
    
    
    100
    
    
    
    0Hire Purchase Agreement  current portion
    
    
    7
    
    
    
    158
    
    
    
    142
    
    
    
    142
    
    
    
    159Provisions  current portion
    
    
    11
    
    
    
    29
    
    
    
    26
    
    
    
    26
    
    
    
    25Total Current Liabilities
    
    
    
    
    
    $
    1,327
    
    
    $
    1,296
    
    
    $
    930
    
    
    $
    1,045Non Current LiabilitiesConvertible debentures  non-current portion
    
    
    2.14 & 8.1
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    304Credit facility
    
    
    6
    
    
    
    1,580
    
    
    
    1,629
    
    
    
    214
    
    
    
    238Deferred gain on sale and leaseback
    
    
    
    
    
    
    99
    
    
    
    182
    
    
    
    182
    
    
    
    281Other loans
    
    
    7
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    100Hire Purchase Agreement  non-current portion
    
    
    7
    
    
    
    158
    
    
    
    284
    
    
    
    284
    
    
    
    477Provisions  non-current portion
    
    
    11
    
    
    
    156
    
    
    
    166
    
    
    
    167
    
    
    
    177Total Non Current Liabilities
    
    
    
    
    
    $
    1,993
    
    
    $
    2,261
    
    
    $
    847
    
    
    $
    1,577Total liabilities
    
    
    
    
    
    $
    3,320
    
    
    $
    3,557
    
    
    $
    1,777
    
    
    $
    2,622Commitments and ContingenciesShareholders Equity
    
    
    8Common stock, Cdn $0.001 par value;
120,000,000 shares authorised; issued & outstanding
88,899,675 at December 31 & February 28, 2006,
(79,899,675 at December 31, 2005)
    
    
    
    
    
    
    1,813
    
    
    
    1,805
    
    
    
    1,813
    
    
    
    1,805Share premium, holders options outstanding
on credit facility and contribution surplus
    
    
    
    
    
    
    37,457
    
    
    
    34,326
    
    
    
    37,457
    
    
    
    34,563Convertible debentures
    
    
    
    
    
    
    4,613
    
    
    
    4,613
    
    
    
    4,613
    
    
    
    3,920Accumulated deficit during the development stage
    
    
    
    
    
    
    (43,690
    )
    
    
    (42,832
    )
    
    
    (43,070
    )
    
    
    (41,213
    )Cumulative foreign currency translation adjustments
    
    
    
    
    
    
    (269
    )
    
    
    (79
    )
    
    
    (82
    )
    
    
    (216
    )Total Shareholders (Deficit) Equity
    
    
    
    
    
    
    (76
    )
    
    
    (2,167
    )
    
    
    731
    
    
    
    (1,141
    )TOTAL LIABILITIES AND
SHAREHOLDERS EQUITY (DEFICIT)
    
    
    
    
    
    $
    3,244
    
    
    $
    1,390
    
    
    $
    2,508
    
    
    $
    1,481
  56




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##### Table of Contents



CALCITECH LTD
(a Company in the development stage)
CONSOLIDATED STATEMENT OF OPERATIONS
For the ten month period ended December 31, 2006,
and for the years ended February 28, 2006 and February 28, 2005
 Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toNotes
    
    
    Dec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Revenues
    
    
    
    
    
    
    48
    
    
    
    13
    
    
    
    60
    
    
    
    75Cost of revenues
    
    
    
    
    
    
    (32
    )
    
    
    (43
    )
    
    
    (53
    )
    
    
    (60
    )Gross margin
    
    
    
    
    
    
    16
    
    
    
    (30
    )
    
    
    7
    
    
    
    15Research and development expenses
    
    
    
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Project development expenses
    
    
    
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    238Product development expenses
    
    
    
    
    
    
    0
    
    
    
    242
    
    
    
    310
    
    
    
    176General and administrative expenses
    
    
    
    
    
    
    410
    
    
    
    897
    
    
    
    1,135
    
    
    
    920Operating loss
    
    
    
    
    
    
    (394
    )
    
    
    (1,169
    )
    
    
    (1,438
    )
    
    
    (1,319
    )Profit on disposals
    
    
    9
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    22Interest expense
    
    
    
    
    
    
    (228
    )
    
    
    (450
    )
    
    
    (419
    )
    
    
    (371
    )Loss before income taxes
    
    
    
    
    
    
    (622
    )
    
    
    (1,619
    )
    
    
    (1,857
    )
    
    
    (1,668
    )Provision for income taxes
    
    
    11
    
    
    
    2
    
    
    
    0
    
    
    
    (1
    )
    
    
    0Net Loss
    
    
    
    
    
    $
    (620
    )
    
    $
    (1,619
    )
    
    $
    (1,858
    )
    
    $
    (1,668
    )Net deficit per share:Basic and diluted
    
    
    
    
    
    $
    (0.01
    )
    
    $
    (0.02
    )
    
    $
    (0.02
    )
    
    $
    (0.03
    )Shares used in net loss per share calculation:Basic and diluted
    
    
    
    
    
    
    88,899,675
    
    
    
    79,899,675
    
    
    
    80,738,031
    
    
    
    64,713,374
   57




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##### Table of Contents



CALCITECH LTD
(a Company in the development stage)
CONSOLIDATED STATEMENT OF SHAREHOLDERS (DEFICIT) EQUITY
For the ten month period ended December 31, 2006, and December 31, 2005 (unaudited)
and for the years ended February 28, 2006 and February 28, 2005
 Share premium,
    
    
    
    
    
    
    
    
    
    Cumulativeholders' option
    
    
    
    
    
    Accumulated
    
    foreign currency
    
    Total consolidatedoutstanding and
    
    Convertible
    
    deficit during
    
    translation
    
    shareholders'Note
    
    Common stock
    
    contributed surplus
    
    debentures
    
    development stage
    
    adjustments
    
    (deficit) equityShares
    
    $
    
    $
    
    $
    
    $
    
    $
    
    $Balances, February 29, 2004
    
    
    
    
    
    
    63,899,675
    
    
    
    1,792
    
    
    
    31,441
    
    
    
    3,920
    
    
    
    (39,545
    )
    
    
    (179
    )
    
    
    (2,571
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    
    
    
    0
    
    
    
    (1,668
    )
    
    
    0
    
    
    
