UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

**FORM 10-KSB/A**

(Mark One)

[X] Annual report under Section 13 or 15(d) of the Securities
Exchange Act of 1934 
For the fiscal year ended June 30, 2006

[   ] Transition report under Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the transition period from ________ to ________

Commission File Number 33-17598-NY

THE TIREX CORPORATION(Name of Small Business Issuer in Its Charter)

|Delaware                                 | 22-3282985         
|---------------------------------------- | -------------------
|(State or Other Jurisdiction of          | (I.R.S. Employer   
|Incorporation or Organization)           | Identification No.)
|                                         |                    
|P.O. Box 1000, Stratford Postal Store    |                    
|411 Barnum Ave. Cutoff                   |                    
|Stratford CT                             | 06614-9991         
|(Address of Principal Executive Offices) | (Zip Code)         

(203) 522-3247(Issuer's Telephone
Number, Including Area Code)

Securities registered under Section 12(b) of the Exchange Act:

Name of Each Exchange

|Title of Each Class | on Which Registered
|------------------- | -------------------
|NONE                | NONE               

Securities registered under Section 12(g) of the Exchange Act:
NONE

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

Yes [X]    No [   ]

Check if there is no disclosure of delinquent filers in response
to Item 405 of Regulation S-B contained in this form, and if no disclosure
will be contained, to the best of the Company's knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this Form
10-KSB or any amendment to this Form 10-KSB. [X]

$nil(Issuer's revenues for its most
recent fiscal year)

$zero (as of June 30, 2007)(Aggregate
market value of the voting stock held by non-affiliates of the Issuer)

249,895,892 (as of September 30, 2007)(Number of shares outstanding of each of the Issuer's classes of common
stock)

Transitional Small Business Disclosure Format (check one)
Yes [   ]     No [X]

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DOCUMENTS INCORPORATED BY REFERENCE into Part I

Annual Report of the Company on Form 10-KSB/A for the year ended
June 30, 2007

Quarterly Reports of the Company on Form 10-QSB for the
quarters ended September 30, 2006, December 31, 2006, and March 31, 2007

Current Reports on Forms 8-K of the Company

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EXPLANATORY NOTE

The primary purpose of this amended Report 10-KSB is to replace
the unaudited financial statements included with the original filings with
audited financial statements, these statements having been retroactively audited
by Moore & Associates. To the extent of some minor variations in the
financial statements, as a result of the audit, the Liquidity and Capital
Resources sub-section of the Management Discussion and Analysis has been
modified to reflect the numbers of the audited financial statements. There have been no other material changes.

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ITEM 1. DESCRIPTION OF BUSINESS

The Company

The Tirex Corporation
(hereinafter referred to as "we", "us" or the "Company") is engaged in the
business of developing for sale, license or lease an environmentally safe
patented "turn key" cryogenic tire recycling system, known as the "TCS System"
The TCS System was designed and developed by us and separates tires into clean
and saleable rubber crumb, steel wire, and fiber. The Company was incorporated
in Delaware on August 19, 1987 under the name "Concord Enterprises, Inc." The
Company's name was changed to "Stopwatch Inc." on June 20, 1989 and to "Tirex
America Inc." on March 10, 1993. On July 11, 1997, the Company's name was
changed to "The Tirex Corporation". Since 1993, our core business has been to
develop and to initiate marketing efforts by sale or license of an
environmentally friendly cryogenic tire recycling system, which we intend to
sell to recycling companies and governmental agencies to enable them to recycle
tires. We have devoted much of our earlier efforts to completing the design and
development of our first production model and raising the financing required to
do so, but for the last four years, our efforts have turned to marketing. The
Company has generated only very limited revenues from operations and is still in
the development stage.

