UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


WASHINGTON, D.C. 20549


FORM 20-F





(Mark One)


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





x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2010





 ̈ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM __________ TO __________





 ̈ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM __________ TO __________





Commission file number 0-31481


CARTHEW BAY TECHNOLOGIES INC.


(Exact name of Registrant as specified in its charter)


Not Applicable


(Translation of Registrant's Name into English)


ONTARIO


(Jurisdiction of incorporation or organization)


BROOKFIELD PLACE, 181 BAY STREET, SUITE 2500


TORONTO, ONTARIO M5J 2T7 CANADA


(Address of principal executive offices)





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


NONE





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


COMMON SHARES


(Title of Class)





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


NONE


(Title of Class)





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


76,404,648 COMMON SHARES





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


Yes  ̈         No x





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


Yes  ̈         No x





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


Yes x             No  ̈





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


Large accelerated filer  ̈          Accelerated filer  ̈          Non-accelerated filer x





Indicate by check mark which financial statement item the registrant has elected to follow.


Item 17 x         Item 18  ̈





If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).


Yes  ̈         No x





(Applicable only to Issuers involved in Bankruptcy proceedings during the past five years) Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.


Yes  ̈             No  ̈







TABLE OF CONTENTS





Part I
4Item 1. Identity of Directors, Senior Management and Advisers
4Item 2. Offer Statistics and Expected Timetable
4Item 3. Key Information
4Item 4. Information on the Company
12Item 4A. Unresolved Staff CommentsItem 5. Operating and Financial Review and Prospects
14Item 6. Directors, Senior Management and Employees
19Item 7. Major Shareholders and Related Party Transactions
26Item 8. Financial Information
27Item 9. The Offer and Listing
28Item 10. Additional Information
29Item 11. Quantitative and Qualitative Disclosures About Market Risk
44Item 12. Description of Securities Other than Equity Securities
44Part II
44Item 13. Defaults, Dividend Arrearages and Delinquencies
44Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds
45Item 15. Controls and Procedures
45Item 16. [Reserved]
46Item 16A. Audit Committee Financial Expert
46Item 16B. Code of EthicsItem 16C. Principal Accountant Fees and Services
46Item 16D. Exemptions from listing the Standards for Audit CommitteesItem 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers
46Part III
46Item 17. Financial Statements
46Item 18. Financial Statements
47Item 19. Exhibits
47


2




FORWARD LOOKING STATEMENTS Certain statements in this annual report are based upon the beliefs of management of Carthew Bay Technologies Inc. (Formerly Astris Energi Inc.), as well as assumptions made by and information currently available to management, and such statements may constitute "forward-looking statements" within the meaning of the U. S. Private Securities Litigation Reform Act of 1995. Investors should note that many factors, some of which are discussed elsewhere in this Report, could affect the future operations and the future financial results of the Company and could cause future operations and future financial results to differ materially from those expressed in such forward-looking statements.





3




PART I.





ITEM 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS.


Not Applicable.





ITEM 2.  OFFER STATISTICS AND EXPECTED TIMETABLE.


Not Applicable.





ITEM 3.  KEY INFORMATION.





A.
SELECTED FINANCIAL DATA.





The following table sets forth, in Canadian dollars, selected historical information concerning the Company presented in accordance with Canadian GAAP and is qualified by reference to the consolidated financial statements and notes thereto. See "Item 17. Financial Statements".





As at


As at


As at


As at


As atDecember 31,


December 31,


December 31,


December 31,


December 31,2010


2009


2008


2007


2006Revenue

$
NIL


$
NIL


$
NIL


$
31,290


$
85,915Net Profit (Loss)from Operations


(1,071,991
)


(148,984
)


(571,755
)


(2,507,843
)


(2,120,422
)Net Profit (Loss)


(2,938,229
)


(155,785
)


176,689



1,995,088



(2,120,422
)Basic Profit (Loss) from operationsper Share


(0.05
)


0.00



0.00



0.04



(0.05
)Diluted


(0.05
)


0.00



0.00



0.02



n/aTotal Assets


461,247



2,892,240



2,995,529



2,634,698



1,766,218Net Assets


(103,285
)


2,789,294



2,945,079



2,551,811



( 53,221
)Long Term Obligations


-



-



-



-



-Share Capital


10,978,448



10,978,448



10,978,448



10,845,648



11,205,002Number of Shares Basic


76,404,648



76,404,648



76,404,648



50,789,682



48,131,669Cash Dividends


-



-



-



-



-




4





EXCHANGE RATES





The following table sets out the exchange rates for the conversion of Canadian dollars into United States dollars.  The exchange rates used are the closing rates provided by The Bank of Canada.  The table lists the rate in effect at the end of the following periods, the average exchange rates (based on the average of the exchange rates for the closing date of each month in such periods), and the range of high and low exchange rates for such periods.





Year ended December 31,

2010


2009


2008


2007


2006End of Period


1.0054



.9555



.8166



1.02



.86Average for Period


.9713



.8704



.938



.936



.882High for Period


1.0054



.9716



1.028



1.09



.91Low for Period


.9278



.7692



.7711



.84



.853





The following table sets out the range of high and low exchange rates, for the conversion of Canadian dollars into United States dollars for each of the corresponding months during 2010 and 2011.  The exchange rates used are the closing rates as provided by the Bank of Canada.




Month

High


LowNovember 2010


.9987



.9743December 2010


1.0054



.9825January 2011


1.0140



.99978February 2011


1.0268



1.0045March 2011


1.0324



1.0083





The exchange rate on December 31, 2010 for the conversion of United States dollars into Canadian dollars was $1.0054 (CDN$1.00 = US$.9946). As of  19, 2011 the close rate of exchange for the conversion of United States dollars into Canadian dollars was 1.0136(CDN$1.00 = US$.9866).  The exchange rates used are the closing rates as provided by the Bank of Canada.





B.
CAPITALIZATION AND INDEBTEDNESS.


Not Applicable.





C.
REASON FOR THE OFFER AND USE OF PROCEEDS.


Not Applicable.





D. RISK FACTORS. An investment in the securities of the Company involves a high degree of risk. The following risk factors should be considered carefully in evaluating the Company and its business. If any of the risks described below occurs, the business, results of operations and financial condition of the Company could be adversely affected.


5





HISTORY OF LOSSES SINCE INCEPTION, EXPECTATION OF LOSSES IN THE IMMEDIATE FUTURE, AND POSSIBILITY THAT THE COMPANY MAY NEVER ACHIEVE OR SUSTAIN PROFITABILITY. The Company has incurred operating net losses each year since inception. The accumulated deficit of the Company was CDN$17,363,950 as of December 31, 2010.





Carthew Bay Technologies Inc. (Formerly Astris Energi Inc.)(the “Company”) designed, developed, manufactured and sold alkaline fuel cells (“AFCs”) and alkaline fuel cell systems, fuel cell and battery test loads and provide engineering and other services.





Since inception, the efforts of the Company have been devoted to the development of AFCs for industrial, commercial, educational, scientific, transportation and similar applications.  The Company had not earned significant revenues.





On August 1, 2007, the Company sold substantially all its assets, including its wholly-owned subsidiaries, to MKU Canada Inc., an arm’s-length third party.  MKU Canada Inc. is a wholly-owned subsidiary of MKU Cyprus Ltd.  The transaction includes the sale of substantially all of the assets of the Company, including its fuel cell and test load technology assets for consideration of: i) US$3,064,363 in cash ($3,216,049 Canadian: ii) forgiveness of US$1,225,000 and $380,000 Canadian of face value  secured convertible debentures held by ACME Global Inc. (a subsidiary of MKU Cyprus Ltd.) along with US$210,000 ($234,558 Canadian) of accrued interest: iii) an option for the Company, for a consideration of $1 to purchase 4,248,750 of its own shares: iv) the forgiveness of a secured convertible promissory note in the amount of US$600,000 ($642,700 Canadian). The Company has exercised the option to reacquire and cancel the 4,248,750 of its own shares.





With the sale of substantially all of its assets, the Company ceased to be in the development stage.  In prior years, the Company reported as a development stage enterprise.





The Company changed its name to Carthew Bay Technologies Inc. on August 17, 2007.





On December 10, 2007, the Company announced that it had executed a letter of intent (“LOI”) with Colorep Inc. (“Colorep”) relating to a transaction whereby shares of the Company will be issued in exchange for all of the issued and outstanding shares of Colorep under terms that constitute a reverse takeover (“RTO”) pursuant to Emerging Issue Committee abstract EIC-10, Reverse Takeover Accounting, of the CICA Handbook.  Following the successful completion of the RTO, the Company would become the legal parent of, and the existing shareholders of Colorep would acquire control of, the combined enterprise.  Successful completion of the RTO is subject to several conditions as discussed below.




6


Colorep is located in Rancho Cucamonga, CA, and develops and offers for sale sustainable subsurface printing and dyeing technology for decorating a wide variety of textiles and other consumer products. Colorep has previously announced its intention to acquire Transprint USA Inc. (“Transprint”), a privately held, employee-owned company, founded in 1978, with headquarters and manufacturing facilities in Harrisonburg, VA, and design studios and showrooms in New York City and Charlotte, NC. Transprint offers printing products and design services worldwide for the apparel, commercial and residential furnishings markets.  The definitive share purchase agreement between Colorep and Transprint has been completed.  One of the conditions precedent to the conclusion of the RTO under the LOI is receipt by Colorep of a credit facility sufficient to enable Colorep to conclude the acquisition of Transprint.




Pursuant to the LOI and subject to the terms thereof, the Company will invest US $2,000,000 in two equal tranches into secured debentures (the “Debentures”) of Colorep.  The Debentures will bear interest at 1% per month (unless increased pursuant to the terms of the LOI) and interest will accrue until maturity on April 30, 2008.  Subject to certain conditions, the Company is obligated to advance the first US $1,000,000 to Colorep upon execution of a binding share exchange agreement.  The LOI further provides that upon receipt of all approvals, including shareholder and regulatory approvals, necessary to conclude the RTO, the Company will cancel the Debentures.  There are many conditions associated with the conclusion of the various transactions included as part of the LOI including: a) a condition that the Company consolidate its shares pursuant to a formula included as part of the LOI, and b) the completion of Transprint acquisition by Colorep.




Subject to certain extension provisions set out in the LOI, the transactions contemplated thereunder must be completed prior to April 30, 2008.  Upon closing of the RTO, all of the current members of the Board of Directors of the Company, other than Michael Liik, will resign and will be replaced by between four and six new members.




Execution of the LOI has received the unanimous approval for the Board of Directors of the Company.




In conjunction with the proposed RTO, the Board of Directors of the Company approved a Success Fee payable to its CEO and CFO amounting to 1.4% of the Colorep transaction value or $1,150,000, earned upon closing of the Colorep RTO transaction and payable as a combination of cash remaining in the Company immediately prior to the RTO transaction and treasury shares of the Company issued at a price equivalent to the value per share (after giving consideration to the shares issued in this regard) received by the shareholders of the Company as a consequence of the RTO.  The fee would be increased by an additional 0.06% of the transaction value or $500,000, or such pro-rated amount, determined 3 months after closing of the RTO transaction and based upon the performance of the post-RTO shares.  In the event that the performance of the post-RTO shares (with the definition of performance to be established in a formal agreement), is between $0.70 per share equivalent value (as described in the LOI) and $1.00 per share, the additional $500,000 fee would be pro-rated such that no fee would be earned on the lower threshold and the full fee earned on the upper threshold.  This fee would be payable in treasury shares of the Company on the basis described above.




On May 23, 2008, Carthew Bay Technologies Executed Agreement and Plan of Merger with Colorep, Inc. and advanced a second US$1.0 Million in respect of the Secured Debenture Financing related thereto.




7


On March 26, 2010, the Company made changesto the Success/M&A Fee originally approved in December 2007.  Upon Shareholder approval of the conversion discussed below, the previously issued 21,821,632 shares held in escrow (note 6(a)) will be released as well as a cash payment of $150,000. On March 26, 2010 the CEO agreed to surrender 2,543,485 options and the CFO agreed to surrender 1,526,091 options as well as 254,348 Finder’s Fee options granted in 2007.




The Company has entered into the Amended and Restated Convertible Debenture of Colorep (which replaces the Debentures) and the Amended and Restated Agreement and Plan of Merger (which replaces the Original Agreement and Plan of Merger), both of which are made and effective as of March 31, 2010.  The Amended and Restated Convertible Debenture and the Amended and Restated Agreement and Plan of Merger were entered into at the request of Colorep (i) to facilitate its immediate financing needs, and (ii) because the Company was able to negotiate an amendment fee.  The Amended and Restated Convertible Debenture requires the Company to hold a shareholder’s meeting at the earliest possible date to approve above amendments.




The Amended and Restated Convertible Debenture provides that all outstanding principal and unpaid interest will be due on March 31, 2012 and will bear interest at a rate of one percent (1%) per month until such time.  In exchange for the Company’s agreement, Colorep agreed to pay an amendment fee of US $100,000 (the “Amendment Fee”), payable in the amount of US $50,000 immediately and US $50,000 on April 30, 2010, to be credited against the cash payment obligation set forth in (iv) below.  The amended and Restated Convertible Debenture also provides that, immediately upon approval by the Shareholders of the Special Resolution described under the heading “Special Resolution” below:




i)  all outstanding principal and unpaid interest and all other amounts owed by Colorep to the Company will be converted into: (a) 714,005 shares of Series C preferred stock of Colorep (convertible into shares of common stock at a rate of ten shares of common stock for each share of Series C Preferred Stock) – which represent approximately 4.52% of the outstanding securities of Colorep, calculated on an as-converted into common shares basis (fully diluted in accordance with US GAAP) or 2.58% of the outstanding shares of Colorep calculated on an as-converted into common shares basis (fully diluted including all warrants); (b) warrants to purchase 7,140,050 shares of common stock of Colorep to be exercisable at US $0.378 per share for a period of five years from issuance – which represent approximately 2.58%  of the outstanding shares of Colorep calculated on an as-converted into common shares basis (fully diluted including all warrants) (these warrants are not included pursuant to US GAAP); and (c) 2,697,392 shares of Common Stock of Colorep – which represent approximately 1.71% of the outstanding shares of Colorep, calculated on an as-converted into common shares basis (fully diluted basis in accordance with US GAAP) or 0.97% of the outstanding common shares of Colorep calculated on an as-converted basis (fully diluted including all warrants);




ii)  the shares of Series C preferred stock and warrants to purchase common stock of Colorep issued pursuant to (i) will be subject to adjustment pursuant to applicable anti-dilution provisions in favour of the Company;




iii)  a conversion fee of US $500,000 payable out of financings would accrue to the Company and be payable in two portions without interest: (a) upon consummation of Colorep’s next Company Financing Event (as defined in the Amended and Restated Convertible Debenture), an amount equal to 10% of the proceeds of the financing; and (b) the balance due, if any, upon consummation of any subsequent Company Financing Event;




8




iv)  US $30,000 per month would accrue to the Company until the date of effectiveness of a Form 10 filing by Colorep registering its Common Stock pursuant to Section 12 of the U.S. Exchange Act (subject to a minimum of US $150,000 and a maximum of US $184,931), payable as follows: (a) application of the paid Amendment Fee as an advance against subsequent accruals; and (b) any accrued and unpaid balance of the accruals payable concurrent with consummation of each Company Financing Event subsequent to the closing of the conversion;




v)  5% of the Original Issuance Price (as defined in the Amended and Restated Convertible Debenture) would accrue to the Company per annum per Series C Share issued in conjunction with the conversion, until conversion of the Series C Shares at the Company’s option or automatically upon the common stock of Colorep becoming freely tradable (as applicable), and payable by Colorep concurrent with conversion of the Series C Shares in either cash or additional Series C Shares (to be immediately converted) at Colorep’s option;




vi)  Colorep would be required to issue additional warrants to purchase shares of Common Stock of Colorep and pay a $25,000 cash penalty to the Company in the event that it fails to timely pay any amount due under item (iii) or item (iv) above;




vii)  pursuant to the terms of its Series C Shares of Colorep, the Company will be entitled to elect one member of the board of directors of Colorep until such time as less than fifty and one tenth percent (50.1%) of such shares are outstanding;




viii)  the Company will be granted certain participation rights, information rights and other rights pursuant to a third amended and restated investors’ rights agreement: and




ix)  the Company will be granted certain registration and other rights pursuant to a third amended and restated registration rights agreement




The Amended and Restated Agreement and Plan of Merger provides Colorep with the option to determine whether or not to proceed with the RTO, which Colorep must exercise on or before December 31, 2010.  The Company does not have any right to trigger or enforce the Amended and Restated Agreement and Plan of Merger with respect to the conduct and completion of the RTO in the absence of Colorep exercising its option to proceed with the RTO.  If Colorep does not exercise its option to proceed with the RTO prior to December 31, 2010, the Amended and Restated Agreement and Plan of Merger shall terminate and the parties will have no further obligations to conduct or complete the RTO.  If Colorep does exercise its option to proceed prior to December 31, 2010, the RTO would be conducted and completed pursuant to the Amended and Restated Agreement and Plan of Merger and a further special meeting of the shareholders of the Company would be convened to obtain any additional approvals of the shareholders of the Company that may be required with respect thereto.




9


On May 6, 2010, CBT announced that the shareholders voted overwhelmingly to approve the conversion of the Company’s debt investment in Colorep Inc. into various equity securities of Colorep and cash payments at the Special Meeting of Shareholders. The Company also announced that it had formed an Advisory Board made up of Messrs. Jiri Nor, Atul Sabharwal, and Michael Stein. The Company further announced that its Chief Executive Officer and Chief Financial Officer have today agreed to amend their success fee arrangement in connection with the approval of the transaction with Colorep.  As a result, 1/3 of the 21,776,632 common shares in the capital of the Company which were to be released from escrow today to the Chief Executive Officer and Chief Financial Officer of the Company (as more fully described in the management information circular prepared in connection with the special meeting of shareholders of the Company held today) will continue to be held in escrow until such time when, over a period a 5 consecutive business days, the simple average of the closing prices of the Company’s shares on the principal stock exchange or stock quotation system on which such stock trades is equal to or greater than U.S. $0.11¢.  However, if the shares remaining in escrow are not released on or before May 6, 2015 they shall be surrendered to the Company and cancelled.