    (1,668
    )Issuance of common stock on conversion
of credit facility
    
    
    8.2
    
    
    
    7,000,000
    
    
    
    6
    
    
    
    1,394
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,400Issuance of common stock in private placement
    
    
    8.3
    
    
    
    9,000,000
    
    
    
    7
    
    
    
    2,086
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,093Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (358
    )
    
    
    
    
    
    
    
    
    
    
    (37
    )
    
    
    (395
    )Balances, February 28, 2005
    
    
    
    
    
    
    79,899,675
    
    
    
    1,805
    
    
    
    34,563
    
    
    
    3,920
    
    
    
    (41,213
    )
    
    
    (216
    )
    
    
    (1,141
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    
    
    
    0
    
    
    
    (1,858
    )
    
    
    0
    
    
    
    (1,858
    )Issue of Warrants as common stock
    
    
    
    
    
    
    9,000,000
    
    
    
    8
    
    
    
    3,111
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,119Debentures: non-current portion adjs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (217
    )
    
    
    693
    
    
    
    
    
    
    
    
    
    
    
    476Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    134
    
    
    
    135Balances, February 28, 2006
    
    
    
    
    
    
    88,899,675
    
    
    
    1,813
    
    
    
    37,457
    
    
    
    4,613
    
    
    
    (43,070
    )
    
    
    (82
    )
    
    
    731Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    
    
    
    0
    
    
    
    (620
    )
    
    
    0
    
    
    
    (620
    )Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    (187
    )
    
    
    (187
    )Balances, December 31, 2006
    
    
    
    
    
    
    88,899,675
    
    
    
    1,813
    
    
    
    37,457
    
    
    
    4,613
    
    
    
    (43,690
    )
    
    
    (269
    )
    
    
    (76
    )Balances, February 28, 2005
    
    
    
    
    
    
    79,899,675
    
    
    
    1,805
    
    
    
    34,563
    
    
    
    3,920
    
    
    
    (41,213
    )
    
    
    (216
    )
    
    
    (1,141
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    
    
    
    0
    
    
    
    (1,619
    )
    
    
    0
    
    
    
    (1,619
    )Debentures: non-current portion adjs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    
    
    
    693
    
    
    
    0
    
    
    
    0
    
    
    
    693Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (237
    )
    
    
    0
    
    
    
    0
    
    
    
    137
    
    
    
    (100
    )Balances, December 31, 2005 (unaudited)
    
    
    
    
    
    
    79,899,675
    
    
    
    1,805
    
    
    
    34,326
    
    
    
    4,613
    
    
    
    (42,832
    )
    
    
    (79
    )
    
    
    (2,167
    )
  58




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##### Table of Contents



CALCITECH LTD
(a Company in the development stage)
CONSOLIDATED STATEMENT OF CASH FLOWS
For the ten month periods ended December 31, 2006, and December 31, 2005 (unaudited)
and for the years ended February 28, 2006 and February 28, 2005
 Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Cash flows from operating activitiesNet loss
    
    
    (620
    )
    
    
    (1,620
    )
    
    
    (1,858
    )
    
    
    (1,668
    )Adjustments for:Profit on disposal of investment
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    (22
    )Depreciation and amortization
    
    
    76
    
    
    
    77
    
    
    
    98
    
    
    
    128Interest expense
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    371Operating loss before working capital changes
    
    
    (544
    )
    
    
    (1,543
    )
    
    
    (1,760
    )
    
    
    (1,191
    )Changes in working capital:Receivables, prepayments & current assets
    
    
    (4
    )
    
    
    48
    
    
    
    38
    
    
    
    (24
    )Accounts payable, accruals and provisions
    
    
    478
    
    
    
    270
    
    
    
    (503
    )
    
    
    (123
    )Adjustment in Convertible Debentures
    
    
    0
    
    
    
    49
    
    
    
    693
    
    
    
    0Net cash used in operating activities
    
    
    (70
    )
    
    
    (1,176
    )
    
    
    (1,532
    )
    
    
    (1,338
    )Cash flows from investing activities in:Property, plant and equipment
    
    
    (136
    )
    
    
    (131
    )
    
    
    (26
    )
    
    
    (291
    )Plant pre-financing, project & product development
    
    
    (1,560
    )
    
    
    (164
    )
    
    
    (158
    )
    
    
    0Patents
    
    
    (42
    )
    
    
    (72
    )
    
    
    (72
    )
    
    
    33Net cash used in investing activities
    
    
    (1,738
    )
    
    
    (367
    )
    
    
    (256
    )
    
    
    (258
    )Cash flows from financing activities:Other loans
    
    
    (190
    )
    
    
    (109
    )
    
    
    (109
    )
    
    
    (99
    )Sale and leaseback
    
    
    (110
    )
    
    
    (209
    )
    
    
    (208
    )
    
    
    (113
    )Proceeds from credit facility
    
    
    1,653
    
    
    
    1,357
    
    
    
    1,637
    
    
    
    2,317Payment of credit facility
    
    
    (287
    )
    
    
    34
    
    
    
    (1,662
    )
    
    
    (127
    )Proceeds from private placement
    
    
    0
    
    
    
    0
    
    
    
    2,902
    
    
    
    0Net cash provided by financing activities
    
    
    1,066
    
    
    
    1,073
    
    
    
    2,560
    
    
    
    1,978Effect of exchange rate changes on cash
and cash equivalents
    
    
    (186
    )
    
    
    136
    
    
    
    134
    
    
    
    (36
    )Net (decrease)/increase in cash & cash equivalents
    
    
    (928
    )
    
    
    (334
    )
    
    
    906
    
    
    
    346Cash and cash equivalents, beginning of year
    
    
    1,313
    
    
    
    407
    
    
    
    407
    
    
    
    61Cash and cash equivalents, end of year
    
    $
    385
    
    
    $
    73
    
    
    $
    1,313
    
    
    $
    407
  59




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##### Table of Contents



1. BUSINESS OF THE COMPANY
   2. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 2.1 Going concern
    60




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##### Table of Contents




  2.2 Basis of presentation
  Dec 31, 2006 Dec 31, 2005 Feb 28, 2006 Feb 28, 2005
 61




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##### Table of Contents



2.3 Principles of consolidation
  2.4 Use of estimates
  2.5 Foreign currency translation
    Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Unrealised loss on currencies
    
    
    216
    
    
    
    (19
    )
    