The TCS-System

Our TCS-System comprises a
complete, turn-key, environmentally safe, semi-cryogenic tire recycling system
designed to: (i) disintegrate scrap tires, using less energy than is required by
existing ambient methods (which shred and/or chop tires at "ambient" or normal
room temperatures) or other currently available cryogenic methods (which reduce
the temperature of the materials through the use of liquid nitrogen), and (ii)
produce commercially exploitable, high quality, clean rubber crumb and shredded
steel and fiber. Disregarding configuration variations related to tire feedstock
preparation and possible auxiliary grinding after processing through the System
to obtain higher proportions of fine mesh rubber, these variations not forming
part of our technology in any event, the TCS System is offered in multiple
versions, defined in terms of multiples of basic TCS-1 capacity. Based on an
assumed scrap tire weight of 19 lbs., a TCS-1 would process one million scrap
tires per year. There is no significant market for a TCS-1 per se, and we market
the TCS-2 version primarily. However, we are reacting to requests for TCS-3 and
TCS-4 systems as well. It should be emphasized that the TCS technology is not
defined in terms of quantities of tire processing but rather the weight of tires
to be processed. In some regions, scrap tire weights vary significantly from the
19 lb average. For example, in upstate New York, the apparent scrap tire average
weight is reportably about 221⁄2 lbs. In such regions, the actual numbers of tires
which can be processed over a year would vary proportionately as a function of
actual scrap tire weight versus the 19 lb average.

As noted above, the TCS System is
a semi-cryogenic system, in that the precise scientific definition of cryogenics
involves temperatures much colder than what is required to freeze tire pieces to
the point where they can be disintegrated mechanically. Liquid nitrogen systems
are truly cryogenic in that the temperature of liquid nitrogen qualifies for the
truly cryogenic definition. The operating cost of truly cryogenic systems is
significantly higher than that of a semi-cryogenic system because the
incremental cost of attaining cryogenic temperatures, which are not necessary,
imposes a substantial cost of cold premium to the process of tire chip
freezing. At issue is that the cost of attaining each additional degree of cold
costs a little more than the previous degree. While not an exponential
relationship, neither is it a linear relationship. The semi-cryogenic process
avoids the cost of acquiring these additional and unnecessary degrees of cold.

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The freezing chamber of the TCS-1
Production Model, previously located in Montreal, was a large tank through which
the tire parts were circulated having temperatures of approximately 170 degrees
below zero, Fahrenheit. The first commercial version of the TCS has been
re-designed to run approximately 20 degrees colder to ensure that no pieces of
rubber can warm up to the "glass point" before being entirely processed by our
patented fracturing mill. Frozen tire parts are passed through a fracturing mill
that separates the component parts of all tires, including rubber powder, clean
steel wire and twine. The mesh is then physically separated from the metal and
twine and is finally subjected to other steps to achieve the desired mesh size.
The configuration of the back end of the system can be modified, as required, to
produce proportions of mesh sizes appropriate to local crumb rubber customers,
such as 100% -30 mesh or even finer.

The functions and mechanisms of
the TCS-System were originally designed for the purpose of disintegrating
automobile tires, although relatively minor modifications could be introduced to
accept other kinds of tires as well. Such modifications would focus on the
front-end tire chip operation which is not part of the Tirex technology and
which is widely available.

The TCS System has been designed
to operate continuously (with minimum amounts of scheduled downtime for
maintenance) and to require less energy than is used, to the best of the
Company's knowledge, by other presently existing tire recycling equipment.

Step-by-Step Operations

The step-by step operations of
the TCS-System comprise the following:

Tire Feedstock Preparation

The TCS System is not designed to
accept whole tires; whole tires must undergo preliminary preparation to produce
pieces of tire having dimensions which permit their introduction into the
patented fracturing mill. Feedstock preparation can be accomplished in a number
of ways including chipping, shredding and removal of sidewalls followed by
diecutting. None of these techniques form part of the TCS System technology and
the technique ultimately chosen by the tire recycling entrepreneur will revolve
around issues of capital and operating costs as well as possible issues of
transportation costs respecting whole tires.

Freezing the Tire Pieces

The prepared tire pieces are
deposited on a conveyor belt which brings a continuous stream of tire pieces to
a freezing chamber. Supercooled air, produced on-site by an Air Plant, is
continuously blown into the freezing chamber, and this cold air freezes the tire
pieces moving through the chamber to the point where these pieces can be made to
shatter like glass when subjected to forces such as pressure and bending. After
approximately thirty minutes in the Freezing Chamber the frozen pieces exit the
Freezing Chamber and enter our patented disintegrators ("Fracturing Mills").