The Consulting Agreement between CBT and and Macnor was amended on May 6, 2010 so that there will be no minimum number of consulting service days, the options previously granted will be surrendered for cancellation such that Macnor Corp. will retain options to purchase 416,666 common shares of CBT. The term of the agreement was also amended so that the initial term of the agreement will be for one year subject to renewal upon mutual agreement.





On May 20th, CBT announced that it had completed the conversion of the Company’s debt investment in Colorep, Inc., into various securities and cash payments.





RISKS INHERENT IN INTERNATIONAL OPERATIONS INCLUDING CURRENCY EXCHANGE RATE FLUCTUATIONS AND TARIFF REGULATIONS. A substantial portion of the Company's revenues is expected to be realized in currencies other than Canadian dollars. The Company's operating expenses are primarily paid in Canadian dollars. Fluctuations in the exchange rate between the Canadian dollar and such other currencies may have a material effect on the Company's results of operations.





POSSIBLE DIFFICULTIES BY UNITED STATES PERSONS TO EFFECT SERVICE OF PROCESS WITHIN THE UNITED STATES UPON THE COMPANY OR ITS DIRECTORS OR OFFICERS, OR TO REALIZE IN THE UNITED STATES UPON JUDGMENTS. The Company is an Ontario corporation with its principal place of business in Canada. Most of its Directors and Officers are residents of Canada and most of the assets of such persons and of the Company are located outside the United States. US Persons should not assume that Canadian courts (i) would enforce judgments of United States courts obtained in actions against the Company or its Officers and Directors predicated upon the civil liability provisions of the United States federal securities laws or the securities or "blue sky" laws of any state within the United States or (ii) would enforce, in original actions, liabilities against the Company or its Officers and Directors predicated upon the United States federal securities laws or any such state securities or blue sky laws.  Canadian courts can enforce such judgments but are not required to give “full faith and credit” to such judgments as would courts lying in separate United States jurisdictions. For instance, a Florida court would have to enforce a New York judgment, but a Canadian court can decide not to enforce a US judgment in Canada.


10


THE COMPANY HAS NEVER PAID DIVIDENDS AND IT DOES NOT ANTICIPATE PAYING DIVIDENDS IN THE FORESEEABLE FUTURE. The Company has never declared any cash dividends on its Common Shares, and if the Company were to become profitable, it would be expected that most or all of such earnings would be retained to support the business. As a result, shareholders must rely on stock appreciation for any return on their investment in the Common Shares.





THE COMPANY HAS AUTHORIZED AN UNLIMITED NUMBER OF COMMON SHARES AND UP TO 10,000,000 PREFERRED SHARES OF SHARE CAPITAL.  Under Canadian law the Company is able to issue an unlimited number of its common shares and up to 10 million preferred shares. The Company does not need the consent of its shareholders to issue these additional shares. Therefore, there is a high likelihood of dilution from the issuance of additional shares. The additional shares can be used to thwart a takeover attempt that the Board of Directors does not deem in the Company’s best interest, however the Company has not made any provision for issuing shares in that manner. The Company has not issued any preferred shares.





VOLATILE AND LIMITED MARKET FOR THE COMPANY'S COMMON SHARES. The Company's Common Shares are not actively traded.  The Company's Common Shares began trading on the Over The Counter Bulletin Board Exchange (“OTC.BB”) on June 20, 2001.  The Common Shares traded in 2010 from a high of US$0.0156 to a low of US$0.0035 per share. The Common Shares are not presently publicly traded in Canada. There can be no assurance given that trading activity will increase investor recognition.





APPLICATION OF THE SEC PENNY STOCK REGULATIONS AND RESTRICTIONS. The Securities and Exchange Commission has adopted regulations which generally define Penny Stocks to be an equity security that has a market price less than US$5.00 per share or an exercise price of less than US$5.00 per share.  This is subject to certain exemptions based upon minimum assets or revenues. As of April 28, 2010, the closing bid and asked prices for the Common Shares were US$.0133 and US$.05 per share. As a Penny Stock, the Company's Common Shares may become subject to Rule 15g-9 under the Securities Exchange Act of 1934, as amended, or the Penny Stock Rule. This Rule imposes additional sales practice requirements on broker-dealers that sell such securities to persons other than established customers and "accredited investors" (generally defined as individuals with a net worth in excess of US$1,000,000 or annual incomes exceeding US$200,000, or combined annual income with spouse of US$300,000).  For transactions covered by Rule 15g-9, a broker-dealer must make a special suitability determination for the purchaser and have received the purchaser's written consent to the transaction prior to sale. As a result, this Rule may affect the ability of broker-dealers to sell the Company's securities and may affect the ability of purchasers to sell any of the Company's securities in the secondary market.




11


For any transaction involving a Penny Stock, unless exempt, the Rule requires that prior to any transaction in a Penny Stock, a disclosure schedule prepared by the SEC relating to the Penny Stock market is delivered. Disclosures about sales commissions payable to both the broker-dealer and the registered representative and about current quotations for the securities are also required. Finally, monthly statements are required to be sent disclosing recent price information for the Penny Stock held in the account and information on the limited market in penny stock.





FORWARD LOOKING INFORMATION





The following discussion, as well as other sections within this annual report, contains forward-looking information which is based on current expectations and entails various risks and uncertainties. These risks and uncertainties could cause or contribute to actual results that are materially different from those expressed or implied.  The forward-looking information contained in this document is current only as of the date of the document.  There should not be an expectation that such information will in all circumstances be updated, supplemented or revised whether as a result of new information, changing circumstances, future events or otherwise.





ITEM 4. INFORMATION ON THE COMPANY.





A.
HISTORY AND DEVELOPMENT OF THE COMPANY.





Carthew Bay Technologies Inc. (Formerly Astris Energi Inc.) ("AEI" or the "Company") was incorporated as Kayty Exploration Ltd. on March 18, 1981, pursuant to the Companies Act of the Province of Alberta, Canada to engage in oil and gas exploration activities. The Company subsequently changed its name to Kayty Inc. in August 1987, changed the place of incorporation to the Province of Ontario, Canada, and effected a one-for-ten reverse split of its Common Shares. In December 1994, the Company changed its name to WLD Inc. ("WLD") and effected a one-for-three reverse split of its Common Shares, reducing the outstanding Common Shares to 5,000,000 shares. By 1995, WLD had ceased exploration activities and sought other business activities. In February 1996, the Company acquired Astris Inc. in exchange for 1,500,000 Common Shares and warrants for the purchase of 3,500,000 Common Shares, which warrants were subsequently exercised in 1997 at an exercise price of CDN$0.05 per warrant. Additionally, in June 1995, the Company changed its name to  Astris Energi Inc. The purpose of the acquisition was for the Company to obtain a potentially promising business activity, and Astris Inc. was seeking to be part of a public company to facilitate raising working capital to further the development of its fuel cell research.  AEI began trading on the OTC.BB under the trading symbol “ASRNF” on June 20, 2001. On August 22, 2007 the trading symbol was changed to “CWBYF” coincident with the change in name from Astris Energi Inc. to Carthew Bay Technologies Inc.





The Company's principal business office is located at Brookfield Place, 181 Bay Street, Suite 2500, Toronto, Ontario, Canada M5J 2T7 and its telephone number is (416)307-4015. The Company's e-mail address is mliik@carthewbaytechnologies.com. The Company maintains a website at www.carthewbaytechnologies.com. The Company is not incorporating, by reference in this Form 20-F, the information on its website.


12


The Company’s U.S. agent is CT Corporation System, 111 Eighth Avenue, 13th Floor, New York City, New York, U.S.A. 10011.





B.
BUSINESS OVERVIEW.





THE COMPANY'S PURPOSE





The Company's mission was to become the leading provider of affordable fuel cells and fuel cell power generators.  The Company’s near term priority was to achieve the required business partnerships and financing to successfully achieve manufacturing capability leading to commercialization.  The Company’s business plan called for commercialization within three years provided that adequate funding can be secured. With the Asset Sale in July 2007, the Company has changed its focus and direction and sought to maximize shareholder value. As such, on May 23, 2008, the Company executed an Agreement and Plan of Merger with Colorep, Inc.





DESCRIPTION OF THE COMPANY'S BUSINESS ACTIVITIES





Carthew Bay Technologies Inc. (Formerly Astris Energi Inc.) is a Canadian (Toronto, Ontario) company that since 1983 had been pioneering the development of alkaline fuel cells (“AFCs”) and AFC generators and had a series of such power systems tested and ready for commercialization. While most fuel cell companies are targeting the eventual car-truck-bus market or large utility type generating stations, Carthew Bay Technologies (Formerly Astris) had specialized, in one-to-ten kilowatt systems which we believed would have tremendous global market potential. The company also anticipated linking modules together in larger units for larger applications.





COMPETITION





LEGAL PROCEEDINGS





There are no current legal proceedings.





GOVERNMENTAL REGULATION





The Company knows of no governmental license or approval required in connection with the manufacture or sale of the Company's current products. There are no extraordinary governmental regulations known to the Company that affects its ability to sell or produce its products. The Company does not believe that it will be subject to existing regulations governing traditional electric utilities.





The Company knows that its products must comply, where applicable, with the existing rules and regulations for electrical and electronic products, and is prepared to meet such requirements.




13


The Company anticipated that its products and their installation may have been subject to oversight and regulation related to their safety due to their use of hydrogen, which is flammable and regarded as a hazardous gas. However, hydrogen is a commonplace industrial gas, which is produced in enormous quantities every day in numerous industrial facilities around the world. Regulations have been in place for decades regarding hydrogen, which provide routine specifications for manufacturers of hydrogen-using equipment.  Therefore, the Company does not anticipate any new regulations regarding hydrogen, or any difficulties in complying with existing regulations.





ENVIRONMENTAL COMPLIANCE





There are no environmental laws known to the Company, which may affect any of its operations as they are currently constituted. The Company is not involved in a business which involves the use of materials which are likely to result in a violation of any existing environmental laws, rules or regulations, nor does it own any real property which would lead to liability as a land owner.





C.
ORGANIZATIONAL STRUCTURE.





The Company had a subsidiary, Astris Inc. ("AI") which was amalgamated with Carthew Bay Technologies Inc. (Formerly Astris Energi Inc.) ("AEI") effective January 1, 2005.  AI was incorporated initially as Astris Science Inc. on April 8, 1983, in the Province of Ontario, and changed its name to Astris Inc. in 1986.  AEI also owns 100% of holding company 2062540 Ontario Inc.("Holdco"), incorporated in the Province of Ontario on January 12, 2005.  Holdco owns 100% of Astris s.r.o., which was organized under the laws of the Czech Republic.  The Company, up until January 27, 2005 owned a 30% minority interest in Astris s.r.o.  The Company transferred its 30% ownership to Holdco as part of the acquisition of the remaining 70% of Astris s.r.o.  The remaining 70% interest in Astris s.r.o. was owned by Macnor Corp., an Ontario corporation that is wholly owned by Jiri K. Nor, an Executive Officer, Director and principal shareholder of the Company. Unless otherwise indicated or outside the context of the disclosure, all references to the Company shall include AI, 2062540 Ontario Inc. and Astris s.r.o.





Effective July 31, 2007, Carthew Bay Technologies sold substantially all of its assets including “Holdco” to MKU Canada Inc. On August 22, 2007 Carthew Bay Technologies announced that it had changed its name from Astris Energi Inc. to Carthew Bay Technologies Inc.





D.
PROPERTY, PLANT AND EQUIPMENT (FIXED ASSETS).





The Company currently has no Fixed Assets as they were sold to MKU Canada, Inc as of July 31, 2007.





ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS.





The following is a discussion of the results of operations and financial condition of the Company for the fiscal years ended December 31, 2010, 2009 and 2008.  The financial statements are prepared in accordance with Canadian generally accepted accounting principles (“GAAP”) and are presented in Canadian dollars.  Differences between Canadian GAAP and United States GAAP can be found in Note 13 of Item 17 of this filing.  This discussion should be read in conjunction with the consolidated financial statements and notes thereto forming a part of this annual report.


14


The following discussion, as well as other sections within this annual report, contain forward-looking information which is based on current expectations and entails various risks and uncertainties. These risks and uncertainties could cause or contribute to actual results that are materially different from those expressed or implied.  The forward-looking information contained in this document is current only as of the date of the document. There should not be an expectation that such information will in all circumstances be updated, supplemented or revised whether as a result of new information, changing circumstances, future events or otherwise.





The only critical accounting policy is income taxes.  Because there is uncertainty when the Company will make sufficient profits in future years to absorb the losses before they expire, the Company takes a valuation allowance which results in no tax being recovered.





A.
OPERATING RESULTS.





The financial statements included in this report are stated in Canadian dollars.





REVENUE





For the year ended December 31, 2010, revenue was $NIL compared with  $NIL for the same period in 2009 and $NIL for the same period in 2008.





EXPENSES





For the year ended December 31, 2010, expenses totaled $1,071,991 compared with $148,984 for the same period in 2009, compared with $571,755 for the same period in 2008.  General and Administrative expenses were $481,323 in 2010, $155,876 in 2009 as compared to $554,712 in 2008.





Professional fees were $520,018 in 2010, as compared to $21,893 in 2009 as compared to $148,426 in 2008, reflecting the Company’s increased corporate activity, legal activity, accounting and compliance activity.





NET INCOME (LOSS) FOR THE YEAR ENDED DECEMBER 31, 2010





The Company reported a net loss of $2,938,229 (a loss of $.05 per share basic and diluted) for the year ended December 31, 2010, compared with net loss of $155,785 (a loss of $0.00 per share basic and diluted) for the year ended December 31, 2009, compared with income of $176,689 (a gain of $0.00 per share basic and $0.00 diluted) in 2008.





As at December 31, 2010, the Company has non-capital loss carry forwards of approximately $10,343,861.  If unused, the tax losses will expire as follows:


15


2014

$
2,438,0142015

$
3,029,9462026

$
1,835,4412028

$
120,8472030

$
1,147,916





The Company has unclaimed scientific research and experimental development (“SRED”) tax pools in Canada of $1,771,697 which are available to offset future taxable income. These SRED amounts have an unlimited carry forward period.





B.  LIQUIDITY AND CAPITAL RESOURCES.





The Company had a net cash flow deficit of $195,184 in 2010, $268,142 in 209 compared with $2,064,900 in 2008.





At 2010 year end, the Company had $461,247 of assets and a shareholders’ equity of ($103,285) compared to a shareholders’ equity of $2,789,294 in 2009.





The Company does not have any off-balance sheet arrangements.





During 2006, the Company raised $1,856,750 through the convertible debentures below and the leasing of $28,360 of capital equipment.  During 2005, the Company raised $493,350 through the convertible debenture described below and the issuance of shares for options exercised.  During 2004, the Company raised $2,076,041 through private placements of shares and warrants.





On March 28, 2005, the Company announced that it had closed a convertible debenture financing for gross proceeds of CDN$420,000. The debenture was available for subscription to “Canadian accredited investors” only and included a coupon for 6%, payable in common shares upon conversion or maturity.  Each debenture is convertible into Common Shares at a conversion rate that in no case shall be less than USD$0.20 or more than USD$0.70.  Warrants may be issued to the debenture holders depending on the terms of a second larger equity financing.  The debentures mature on December 10, 2005, 270 days from the date of issuance. Total net proceeds were CDN$378,000. Fraser Mackenzie Limited, for facilitating the funding, also received 156,000 broker warrants exercisable at CDN$0.27 until March 24, 2007.  These debenture holders agreed to amend this debenture to the same terms of the Cornell Capital debenture described below.





On April 12, 2006, the Company issued a press release announcing the completion of a One Million Five Hundred Thousand Dollars ($1,500,000) million financing (the “Financing”).  The Company entered into a Securities Purchase Agreement (the “Agreement”) on April 10, 2006 with Cornell Capital Partners, LP, an institutional investor (the “Investor”), relating to the sale of One Million Five Hundred Thousand Dollars ($1,500,000) of secured convertible debentures (the “Convertible Debentures”), which will be convertible into shares (the “Conversion Shares”) of the Company’s common stock (the “Common Stock”) of which Seven Hundred Fifty Thousand Dollars ($750,000) was funded on April 18, 2006 (the “First Closing”) and Seven Hundred Fifty Thousand Dollars ($750,000) was funded on June 9, 2006, for a total purchase price of up to One Million Five Hundred Thousand Dollars ($1,500,000), (the “Purchase Price”).  Pursuant to the Agreement, the Investor also received common stock purchase warrants (the “Warrants”) to purchase (i) 1,000,000 shares of the Company's common stock at an exercise price of $.30 per share (ii) 600,000 shares of the Company's common stock at an exercise price of $.20 per share and (iii) 1,600,000 shares of the Company's common stock at an exercise price of $.19 per share.  The Company received net proceeds from the First Closing Six Hundred Seventeen Thousand Five Hundred Dollars ($617,500) and Six Hundred and Fifty-Two Thousand Dollars ($652,000) in the second closing, which are to be used primarily for working capital purposes.


16


The Convertible Debentures have an initial conversion price of the lesser of (i) a price equal to $.2483 (the “Fixed Conversion Price”) or (ii) ninety percent (90%) of the lowest daily Volume Weighted Average Price of the Common Stock during the ten (10) trading days immediately preceding the Conversion Date as quoted by Bloomberg, LP per share and provides for anti-dilution protection (in certain circumstances).  At the Fixed Conversion Price, the Convertible Debentures will be convertible into an aggregate of 6,041,079 shares of common stock.  The Convertible Debentures bear interest at 10% per annum.  Interest is payable in cash or, at the Company's option, in shares of common stock (the “Interest Shares”) provided certain conditions are satisfied.  At any time after their respective issuance dates and prior to April 9, 2009, the Convertible Debentures may be redeemed at the election of the Company at the principal amount plus a redemption premium equal to 20% of the principal amount being redeemed, plus accrued but unpaid interest, subject to the satisfaction of certain conditions.