    
    (68
    )
    
    
    (51
    )Change in foreign currency adjustments
    
    
    (187
    )
    
    
    137
    
    
    
    134
    
    
    
    (37
    )Exchange Gain
    
    $
    29
    
    
    $
    118
    
    
    $
    66
    
    
    $
    (88
    )
 2.6 Cash and cash equivalents
  62




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##### Table of Contents



2.7 Property, plant and equipment
  Plant and equipment
    
    10 yearsOffice furniture and equipment
    
    3 to 8 years
  2.8 Intangible Assets
  2.9 Research and development
  
    
    the technical feasibility of completing the intangible asset so that it will be available for use or sale;
    
    its intention and ability to use or sell the intangible asset;
    
    the existence of a market for the output of the intangible asset or the intangible asset itself;
    
    the availability of adequate technical resources to complete the development;
    
    the availability of adequate financial and other resources to complete the development and to use or sell the
intangible asset, subject to the ability of the Company to continue as a going concern, as described in Note 2.1 and;
    
    its ability to measure the expenditure attributable to the intangible asset during its development reliably.
  
    
    expenditure on materials and services used or consumed in
generating the intangible asset;
    
    the salaries, wages and other employment related costs of
personnel directly engaged in generating the asset, and
    
    any expenditure that is directly attributable to generating the
asset, such as the amortisation of patents used to generate the
asset.
  63




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##### Table of Contents



2.10 Net loss per common share
   2.11 Fair value of financial instruments
  2.12 Deferred taxation
   2.13 Stock options
  2.14 Convertible debt accounting
  64




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##### Table of Contents



2.15 Modification of debt instruments
  a.
    
    The present value of the cash flows under the terms of the modified or new debt instrument
is at least 10% different from the present value of the remaining cash flows under the terms
of the original debt instrument;b.
    
    There is a change in the borrowing currency; orc.
    
    There is a change in the creditor and the original debt is legally discharged by the debtor
through a cash payment or otherwise.
   2.16 Government grants
  
 65




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##### Table of Contents



Unaudited10 months to
    
    10 months to
    
    year to
    
    year toGovernment Grants
    
    Dec 31, 2006
    
    Dec 31, 2005
    
    Feb 28, 2006
    
    Feb 28, 2005Germany
    
    
    22
    
    
    
    19
    
    
    
    22
    
    
    
    19
 2.17 Leases
   2.18 Revenue recognition
    2.19 Borrowing costs
  2.20 Inventories
  66




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##### Table of Contents



3. RECEIVABLES, PREPAID EXPENSES AND OTHER CURRENT ASSETS
  UnauditedDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Accounts receivable
    
    
    68
    
    
    
    95
    
    
    
    134
    
    
    
    74Other debtors
    
    
    25
    
    
    
    23
    
    
    
    23
    
    
    
    45VAT receivable
    
    
    38
    
    
    
    27
    
    
    
    4
    
    
    
    26Deposits
    
    
    40
    
    
    
    24
    
    
    
    24
    
    
    
    53Prepaid expenses
    
    
    67
    
    
    
    53
    
    
    
    50
    
    
    
    70Total
    
    $
    238
    
    
    $
    222
    
    
    $
    235
    
    
    $
    268
 4. PROPERTY, PLANT AND EQUIPMENT
 Building,
    
    Commercial
    
    OfficeLeasehold
    
    Computer
    
    Plant &
    
    Plant Pre-
    
    Furniture &Improvements
    
    Equipment
    
    Equipment
    
    financing
    
    Equipment
    
    Total$
    
    $
    
    $
    
    
    
    
    
    $
    
    $Balance at February 28, 2006
    
    
    0
    
    
    
    0
    
    
    
    581
    
    
    
    0
    
    
    
    19
    
    
    
    600Additions
    
    
    0
    
    
    
    28
    
    
    
    54
    
    
    
    312
    
    
    
    17
    
    
    
    411Disposals
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Depreciation during year
    
    
    0
    
    
    
    (4
    )
    
    
    (86
    )
    
    
    0
    
    
    
    (17
    )
    
    
    (107
    )Foreign Currency Adjustments
    
    
    0
    
    
    
    0
    
    
    
    66
    
    
    
    0
    
    
    
    2
    
    
    
    68Balance at December 31, 2006
    
    $
    0
    
    
    
    24
    
    
    
    615
    
    
    
    312
    
    
    
    21
    
    
    
    972Gross Amount
    
    
    17
    
    
    
    35
    
    
    
    915
    
    
    
    312
    
    
    
    99
    
    
    
    1,378Accumulated Depreciation
    
    
    (17
    )
    
    
    (11
    )
    
    
    (300
    )
    
    
    0
    
    
    
    (78
    )
    
    
    (406
    )Balance at December 31, 2006
    
    $
    0
    
    
    
    24
    
    
    
    615
    
    
    
    312
    
    
    
    21
    
    
    
    972
  
   67




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##### Table of Contents



Year ending December 31, 2007
    
    $
    158Year ending December 31, 2008
    
    $
    158Total minimum lease payments
    
    $
    316Less: amounts representing interest
    
    $
    30Net minimum lease payments
    
    $
    286
 5. INTANGIBLE ASSETS
  CommercialProject
    
    Product
    
    Plant Pre-Development
    
    Development
    
    financing
    
    Patents
    
    Total$
    
    $
    
    $
    
    $
    
    $Balance at February 28, 2006
    
    
    158
    
    
    
    0
    
    
    
    0
    
    
    
    196
    
    
    
    354Additions
    
    
    654
    
    
    
    357
    
    
    
    233
    
    
    
    42
    
    
    
    1,286Disposals
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Amortisation during period
    
    
    0
    
    
    
    0
    
    
    
    (2
    )
    
    
    0
    
    
    
    (2
    )Foreign Currency Adjustments
    
    
    5
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    5Balance at December 31, 2006
    
    $
    817
    
    
    
    357
    
    
    
    231
    
    
    
    238
    
    
    
    1,643Gross Amount
    
    
    817
    
    
    
    357
    
    
    
    233
    
    
    
    266
    
    
    
    1,673Accumulated Amortisation
    
    
    0
    
    
    
    0
    
    
    
    (2
    )
    
    
    (28
    )
    
    
    (30
    )Balance at December 31, 2006
    
    $
    817
    
    
    
    357
    
    
    
    231
    
    
    
    238
    
    
    
    1,643
  6. CREDIT FACILITY AGREEMENT
   68




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##### Table of Contents



Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Face value of note issued during the year
    
    
    1,653
    
    
    
    1,357
    
    
    
    1,637
    
    
    
    2,317Less equity conversion component
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    01,653
    
    
    
    1,357
    
    
    
    1,637
    
    
    
    2,317Interest expense
    
    
    27
    
    
    
    44
    
    
    
    56
    
    
    
    92Conversion of note into common shares
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    (1,400
    )Payments made during the year
    
    
    (314
    )
    
    
    (10
    )
    
    
    (1,717
    )
    
    
    (1,136
    )01,366
    
    
    
    1,391
    
    
    
    (24
    )
    
    
    (127
    )Non-current liability at beginning of period
    
    
    214
    
    
    
    238
    
    
    
    238
    
    
    
    365Non-current liability at end of period
    
    $
    1,580
    
    
    
    1,629
    
    
    $
    214
    
    
    $
    23825% current liability as Interest Expense
    
    $
    395
    
    
    
    407
    
    
    $
    53
    
    
    $
    59Effective interest rate at period end
    
    
    7.75
    %
    
    
    7.75
    %
    
    
    7.50
    %
    
    
    7.50
    %
  7. OTHER LOANS
  UnauditedDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Other loans
    
    
    0
    
    
    
    100
    
    
    
    100
    
    
    
    100Finance lease loan
    
    
    316
    
    
    
    426
    
    
    
    426
    
    
    
    636Total loans
    
    $
    316
    
    
    $
    526
    
    
    $
    526
    
    
    $
    736Falling due split:Amounts due within one year
Other loans
    
    
    0
    
    
    
    100
    
    
    
    100
    
    
    
    0Finance lease
    
    
    158
    
    
    
    142
    
    
    
    142
    
    
    
    159Total amounts due within one year
    
    
    158
    
    
    
    242
    
    
    
    242
    
    
    
    159Amounts due after one year
Other loans
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    100Finance lease 1 -2 years
    
    
    158
    
    
    
    142
    
    
    
    142
    
    
    
    159Finance lease 2 -5 years
    
    
    0
    
    
    
    142
    
    
    
    142
    
    
    
    318Balance at the end of the year
    
    $
    316
    
    
    $
    526
    
    
    $
    526
    
    
    $
    736
  69




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##### Table of Contents



8. SHAREHOLDERS EQUITY (DEFICIT)
 8.1 Convertible debentures
      70




---



##### Table of Contents



 
 
  Section 2 Definitions: Shall be extended by the following definition.
  Section 3 Conversion: Shall be amended as follows
 st
    71




---



##### Table of Contents



UnauditedDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Principal amount of debentures at issuance
    
    
    4,642
    
    
    
    4,642
    
    
    
    4,642
    
    
    
    4,642Less present value of future
interest payments at issuance
    
    
    (545
    )
    
    
    (545
    )
    
    
    (545
    )
    
    
    (545
    )Less finders fee
    
    
    (177
    )
    
    
    (177
    )
    
    
    (177
    )
    
    
    (177
    )Adjustment for non-current portion
    
    
    693
    
    
    
    693
    
    
    
    693
    
    
    
    0$
    4,613
    
    
    $
    4,613
    
    
    $
    4,613
    
    
    $
    3,920
 8.2 Conversion of credit facility
       72




---



##### Table of Contents



8.3 Private placement
    8.4 Stock option plan
  Number of
    
    Exercise price perShares
    
    shareBalance at February 28, 1999
    
    
    2,185,000
    
    
    Cdn $0.80 to 1.50Options lapsed
    
    
    (1,175,000
    )
    
    Cdn $0.29 to 1.50Options granted
    
    
    500,000
    
    
    Cdn $0.30Balance at February 29, 2000
    
    
    1,510,000
    
    
    Cdn $0.29 to 0.30Options lapsed
    
    
    (350,000
    )
    
    Cdn $0.29Options granted
    
    
    0Balance at February 28, 2001
    
    
    1,160,000
    
    
    Cdn $0.29 to 0.30Options lapsed
    
    
    0Options granted
    
    
    0Balance at February 28, 2002
    
    
    1,160,000
    
    
    Cdn $0.29 to 0.30Options exercised
    
    
    (620,000
    )
    
    Cdn $0.29Options lapsed
    
    
    (40,000
    )
    
    Cdn $0.29Options granted
    
    
    0Balance at February 28, 2003
    
    
    500,000
    
    

Cdn
$0.30Options exercised
    
    
    0Options lapsed
    
    
    0Options granted
    
    
    1,350,000
    
    
    Cdn $0.33 to 0.45Balance at February 29, 2004
    
    
    1,850,000
    
    

Cdn
$0.30 to 0.45Options exercised
    
    
    0Options lapsed
    
    
    (250,000
    )
    
    Cdn $0.30Options granted
    
    
    450,000
    
    
    $0.24Balance at February 28, 2005
    
    
    2,050,000
    
    

Cdn
$0.30 to 0.45Options exercised
    
    
    0Options lapsed
    
    
    0Options granted
    
    
    250,000
    
    
    $0.23Balance at December 31, 2005
    
    
    2,300,000Options exercised
    
    
    0Options lapsed
    
    
    0Options granted
    
    
    0Balance at February 28, 2006
    
    
    2,300,000
    
    

Cdn
$0.23 to 0.45Options exercised
    
    
    0Options lapsed
    
    
    0Options granted
    
    
    0Balance at December 31, 2006
    
    
    2,300,000
    
    

Cdn
$0.23 to 0.45
 73




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##### Table of Contents



Weighted-
    
    
    
    
    
    Weightedaverage
    
    
    
    
    
    averageNumber of
    
    Number of
    
    remainingExercise
    
    options
    
    options
    
    contractual lifePrice
    
    outstanding
    
    exercisable
    
    (years)Cdn $0.30
    
    
    250,000
    
    
    
    250,000
    
    
    
    3.16Cdn $0.33
    
    
    850,000
    
    
    
    850,000
    
    
    
    1.94Cdn $0.45
    
    
    500,000
    
    
    
    500,000
    
    
    
    1.58$0.24
    
    
    450,000
    
    
    
    450,000
    
    
    
    3.16$0.23
    
    
    250,000
    
    
    