The Investor was granted a security interest in the assets of the Company and the assets of the Company's subsidiary, 2062540 ONTARIO INC.





The Warrants may be exercised for cash, as indicated above, and also contain a cashless exercise provision, which may be exercised in certain circumstances.  The Warrants provide for anti-dilution protection in certain circumstances.  The Warrants are exercisable for 1,000,000, 600,000 and 1,600,000 shares of Common Stock (the “Warrant Shares”), respectively, and if fully exercised for cash at the initial exercise price, the Warrant would yield approximately $724,000 of additional proceeds to the Company.





The Company filed a registration statement (the “Registration Statement”) with the SEC in order to register the resale of the shares issuable upon conversion of the Convertible Debentures and the shares issuable upon exercise of the Warrants.  The registration was declared effective on July 21, 2006.





Pursuant to the Securities Purchase Agreement, the Investor has certain rights to participate in future financings of the Company.  In addition, subject to certain exceptions, so long as any of the Convertible Debentures are outstanding, the Company may not, without the prior written consent of the investor, issue shares of common stock or common stock equivalents.





Pursuant to the Securities Purchase Agreement, the Company and the Investor entered into a Share Escrow Agreement and an Irrevocable Letter of Instructions to the Company’s transfer agent (the “Transfer Agent”).  Pursuant to the Share Escrow Agreement, the Irrevocable Letter of Instructions is being held by an escrow agent (“Escrow Agent”) and upon the occurrence of an “Event of Default” (as that term is defined in the Convertible Debentures) may be delivered to the Transfer Agent by the Escrow Agent directing the Transfer Agent to issue 34,500,000 shares of Common Stock to the Investor without any further action by the Company.


17


The Investor may not convert the Convertible Debentures or exercise the Warrant to the extent that, after giving effect to such conversion or exercise, as the case may be, the Investor would beneficially own in excess of 4.99% of the number of shares of common stock of the Company outstanding immediately after giving effect to such conversion or exercise, calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.  Such limitation with respect to such conversion or exercise may be waived by the Investor upon not less than 65 days prior notice to the Company.





The offering, sale and issuance of the Convertible Debentures and the Warrants were effected pursuant to the exemption from registration provided by Rule 506 promulgated under the Securities Act of 1933, as amended.  The Convertible Debentures and Warrants have not been registered under the Securities Act of 1933, as amended, and confirmed the Company has been notified that all existing convertible debentures are now owned by ACME Global Inc., a Delaware corporation and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.





We use options to pay non employees who provide services to us.  Also all of our senior management have been willing to support the company through accepting part cash and part equity for their services provided.





PROSPECTS





On October 26, 2005, the Company hired Ardour Capital Investments LLC (“Ardour”) as its exclusive financial advisor.  For a 24 month engagement, Ardour will receive 1,250,000 common shares of Astris stock.  Ardour is also entitled to 7% commission on any funds raised through them. In January 2008 625,000 shares were issued to Ardour for the ending of the engagement on October 26, 2007.





On June 5, 2007, the company executed a binding asset purchase agreement with MKU Canada Inc., a corporation incorporated under the laws of Ontario, Canada, a wholly-owned subsidiary of Green Shelters Innovations Ltd. (“GSI”), a wholly-owned subsidiary of Green Shelters (India) Private Ltd, to sell substantially all of its assets to MKU Canada Inc.




This transaction, which was negotiated by the Special Committee of the Board of Directors of Astris, includes the sale of substantially all of the assets of the Company, including its fuel cell and test load technology assets for consideration of: (i) approximately US$3.1 Million in cash; (ii) forgiveness of US$1.6 Million of face value secured convertible debentures held by ACME Global Inc. (a subsidiary of GSI) and accrued interest of US$175,000; (iii) an option for Astris to redeem, for nominal consideration and then cancel 4,248,750 shares recently acquired by ACME Global Inc. for US$0.08 per share; and (iv) a secured convertible promissory note funding commitment of a minimum of US$150,000 per month to finance operations to closing and to be forgivable thereafter.


18


Immediately after closing, existing management will resign both as officers and directors of the Company. It is the intention of the Board of the Company to appoint a new CEO with a mandate to utilize the remaining cash and residual tax losses to seek new business opportunities.





The obligation of the parties to consummate this transaction will be subject to the following primary conditions: 1) no material adverse change to Carthew Bay’s business; 2) execution of employment agreements between GSI and key personnel of Astris; 3) completion prior to July 31, 2007; 4) approval by at least two thirds of the votes cast at a Special Meeting of Astris shareholders on July 10, 2007; 5) closing terms typical of an asset purchase; 6) receipt of all necessary government approvals; and 7) exclusivity to MKU for the period to closing. As such, the Company has agreed to a non-refundable break-up fee equal to the greater of any advances under the secured convertible promissory note operating facility described above or $500,000, at the time of any breach.  Upon termination, the promissory note would immediately become due and payable.





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





See "Research and Development" in Section 4.





D.  TREND INFORMATION.





E.  OFF BALANCE SHEET ARRANGEMENTS





None





F.  CONTRACTUAL OBLIGATIONS





There are no contractual obligations to be disclosed.





ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES.





A. DIRECTORS AND SENIOR MANAGEMENT.





The following table sets forth the name, age and office held with the Company as of April 15th, 2010 and the period during which such person has served as a Director, Executive Officer and/or senior management.




Name

Age

Office Held

Director SinceMichael Liik (1)

52

President, Chief Executive Officer and Director

2004Brian Clewes

52

Chief Financial Officer, Secretary, Treasurer and Director

2004Arthur Laudenslager (2)

84

Director

2003Christopher Besant

52

Director

2007Richard Callander (1)

54

Director

2007Howard Drabinsky (2)

55

Director

2007




19




Notes




(1)
Members of the Company's Audit Committee.


(2)
Members of the Company’s Compensation Committee.





Michael Liik, P. Eng, MBA is currently President of Liikfam Holdings Inc., an investment/venture capital company. He has a record of investing in and leading both early-stage and high-growth Canadian public companies including Cymat Corp. and Slater Steel. Mr. Liik is both a Professional Engineer and an MBA




Brian D. Clewes is a twenty-eight year veteran of the insurance industry; he is currently a principal in Clewes & Associates Life Insurance Consultancy Inc., the largest supplier of benefits consulting services to Ontario Chartered Accounting firms. Mr. Clewes is an outstanding entrepreneur with solid connections in the angel financing community. Mr. Clewes is a Chartered Life Underwriter, a Certified Financial Planner, and a Chartered Financial Consultant.




Arthur E. Laudenslager was formerly a senior officer and director of several public and private corporations, is currently Vice President, First Energy Advisors Inc., and a business consultant who brings to the Astris Energi Board a great deal of experience and knowledge in corporate structure and financing




Christopher Besant is a lawyer and the Chair of the Canadian Financial Restructuring and Recovery Practice of Baker & McKenzie LLP and a partner in the global Baker & McKenzie North American Restructuring Practice. Mr. Besant has been extensively involved in a range of major domestic and cross-border proceedings affecting industries which span the Canadian economy.




Richard Callander is the President of EcoRock Asset Management, an investment manager and President and Managing Partner of Razor Capital Partners, a corporate advisory. Mr. Callander has managed both large and small cap equities and provided financial advice for over 25 years with a particular focus on providing guidance and raising capital for pre-public and small capitalization public companies. He was previously a partner with one of Canada’s largest investment counseling firms.




Howard M. Drabinsky is the Senior Partner and former Managing Partner of Lang Michener LLP, now McMillan LLP, a Toronto business law firm, former Chairman of the firm's Business Law Group, and a partner since 1987. As a recognized leader in the corporate community, he also has and continues to serve as an officer and director of public and private companies. Mr. Drabinsky's particular expertise is in mergers and acquisitions and corporate finance. He works with publicly and privately owned clients in a wide range of industries, including information technology, manufacturing, entertainment, consumer products and financial services.




20





There are no family relationships between any of the persons above, nor are there any arrangements or understandings with major shareholders, customers, suppliers or others, pursuant to which any person referred to above was selected as a Director or member of senior management.





B.  COMPENSATION





Under the current financial circumstances, executives and directors or their affiliate companies often elect to take all or part of their compensation in the form of restricted common stock, or options to acquire common stock of the Company.  An individual or entity that receives common stock of the Company in lieu of cash is still responsible to pay tax on the income earned in the current fiscal year even though the shares issued are restricted from trading for a minimum of one year or longer.  In Canada, the personal income tax rate is higher in most cases than the corporate tax rate.  This benefit does not limit the Company’s ability to deduct the compensation in any way.




(1)
Paid in Cash





2010


2009


2008Jiri Nor


-



-



-Anthony Durkacz


-



-



-Liikfam Holdings Inc. (1)


-



28,447



27,315Michael Liik


-



-



-397230 Ontario Limited (2)


-



-



-Brian Clewes


12,500



28,447



27,315Arthur Laudenslager


-



28,447



27,315Stirling Partners (3)


-



28,447



27,315Howard Drabinsky


-



-



27,315Lang Michener


-



-



-Chris Besant


12,500



28,447



27,315Total


25,000



142,235



163,890





(1)      Liikfam Holdings Inc. is an Ontario Corporation owned and controlled by Michael Liik, the CEO and Director of Carthew Bay Technologies.





(2)      397230 Ontario Limited is an Ontario Corporation owned and controlled by Brian Clewes, an Officer and Director of Carthew Bay Technologies.





(3)      Stirling Partners is an Ontario Corporation owned and controlled by Rick Callander, a Director of Carthew Bay Technologies.


21





2)           Paid in Shares





In 2004, we issued to related parties 586,592 common shares for a value of $332,360 for consulting services rendered and 293,751 shares for $128,000 to pay down debt and accrued interest on that debt for a total of 880,343 shares for a total of $473,060.  These shares and amounts were issued to the following entities or individuals:





Individual or Entity

# of Shares


$ ValueJiri Nor as an individual


117,500



51,200Macnor Corp. (Note 1)


266,263



144,455Fortius Research & Trading (Note 2)


95,880



52,500Director – David Ramm


57,445



34,422Director – Gordon Emerson


118,032



81,443Director – Gerald Crawford


89,793



46,435Director – Donald Blenkarn


117,500



51,200Director – Arthur Laudenslager


17,930



11,405Total


880,343



473,060





Note 1. Macnor Corp is an Ontario Corporation owned and controlled by Jiri Nor, the former CEO and former Director of the Company.  Macnor also provided research and development services by Jiri Nor and marketing services by his son Peter Nor, who was an Officer of Carthew Bay Technologies (Formerly Astris).





Note 2. Fortius Research & Trading Corporation is an Ontario Corporation owned and controlled by Anthony Durkacz, a former Officer and Director of Carthew Bay Technologies (Formerly Astris).





In 2005, Carthew Bay Technologies (Formerly Astris) issued to related parties, 5,000,000 shares for the purchase of 2062540 Ontario Inc. for a value of $1,955,000; 1,160,803 shares for professional services for a value of $284,666; 125,000 shares to repay a liability worth $26,150; 719,873 shares for consulting services for a value of $168,437; and 3,415 shares for expense recovery for a value of $1,205. These shares and amounts were issued to the following entities or individuals:





Individual or Entity

# of Shares


$ ValueMacnor Corp (Note 1)


6,285,803



2,265,816Fortius Research and Trading(Note 2)


327,269



72,500Liikfam Holdings(Note 3)


392,604



95,937Director - A. Laudenslager


3,415



1,205Total


7,009,091



2,435,458





Note 1. Macnor Corp is an Ontario Corporation owned and controlled by Jiri Nor, the former CEO and former Director of the Company.  Macnor also provides research and development services by Jiri Nor and marketing services by his son Peter Nor, who is an Officer of Carthew Bay Technologies (Formerly Astris).





Note 2. Fortius Research & Trading Corporation is an Ontario Corporation owned and controlled by Anthony Durkacz, a former Officer and Director of Carthew Bay Technologies (Formerly Astris).


22





Note 3. Liikfam Holdings is an Ontario Corporation owned and controlled by Michael Liik, the CEO and Director of Carthew Bay Technologies.




In 2006, Carthew Bay Technologies (Formerly Astris) issued to related parties, 2,616,313 shares for professional services for a value of $374,533. These shares and amounts were issued to the following entities or individuals:





Individual or Entity

# of Shares


$ ValueMacnor Corp (Note 1)


792,899



112,000Fortius Research and Trading(Note 2)


178,291



37,500Liikfam Holdings(Note 3)


808,968



100,000Director - A. Laudenslager


160,106



24,359Director – Brian Clewes


191,476



29,465Director – David Ramm


78,952



12,000Director – Gary Brandt


88,476



12,698Director – Anthony Durkacz


96,476



14,000Director – Jiri Nor


96,476



14,000Total


2,616,310



374,534





Note 1. Macnor Corp is an Ontario Corporation owned and controlled by Jiri Nor, the CEO and Director of the Company.  Macnor also provides research and development services by Jiri Nor and marketing services by his son Peter Nor, who is an Officer of Carthew Bay Technologies (Formerly Astris).





Note 2. Fortius Research & Trading Corporation is an Ontario Corporation owned and controlled by Anthony Durkacz, an Officer and Director of Carthew Bay Technologies (Formerly Astris).





Note 3. Liikfam Holdings is an Ontario Corporation owned and controlled by Michael Liik, the CEO and Director of Carthew Bay Technologies.





In 2007, we issued to related parties, 1,838,732 shares for professional services for a value of $374,533. These shares and amounts were issued to the following entities or individuals:





Individual or Entity

# of Shares


$ ValueLiikfam Holdings (Note 3)


505,982



41,667Director - A. Laudenslager


389,845



32,103Director – Brian Clewes


420,021



34,586Director – Michael Liik


400,021



32,941Director – Anthony Durkacz


61,432



5,059Director – Jiri Nor


61,431



5,059Total


1,838,732



151,415




In 2008, we issued to Macnor Corp, a related party, 3,000,000 shares for professional services for a value of $101,875.





Directors





(2)          Currently, the compensation arrangement for the Directors is as follows:


23





An annual fee of $25,000 payable in cash or options to acquire common stock of the Company plus an option grant of 508,697 Shares exercisable at US$0.027 which vest upon the successful completion of an RTO transaction.





The Company does not have any pension plan, retirement or similar plan for its Executive Officers or Directors





(3)         Governance





An executive compensation committee was appointed in January 2005 to study and determine appropriate levels of compensation and to structure employment agreements for officers.





(4)         Stock Option Plan





The Company has stock option plans for its employees, Directors, Officers, and consultants who are regarded as integral to the benefit and progress of the Company and its operations.  Options are normally issued as a bonus of employment or are tied into performance related compensation.  Performance related compensation includes completion of research and development projects within specific timeframes and budget, achieving financial targets on behalf of the Company or introduction/referral/ completion of business agreements or arrangements. In general, the minimum vesting requirement of options issued is one year. The maximum term of options is five years from the grant date.  Normally the exercise price of the option is determined using the five-day closing average of the shares prior to the grant date.





On October 22, 2004, the Board of Directors passed a resolution authorizing an amendment to a stock option plan dated September 25, 2001 and amended October 30, 2002 increasing the number of shares available in the plan by 2,600,000 shares, to a total of 5,100,000 shares.  The amendment was adopted by the Company’s shareholders at its annual and special meeting of shareholders held on October 22, 2004.  On Oct 12, 2005, the Board of Directors received approval from shareholders at the Annual General Meeting to increase the common shares available for the Company’s Stock Option Plan by 2,000,000. All features of the plan remain unchanged.





(5)         Options and Warrants outstanding as at June 24, 2010





The following table outlines the options that are outstanding as of June 24, 2010 of the directors and senior management or their affiliates of the Company:





Name

Number of Shares


Exercise Price

ExpiryMichael Liik (1)


508,697


US$
0.026

09/06/2012Brian Clewes (1)


508,697


US$
0.026

09/06/2012Arthur Laudenslager (1)


508,697


US$
0.026

09/06/2012Christopher Besant (1)


508,697


US$
0.026

09/06/2012Richard Callander (1)


508,697


US$
0.026

09/06/2012Howard Drabinsky (1)


508,697


US$
0.026

09/06/2012Howard Drabinsky (2)


2,400,000


US$
0.0132

04/03/2015




24





Options to Directors and Officers will become vested as follows:





1)     Upon successful completion of the acquisition of a suitable company. Without limitation the Board has determined that upon the closing of the Colorep transaction described in the LOI, tabled at the Board meeting of February 26, 2010, the options are vested.





2)     Upon issue as issued on account of Directors’ Fees.





C.     BOARD PRACTICES.





The Board of Directors may consist of from three to ten members, and currently consists of six members. Each Director is elected by the shareholders to serve until the next annual meeting or until a successor is elected or appointed





For a list of the Directors and the period during which the current Directors have served in that office, please see Section 6A above.




The Directors of the Company do not currently have any service contracts with the Company providing for benefits upon termination of employment. There does not currently exist any compensation arrangement for any of the Directors. The Company does not have any pension, retirement or similar plan for its Directors.





Michael Liik and Richard Callander are members of the Company’s Audit Committee. Arthur Laudenslager and Howard Drabinsky are members of the Company’s Compensation Committee. There are no additional committees of the Board





D.    EMPLOYEES.





The Company currently has no employees.