    250,000
    
    
    
    3.50Total
    
    
    2,300,000
    
    
    
    2,300,000
 74




---



##### Table of Contents



9. PROFIT ON DISPOSAL OF INVESTMENTS
  year toFeb 28, 2005$Sale of patent rights
    
    
    28Less: carrying value of patents
    
    
    (6
    )Profit on sale of patent rights
    
    $
    22
  
   year to
    
    
    year toFeb 28, 2004
    
    
    Feb 28, 2003$
    
    
    $Revenue
    
    
    402
    
    
    
    492Operating costs
    
    
    (374
    )
    
    
    (398
    )Profit before tax
    
    
    28
    
    
    
    94Income tax expense
    
    
    (14
    )
    
    
    (17
    )Profit on ordinary activities after tax
    
    $
    14
    
    
    $
    77
 75




---



##### Table of Contents



year to
    
    
    year toFeb 28, 2004
    
    
    Feb 28, 2003$
    
    
    $Property improvements
    
    
    4
    
    
    
    5Other fixed assets
    
    
    0
    
    
    
    25Deposits
    
    
    7
    
    
    
    7TVA refund receivable
    
    
    16
    
    
    
    30Trade debtors
    
    
    27
    
    
    
    0Other debtors
    
    
    352
    
    
    
    205Prepayments
    
    
    7
    
    
    
    4Cash at bank
    
    
    0
    
    
    
    (8
    )Trade creditors
    
    
    (105
    )
    
    
    (111
    )Other creditors
    
    
    (10
    )
    
    
    0Accruals
    
    
    (195
    )
    
    
    (66
    )Income tax liability
    
    
    (419
    )
    
    
    0Total
    
    $
    (316
    )
    
    $
    91Gain on disposal
    
    
    316Total consideration
    
    $
    0
 10. INCOME TAXES
   Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Bermuda
    
    
    (457
    )
    
    
    (1,165
    )
    
    
    (1,093
    )
    
    
    (1,280
    )Rest of world
    
    
    (165
    )
    
    
    (454
    )
    
    
    (765
    )
    
    
    (388
    )Total
    
    $
    (622
    )
    
    
    (1,619
    )
    
    
    (1,858
    )
    
    $
    (1,668
    )
  76




---



##### Table of Contents



11. PROVISIONS AND CONTINGENCIES
  12. RELATED PARTY TRANSACTIONS
  Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Amounts paid to shareholders,
directors and officers of the Company
for consulting and other services
    
    $
    230
    
    
    $
    262
    
    
    $
    327
    
    
    $
    492Amounts paid to
EuroHelvetia TrustCo S.A.
for financial advice
    
    $
    66
    
    
    $
    227
    
    
    $
    275
    
    
    $
    247Amounts payable at Balance Sheet date
    
    $
    233
    
    
    $
    111
    
    
    $
    104
    
    
    $
    89
    77




---



##### Table of Contents



13. FINANCIAL INFORMATION BY INDUSTRY SEGMENT AND GEOGRAPHIC AREA
  Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005Revenues
    
    $
    
    
    $
    
    
    $
    
    
    $Bermuda
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Rest of world
    
    
    48
    
    
    
    13
    
    
    
    60
    
    
    
    75Total
    
    $
    48
    
    
    $
    13
    
    
    $
    60
    
    
    $
    75
 Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005Operating loss
    
    $
    
    
    $
    
    
    $
    
    
    $Bermuda
    
    
    (231
    )
    
    
    (823
    )
    
    
    (691
    )
    
    
    (931
    )Rest of world
    
    
    (163
    )
    
    
    (346
    )
    
    
    (746
    )
    
    
    (387
    )Total
    
    $
    (394
    )
    
    $
    (1,169
    )
    
    $
    (1,437
    )
    
    $
    (1,318
    )Identifiable assetsBermuda
    
    
    1,364
    
    
    
    385
    
    
    
    1,503
    
    
    
    24Rest of world
    
    
    1,880
    
    
    
    1,005
    
    
    
    1,005
    
    
    
    1,457Total
    
    $
    3,244
    
    
    $
    1,390
    
    
    $
    2,508
    
    
    $
    1,481
 14. ANALYSIS OF MAJOR EXPENDITURES INCLUDED IN GENERAL AND ADMINISTRATIVE EXPENSES
  Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
    year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Employee costs
    
    
    180
    
    
    
    381
    
    
    
    457
    
    
    
    307Professional fees
    
    
    60
    
    
    
    89
    
    
    
    119
    
    
    
    83Investor relations
    
    
    122
    
    
    
    49
    
    
    
    100
    
    
    
    118Rent, rates & charges
    
    
    33
    
    
    
    56
    
    
    
    63
    
    
    
    108Travel
    
    
    (21
    )
    
    
    133
    
    
    
    156
    
    
    
    169Administrative fees & expenses
    
    
    0
    
    
    
    0
    
    
    
    (8
    )
    
    
    120Depreciation
    
    
    76
    
    
    
    47
    
    
    
    56
    
    
    
    (13
    )
 15. DIFFERENCES BETWEEN INTERNATIONAL FINANCIAL REPORTING STANDARDS AND US GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES.
  78




---



##### Table of Contents



Unaudited10 months
    
    
    10 months
    
    
    year to
    
    
    year toto Dec 31,
    
    
    to Dec 31,
    
    
    Feb 28,
    
    
    Feb 28,
    
    
    Cumulative to2006
    
    
    2005
    
    
    2006
    
    
    2005
    
    
    Dec 31, 2006$
    
    
    $
    
    
    $
    
    
    $Net loss in accordance with IFRS
    
    
    (620
    )
    
    
    (1,619
    )
    
    
    (1,858
    )
    
    
    (1,668
    )
    
    
    (43,690
    )Interest on convertible debentures
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    (895
    )Amortisation of debt discount for credit facility
    
    
    (65
    )
    
    
    (63
    )
    
    
    (409
    )
    
    
    (579
    )
    
    
    (4,059
    )Share options accounting
    
    
    0
    
    
    
    (86
    )
    
    
    (103
    )
    
    
    (67
    )
    
    
    (384
    )Change in fair value of derivative financial instruments
    
    
    947
    
    
    
    (405
    )
    
    
    (1,907
    )
    
    
    1,517
    
    
    
    152Net income (loss) in accordance with US GAAP
    
    $
    262
    
    
    $
    (2,173
    )
    
    $
    (4,277
    )
    
    $
    (797
    )
    
    $
    (48,876
    )Basic and dilutive net loss per share under US GAAP
    
    
    0.00
    
    
    
    (0.03
    )
    
    
    (0.05
    )
    
    
    (0.01
    )Shareholders equity (deficiency) under IFRS
    
    
    (76
    )
    
    
    (2,167
    )
    
    
    731
    
    
    
    (1,141
    )Convertible debentures
    
    
    (4,613
    )
    
    
    (4,613
    )
    
    
    (4,613
    )
    
    
    (3,920
    )Shareholders equity (deficiency) adjustment for opening
balance for derivative financial instruments
    
    
    (1,133
    )
    
    
    (1,858
    )
    
    
    (1,858
    )
    
    
    (1,870
    )Change in fair value of derivative financial instruments
    
    
    947
    
    
    
    (405
    )
    
    
    (1,907
    )
    
    
    1,517Conversion of credit facility
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    350To record derivative liability upon grant of 13.5 million
warrants in connection with private placement
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    (1,560
    )To remove derivative liability upon exercise of
9 million warrants
    
    
    0
    
    
    
    0
    
    
    
    2,612
    
    
    
    0Re-class of derivative liability to share premium,
holders option and contributed surplus for
repayments of credit facility
    
    
    79
    
    
    
    3
    
    
    
    429
    
    
    
    284Interest on convertible debentures
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Interest expense for amortisation of beneficial
conversion feature
    
    
    (65
    )
    
    
    (63
    )
    
    
    (409
    )
    
    
    (579
    )Reclass of derivative liability due to removal of
conversion option on facility on August 15, 2006
    
    
    241
    
    
    
    0
    
    
    
    0
    
    
    
    0Start up costs
    
    
    (1,254
    )
    
    
    0
    
    
    
    0
    
    
    
    0Shareholders deficiency under US GAAP
    
    $
    (5,874
    )
    
    $
    (9,103
    )
    
    $
    (5,015
    )
    
    $
    (6,919
    )
  UnauditedDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Total assets: IFRS
    
    
    3,244
    
    
    
    1,390
    
    
    
    2,508
    
    
    
    1,481Start up costs
    
    
    (1,254
    )
    
    
    0
    
    
    
    0
    
    
    
    0Total assets: US GAAP
    
    $
    1,990
    
    
    $
    1,390
    
    
    $
    2,508
    
    
    $
    1,481Total liabilities: IFRS
    
    
    3,320
    
    
    
    3,557
    
    
    
    1,777
    
    
    
    2,622Convertible debentures
    
    
    4,613
    
    
    
    4,613
    
    
    
    4,613
    
    
    
    3,920Debt discount
    
    
    (69
    )
    
    
    (347
    )
    
    
    (55
    )
    
    
    (60
    )Derivative liability
    
    
    0
    
    
    
    2,652
    
    
    
    1,188
    
    
    
    1,899Total liabilities: US GAAP
    
    $
    7,864
    
    
    $
    10,475
    
    
    $
    7,523
    
    
    $
    8,381
  79




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##### Table of Contents



Number
    
    
    Value$As at February 28, 1987
    
    
    8,167,825
    
    
    $
    10,560Performance shares for patent rights
    
    
    10,000,000
    
    
    
    Issue of shares for cash
    
    
    766,667
    
    
    
    838As at February 29, 1988
    
    
    18,934,492
    
    
    $
    11,398Issue of shares for cash
    
    
    250,000
    
    
    
    359As at February 28, 1989 and 1990
    
    
    19,184,492
    
    
    $
    11,757Issue of shares for cash
    
    
    1,000,000
    
    
    
    602As at February 28, 1991
    
    
    20,184,492
    
    
    $
    12,359Issue of shares for cash
    
    
    600,000
    
    
    
    394Exercise of stock options
    
    
    23,000
    
    
    
    15Issue of shares for debt
    
    
    413,171
    
    
    
    271Reduction of paid up capital
    
    
    0
    
    
    
    (12,169
    )As at February 29, 1992
    
    
    21,220,663
    
    
    $
    870Exercise of stock options
    
    
    207,000
    
    
    
    140Exercise of warrants
    
    
    70,000
    
    
    
    56Performance shares cancelled
    
    
    (10,000,000
    )
    
    
    0As at February 28, 1993
    
    
    11,497,663
    
    
    $
    1,066Exercise of warrants
    
    
    530,000
    
    
    
    483Exercise of stock options
    
    
    11,000
    
    
    
    18Acquisition of Kemgas Corporation Inc.
    
    
    5,187,495
    
    
    
    109As at February 28, 1994
    
    
    17,226,158
    
    
    $
    1,676Exercise of stock options
    
    
    75,000
    
    
    
    82Exercise of stock options
    
    
    75,000
    
    
    
    0As at February 28, 1995
    
    
    17,376,158
    
    
    $
    1,758Exercise of stock options
    
    
    200,000
    
    
    
    0Acquisition of 50.1% Kemgas Corporation Inc.
    
    
    5,187,505
    
    
    
    4As at February 29, 1996
    
    
    22,763,663
    
    
    $
    1,762Exercise of Kemgas Corporation Inc. stock options
    
    
    375,000
    
    
    
    0As at February 28, 1997
    
    
    23,138,663
    
    
    $
    1,762Issue of shares on conversion of credit facility
    
    
    3,800,000
    
    
    
    4As at February 28, 1998
    
    
    26,938,663
    
    
    $
    1,766Issue of shares on conversion of credit facility
    
    
    2,978,723
    
    
    
    2As at February 28, 1999
    
    
    29,917,386
    
    
    $
    1,768Issue of shares for cash
    
    
    2,429,150
    
    
    
    2Conversion of convertible debentures
    
    
    7,202,643
    
    
    
    5Exercise of Kemgas Corporation Inc. stock options
    
    
    175,000
    
    
    
    0As at February 29, 2000
    
    
    39,724,179
    
    
    $
    1,775Issue of shares on conversion of credit facility
    
    
    4,000,000
    
    
    
    3As at February 28, 2002 and February 28, 2001
    
    
    43,724,179
    
    
    $
    1,778Issue of shares on conversion of credit facility
    
    
    3,955,695
    
    
    