E.    SHARE OWNERSHIP.





The following table lists, as of November 12, 2011, the beneficial share holdings (see (4)) in the Common Shares, which are the only outstanding voting securities of the Company, of (i) each of the Company's Executive Officers and Directors of the Company; and (ii) all of the Company's Executive Officers and Directors as a group:


25





Name

Options,

Warrants or

Agreements

Vested


Directly

Owned


Total Owned

included

Vested Amounts


Percent

of

ClassBrian Clewes (1)


2,712,704



6,137,295



8,849,999



11.58
%Arthur Laudenslager






755,796



755,796



.99
%Michael Liik (2)


4,546,174



11,359,160



15,905,334



20.82
%7,258,878



18,252,251



25,511,129



33.39
%





(1)
Includes  (i) 711,887 Common shares held by Brian Clewes and (ii) 8,138,112 owned by 397230 Ontario Limited, and (iii) 2,712,704 shares held in Escrow.





(2)
Includes (i) 524,211 Common shares held by Michael Liik and (ii)10,834,949 Common shares by Liikfam Holdings Inc. and (iii) 4,546,174 shares held in Escrow.





All the individuals included in the table above are beneficial owners as defined in General Instruction F to this form 20-F.  Each person in the above table either owns or has the right to acquire the common shares within 60 days by options, warrants or other agreement.





ITEM 7.





MAJOR SHAREHOLDERS AND RELATED AND NON-RELATED PARTY TRANSACTIONS.





A. MAJOR SHAREHOLDERS.





The following table lists, as of November 12, 2011, the beneficial share holdings in the Common Shares, which are the only outstanding voting securities of the Company, of all persons who are known to the Company to beneficially own, directly or indirectly, five percent or more of the issued and outstanding Common Shares:





Name of Beneficial Owner

Amount and Nature of

Class


PercentBrian Clewes


6,137,295



8.03
%Jiri K. Nor (1)


7,243,446



9.48
%Michael Liik


11,359,160



14.87
%ACME Global Inc.


4,801,747



6.28
%





(1)Includes (i) 307,907 Common Shares held by Jiri K. Nor and (ii) 4,457,879 Common Shares held by Macnor Corp.





There has been significant change in the percentage ownership held by both major shareholders during the past four years due to dilution incurred by private placements, the issuance of Common Shares to reduce debt and the issuance of common shares for the acquisition of Astris s.r.o.





The Company's major shareholders do not have any different voting rights than other holders of the Common Shares.


26





For a discussion of the number of shares of Common Stock held in Canada, please see Item 9 below.





To the Company's knowledge, it is not directly or indirectly owned or controlled by another corporation(s), by any foreign government or by any other natural or legal person(s). The Company does not know of any arrangement that may, at a subsequent date, result in a change in control of the Company.





B.  RELATED PARTY TRANSACTIONS.





(2)         Amounts owing to Directors and Officers:





Payables and accruals as at December 31, 2010 include the following amounts:





Position in

Amount


Amount


AmountEntity

Company

2010


2009


2008Michael Liik

Director


37,500Arthur Laudenslager

Director


27,500






5,075Brian Clewes

Director


37,500



13,082



5,075Chris Besant

Director


27,500



13,083



5,075Richard Callander

Director


27,500







5,075Fortius Research andTrading

Controlled by A.D.










5,075Howard Drabinsky

Director


10,000



26,165



5,075Liikfam Holdings Inc.

Controlled by M.L.$
167,500


$
52,330


$
30.450




(3)         Compensation Expensed to Directors and Officers





The following amounts were expensed as consulting and other compensation to directors and officers:




Position in

Amount


Amount


AmountEntity

Company

2010


2009


2008Brian Clewes (BC)

Director


26,142



28,448



27,315Arthur Laudenslager

Director


3,000



28,448



27,315397230 Ontario Limited

Controlled by B.C.


110,000



176,020



147,535Howard Drabinsky (HD)

Director


-



28,448



27,316Lang Michener

For HDRick Callander (RC)

DirectorChris Besant

Director


26,142



28,448



27,315Stirling Partners

Controlled by R.C.


-



28,448



27,315Liikfam Holdings Inc.

Controlled by M.L.


110,000



176,020



122,572Macnor Corp. re Jiri Nor

Controlled by J.N.Macnor Corp re Peter Nor

Controlled by J.N.Michael Liik (ML)

Director


-$
275,284


$
465,834


$
406,683




C. NON-RELATED PARTY COMMON STOCK TRANSACTIONS.





During the four quarters of 2004, the company issued shares of common stock to settle obligations owing by the Company to certain individuals and companies as follows:





First

Quarter


Second

Quarter


Third

Quarter


Fourth

Quarter


AnnualTotal Non-Related Parties


306,040



136,092



565,535



721,205



1,728,872





During the four quarters of 2005, the company issued shares of common stock to settle obligations owing by the Company to certain individuals and companies as follows:





First

Quarter


Second

Quarter


Third

Quarter


Fourth

Quarter


AnnualTotal Non-Related Parties


261,350



1,113,757



2,373,045



557,775



4,305,927





During the four quarters of 2006, the company issued shares of common stock to settle obligations owing by the Company to certain individuals and companies as follows:





First

Quarter


Second

Quarter


Third

Quarter


Fourth

Quarter


AnnualTotal Non-Related Parties


954,039



1,565,637



296,772



105,667



2,925,115





There were no shares issued to Non-Related Parties during the year ended December 31, 2007.





In January 2008, 625,000 were issued to Ardour Capital Investments, LLC due at the conclusion of their financial consulting agreement at October 26, 2007. In June 2008, 213,334 shares were issued to non-related parties in settlement of amounts owing.





There were no shares issued to Non-Related Parties during the year ended December 31, 2010.





D. INTERESTS OF EXPERTS AND COUNSEL.





Not Applicable.





ITEM 8. FINANCIAL INFORMATION.





CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION.





Reference is made to Item 17 for a list of all financial statements and notes related thereto filed as part of this Annual Report.




27





SIGNIFICANT CHANGES.


On June 5, 2007, the company executed a binding asset purchase agreement with MKU Canada Inc., a corporation incorporated under the laws of Ontario, Canada, a wholly-owned subsidiary of Green Shelters Innovations Ltd., a wholly-owned subsidiary of Green Shelters (India) Private Ltd, to sell substantially all of its assets to MKU Canada Inc.




This transaction, which was negotiated by the Special Committee of the Board of Directors of Astris, includes the sale of substantially all of the assets of the Company, including its fuel cell and test load technology assets for consideration of: (i) approximately US$3.1 Million in cash; (ii) forgiveness of US$1.6 Million of face value secured convertible debentures held by ACME Global Inc. (a subsidiary of GSI) and accrued interest of US$175,000; (iii) an option for Astris to redeem, for nominal consideration and then cancel 4,248,750 shares recently acquired by ACME Global Inc. for US$0.08 per share; and (iv) a secured convertible promissory note funding commitment of a minimum of US$150,000 per month to finance operations to closing and to be forgivable thereafter.




Immediately after closing, existing management resigned both as officers and directors of the Company. It is the intention of the Board of the Company to appoint a new CEO with a mandate to utilize the remaining cash and residual tax losses to seek new business opportunities.




The obligation of the parties to consummate this transaction are subject to the following primary conditions: 1) no material adverse change to Carthew Bay’s business; 2) execution of employment agreements between GSI and key personnel of Astris; 3) completion prior to July 31, 2007; 4) approval by at least two thirds of the votes cast at a Special Meeting of Astris shareholders on July 10, 2007; 5) closing terms typical of an asset purchase; 6) receipt of all necessary government approvals; and 7) exclusivity to MKU for the period to closing. As such, the Company has agreed to a non-refundable break-up fee equal to the greater of any advances under the secured convertible promissory note operating facility described above or $500,000, at the time of any breach.  Upon termination, the promissory note would immediately become due and payable.




DIVIDEND POLICY.





The Company has not paid dividends within the last five fiscal years. For a description of the ability of the Board of Directors to distribute dividends, please see Item 10B below.





ITEM 9. THE OFFER AND LISTING.





MARKETS AND PRICE HISTORY OF THE COMPANY'S STOCK.





As of June 24, 2010, the Company had 234 stockholders of record for its Common Shares and 76,404,648 Common Shares were issued and outstanding. The Company believes that there are a considerable number of beneficial holders of the Common Shares, as a substantial number of Common Shares are held of record by principal depositories in Canada and the United States. As at June 24, 2010, the shareholder list showed 269 registered shareholders holding a total of 76,404,648 Common Shares, 14,250,721 Common Shares in the name of Cede & Co and 24,292,623 Common shares in the name of CDS & Co (the depository in Canada).


28





The Common Shares were previously traded in Canada on the Canadian Dealing Network (CDNX), but presently has an inactive listing on the CDNX.  Since June 20, 2001, the Company's Common Shares have been posted for trading on the O.T.C. Bulletin Board under the symbol CWBYF. The quarterly high and low prices for the past two fiscal years are tabulated below:





2009

High


LowFirst


.01



.005Second


.015



.007Third


.019



.009Fourth


.02



.0062010First


.0072



.005Second


.008



.005Third


.006



.004Fourth


.004



.002





The following table sets forth the high and low market prices for each of the past 4 months:





2011

High,

US$ /share


Low,

US$ /shareJanuary


.0058



.0058February


.006



.0025March


.0025



.0033April


.0031



.0028





ITEM 10. ADDITIONAL INFORMATION.





A.  SHARE CAPITAL.





Not Applicable.





ITEM 10 B.  MEMORANDUM AND ARTICLES OF ASSOCIATION.





1.  ORGANIZATION.





The Company was incorporated in the Province of Ontario, Canada as required under the Business Corporations Act (Ontario).  The registrant’s memorandum and articles do not provide for any specific objects or purposes.


29





2.  DIRECTORS POWERS.





A director who is a party to, or who is a director or officer of or has a material interest in a proposal, arrangement or contract cannot vote on any resolution to approve the potential conflict of interest.  A director may not vote, in the absence of an independent quorum, on compensation to themselves or any members of their body.





No person shall be qualified for election as a director if such person is less than 18 years of age, is of unsound mind and has been so found by a court in Canada or elsewhere, is not an individual, or has the status of a bankrupt.  Directors are not required to retire upon reaching a specific age.  A director need not be a shareholder.  A majority of the directors shall be resident Canadians.





CORPORATE GOVERNANCE.





The Company's by-laws provide that, subject to any unanimous shareholder agreement, the Board of Directors shall manage or supervise the management of the business and affairs of the Corporation. The powers of the board may be exercised at a meeting at which a quorum is present or by resolution in writing signed by all the Directors entitled to vote on that resolution at a meeting of the Board. Where there is a vacancy in the board, the remaining Directors may exercise all the powers of the Board, so long as a quorum remains in office.




MEETINGS OF THE BOARD OF DIRECTORS.





The Company's by-laws provide that meetings of the Board of Directors may be held at any place within or outside Ontario and in any financial year of the Corporation a majority of the meetings need not be held in Canada. Meetings of the board shall be held from time to time at such time and at such place as the Board of Directors, the Chair of the Board, the Managing Director, the President or any two Directors may determine.





BORROWING POWER.





The Company's by-laws provide that without limiting the borrowing powers of the Corporation, as set forth in the Business Corporation Act (Ontario) (the "Act"), but subject to the articles and any unanimous shareholder agreement, the Board of Directors may from time to time on behalf of the Corporation, without authorization of the shareholders:





borrow money upon the credit of the Corporation;





issue, reissue, sell or pledge bonds, debentures, notes or other evidences of indebtedness or guarantee of the Corporation, whether secured or unsecured;





to the extent permitted by the Act, give directly or indirectly financial assistance to any person by means of a loan, a guarantee or otherwise on behalf of the Corporation to secure performance of any present or future indebtedness, liability or obligation of any person;


30





and





mortgage, hypothecate, pledge or otherwise create a security interest in all or any currently owned or subsequently acquired real or personal, movable or immovable, property of the Corporation including book debts, rights, powers, franchises and undertakings, to secure any such bonds, debentures, notes or other evidences of indebtedness or guarantee or any other present or future indebtedness, liability or obligation of the Corporation.





Nothing limits or restricts the borrowing of money by the Corporation on bills of exchange or promissory notes made, drawn, accepted or endorsed by or on behalf of the Corporation.





Unless the articles of the Corporation otherwise provide, the board may from time to time delegate to a director, a committee of the board, or an officer of the Corporation any or all of the powers conferred on the board to such extent and in such manner as the board may determine at the time of such delegation.




3.         RIGHTS, PREFERENCES AND RESTRICTIONS OF PREFERRED AND COMMON SHARES




The holders of the common shares are entitled to receive notice of and to attend and vote at all meetings of shareholders of the company and to one vote in respect of each common share held at all such meetings, except meetings at which only holders of a specified class of shares (other than the common shares) are entitled to vote.  Holders of common shares are entitled to receive, subject to the rights of holders of other classes of shares, dividends as and when declared by the company.  Holders of common shares are entitled to receive, subject to the rights of holders of other classes of shares, the remaining property of the company on the liquidation, dissolution or winding up of the company, whether voluntary or involuntary, or any other distribution of the assets of the company among its shareholders for the purpose of winding up its affairs.




The holders of the preferred shares shall have preferred rights as to dividends as determined by the directors of the company.  The preferred shares may be issued in one or more series, each series to consist of such number of shares as may before the issue thereof be determined by the directors who may by resolution fix before the issue thereof the designation, preference, rights, privileges, restrictions, conditions and limitations attached to the preferred shares of each series including the rate and nature of preferential dividends, the date of payment thereof, the redemption price and conditions of redemption, if any, conversion rights and conditions of conversion, if any, and voting rights, if any.




31





DIVIDENDS





The Company's by-laws provide that, subject to the Act, the articles and any unanimous shareholder agreement, the Board of Directors may from time to time declare dividends payable to the shareholders according to their respective rights and interests in the Corporation. Dividends may be paid in money or property or by issuing fully paid shares of the Corporation or options or rights to acquire fully paid shares of the Corporation. Any dividend unclaimed after a period of six years from the date on which the same has been declared to be payable shall be forfeited and shall revert to the Corporation.





4.           CHANGING RIGHTS OF SHAREHOLDERS





The rights of shareholders may not be modified other than by a majority vote of the common shares voting on such modification at a special meeting. The rights of shareholders may also be modified by a unanimous shareholder agreement.





5.           ANNUAL GENERAL MEETINGS AND SPECIAL MEETINGS





The annual meeting of shareholders shall be held at such time in each year and at such place anywhere in the world as the board, chair of the board, the managing director or the president may from time to time determine.  The board, chair of the board, the managing director or the president shall have the power to call a special meeting of shareholders at anytime.  Notice of the time and place of each meeting of shareholders will be given no less than 21 and no more than 50 days before the date of the meeting to each director, to the auditor, and to each shareholder who at the close of business on the record date for notice is entered in the securities register as the holder of one or more shares carrying the right to vote.





6.           LIMITATIONS TO OWN SECURITIES





There are no limitations on the rights to own securities, to hold securities or exercise voting rights on securities imposed by foreign law.





7.           ISSUES RELATED TO MERGERS, ACQUISITIONS OR CORPORATE RESTRUCTURING





Currently there are no provisions in the company’s articles or by-laws that would have an effect of delaying, deferring or preventing any of item 7 above.





8.           OWNERSHIP THRESHOLD





There are no by-law provisions governing the ownership threshold above which shareholder ownership must be disclosed.  However, in the United States, 5% ownership or more must be publicly disclosed.  In Canada, 10% ownership or more must be publicly disclosed.




9 & 10.LAW





The laws of Ontario, Canada, relating to Items 2-8 are not significantly different from the laws of the United States.  The conditions imposed by the memorandum and articles of association governing changes in capital are not more stringent than is required by law.


32


C.  MATERIAL CONTRACTS





On June 5, 2007, the company executed a binding asset purchase agreement with MKU Canada Inc., a corporation incorporated under the laws of Ontario, Canada, a wholly-owned subsidiary of Green Shelters Innovations Ltd. (“GSI”), a wholly-owned subsidiary of Green Shelters (India) Private Ltd, to sell substantially all of its assets to MKU Canada Inc.




This transaction, which was negotiated by the Special Committee of the Board of Directors of Astris, includes the sale of substantially all of the assets of the Company, including its fuel cell and test load technology assets for consideration of: (i) approximately US$3.1 Million in cash; (ii) forgiveness of US$1.6 Million of face value secured convertible debentures held by ACME Global Inc. (a subsidiary of GSI) and accrued interest of US$175,000; (iii) an option for Astris to redeem, for nominal consideration and then cancel 4,248,750 shares recently acquired by ACME Global Inc. for US$0.08 per share; and (iv) a secured convertible promissory note funding commitment of a minimum of US$150,000 per month to finance operations to closing and to be forgivable thereafter.




Immediately after closing, existing management will resign both as officers and directors of the Company. It is the intention of the Board of the Company to appoint a new CEO with a mandate to utilize the remaining cash and residual tax losses to seek new business opportunities.




The obligation of the parties to consummate this transaction will be subject to the following primary conditions: 1) no material adverse change to Carthew Bay’s business; 2) execution of employment agreements between GSI and key personnel of Astris; 3) completion prior to July 31, 2007; 4) approval by at least two thirds of the votes cast at a Special Meeting of Astris shareholders on July 10, 2007; 5) closing terms typical of an asset purchase; 6) receipt of all necessary government approvals; and 7) exclusivity to MKU for the period to closing. As such, the Company has agreed to a non-refundable break-up fee equal to the greater of any advances under the secured convertible promissory note operating facility described above or $500,000, at the time of any breach.  Upon termination, the promissory note would immediately become due and payable.




On August 1, 2007, the Company sold substantially all its assets, including its wholly-owned subsidiaries, to MKU Canada Inc., an arm’s-length third party.  MKU Canada Inc. is a wholly-owned subsidiary of MKU Cyprus Ltd.  The transaction includes the sale of substantially all of the assets of the Company, including its fuel cell and test load technology assets for consideration of: i) US$3,064,363 in cash ($3,216,049 Canadian: ii) forgiveness of US$1,225,000 and $380,000 Canadian of face value  secured convertible debentures held by ACME Global Inc. (a subsidiary of MKU Cyprus Ltd.) along with US$210,000 ($234,558 Canadian) of accrued interest: iii) an option for the Company, for a consideration of $1 to purchase 4,248,750 of its own shares: iv) the forgiveness of a secured convertible promissory note in the amount of US$600,000 ($642,700 Canadian). The Company has exercised the option to reacquire and cancel the 4,248,750 of its own shares.