    3Issue of shares for cash
    
    
    4,933,091
    
    
    
    3Exercise of warrants
    
    
    656,200
    
    
    
    0Exercise of stock options
    
    
    620,000
    
    
    
    0As at February 28, 2003
    
    
    53,889,165
    
    
    $
    1,784Issue of shares on conversion of facility
    
    
    10,010,510
    
    
    
    8As at February 29, 2004
    
    
    63,899,675
    
    
    $
    1,792Issue of shares in private placement
    
    
    9,000,000
    
    
    
    7Issue of shares on conversion of facility
    
    
    7,000,000
    
    
    
    6As at February 28, 2005
and December 31, 2005 (unaudited)
    
    
    79,899,675
    
    
    $
    1,805Exercise of warrants
    
    
    9,000,000
    
    
    
    8As at February 28, 2006 and December 31, 2006
    
    
    88,899,675
    
    
    $
    1,813
 80




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##### Table of Contents



Options
    
    
    Option price perOutstanding
    
    
    shareCdn.Balance, February 28, 1990
    
    
    1,850,000
    
    
    
    0Options granted
    
    
    490,000
    
    
    
    1Options cancelled
    
    
    (1,925,000
    )
    
    
    0.45 to 0.90Balance, February 28, 1991
    
    
    415,000
    
    
    
    1Options granted
    
    
    100,000
    
    
    
    1Options granted
    
    
    25,000
    
    
    
    1Options granted
    
    
    20,000
    
    
    
    2Options exercised
    
    
    (23,000
    )
    
    
    1Options cancelled
    
    
    (40,000
    )
    
    
    1Balance, February 29, 1992
    
    
    497,000
    
    
    0.90 to 1.50Options exercised
    
    
    (207,000
    )
    
    
    0.90 to 1.50Options cancelled
    
    
    (115,000
    )
    
    
    0.90 to 1.50Options granted
    
    
    75,000
    
    
    
    2Balance, February 28, 1993
    
    
    250,000
    
    
    0.90 to 1.50Options granted
    
    
    131,000
    
    
    
    2Options exercised
    
    
    (11,000
    )
    
    
    2Options cancelled
    
    
    (100,000
    )
    
    
    2Balance, February 28, 1994
    
    
    270,000
    
    
    0.90 to 2.25Options granted
    
    
    200,000
    
    
    
    2Options exercised
    
    
    (75,000
    )
    
    
    2Options exercised
    
    
    (75,000
    )
    
    
    1Balance, February 28, 1995
    
    
    320,000
    
    
    2.25 to 2.28Options exercised
    
    
    (200,000
    )
    
    
    2Balance, February 29, 1996
    
    
    120,000
    
    
    
    2Options lapsed
    
    
    (10,000
    )
    
    
    2Options granted
    
    
    750,000
    
    
    
    2Options granted
    
    
    425,000
    
    
    US$
    2.50Balance, February 28, 1997
    
    
    1,285,000
    
    
    2.25 to 2.45 & 2.50Options lapsed
    
    
    (1,175,000
    )
    
    
    2.45 & 2.50Options granted
    
    
    1,925,000
    
    
    
    2Balance, February 28, 1998
    
    
    2,035,000
    
    
    1.50 to 2.25Options lapsed
    
    
    (600,000
    )
    
    
    1.50 to 2.25Options granted
    
    
    750,000
    
    
    
    0.80 to 1.50Balance, February 28, 1999
    
    
    2,185,000
    
    
    0.80 to 1.50Options lapsed
    
    
    (1,175,000
    )
    
    
    0.29 to 1.50Options granted
    
    
    500,000
    
    
    
    0Balance, February 29, 2000
    
    
    1,510,000
    
    
    0.29 to 0.30Options lapsed
    
    
    (350,000
    )
    
    
    0Balance, February 28, 2002 and
February 28, 2001
    
    
    1,160,000
    
    
    0.29 to 0.30Options exercised
    
    
    (620,000
    )
    
    
    0Options lapsed
    
    
    (40,000
    )
    
    
    0Balances, February 28, 2003
    
    
    500,000
    
    
    0.29 to 0.30Options granted
    
    
    1,350,000
    
    
    
    0.33 to 0.45Balances, February 29, 2004
    
    
    1,850,000
    
    
    0.29 to 0.45Options lapsed
    
    
    (250,000
    )
    
    
    0Options granted
    
    
    450,000
    
    
    $
    0.24Balances, February 28, 2005
    
    
    2,050,000
    
    
    0.24 to 0.45Options lapsed
    
    
    0Options granted
    
    
    250,000
    
    
    $
    0.23Balances, December 31, 2005 (unaudited)
February 28, 2006 and December 31, 2006
    
    
    2,300,000
    
    
    0.23 to 0.45
 81




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##### Table of Contents



Number ofWarrants
    
    
    Exercise price peroutstanding
    
    
    shareCdnBalance at February 29, 2000
    
    
    0Warrants granted re: debentures
    
    
    315,000
    
    
    Cdn$0.33 to 0.44Warrants exercised
    
    
    0Balance at February 28, 2001
    
    
    315,000
    
    
    Cdn$0.33 to 0.44Warrants granted re: debentures
    
    
    525,000
    
    
        Cdn  $0.46 to 0.51Warrants exercised
    
    
    0Balance at February 28, 2002
    
    
    840,000
    
    
        Cdn $0.33 to 0.51Warrants granted re: private place
    
    
    4,933,091
    
    
        Cdn  $0.66Warrants granted re: debenture
    
    
    63,000
    
    
        Cdn  $0.80 to 0.90Warrants exercised
    
    
    (656,200
    )
    
    Cdn  $0.33 to 0.46Warrants lapsed
    
    
    (183,800
    )
    
    Cdn  $0.33 to 0.46Balance at February 28, 2003
    
    
    4,996,091
    
    
        Cdn $0.33 to 0.90Warrants lapsed
    
    
    (4,996,091
    )
    
    Cdn $0.33 to 0.90Balance at February 29, 2004
    
    
    0Warrants granted re: private placement
    
    
    13,500,000
    
    
    $
    0.35 to 0.50Balance at February 28, 2005
    
    
    13,500,000
    
    
        Cdn$0.33 to 0.44Warrants exercised
    
    
    0Balance at December 31, 2005 (unaudited)
    
    
    13,500,000Warrants exercised
    
    
    (9,000,000
    )
    