33





With the sale of substantially all of its assets, the Company ceased to be in the development stage.  In prior years, the Company reported as a development stage enterprise.





The Company changed its name to Carthew Bay Technologies Inc. on August 17, 2007.





On December 10, 2007, the Company announced that it had executed a letter of intent (“LOI”) with Colorep Inc. (“Colorep”) relating to a transaction whereby shares of the Company will be issued in exchange for all of the issued and outstanding shares of Colorep under terms that constitute a reverse takeover (“RTO”) pursuant to Emerging Issue Committee abstract EIC-10, Reverse Takeover Accounting, of the CICA Handbook.  Following the successful completion of the RTO, the Company will become the legal parent of, and the existing shareholders of Colorep will acquire control of, the combined enterprise.  Successful completion of the RTO is subject to several conditions as discussed below.




Colorep is located in Rancho Cucamonga, CA, and develops and offers for sale sustainable subsurface printing and dyeing technology for decorating a wide variety of textiles and other consumer products. Colorep has previously announced its intention to acquire Transprint USA Inc. (“Transprint”), a privately held, employee-owned company, founded in 1978, with headquarters and manufacturing facilities in Harrisonburg, VA, and design studios and showrooms in New York City and Charlotte, NC. Transprint offers printing products and design services worldwide for the apparel, commercial and residential furnishings markets.  The definitive share purchase agreement between Colorep and Transprint has been completed.  One of the conditions precedent to the conclusion of the RTO under the LOI is receipt by Colorep of a credit facility sufficient to enable Colorep to conclude the acquisition of Transprint.




Pursuant to the LOI and subject to the terms thereof, the Company will invest US $2,000,000 in two equal tranches into secured debentures (the “Debentures”) of Colorep.  The Debentures will bear interest at 1% per month (unless increased pursuant to the terms of the LOI) and interest will accrue until maturity on April 30, 2008.  Subject to certain conditions, the Company is obligated to advance the first US $1,000,000 to Colorep upon execution of a binding share exchange agreement.  The LOI further provides that upon receipt of all approvals, including shareholder and regulatory approvals, necessary to conclude the RTO, the Company will cancel the Debentures.  There are many conditions associated with the conclusion of the various transactions included as part of the LOI including: a) a condition that the Company consolidate its shares pursuant to a formula included as part of the LOI, and b) the completion of Transprint acquisition by Colorep.




Subject to certain extension provisions set out in the LOI, the transactions contemplated thereunder must be completed prior to April 30, 2008.  Upon closing of the RTO, all of the current members of the Board of Directors of the Company, other than Michael Liik, will resign and will be replaced by between four and six new members.




Execution of the LOI has received the unanimous approval of the Board of Directors of the Company.




34


On February 1, 2008, Carthew Bay technologies advanced the first $1 million in respect of the secured debenture financing for Colorep Inc. This tranche is the initial advance of a total $2 million financing contemplated in the previously announced Letter of Intent with Colorep, to be followed by a transaction whereby shares of CBT will be exchanged for all of the issued and outstanding shares of Colorep.




In conjunction with the proposed RTO, the Board of Directors of the Company approved a Success Fee payable to its CEO and CFO amounting to 1.4% of the Colorep transaction value or $1,150,000, earned upon closing of the Colorep RTO transaction and payable as a combination of cash remaining in the Company immediately prior to the RTO transaction and treasury shares of the Company issued at a price equivalent to the value per share (after giving consideration to the shares issued in this regard) received by the shareholders of the Company as a consequence of the RTO.  The fee would be increased by an additional 0.06% of the transaction value or $500,000, or such pro-rated amount, determined 3 months after closing of the RTO transaction and based upon the performance of the post-RTO shares.  In the event that the performance of the post-RTO shares (with the definition of performance to be established in a formal agreement), is between $0.70 per share equivalent value (as described in the LOI) and $1.00 per share, the additional $500,000 fee would be pro-rated such that no fee would be earned on the lower threshold and the full fee earned on the upper threshold.  This fee would be payable in treasury shares of the Company on the basis described above.




On May 22, 2008, Carthew Bay Technologies entered into a consulting agreement with Macnor Corp and Jiri Nor to provide repair services to a generator previously sold by Astris Energi in 2005 as well as assist in the preparation of filings on behalf of Carthew Bay Technologies for amounts to be claimed for the 2007 Fiscal Year from the Government of Canada under the Scientific Research and Experimental Development Program administered by the Canada Revenue Agency.




On May 23, 2008, Carthew Bay Technologies Executed Agreement and Plan of Merger with Colorep, Inc. and advanced a second US$1.0 Million in respect of the Secured Debenture Financing related thereto.




On July 8, 2008 the Company announced that a delay in the closing of the RTO would occur as a consequence of the delay in the signing of the RTO Agreement (May 23, 2008). In addition, the Transaction closing was changed to December 31, 2008. The transaction requires the filing of a Registration Statement with the SEC by the Company. It was anticipated that the Registration Statement would be filed by the end of July and will require 90 to 120 days for SEC review and comments. Thereafter, the Company would convene a Special Meeting of shareholders to vote on the RTO transaction. In the event that shareholders approve same, the transaction would close shortly thereafter. It is likely that the Company will delay its annual meeting to coincide with this special meeting to avoid duplicating associated costs.





On September 5, 2008, the Company announced that there would be further delays with the completion of Colorep’s audit, which would affect the filing of the Registration Statement with the SEC.


35


On October 27, 2008 the Company announced that it had re-negotiated the terms of the RTO Agreement with Colorep, Inc. and agreed to extend the closing of the RTO Agreement from December 31, 2008 to June 30, 2009. In exchange for this agreement, Colorep will increase the ownership percentage of the post-RTO company held by the current CBT shareholders such that upon closing of the RTO transaction, CBT shareholders shall hold 12.753% of the post-RTO common stock of the surviving company, based upon the current issued and outstanding shares of Colorep. In addition, in the event that Colorep issues additional shares or securities convertible into shares of Colorep prior to the RTO, CBT will be granted dilution protection such that in no event shall the interest of the current CBT shareholders in the surviving company be allowed to fall below 8% of the issued and outstanding post-RTO common stock of the surviving company (based on the current issued and outstanding shares of Colorep), or 5.3% of the post-RTO ownership of the surviving company, as calculated on a fully diluted basis.





As a further inducement to extend the closing, Colorep has agreed to: (i) increase their obligation to contribute to CBT overhead expenses from $20,000 to $30,000 per month and to pre-pay such amounts through the end of January, 2009; (ii) pay any outstanding accrued interest on CBT debentures and thereafter make interest payments on a monthly basis as well as to pre-pay future interest on same through to the end of January, 2009; (iii) pay any and all amounts outstanding to CBT in respect of legal or costs owing to CBT plus all reasonable costs associated with effecting this amendment, to a maximum of $307,000 including the satisfaction of (i) and (ii) above. Any amounts still outstanding in excess of the $307,000 cap will be payable on February 1, 2009.




On March 26, 2010, the Company made changesto the Success/M&A Fee originally approved in December 2007.  Upon Shareholder approval of the conversion discussed below, the previously issued 21,821,632 shares held in escrow (note 6(a)) will be released as well as a cash payment of $150,000. On March 26, 2010 the CEO agreed to surrender 2,543,485 options and the CFO agreed to surrender 1,526,091 options as well as 254,348 Finder’s Fee options granted in 2007.




The Company has entered into the Amended and Restated Convertible Debenture of Colorep (which replaces the Debentures) and the Amended and Restated Agreement and Plan of Merger (which replaces the Original Agreement and Plan of Merger), both of which are made and effective as of March 31, 2010.  The Amended and Restated Convertible Debenture and the Amended and Restated Agreement and Plan of Merger were entered into at the request of Colorep (i) to facilitate its immediate financing needs, and (ii) because the Company was able to negotiate an amendment fee.  The Amended and Restated Convertible Debenture requires the Company to hold a shareholder’s meeting at the earliest possible date to approve above amendments.




The Amended and Restated Convertible Debenture provides that all outstanding principal and unpaid interest will be due on March 31, 2012 and will bear interest at a rate of one percent (1%) per month until such time.  In exchange for the Company’s agreement, Colorep agreed to pay an amendment fee of US $100,000 (the “Amendment Fee”), payable in the amount of US $50,000 immediately and US $50,000 on April 30, 2010, to be credited against the cash payment obligation set forth in (iv) below.  The amended and Restated Convertible Debenture also provides that, immediately upon approval by the Shareholders of the Special Resolution described under the heading “Special Resolution” below:




36


i)  all outstanding principal and unpaid interest and all other amounts owed by Colorep to the Company will be converted into: (a) 714,005 shares of Series C preferred stock of Colorep (convertible into shares of common stock at a rate of ten shares of common stock for each share of Series C Preferred Stock) – which represent approximately 4.52% of the outstanding securities of Colorep, calculated on an as-converted into common shares basis (fully diluted in accordance with US GAAP) or 2.58% of the outstanding shares of Colorep calculated on an as-converted into common shares basis (fully diluted including all warrants); (b) warrants to purchase 7,140,050 shares of common stock of Colorep to be exercisable at US $0.378 per share for a period of five years from issuance – which represent approximately 2.58%  of the outstanding shares of Colorep calculated on an as-converted into common shares basis (fully diluted including all warrants) (these warrants are not included pursuant to US GAAP); and (c) 2,697,392 shares of Common Stock of Colorep – which represent approximately 1.71% of the outstanding shares of Colorep, calculated on an as-converted into common shares basis (fully diluted basis in accordance with US GAAP) or 0.97% of the outstanding common shares of Colorep calculated on an as-converted basis (fully diluted including all warrants);




ii)  the shares of Series C preferred stock and warrants to purchase common stock of Colorep issued pursuant to (i) will be subject to adjustment pursuant to applicable anti-dilution provisions in favour of the Company;




iii)  a conversion fee of US $500,000 payable out of financings would accrue to the Company and be payable in two portions without interest: (a) upon consummation of Colorep’s next Company Financing Event (as defined in the Amended and Restated Convertible Debenture), an amount equal to 10% of the proceeds of the financing; and (b) the balance due, if any, upon consummation of any subsequent Company Financing Event;




iv)  US $30,000 per month would accrue to the Company until the date of effectiveness of a Form 10 filing by Colorep registering its Common Stock pursuant to Section 12 of the U.S. Exchange Act (subject to a minimum of US $150,000 and a maximum of US $184,931), payable as follows: (a) application of the paid Amendment Fee as an advance against subsequent accruals; and (b) any accrued and unpaid balance of the accruals payable concurrent with consummation of each Company Financing Event subsequent to the closing of the conversion;




v)  5% of the Original Issuance Price (as defined in the Amended and Restated Convertible Debenture) would accrue to the Company per annum per Series C Share issued in conjunction with the conversion, until conversion of the Series C Shares at the Company’s option or automatically upon the common stock of Colorep becoming freely tradable (as applicable), and payable by Colorep concurrent with conversion of the Series C Shares in either cash or additional Series C Shares (to be immediately converted) at Colorep’s option;




vi)  Colorep would be required to issue additional warrants to purchase shares of Common Stock of Colorep and pay a $25,000 cash penalty to the Company in the event that it fails to timely pay any amount due under item (iii) or item (iv) above;


37


vii)  pursuant to the terms of its Series C Shares of Colorep, the Company will be entitled to elect one member of the board of directors of Colorep until such time as less than fifty and one tenth percent (50.1%) of such shares are outstanding;




viii)  the Company will be granted certain participation rights, information rights and other rights pursuant to a third amended and restated investors’ rights agreement: and




ix)  the Company will be granted certain registration and other rights pursuant to a third amended and restated registration rights agreement




The Amended and Restated Agreement and Plan of Merger provides Colorep with the option to determine whether or not to proceed with the RTO, which Colorep must exercise on or before December 31, 2010.  The Company does not have any right to trigger or enforce the Amended and Restated Agreement and Plan of Merger with respect to the conduct and completion of the RTO in the absence of Colorep exercising its option to proceed with the RTO.  If Colorep does not exercise its option to proceed with the RTO prior to December 31, 2010, the Amended and Restated Agreement and Plan of Merger shall terminate and the parties will have no further obligations to conduct or complete the RTO.  If Colorep does exercise its option to proceed prior to December 31, 2010, the RTO would be conducted and completed pursuant to the Amended and Restated Agreement and Plan of Merger and a further special meeting of the shareholders of the Company would be convened to obtain any additional approvals of the shareholders of the Company that may be required with respect thereto.




On May 6, 2010, CBT announced that the shareholders voted overwhelmingly to approve the conversion of the Company’s debt investment in Colorep Inc. into various equity securities of Colorep and cash payments at the Special Meeting of Shareholders. The Company also announced that it had formed an Advisory Board made up of Messrs. Jiri Nor, Atul Sabharwal, and Michael Stein. The Company further announced that its Chief Executive Officer and Chief Financial Officer have today agreed to amend their success fee arrangement in connection with the approval of the transaction with Colorep.  As a result, 1/3 of the 21,776,632 common shares in the capital of the Company which were to be released from escrow today to the Chief Executive Officer and Chief Financial Officer of the Company (as more fully described in the management information circular prepared in connection with the special meeting of shareholders of the Company held today) will continue to be held in escrow until such time when, over a period a 5 consecutive business days, the simple average of the closing prices of the Company’s shares on the principal stock exchange or stock quotation system on which such stock trades is equal to or greater than U.S. $0.11¢.  However, if the shares remaining in escrow are not released on or before May 6, 2015 they shall be surrendered to the Company and cancelled.




The Consulting Agreement between CBT and Macnor was amended on May 6, 2010 so that there will be no minimum number of consulting service days, the options previously granted will be surrendered for cancellation such that Macnor Corp. will retain options to purchase 416,666 common shares of CBT. The term of the agreement was also amended so that the initial term of the agreement will be for one year subject to renewal upon mutual agreement.


38





On May 20th, CBT announced that it had completed the conversion of the Company’s debt investment in Colorep, Inc., into various securities and cash payments.





D.  EXCHANGE CONTROLS AND OTHER LIMITATIONS AFFECTING SECURITY HOLDERS





There are no governmental laws, decrees or regulations in Canada relating to restrictions on the import/export of capital affecting the remittance of interest, dividends or other payments to non-residential holders of the Company's Common Shares. Any such remittances to United States residents, however, are subject to a 15% withholding tax pursuant to Article X of the reciprocal tax treaty between Canada and the United States. See Part E below.





Except as provided in the Investment Canada Act (the "Act"), there are no limitations under the laws of Canada, the Province of Ontario or in the charter or any other constituent documents of the Company on the right of foreigners to hold and/or vote the Common Shares of the Company.





The Act requires a non-Canadian making an investment to acquire control of a Canadian business, the gross assets of which exceed certain defined threshold levels, to file an application for review with Investment Canada, the federal agency created by the Act.





As a result of the Canada-U.S. Free Trade Agreement, the Act was amended in January 1989 to provide distinct threshold levels for Americans who acquire control of a Canadian business.





A Canadian business is defined in the Act as a business carried on in Canada that has a place of business in Canada, an individual or individuals in Canada who are employed or self-employed in connection with the business, and assets in Canada used in carrying on the business.





An American, as defined in the Act, includes: an individual who is an American national or a lawful permanent resident of the United States; a government or government agency of the United States; an American-controlled entity, corporation or limited partnership or trust which is not controlled in fact through ownership of its voting interests of which two-thirds of its Board of Directors, general partners or trustees, as the case may be, are any combination of Canadians or Americans.





The following investments by a non-Canadian are subject to review by Investment Canada:





(a)
all direct acquisitions of control of Canadian businesses with assets of CDN$5 million or more;





(b)
all indirect acquisitions of control of Canadian businesses with assets of CDN$50 million or more if such assets represent less than 50% of the value of the assets of the entities, the control of which is being acquired; and





(c)
all indirect acquisitions of control of Canadian businesses with assets of CDN$5 million or more if such assets represent more than 50% of the value of the assets of the entities, the control of which is being acquired.


39





Review by Investment Canada is required when investments by Americans exceed CDN$150 million for direct acquisitions of control. For the purposes of the Act, direct acquisition of control means: a purchase of the voting interest on a corporation, partnership, joint venture or trust carrying on a Canadian business, or any purchase of all or substantially all of the assets used in carrying on a Canadian business; and indirect acquisition of control means a purchase of the voting interest of a corporation, partnership, joint venture or trust, whether a Canadian or foreign entity, which controls a corporation, partnership, joint venture or trust carrying on a Canadian business in Canada.





The acquisition of certain Canadian businesses is excluded from the higher thresholds set out for Americans. These excluded businesses include oil, gas, uranium, financial services (except insurance); transportation services and cultural services (i.e. the publication, distribution or sale of books, magazines, periodicals (other than printing or typesetting businesses), music in print or machine readable form, radio, television, cable and satellite services; the publication, distribution, sale or exhibitions of film or video recordings or audio or video music recordings).





Direct or indirect acquisitions of control of these excluded businesses are reviewable at the CDN$5 and CDN$50 million thresholds.





A non-Canadian shall not implement an investment reviewable under the Act unless the investment has been reviewed and the Minister responsible for Investment Canada is satisfied or is deemed to be satisfied that the investment is likely to be of net benefit to Canada. If the Minister is not satisfied that the investment is likely to be a net benefit to Canada, the non-Canadian shall not implement the investment or, if the investment has been implemented, shall divest himself of control of the business that is the subject of the investment.





A non-Canadian or American making the following investments:





(i)
an investment to establish a new Canadian business; and





(ii)
an investment to acquire control of a Canadian business which investment is not subject to review under the Act, must notify Investment Canada, within prescribed time limits, of such investments.


E.           TAXATION.





CANADIAN INCOME TAX CONSEQUENCES





Management of the Company considers that the following discussion respecting taxation fairly describes the principal and material Canadian federal income tax consequences applicable to shareholders of the Company who are residents of the United States and are not residents of Canada and do not hold, and are deemed not to hold, Common Shares of the Company in connection with carrying on a business in Canada (a "non-resident").


40





Generally, dividends paid by Canadian corporations to non-resident shareholders are subject to a withholding tax of 25% of the gross amount of such dividends. However, Article X of the reciprocal tax treaty between Canada and the United States reduced to 15% the withholdings tax on the gross amount of dividends paid to residents of the United States. A further 10% reduction in 1997 in the withholding tax rates on the gross amount of dividends is applicable when a U.S. corporation owns at least 10% of the voting stock of the Canadian corporation paying the dividends.





A non-resident who holds Common Shares as capital property will not be subject to tax on capital gains realized on the disposition of such Shares unless such Shares are "taxable Canadian property" within the meaning of the Income Tax Act (Canada), and no relief is afforded under any applicable tax treaty.  However, the Common Shares of Astris are taxable Canadian property because they are not traded on a prescribed stock exchange.  This creates Canadian filing requirements for non-residents. Non-Canadian Residents would be required to file a special Canadian Income Tax Return for dispositions of shares in Astris stock and would be taxable in Canada on any Net Capital Gains earned on such dispositions.





UNITED STATES FEDERAL INCOME TAX CONSEQUENCES





The following discussion describes the United States federal income tax consequences of the ownership and disposition of Common Shares of the Company. The discussion contained in this summary is based on the Internal Revenue Code of 1986, as amended (the "Code"), existing and proposed Treasury Regulations, judicial decisions and administrative pronouncements, all of which are subject to change. Any such changes may be applied retroactively in a manner that could result in federal income tax consequences different from those discussed below.





This summary discusses only Common Shares of the Company held by a U.S. Holder (defined below) as a capital asset within the meaning of Section 1221 of the Code, and does not deal with special situations, such as those of banks, thrift institutions, real estate investment trusts, regulated investment companies, insurance companies, dealers in securities or commodities, tax-exempt investors, holders whose functional currency is not the U.S. dollar, persons who hold Common Shares of the Company as a position in a straddle, as part of a synthetic security or hedge, as part of a conversion transaction or other integrated investment, or persons who are not U.S. Holders (as defined below). Further, the summary does not include any description of any alternative minimum tax consequences or any state, local or foreign tax consequences that may be applicable. This summary assumes that no U.S. Holder will own, directly or indirectly, Common Shares of the Company representing 10% or more of the voting power of the Company.





HOLDERS OF COMMON SHARES OF THE COMPANY ARE URGED TO CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE OWNERSHIP AND DISPOSITION OF SUCH SHARES IN LIGHT OF THEIR PARTICULAR CIRCUMSTANCES, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN AND OTHER TAX LAWS, AND THE POSSIBLE EFFECTS OF CHANGES IN UNITED STATES FEDERAL OR OTHER TAX LAWS.


41





As used herein, a "U.S. Holder" means a beneficial owner of Common Shares of the Company who is (I) a citizen or resident of the United States, (ii) a corporation, partnership or other entity created or organized in or under the laws of the United States or any State thereof or the District of Columbia,(iii) an estate the income of which is subject to United States federal income taxation regardless of its source, or (iv) a trust the administration of which is subject to the primary supervision of a court within the United States and for which one or more U.S. persons have the authority to control all substantial decisions.





If dividends were to be declared, they could be treated as dividends from a qualified foreign corporation and, accordingly, be subject to a 15% U.S. tax rate.





Dividends





Distributions with respect to the Common Shares (other than liquidating distributions and certain distributions in redemption of the Common Shares) which are paid out of current or accumulated earnings and profits, as calculated for United States federal income tax purposes, generally will constitute dividends taxable as ordinary income. To the extent the amount of any such distribution paid with respect to the Common Shares exceeds current and accumulated earnings and profits, as calculated for United States federal income tax purposes, such excess distribution will not constitute a dividend for United States federal income tax purposes, but will be treated first as a tax-free return of capital to the extent of the holder's adjusted tax basis in his Common Shares (with a corresponding reduction in such basis) and, to the extent the distribution exceeds such basis, as a capital gain.





Foreign Tax Credit





A U.S. Holder who pays (or has had withheld from distributions) Canadian income tax with respect to the ownership of Common Shares of the Company may be entitled, at the option of the U.S. Holder, to either a deduction or a tax credit for such foreign tax paid or withheld. This election is made on a year-by-year basis and applies to all foreign taxes paid by (or withheld from) the U.S. Holder during that year. There are significant and complex limitations that apply to the credit, among which is the general limitation that the credit cannot exceed the proportionate share of the U.S. Holder’s United States Federal income tax liability that the U.S. Holder’s foreign source income bears to his worldwide taxable income. The availability of the foreign tax credit and the application of the limitations on the credit are fact specific and holders and prospective holders of Common Shares should consult their own tax advisors regarding their individual circumstances.


42





Dispositions, Including Redemptions





Any sale, exchange, redemption (except as discussed below) or other disposition of the Common Shares generally will result in taxable gain or loss equal to the difference between the amount received upon the sale, exchange, redemption or other disposition and the holder's adjusted tax basis in the Common Shares. Such gain or loss generally will be capital gain or loss and will be long-term capital gain or loss if the holding period for the Shares of the Company exceeds one year.





In certain cases, a redemption of Common Shares may be treated as a dividend, rather than as a payment in exchange for the Shares of the Company. In such events, the redemption payment will be treated as ordinary dividend income to the extent that such payment is made out of current or accumulated earnings and profits, as calculated for United States federal income tax purposes. The determination of whether the redemption will be treated as a dividend rather than as payment in exchange for the Common Shares of the Company will depend upon whether and to what extent the redemption reduces the holder's percentage stock ownership interest in the Company. A redemption will be treated as an exchange of stock that produces a capital gain if the redemption either (1) completely terminates the holder's interest in the Company under Section 302(b)(3) of the Code, (2) is "substantially disproportionate" with respect to the holder under Section 302(b)(2) of the Code, or (3) is "not essentially equivalent to a dividend" under Section 302(b)(1) of the Code.





A redemption will completely terminate the holder's interest in the Company if, as a result of the redemption, the holder no longer has any stock interest in the Company, directly or constructively after application of the attribution rules of Section 302(c) of the Code. A redemption will be "substantially disproportionate" with respect to the holder if (1) the ratio of the voting stock owned by the holder (including stock attributed to the holder under Section 302(c) of the Code) immediately after the redemption to all the voting stock of the Company is less than 80% of the same ratio for the voting stock owned by the holder immediately before the redemption, (2) there is a similar percentage reduction in the ownership by the holder of Common Shares of the Company, and (3) the holder owns less than 50% of the voting stock of the Company. Whether a redemption is "not essentially equivalent to a dividend" with respect to a holder will depend upon the holder's particular circumstances. The IRS has ruled that a minority shareholder in a publicly held corporation whose relative stock interest is minimal and who exercises no control with respect to corporate affairs is considered to have a "meaningful reduction" if such shareholder has a reduction in his percentage stock ownership. In determining whether any of the foregoing tests have been satisfied, the holder is deemed, under the constructive ownership rules of Section 302(c) of the Code, to own any Common Shares in the Company owned by certain related persons and entities and any Common Shares which the holder or certain related persons and entities have an option to acquire. However, because of the ambiguities in applying the foregoing rules, holders should consult their tax advisors to determine whether a redemption of Common Shares will be treated as a dividend or as a payment in exchange for the Common Shares of the Company.





F.
DIVIDENDS AND PAYING AGENTS





Not Applicable.


43





G.
STATEMENT BY EXPERTS





Not Applicable.





H.
DOCUMENTS ON DISPLAY





The Company is subject to the informational requirements for foreign private issuers under the Securities Exchange Act of 1934, as amended. In accordance with these requirements, the Company files reports on Form 20-F and 6-K with the United States Securities and Exchange Commission. These materials, including this annual report and the exhibits thereto, may be inspected and copied at the Commission's Public Reference Room at 100 F Street, N.E., Washington, DC 20549. Copies of the materials may be obtained from the Public Reference Room at prescribed rates. The public may obtain information on the operations of the Commission's Public Reference Room by calling the Commission in the United States at 1-800-SEC-0330. The Commission also maintains a web site at http://sec.gov that contains reports, proxy statements and other information regarding registrants that file electronically with the Commission.





I.
SUBSIDIARY INFORMATION





Not Applicable.





ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK





INTEREST RATE RISK.





The Company does not have any significant exposure to changes in interest rates.





IMPACT OF CURRENCY FLUCTUATIONS





The Company's operating expenses are primarily paid in Canadian dollars.  Fluctuations in the exchange rate between the Canadian dollar and such other currencies may have a material effect on the Company's results of operations. In particular, the Company may be adversely affected by a significant strengthening of the Canadian dollar against the U.S. dollar or Euro. The Company has not previously engaged in, and does not now intend to enter into, any currency hedging or other similar currency hedging transactions. The Company may enter into such transactions on a non-speculative basis to the extent that it might in the future have substantial foreign currency exposure.





ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES





Not Applicable.





PART II.





ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES





None.


44




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





None.





ITEM 15





CONTROLS AND PROCEDURES





EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES




The Company’s Chief Executive Officer and Chief Financial Officer, as of the end of the fiscal year covered by this Annual Report have evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based upon such evaluation, the Chief Executive Officer and Chief Financial Officer concluded the Company’s disclosure controls and procedures were not effective. In addition to our disclosure and procedures, management is currently enhancing its corporate governance and audit committee team to strengthen the Company’s overall internal controls over financial reporting (ICOFR).





MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING





Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control system was designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes, in accordance with generally accepted accounting principles. Because of inherent limitations, a system of internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate due to a change in conditions, or that the degree of compliance with the policies or procedures may deteriorate.





Our management, including our Chief Executive Officer and Chief Financial Officer as of the end of the fiscal year covered by this Annual Report, conducted an evaluation of the effectiveness of our internal control over financial reporting.  Based on its evaluation, management concluded that there is a material weakness in our internal control over financial reporting and accordingly our internal control over financial reporting is not effective. A material weakness is a deficiency, or a combination of control deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.





The material weakness relates to the monitoring and review of work performed by our Chief Financial Officer and lack of segregation of duties.  In the preparation of audited financial statements, footnotes and financial data all of our financial reporting is carried out by our Chief Financial Officer, and we do not have an effective process to review the work performed.  The lack of segregation of duties results from a minimal operation with two individuals. To mitigate this material weakness to the fullest extent possible, all financial reports are monitored and reviewed by the President and Chief Executive Officer. All unexpected results are investigated. We are currently in the process of hiring additional accounting consultants to assist in implementing additional procedures for the monitoring and review of work performed by our Chief Financial Officer.


45





This annual report does not include an attestation report of the Company’s registered public accounting firm MSCM LLP regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management’s report in this Annual Report on Form 20-F.





CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING





No change in the Company s internal control over financial reporting occurred during the year ended December 31, 2010, that materially affected, or is reasonably likely to materially affect, the Company s internal control over financial reporting.





ITEM 16.





A. AUDIT COMMITTEE FINANCIAL EXPERT





Members of the Audit Committee have broad financial experience which has been gained in a variety of disciplines including investment banking, supervision of finance functions and general management, and the Board is satisfied that collectively they have the requisite financial skills and expertise to enable them fully to carry out their responsibilities. However, the Board considers that no individual member of the committee qualifies as a “financial expert” within the terms of the definition set out in the Sarbanes-Oxley Act of 2002.  All current members of the Audit Committee are independent.





C. PRINCIPAL ACCOUNTANT FEES AND SERVICES





For the year ended 2010 and 2009, the audit fees were CDN $30,000 and CDN $27,500.   For the years ended 2010 and 2009, the tax related fees for the principal accountants were CDN $NIL and CDN $NIL.  The Company’s audit committee’s pre-approval of audit fees is discussed in advance with the principal accountant and the audit committee. If there are any adjustments, they are approved by the audit committee.





E.           PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS





Not Applicable.




PART III.





ITEM 17. FINANCIAL STATEMENTS





The following documents are filed as Attachment A hereto and are included as part of this Form 20-F.


46





CARTHEW BAY TECHNOLOGIES INC. (FORMERLY ASTRIS ENERGI INC.) CONSOLIDATED FINANCIAL STATEMENTS





Description of Document:


Auditors' Report for the year ended December 31, 2010.


Auditors' Report for the year ended December 31, 2009.


Auditors' Report for the year ended December 31, 2008.


Auditors' Report for the year ended December 31, 2007.


Auditors’ Report for the year ended December 31, 2006.


Auditors’ Report for the year ended December 31, 2005.


Balance Sheets for the year ended December 31, 2010 and 2009.


Statements of Loss and Deficit for the years ended December 31, 2010, 2009 and 2008.


Statements of Cash Flows for the years ended December 31, 2010 and 2009.


Notes to Financial Statements for the year ended December 31, 2010, 2009 and 2008.





ITEM 18. FINANCIAL STATEMENTS





Not applicable.





ITEM 19. EXHIBITS





3.1*           Memorandum of Association of Kayty Exploration Ltd., filed March 18,1981 with the Province of Alberta Office of Consumer and Corporate Affairs.





3.2*           Articles of Association of Kayty Exploration Ltd., filed March 18,1981 with the Province of Alberta Office of Consumer and Corporate Affairs.





3.3*           Certificate amending the Memorandum of Association of Kayty Exploration Ltd., filed July 9, 1981 with the Province of Alberta Office of Consumer and Corporate Affairs.





3.4*           Certificate amending the Memorandum of Association of Kayty Exploration Ltd., filed November 6, 1981 with the Province of Alberta Office of Consumer and Corporate Affairs.





3.5*           Certificate amending the Memorandum of Association of Kayty Exploration Ltd., filed March 11, 1982 with the Province of Alberta Office of Consumer and Corporate Affairs.





3.6*           Certificate amending the Memorandum of Association of Kayty Exploration Ltd., filed August 9, 1982 with the Province of Alberta Office of Consumer and Corporate Affairs.





3.7*           Articles of Continuance for Kayty Exploration Ltd., filed September 22, 1987 with the Ministry of Consumer and Commercial Relations, Province of Ontario, Canada.





3.8*           Articles of Amendment for Kayty Inc., filed December 7, 1994 with the Ministry of Consumer and Commercial Relations, Province of Ontario, Canada.


47





3.9*        Articles of Amendment for WLD Inc., filed July 4, 1995 with the Ministry of Consumer and Commercial Relations, Province of Ontario, Canada.





3.10*      By-Laws of  Astris Energi Inc., dated April 12, 1996.





4.1*        Astris Energi Inc. Stock Option Plan, dated June 2000.





4.2*        Form of Convertible Debenture Document with Cornell Capital Partners, LP, dated April 10, 2006.





4.3*        Warrant number CCP-001 to Cornell Capital Partners, LP dated April 10, 2006.





4.4*        Warrant number CCP-002 to Cornell Capital Partners, LP dated April 10, 2006.





4.5*        Warrant number CCP-003 to Cornell Capital Partners, LP dated April 10, 2006.





10.1*      License Agreement between  Astris Energi Inc. and Energy Ventures Inc.(Canada) dated October 22, 1998.





10.2*      Debenture by Astris Energi Inc and Astris Inc. to and in favor of Energy Ventures Inc. (Canada) dated October 22, 1998.





10.3*      Equipment Lease between Astris Inc. and Energy Ventures Inc. (Canada) dated October 22, 1998.





10.4*      License Agreement with Macnor Corp. dated October 1, 1999.





10.5*      Lease for property located at 2175 Dunwin Drive, Unit 6, Mississauga, Ontario, between 789542 Ontario Limited and Astris Energi Inc, dated April 14, 2000.





10.6*      License Agreement, between Astris Inc. and Astris s.r.o., dated January 30, 1995.





10.7*      Grant of Options by  Astris Energi Inc. to Energy Ventures Inc., dated October 22, 1998.





10.8*      Agreement between Astris Energi Inc. and Fuelcellstore.com, Inc., dated October 12, 2000.





10.9*      Assignment Agreement between Josef Soltys and Astris Inc. for Canadian Patent #1,295,679, for QUICKCELL, dated November 15, 1995.





10.10*    Debenture between Astris Inc. and Donald Alex Blenkarn, in trust, dated September 30, 1996.





10.11*    Value Added Reseller Agreement with Alternate Energy Corp., dated May 14, 2004.





10.12*    Co-operation agreement with El.ma, dated October 15, 2004.





10.13*    Consulting Agreement with Liikfam Holdings, dated December 10, 2004.


48





10.14*    Purchase and Escrow Agreement between Astris Energi Inc., Macnor Corporation and 2062540 Ontario Inc. dated January 20, 2005.





10.15*    Teaming Arrangement with Plasma Environmental Technologies Inc., dated February 23, 2005.





10.16*    Agreement with First Energy Advisors, dated May 22, 2003.





10.17*    Assignment of technology to Astris Energi Inc. from Macnor Corporation, dated July 25, 2005.





10.18*    Form of Convertible Debenture document, dated March 24, 2005.





10.19*    Securities Purchase Agreement with Cornell Capital Partners LP, dated April 10, 2006.





10.20*    Investor Registration Rights Agreement with Cornell Capital Partners LP, dated April 10, 2006.





10.21*    Security Agreement with Cornell Capital Partners LP, dated April 10, 2006.





10.22*    Security Agreement between 2062540 Ontario Inc. and Cornell Capital Partners LP, dated April 10, 2006.





10.23*    Share Escrow Agreement with Cornell Capital Partners LP, dated April 10, 2006.