    $
    0.35Balance at February 28, 2006 and
December 31, 2006
    
    
    4,500,000
    
    
    $
    0.50
 82




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##### Table of Contents



Accounting for Start-up Activities
  Accounting for Derivatives
  a) Credit Facility Agreement
   83




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##### Table of Contents



b) Convertible Debentures
   AssumptionsStock price
    
    $
    .24-$.41Exercise price
    
    $
    1.75Term
    
        0.83-2.83 yearsVolatility
    
    
    115%-122
    %Discount Rate
    
    
    3.5%-5.5
    %
 c) Warrants
   AssumptionsStock price
    
    $
    .24-$.41Exercise price
    
    $
    .35-$.50Term
    
        1-2 yearsVolatility
    
    
    115%-122
    %Discount Rate
    
    
    3.5%-5.5
    %
 84




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##### Table of Contents



Development Stage Entity
   Statement of Operations
 Cumulativetotals sinceinception(unaudited)Notes
    
    
    Dec 31, 2006$Revenues
    
    
    
    
    
    
    2,961Cost of revenues
    
    
    
    
    
    
    (2,141
    )Gross margin
    
    
    
    
    
    
    820Research and development expenses
    
    
    
    
    
    
    (9,709
    )General and administrative expenses
    
    
    
    
    
    
    (17,720
    )Product development
    
    
    
    
    
    
    (485
    )Project development
    
    
    
    
    
    
    (238
    )Settlement of legal dispute
    
    
    11
    
    
    
    (400
    )Write-down of goodwill
    
    
    
    
    
    
    (10,649
    )Other expenses
    
    
    
    
    
    
    (185
    )Operating loss
    
    
    
    
    
    
    (38,566
    )Profit on disposal of investment
    
    
    
    
    
    
    338Interest expense, net
    
    
    
    
    
    
    (5,126
    )Loss before income taxes and minority interest
    
    
    
    
    
    
    (43,354
    )Provision for income taxes
    
    
    11
    
    
    
    (387
    )Loss from ordinary activities
    
    
    
    
    
    
    (43,741
    )Minority interest
    
    
    
    
    
    
    51Net loss
    
    
    
    
    
    $
    (43,690
    )
 85




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##### Table of Contents



Statement of Cash Flows
 Cumulativetotals sinceinception(unaudited)Dec 31, 2006$Cash flows from operating activitiesNet Loss
    
    
    (43,690
    )Adjustments for:Profit on disposal of investment
    
    
    (338
    )Depreciation and amortization
    
    
    5,522Write-down of property, plant and equipment
    
    
    2,033Write-down of inventory
    
    
    459Write-down of goodwill
    
    
    10,649Interest expense
    
    
    4,479Equity in earnings of affiliates
    
    
    86Operating Loss before working capital changes
    
    
    (20,800
    )Changes in working capital:Receivables, prepaid expenses and other current assets
    
    
    15Accounts payable, accrued expenses, and provisions
    
    
    468Adjustment in Convertible Debentures
    
    
    693Cash used in operations
    
    
    (19,624
    )Interest paid to financial institutions
    
    
    (427
    )Net cash used in operating activities
    
    $
    (20,051
    )Cash flows from investing activitiesAcquisition of property, plant and equipment
    
    
    (1,667
    )Acquisition of pre-financing, project & product development
    
    
    (1,560
    )Acquisition of patents
    
    
    (42
    )Purchase of KCI net of cash acquired
    
    
    537Net cash used in investing activities
    
    $
    (2,732
    )Cash flows from financing activitiesOther loans
    
    
    (407
    )Proceeds raised from finance lease
    
    
    526Payment of bank loans
    
    
    (670
    )Proceeds from issuance of common stock
    
    
    8,814Proceeds from issuance of convertible debentures
    
    
    2,941Proceeds from credit facility
    
    
    17,901Payment of credit facility
    
    
    (6,135
    )Finders fee
    
    
    (285
    )Increase in bank overdraft
    
    
    437Cash received from share subscription of partner in Odda
    
    
    51Interest paid on convertible debentures
    
    
    (210
    )Net cash provided by financing activities
    
    $
    22,963Effect of exchange rate changes on cash
    
    $
    391Net increase in cash and cash equivalents
    
    
    385Cash and cash equivalents, at inception
    
    
    0Cash and cash equivalents, end of year
    
    $
    385
 86




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New accounting pronouncements under IFRS and US GAAP
    87




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88




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##### Table of Contents



16. LIST OF PRINCIPAL CONSOLIDATED COMPANIES
  ProportionName of Company
    
    Countries
    
    Holding
    
    held
    
    Nature of businessCalciTech Synthetic Minerals Ltd.
    
    Bermuda
    
    Ordinary shares
    
    100%
    
    PCC businessCalciTech Group Services SA
    
    Switzerland
    
    Ordinary shares
    
    100%
    
    AdministrationCalciTech Holdings ApS
    
    Denmark
    
    Ordinary shares
    
    100%
    
    Holding CompanyCalciTech Odda A-S (in liquidation)
    
    Norway
    
    Ordinary shares
    
    51%
    
    Production of PCCCalciTech Deutschland GmbH
    
    Germany
    
    Ordinary shares
    
    100%
    
    Production of PCC
  89




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##### Table of Contents



17. ULTIMATE CONTROLLING PARTY
  18. SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
  Unaudited10 months to
    
    
    10 months to
    
    
    year to
    
    
year toDec 31, 2006
    
    
    Dec 31, 2005
    
    
    Feb 28, 2006
    
    
    Feb 28, 2005$
    
    
    $
    
    
    $
    
    
    $Issuance of common stock
upon conversion of credit facility
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    1,400Issuance of common stock
upon private placement through credit facility
    
    
    0
    
    
    
    0
    
    
    
    1,717
    
    
    
    1,136Interest expense through credit facility
    
    
    (28
    )
    
    
    (43
    )
    
    
    (56
    )
    
    
    (92
    )Total
    
    $
    (28
    )
    
    
    (43
    )
    
    
    1,661
    
    
    $
    2,444
  19. COMMITMENT
  20. NUMBER OF EMPLOYEES (UNAUDITED)
  21. POST BALANCE SHEET EVENT
  22. APPROVAL OF FINANCIAL STATEMENTS
  Roger A Leopard
 John M Smith
 90