10.24*    Irrevocable Transfer Agent Instructions between Equity Transfer Services, Inc., Cornell Capital Partners LP and Astris Energi Inc.





10.25*    Letter of Intent to Sell Assets to Green Shelters Innovations Ltd. To sell substantially all of Astris Energi Inc’s assets. Dated April 19, 2007.





10.26*    Loan Agreement between Astris Energi Inc. and Green Shelter Innovations Ltd. To provide on-going financing due July 31, 2007. Dated May 4, 2007.





10.27*    Asset Purchase Agreement with the Issuer and 2062540 Ontario, Inc. a wholly-owned subsidiary of the Issuer and MKU Canada, Inc. and affiliate of Green Shelters Innovations Ltd. Dated June 5, 2007.





10.28*    Settlement Agreements between Jiri Nor, Peter Nor, Anthony Durkacz, Macnor Corp, Fortius Research and Trading Corp, and Astris Energi Inc. Dated July 26, 2007.





10.29*    Completion of Astris Energi Inc. asset sale to MKU Canada, Inc. Dated August 1, 2007.




10.30*    Astris Energi Inc. changes name to Carthew Bay Technologies Inc. and trading symbol becomes “CWBYF” on the OTC Bulletin Board. Dated August 22, 2007.


49





10.31*    Letter of Intent for Reverse Takeover transaction of Colorep, Inc. Dated December 9, 2007.





10.32*    Secured Debenture Financing provided to Colorep, Inc. for US$1.0 Million. Dated February 1, 2008.





10.33*    Execution of Agreement and Plan of Merger whereby shares of Carthew Bay Technologies will be exchanged for all issued and outstanding shares of Colorep, Inc. Secured Debenture Financing provided to Colorep, Inc. for US$1.0 Million. Dated May 23, 2008.





10.34*    Consulting Agreement with Macnor Corp dated May 22, 2008.





10.35*    Letter Agreement with Colorep dated October 27, 2008.





10.36*    Amendments to Agreement of Plan and Merger and all related documents with Colorep dated October 27, 2008.





10.37*    Amending Agreement to Amendments to Agreement and Plan of Merger and all related documents with Colorep dated November 4, 2008.





10.38*   Amendments to the Note Purchase Agreement, Secured Debenture Agreement and Security Agreement with Colorep dated November 11, 2008.





10.39*   Security Agreement with Colorep dated November 21, 2008.





10.40*    Subordination and Intercreditor Agreement with PNC Bank dated December 5, 2008.





10.41*    Amendment to Note Purchase Agreement with Colorep dated December 5, 2008.





10.42*    Amended and Restated Agreement and Plan of Merger with Colorep dated March 31, 2010.





10.43*    Amended and Restated Secured Convertible Debenture with Colorep dated March 31, 2010.





12.1 and 12.2 302 CERTIFICATION





13.1 and 13.2 SECTION 906 CERTIFICATION





23.1 AUDITORS’ CONSENT





99* CODE OF ETHICS





99.1* WHISTLEBLOWER POLICY




* Previously filed.  Otherwise all other exhibits filed herewith.


50




SIGNATURES





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





CARTHEW BAY TECHNOLOGIES INC.By:
/s/ Michael LiikPresident and Chief Executive OfficerDate: November 14, 2011




51




CARTHEW BAY TECHNOLOGIES INC.
 
 Financial Statements
  (Canadian Dollars)
  December 31, 2010, 2009 and 2008
  
 
 CARTHEW BAY TECHNOLOGIES INC.
 
 INDEX
 
 December 31, 2010, 2009 and 2008
 
 PAGEINDEPENDENT AUDITORS’ REPORT
1-2FINANCIAL STATEMENTSBalance Sheets - Statement I
3Statements of Operations and Deficit - Statement II
4Statements of Cash Flows – Statement III
5NOTES TO THE FINANCIAL STATEMENTS
6 – 20
  
 
 Independent Auditors' Report
  To the Shareholders of
 Carthew Bay Technologies Inc.
 Report on the Financial Statements
  We have audited the accompanying financial statements of Carthew Bay Technologies Inc., which comprise the balance sheets as at December 31, 2010 and 2009, and the statements of operations and deficit, statements of retained earnings, and statements of cash flows for the three years ended December 31, 2010, and a summary of significant accounting policies and other explanatory information.
  Management's Responsibility for the Financial Statements
  Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian generally accepted accounting principles ("GAAP"), and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
  Auditors' Responsibility
  Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
  An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
  We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
  Page 1
  Opinion
  In our opinion, the financial statements present fairly, in all material respects, the financial position of Carthew Bay Technologies Inc. as at December 31, 2010 and 2009, and the results of its operations and its cash flows for the three years ended December 31, 2010 in accordance with Canadian generally accepted accounting principles.
  Emphasis of matter
  Without modifying our opinion, we draw attention to Note 1 in the financial statements which discloses conditions and matters that indicate the existence of a material uncertainty that may cast significant doubt about the Company's ability to continue as a going concern.
 
 Chartered AccountantsLicensed Public Accountants
  Toronto, Ontario
 November 7, 2011
  Page 2
 
 CARTHEW BAY TECHNOLOGIES INC.
Statement IBalance SheetsAs at December 31, 2010 and 2009(Canadian Dollars)
 
 2010


2009ASSETSCURRENTCash and cash equivalents

$
16,205


$
211,389Government taxes receivable


5,149



16,152Prepaid expenses


-



18,853Loan receivable – ECOM Financial Corp (note 4)


-



26,165Receivable from Colorep Inc. (note 3)


439,892



-461,246



272,559Receivable from Colorep Inc. (note 3)


-



526,481Investment in Colorep Inc.(note 3)


1



-Convertible debenture in Colorep Inc. (note 3)


-



2,093,200$
461,247


$
2,892,240LIABILITIESCURRENTAccounts payable and accrued liabilities (note 9)

$
534,532


$
102,946Advances from directors (note 9)


30,000



-564,532



102,946SHAREHOLDERS’ (DEFICIT) EQUITYSHARE CAPITAL(note 6(a))


10,978,448



10,978,448CONTRIBUTED SURPLUS (note 6(a))


6,282,217



6,236,567DEFICIT - Statement II


(17,363,950
)


(14,425,721
)( 103,285
)


2,789,294$
461,247


$
2,892,240
 
 Approved on behalf of the Board:
 
 (Director)

(Director)
 
 The accompanying notes are an integral part of these financial statements.
  Page 3
 CARTHEW BAY TECHNOLOGIES INC.
Statement IIStatements of Operations and DeficitFor the Years Ended December 31, 2010, 2009 and 2008(Canadian Dollars)
 
 2010


2009


2008EXPENSESResearch and development (recovery) (note 2)

$
-


$
(28,785
)

$
(131,383
)General and administrative (note 9)


481,323



155,876



554,712Professional fees (note 9)


520,018



21,893



148,426Stock based compensation


45,650



-



-Bad debt


25,000



-



-LOSS FROM OPERATIONS


1,071,991



148,984



571,755OTHER INCOME (EXPENSE)Interest income (note 3)


60,316



393,165



268,450Foreign exchange (loss) gain


(65,085
)


(399,966
)


479,994Loss on settlement of debenture (note 3)


(1,861,469
)


-



-(1,866,238
)


(6,801
)


748,444NET (LOSS) INCOME FOR THE YEAR


(2,938,229
)


(155,785
)


176,689DEFICIT, BEGINNING OF YEAR


(14,425,721
)


(14,269,936
)


(14,446,625
)DEFICIT, END OF YEAR

$
(17,363,950
)

$
(14,425,721
)

$
(14,269,936
)Net (Loss) Income per Common Share – Basic

$
(0.05
)

$
(0.00
)

$
0.00Net (Loss) Income per Common Share – Diluted

$
(0.05
)

$
(0.00
)

$
0.00Weighted Average Number of Common Shares Outstanding – Basic(note 6)


64,173,937



54,628,016



52,796,804Weighted Average Number of Common Shares Outstanding – Diluted(note 6)


64,173,937



54,628,016



64,873,293
 
 The accompanying notes are an integral part of these financial statements.
  Page 4
 CARTHEW BAY TECHNOLOGIES INC.
Statement IIIStatements of Cash FlowsFor the Years Ended December 31, 2010, 2009 and 2008(Canadian Dollars)
 
 2010


2009


2008OPERATING ACTIVITIESNet income (loss) for the year

$
(2,938,229
)

$
(155,785
)

$
176,689Items not requiring cashLoss on settlement of debenture


1,861,469



-Consulting and professional fees paid in capital stock


-



-



30,925Consulting fees paid in capital stock to related parties


-



-



101,875Investment income included in receivable from Colorep Inc. on settlement of debenture


(60,000
)


-



-Expense recovery included in receivable from Colorep Inc. on settlement of debenture


(60,000
)


-



-Bad debts


25,000



-



-Stock based compensation


45,650



-



83,779Unrealized foreign exchange loss (gain)


47,737



341,635



(436,000
)Net change in non-cash working capital balances  related to operations (note 7)


461,441



(428,992
)


(22,168
)(616,932
)


(243,142
)


(64,900
)INVESTING ACTIVITIESInvestment in Colorep Inc.


391,748



-



(2,000,000
)Loan receivable ECOM Financial Corp


-



(25,000
)


-391,748



(25,000
)


(2,000,000
)FINANCING ACTIVITIESAdvances from directors


30,000



-



-NET DECREASE IN CASH AND CASH EQUIVALENTS


(195,184
)


(268,142
)


(2,064,900
)CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR


211,389



479,531



2,544,431CASH AND CASH EQUIVALENTS, END OF YEAR

$
16,205


$
211,389


$
479,531
 Note 7 – Supplemental Disclosure of Cash Flows
  The accompanying notes are an integral part of these financial statements.
  Page 5
  CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 1.
DESCRIPTION OF BUSINESS AND GOING CONCERN
 
 Description of Business
 
 The Company changed its name to Carthew Bay Technologies Inc. on August 17, 2007.
 
 On May 23, 2008, the Company signed a share exchange agreement with Colorep Inc. whereby shares of the Company will be exchanged for all the issued and outstanding shares of Colorep Inc. under terms that constitute a reverse takeover (“RTO”).  On March 31, 2010, the agreement was fundamentally changed, refer to note 3.
 
 Going Concern
 
 These financial statements have been presented on the basis that the Company is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  The Company currently has no commercial operations and has no assets other than cash and cash equivalents and investments, these conditions raise substantial doubt about the ability of the Company to continue as a going concern.
 
 Management proposes to identify and evaluate potential acquisitions or businesses, and once identified and evaluated, to negotiate an acquisition or participation subject to receipt of regulatory and, if required, shareholder approval. When an acquisition or participation is identified, additional funding may be required. The ability of the Company to fund its potential future operations and commitments is dependent upon the ability of the Company to obtain additional financing and on its ability to monetize its investments. However, no assurance can e made that management will be successful in fulfilling all components of its plan. The failure to achieve these plans will have a material adverse effect on the Company’s financial position, results of operations and ability to continue as a going concern.
 
 These financial statements do not reflect any adjustments relating to the recoverability and classifications of assets and liabilities if the Company were not able to continue as a going concern.
 Page 6
 CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 2.
SIGNIFICANT ACCOUNTING POLICIES
 
 Basis of Presentation
 
 These financial statements have been prepared by management in accordance with Canadian generally accepted accounting principles (“GAAP”).
 
 Cash and Cash Equivalents
 
 Cash consists of cash at banks and on hand; cash equivalents consist of highly liquid short-term investments, which may be settled on demand without penalty or within a maximum 90-day period from the date of purchase.
 
 Research and Development Costs, Investment Tax Credits and Government Assistance
 
 All costs relating to scientific research and product evaluation are expensed as incurred.  Product development costs are expensed as incurred unless the product or process is clearly defined; the associated costs can be identified; technical feasibility has been reached; there is intention to produce or market the product; the future market is clearly defined; and, adequate resources exist or are expected to be available to complete the project.  To date, these criteria have not been met and, accordingly, no development costs have been deferred.
 
 Investment tax credits are recognized in the period in which the credits are earned and realization is considered more likely than not.  Government grants are recognized when received.  Assistance received or receivable is accounted for using the cost reduction approach.
 
 2010


2009


2008Canadian SRED credits received


NIL


$
28,785


$
131,383
 
 Income Taxes
 
 Income taxes are recorded using the liability method.  Future income and deduction amounts arise due to temporary differences between the accounting and income tax bases of the Company’s assets and liabilities.  Future income tax assets and liabilities are measured using substantively enacted income tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on future income tax assets and liabilities of a change in income tax rates is recognized in the period that includes the date of substantive enactment.  The future benefits of income tax assets, including unused tax losses, are recognized subject to a valuation allowance to the extent that it is more likely than not that such losses will be ultimately utilized.
  Page 7
 CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
 
 Use of Estimates
 
 The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenue and expenses during the year.  Financial statement items subject to significant management judgment include revenue recognition, the valuation of investment in Colorep Inc. Series C preference shares, investment in Colorep Inc. common shares, and convertible debenture in Colorep Inc., the completeness of accounts payable and accrued liabilities, the valuation of stock-based compensation, and future income taxes.  Actual amounts could differ from management’s estimates.
 
 Financial Instruments
 
 At December 31, 2010, the Company’s financial instruments comprise cash and cash equivalents, interest and support receivable, investment in Colorep Inc., accounts payable and accrued liabilities, and advances from directors.
 
 Financial assets are classified into one of four categories: held-for-trading, held to-maturity, loans and receivables and available-for-sale; financial liabilities are classified into one of two categories: held-for-trading and other financial liabilities.  All derivative instruments, including those that are embedded in, but not closely related to, another contract must be classified as held-for-trading.  All financial instruments, including derivatives, are measured at fair value except for loans and receivables, held-to-maturity investments and other financial liabilities, which are measured at amortized cost, using the effective interest method where applicable.  Subsequent measurement and changes in fair value will depend on their initial classification, as follows: held-for-trading financial assets are measured at fair value and changes in fair value are recognized in net income; available-for-sale financial instruments are measured at fair value with changes in fair value recorded in other comprehensive income until the investment is derecognized or impaired at which time the amounts would be recorded in net earnings.
 
 The Company has designated cash and cash equivalents as held-for-trading, which is measured at fair value.  Investment in Colorep Inc. is comprised of common shares, preference shares, and common share purchase warrants of Colorep Inc. as described in note 3.  The common and preference shares are classified as available-for-sale and are measured at fair value, the common share purchase warrants are classified as held-for-trading and are measured at fair value.  Receivable from Colorep Inc. is classified as loans and receivables and is measured at amortized cost. Accounts payable and accrued liabilities and advances from directors are classified as other financial liabilities and are measured at amortized cost.
  Page 8
 CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
 
 Financial Instruments (continued)
 
 The Company classifies its financial instruments according to a three level hierarchy that reflects the significance of the inputs used in making the fair value measurements.  The three levels of fair value hierarchy are as follows:
 ·
Level 1
-
Unadjusted quoted prices in active markets for identical assets or liabilities
 ·
Level 2
-
Inputs other than quoted prices that are observable for assets or liabilities, either directly or indirectly; and
 ·
Level 3
-
Inputs for assets or liabilities that are not based on observable market data.
 
 Cash and cash equivalents are classified within Level 1 of the fair value hierarchy.
 
 All components of the Company’s investment in Colorep Inc. as described in note 3 are classified within Level 3 of the fair value hierarchy. Their fair value is calculated as the expected future cash flows.
 
 Stock-based Compensation
 
 The Company has in effect a Stock Option Plan (“the Plan”), which is described in note 6.  Stock options are accounted for using a fair value-based method.  Fair value is calculated using the Black-Scholes model with the assumptions described in note 6.  On the exercise of stock options, consideration received and the accumulated contributed surplus amount is credited to share capital.
 
 Foreign Currency Translation
 
 The Company translates foreign currency denominated transactions using the temporal method.  Monetary assets and liabilities denominated in currencies other than Canadian dollars are translated into Canadian dollars at the rate of exchange in effect at the balance sheet date.  Revenues and expenses are translated at the transaction exchange rate, with the exception of amortization, which is translated at historic rates.  Foreign currency gains and losses resulting from the translation of assets and liabilities are reflected in net income of the period.
 
 Income (Loss) per Share
 
 Basic income (loss) per share is computed by dividing the income (loss) for the year by the weighted average number of common shares outstanding during the year, excluding contingently returnable shares.  Diluted income (loss) per share is calculated in a similar manner, except that the weighted average number of common shares outstanding is increased to include contingently returnable common shares and from the assumed exercise of common share purchase options and warrants, if dilutive.  The number of additional shares included in the calculation is based on the treasury stock method for options and warrants.
  Page 9
  CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 2.
SIGNIFICANT ACCOUNTING POLICIES (continued)
 
 Changes in Accounting Policies
 
 International Financial Reporting Standards (“IFRS”)
 
 In January 2006, the CICA’s Accounting Standards Board (“AcSB”) formally adopted the strategy of replacing Canadian generally accepted accounting principles with IFRS for Canadian enterprises with public accountability.  The current conversion timetable calls for financial reporting under IFRS for accounting periods commencing on or after January 1, 2011.  On February 13, 2008 the AcSB confirmed that the use of IFRS will be required in 2011 for publicly accountable profit-oriented enterprises.  For these entities, IFRS will be required for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011.  The Company is prepared to adopt IFRS effective January 1, 2011.
 
 Business Combinations, Consolidated Financial Statements and Non-Controlling Interests
 
 The CICA issued three new accounting standards in January 2009: Section 1582, Business Combinations, Section 1601, Consolidated Financial Statements and Section 1602, Non-ControllingInterests. These new standards will be effective for fiscal years beginning on or after January 1, 2011. The Company is in the process of evaluating the requirements of the new standards.
 
 Section 1582 replaces section 1581 and establishes standards for the accounting for a business combination. It provides the Canadian equivalent to IFRS 3 - Business Combinations. The section applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after January 1, 2011. Sections 1601 and 1602 together replace section 1600, Consolidated Financial Statements. Section 1601, establishes standards for the preparation of consolidated financial statements. Section 1601 applies to interim and annual consolidated financial statements relating to fiscal years beginning on or after January 1, 2011. Section 1602 establishes standards for accounting for a non-controlling interest in a subsidiary in consolidated financial statements subsequent to a business combination. It is equivalent to the corresponding provisions of IFRS lAS 27 - Consolidated and Separate Financial Statements and applies to interim and annual consolidated financial statements relating to fiscal years beginning on or after January 1, 2011.
  Page 10
 CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 3.
CONVERTIBLE DEBENTURE IN COLOREP INC.
 
 On March 31, 2010, the Company and Colorep Inc. entered into an Amended and Restated Convertible Debenture agreement (the “March 31, 2010 Amendment”). The March 31, 2010 Amendment fundamentally changes previous agreements with Colorep Inc.
 
 With the approval of the Amended and Restated Debenture Agreement at the Shareholders’ meeting, held May 6, 2010, a debenture settlement took place and resulted in the investment in Colorep Inc. converting as follows:
  USD


CADInvestment before settlementConvertible Debenture

$
2,000,000


$
2,053,600Receivable from Colorep Inc.


622,820



639,512$
2,622,820


$
2,693,112Fair value of proceeds receivedCash

$
809,936


$
831,642Colorep Inc. securities (see below)


1



1$
809,937


$
831,463Loss on settlement

$
1,812,883


$
1,861,469
 
 The securities of Colorep Inc. described above (the “Securities”) include 2,697,392 common shares, 714,005 Series C preference shares, and 7,140,050 common share purchase warrants of Colorep Inc. Each preference share is convertible into 10 common shares of Colorep Inc. and has a liquidation preference value of US $2.8011.  Each common share purchase warrant is exercisable into one common share of Colorep Inc. at an exercise price of US $0.378 for a period of 5 years from issuance.
 
 As at December 31, 2010, the Company has received US $370,000 related to the settlement.  The remaining US $439,936 was collected in fiscal 2011.
 
 4.
LOAN RECEIVABLE – ECOM FINANCIAL CORP.
 
 On November 13, 2009, the Company advanced US $25,000 (CA $26,165) by way of a Promissory Note to ECOM Financial Corp.  This loan became uncollectable and was written off in 2010.
  Page 11
  CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 5.
INCOME TAXES
 
 The following table reconciles the expected income tax recovery at the Canadian Federal and Provincial statutory rate of 31% (2009 - 33%, 2008 33.5%) to the amount recognized in the statement of operations:
 
 2010


2009


2008Net (loss) income before income taxes

$
(2,938,229
)

$
(155,785
)

$
176,689Statutory income tax rate


31
%


33
%


33.50
%Income tax (recovery) provision at statutory rate

$
(910,851
)

$
(51,409
)

$
59,191Non-taxable gain


-



-



-Non-deductible expenses


576,146



-



72,554Application of non-capital losses applied


(21,148
)


-



-Change in tax rate


171,629



367,838



499,272Change in valuation allowance


184,224



(316,429
)


(631,017
)Income tax expense

$
-


$
-


$
-
 
 The components of the Company’s net future income tax assets are as follows:
 
 2010


2009


2008Statutory income tax rate


25.00
%


25.00
%


29.00
%Non-capital losses and unclaimed SRED

$
2,585,965


$
2,401,741


$
3,050,090Valuation allowance


(2,585,965
)


(2,401,741
)


(3,050,090
)Net future income tax asset

$
-


$
-


$
-
 
 The Company's non-capital income tax losses expire as follows:
  
 2014

$
2,438,0142015


3,029,9462026


1,835,4412028


120,8472030


1,147,916$
10,343,861
 
 The Company has unclaimed scientific research and experimental development (“SRED”) tax pools in Canada of $1,771,697, which are available to offset future taxable income.  These SRED amounts have an unlimited carry forward period.
  Page 12
  CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 6.       SHARE CAPITAL AND CONTRIBUTED SURPLUS
 
 a)    Share capital
 
 Share capital comprises the following:
 
 Authorized
 Unlimited common shares
 10,000,000 preferred shares
 
 Issued and outstanding
 
 At December 31, 2010 and 2009, 76,404,648 common shares were issued and outstanding, including the 7,258,877 (2009 – 21,776,632) shares held in escrow relating the success fee as outlined in note 9.
 
 The weighted average number of common shares outstanding during 2010 was 76,404,648 (2009- 76,404,648; 2008 – 52,796,804).  The contingently returnable shares of 7,258,877 (2009 – 21,776,632; 2008 – 21,776,632) have been excluded in the calculation of diluted net (loss) income per share for the 2010, 2009, and 2008 fiscal years as all conditions necessary for their full release have not been met.
 
 No preferred shares have been issued.
 
 Share and stock option transactions during the years ended December 31, 2010 and 2009 were as follows:
 
 Number of


Capital


ContributedShares Issued


Amount


SurplusBalance, December 31, 2008 and 2009


76,404,648


$
10,978,448


$
6,236,567Valuation of options for consulting fees to unrelated parties


-



-



4,240Valuation of options in lieu of directors’ fees


-



-



41,410Balance, December, 2010


76,404,648


$
10,978,448


$
6,282,217
  Page 13
 CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 6.
SHARE CAPITAL AND CONTRIBUTED SURPLUS  (continued)
 
 b)    Stock option plan
 
 The Company has stock option plan for its employees and consultants who are regarded as integral to the progress of the Company and its operations.  Options are normally issued as a bonus on employment or are tied into performance related compensation.  Performance related compensation includes completion of research and development projects within specific timeframes and budgets, achieving financial targets on behalf of the Company or introduction/referral/completion of business agreements or arrangements.  In general, the minimum vesting requirement of options issued is one year.  The maximum term of options is five years from the grant date.  Normally, the exercise price of the option is determined using the five-day closing average of the shares prior to the grant date.
 
 i)     Stock options granted
 
 During the year ended December 31, 2008, the Company granted stock options as follows:
 
 The Company issued 7,121,758 incentive options to six directors under the following terms: Exercise price US $0.027; expiring September 6, 2012; vesting subject to successful completion of the reverse takeover transaction as described in note 3.
 
 The Company issued 1,500,000 settlement optionsto former directors and officers under the following terms: Exercise price US $0.021; expiring August 1, 2012; vesting immediately.
 
 The Company issued 508,697 finders’ fee options to a director for introducing the Company to Colorep Inc. under the following terms: Exercise price US $0.027; expiring November 23, 2012; vesting subject to successful completion of the reverse takeover transaction.
 
 During the year ended December 31, 2008, the Company issued 500,000 options to a former director to settle debt obligations under the following terms:  Exercise price US $0.035; expiring June 23, 2013; vesting immediately.
 
 No stock options were granted in the year ended December 31, 2009.
 
 During the year ended December 31, 2010, the Company granted stock options as follows:
 
 On March 4, 2010, the Company issued 2,400,000 options to a Director on account of his Directors’ Fees, in accordance with the Company’s director compensation program, for the period August 1, 2008 to January 31, 2010 under the following terms:  Exercise price US $0.0132; expiring March 4, 2015; vesting immediately.
 
 On March 26, 2010 the Company issued 1,250,000 options to a former director for a management contract under the following terms:  Exercise price US $0.013; expiring March 26, 2015; vesting immediately.
  Page 14
  CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 6.
SHARE CAPITAL AND CONTRIBUTED SURPLUS (continued)
 
 b)    Stock option plan (continued)
 
 i)     Stock options granted (continued)
 
 On May 6, 2010 the Company issued 416,666 options to a director for management contract under the following terms: Exercise price US $0.013, expiring May 6, 2015, vesting immediately.
 
 On May 6, 2010 the Company issued 416,666 options to a director for management contract under the following terms: Exercise price US $0.013, expiring May 6, 2015, vesting immediately.
 
 ii)   Stock options exercised
 
 No stock options were exercised during the 2010, 2009 or 2008 fiscal years.
 
 iii)  Stock option valuation
 
 9,630,455 options issued in the year ended December 31, 2008 were valued at $260,129 using the Black-Scholes option pricing model with the following weighted average assumptions: risk free interest rate of 3.40%; expected life of 5 years; expected volatility of 157%; dividend yield of 0%.  These options vested immediately.  In March of 2010, 4,323,924 options were rescinded by the CEO and CFO of the Company.
 
 4,483,332 options issued in the year ended December 31, 2010 were valued at $45,650 using the Black-Scholes option pricing model with the following assumptions: risk free interest rate of 2.52%; expected life of 5 years; expected volatility of 222%; dividend yield of 0%.  These options vested immediately.
 
 iv)   Summary table
 
 WeightedAverageOptions for


ExerciseCommon Shares


Price U.S.$Balance, December 31, 2009 and 2008


9,630,455



0.26Options granted


4,483,332



0.013Options exercised


-



-Options rescinded


(5,157,258
)


(0.025
)Balance, December 31, 2010


8,956,529



0.021
  Page 15
  CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 6.        SHARE CAPITAL AND CONTRIBUTED SURPLUS (continued)
 
 b)    Stock option plan (continued)
 
 v)    Weighted average remaining contractual life
 
 The following table summarizes information about the Company’s stock options outstanding as at December 31, 2010:
 
 Number


Weighted


Weighted


Number


WeightedExercise

Outstanding at


Average


Average


Exercisable at


AveragePrice

December 31,


Exercise


Remaining


December 31,


ExerciseUS$

2010


Price US$


Life in Years


2010


Price US$0.013 – 0.026


8,956,531



0.0208



2.753



8,956,531



0.0208
 
 c)    Common share purchase warrants
 
 The following table illustrates the continuities of the Company’s warrants during the years ended December 31, 2010 and 2009:
  Number





Number





NumberOutstanding





Outstanding





OutstandingPrice


at December


Expired


at December


Expired


at DecemberExpiry

US$



31, 2008


in 2009



31, 2009


in 2010



31, 2010March 2009


0.19



1,344,500



1,344,500



-



-



-April 2009


0.27



185,000



185,000



-



-



-April 2009


0.19



3,486,000



3,486,000



-



-



-April 2009


0.20



746,560



746,560



-



-



-April 2009


0.30



1,241,250



1,241,250



-



-



-7,003,310



7,003,310



-



-



-
 There are no warrants outstanding as at December 31, 2010.
  Page 16
  CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 7.
STATEMENTS OF CASH FLOWS
 
 The net change in non-cash working capital balances related to operations comprises the following:
  2010


2009


2008Government taxes receivable

$
11,003


$
-


$
-Increase in amounts receivable


-



(481,488
)


(58,378
)Decrease in prepaid expenses


18,853



-



68,647Increase (decrease) in accounts payable and accrued liabilities


431,585



52,496



(32,437
)$
461,441


$
(428,992
)

$
(22,168
)
 
 8.
SEGMENTED FINANCIAL INFORMATION
 
 At December 31, 2010 and 2009, all of the Company’s assets and operations were located in Canada.
 
 9.
RELATED PARTY TRANSACTIONS AND BALANCES
 
 During the year ended December 31, 2010, the Company incurred consulting expenses and directors’ fees for the services of certain directors in the amount of $275,284 (2009 - $465,834; 2008 - $406,685). One director elected in accordance with the Company’s director compensation program to receive options as described in note 6.
 
 At December 31, 2010, accounts payable and accrued liabilities included fees payable to directors in the amount of $167,500 (2009 - $52,330). During the year ended December 31, 2010 the Company accrued legal fees of $458,271 to a law firm in which a director of the Company is also a Partner (2009 - $44,843; 2008 - $104,815).
 
 During the year ended December 31, 2008, the Company issued 1,838,732 shares to officers and directors and/or companies controlled by them, and granted 7,121,758 stock options to directors, 1,500,000 settlement options to former directors and officers, and 508,679 finders’ fee options to a director (see note 6).  In 2010, 4,323,924 options were rescinded by the officers of the Company.
 
 During the year ended December 31, 2008, the Company issued 3,000,000 shares and granted 500,000 stock options to a company controlled by a former director (see note 6).  Also during the year ended December 31, 2008, the Company issued 21,776,632 shares to two directors in advance of the success fee which they would have earned if the Colorep Inc. RTO transaction was to close (note 3).
 
 With the settlement of the investment in Colorep Inc., as described in note 3 and as approved at the Shareholders’ meeting held May 6, 2010, two-thirds of the shares granted to directors in 2008 were released to the two directors in 2010.  7,258,877 shares are held in escrow until such time when over a period of five consecutive business days the simple average of the closing prices of the Company’s shares on the principal stock exchange is equal to or greater than U.S. $11.  If the conditions are not met by May 6, 2015, the shares will expire and be surrendered to the Company.
 
 During the year ended December 31, 2010, the Company was advanced $30,000 from its directors.  The advances from directors are due on demand, bear interest at 1% per annum, and have no set terms of repayment.
  Page 17
 CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 10.
CAPITAL MANAGEMENT
 
 The Company’s objective is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to allow the Company to realize on its investment in the shares of Colorep Inc.  Management defines capital as the Company’s shareholders’ (deficit) equity.
 
 The Company is not subject to any externally imposed capital requirements.
 
 11.
FINANCIAL INSTRUMENTS
 
 The fair values of the Company’s financial instruments approximate their carrying values due to the short-term nature of the instruments.
 
 The Company’s risk exposure and the impact on its financial instruments are summarized below:
 
 Credit Risk
 
 Credit risk is the risk of loss associated with counterparty’s inability to fulfill its payment/contractual obligations.  The Company is exposed to credit risk on its cash and receivable from Colorep Inc. The Company has deposited the cash with reputable Canadian financial institutions, from which management believes the risk of loss is minimized.  Management believes that credit risk concentration with respect to the receivable from Colorep Inc. is low.  As at December 31, 2010, the amounts receivable are not considered past due or impaired.
 
 Liquidity Risk
 
 The Company’s approach to managing liquidity risks is to ensure that it will have sufficient liquidity to meet liabilities when due.  As at December 31, 2010, the Company had a cash balance of $16,205 (2009 - $211,389) to settle current liabilities of $624,471 (2009 - $102,946).  Should Colorep Inc. fail to complete a transaction whereby Colorep Inc. would become a publically listed entity, the Company could face difficulties in monetizing its investment in Colorep Inc.
 
 Market risk
 
 (a)
Interest rate risk
 
 The Company has cash and cash equivalents.  The Company’s current policy is to invest excess cash in interest bearing bank accounts.
  Page 18
  CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 11.
FINANCIAL INSTRUMENTS (continued)
 
 (b)
Foreign currency risk
 
 The Company is exposed to foreign currency risk on fluctuations related to cash and cash equivalents and receivable from Colorep Inc.
 
 The Company has not hedged its exposure to currency fluctuations. At December 31, 2010, the Company is exposed to currency risk through the following assets denominated in United States dollars, but presented in Canadian dollar equivalents.
  2010United States DollarsCash and cash equivalents

$
6,409Receivable from Colorep Inc.

$
439,936
 
 Based on the above net exposures at December 31, 2010, and assuming that all other variables remain constant a 10% appreciation or depreciation of the Canadian dollar against the United States dollar would result in an increase/decrease of about $44,500 in the Company’s loss from operations.
 
 (c)
Price risk
 
 The Company is not exposed to price risk.
 
 12.
COMPARATIVE FIGURES
 
 Comparative figures have been reclassified to conform to the current year’s presentation.
 
 13.
DIFFERENCES BETWEEN CANADIAN AND UNITED STATES ACCOUNTING PRINCIPLES
 
 This reconciliation only covers measurement issues and not disclosure issues pursuant to the rules and regulations of the Securities and Exchange Commission.
 
 The financial statements of the Company for the years ended December 31, 2010, 2009 and 2008 have been prepared in accordance with generally accepted accounting principles as applied in Canada (“Canadian GAAP”). In the following respects, generally accepted accounting principles as applied in the United States (“U.S. GAAP”) differ from those applied in Canada.
 
 There would be no adjustments needed to arrive at net (loss) income for the years ended December 31, 2010, 2009 and 2008 if U.S. GAAP were employed.  Similarly, there would be no adjustments needed to arrive at shareholders’ (deficit) equity as at December 31, 2010, 2009 and 2008 if U.S. GAAP were employed.
  Page 19
 CARTHEW BAY TECHNOLOGIES INC.Notes to the Financial StatementsDecember 31, 2010, 2009 and 2008(Canadian Dollars)
 
 13.
DIFFERENCES BETWEEN CANADIAN AND UNITED STATES ACCOUNTING PRINCIPLES(continued)
 
 Recently Issued Accounting Pronouncements
 
 In January 2010, the FASB issued additional guidance on fair value measurements and disclosures which requires reporting entities to provide information about movements of assets among Levels 1 and 2 of the three-tier fair value hierarchy established by the existing guidance.  The guidance is effective for any fiscal year that begins after December 15, 2010, and it should be used for quarterly and annual filings.  We are currently evaluating the impact of this new accounting guidance on our consolidated financial statements.
 
 In May 2011, the FASB issued further guidance on fair value measurements and disclosures which requires the categorization by level for items that are only required to be disclosed at fair value and information about transfers between Level 1 and Level 2. In addition, the update provides guidance on measuring the fair value of financial instruments managed within a portfolio and the application of premiums and discounts on fair value measurements. The guidance requires additional disclosure for Level 3 measurements regarding the sensitivity of fair value to changes in unobservable inputs and any interrelationships between those inputs. The guidance is effective for interim and annual periods beginning after December 15, 2011. The Company is currently evaluating the impact of this new accounting guidance on its financial statements.
 
 In June 2011, the FASB issued guidance regarding the presentation of Comprehensive Income within financial statements.  The guidance is effective for interim and annual periods beginning after December 15, 2011. The Company is currently evaluating the impact of this new accounting guidance on its financial statements.
  Page 20