Size Reduction and Materials Separation in the Fracturing
Mill

The frozen tire pieces pass
through our patented disintegrators ("Fracturing Mills") where the pieces are
reduced to three separate output materials, these being rubber crumb of varying
degrees of fineness, intact pieces of steel and intact pieces of fiber. This
operation does not involve any chopping, shredding, or hammer-milling.
Therefore, the steel wires are neither cut nor broken. The fiber threads retain
their basic shapes and characteristics. No steel powder or fiber fluff is
produced.

Elimination of the Steel from the Fracturing Mill Output

Upon completion of processing in
the Fracturing Mill, the output is conveyed to a magnetic separation system
where the intact steel wires are magnetically removed from the remaining output
of the Fracturing Mill, this being the rubber crumb and the fiber. The steel can
then be baled for either disposal or sale.

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Fiber Removal

The fiber and rubber crumb is
then passed through screens to separate the crumb from the fiber threads. The
fiber threads are then conveyed out of the machine. The fiber can then be baled
or put into a container for either disposal or sale.

Rubber Crumb Finishing

Rubber crumb finishing operations
are dictated by the output requirements of the entrepreneur and his or her
customers. The basic TCS System has been configured to produce rubber crumb in
mesh sizes ranging from -10 mesh to -30 mesh at the option of the entrepreneur
(limited quantities of even finer mesh rubber are also produced), and in such
proportions of mesh sizes as the entrepreneur decides, according to his market
requirements. Back-end configuration modifications can be added to increase the
proportion of finer mesh crumb rubber, even beyond 30 mesh. This
reconfiguration could imply the addition of auxiliary processing equipment which
does not form part of the TCS System technology.

It is possible that some very
small pieces of steel and fiber can be trapped in the larger pieces of rubber
coming out of the Fracturing Mill. These small amounts of steel and fiber are
released during auxiliary processing and can be separated during the auxiliary
processing operation, magnetically for the steel and by an air separation system
for the residual fiber. Alternatively, these larger pieces could be drawn off
and refrozen and re-introduced into the fracturing mills. The rubber crumb is
then passed through a series of screens to sort the rubber crumb by mesh size,
which is thence packaged for customer requirements.

Manufacturing

Our earlier activities focused
primarily on the design and development of the original TCS-1 First Production
Model, and, more recently, on the completion of the design of a second
generation version of this technology. In connection with these activities, we
have been dependent upon arrangements with subcontractors for the manufacture
and assembly of the principal components incorporated into a TCS System Plant.
Pursuant to our signing of the exclusive manufacturing license agreement with
Simpro, S.p.A., with the exception of those systems which Simpro might choose to
refuse to accept a contract from any particular potential customer for whatever
reason, all manufacturing activities of our company will now be undertaken by
this Italian company. In the seemingly unlikely scenario where Simpro would
refuse a contract which we believe should be accepted, we would have the right
to go to alternate sources to have such systems manufactured and installed.
Management believes that numerous alternative sources of supply for all such
systems are readily available and has already identified potential key
suppliers.

We have licensed the
manufacturing respecting our technology to our Manufacturing Partner, Simpro
S.p.A. of Turin, Italy. Simpro is a designer and manufacturer of high-technology
production systems, historically, primarily for the automobile industry, and is
active internationally. Simpro has its ISO 9001, ISO 14001 and EMAS
certifications. We have agreed to this manufacturing partner arrangement because
Simpro is in a position to offer insurance-backed contract performance
guarantees and also to guarantee a minimum tire weight throughput on systems
fabricated, installed and commissioned by them.

The Tirex R&D License

Tirex R&D held an exclusive,
ten year license from the Company, which expired on July 2, 2005. This license,
which was modified in June of 2002, permitted Tirex R&D to design, develop,
and manufacture the TCS-Systems on a worldwide basis (the "Primary License"). To
the extent necessary to ensure that Tirex R&D's operations were focused on
pure research and development activities, Tirex R&D was able sublicense the
Primary License to TCCI or such other corporate entity as would be deemed
appropriate and beneficial. With the expiry of the license and the governments
dissolution of Tirex Canada R&D Inc., and TCCI, unrestricted ownership of
the intellectual property related to the TCS Technology reverted to The Tirex
Corporation.

Canadian Government and Government Sponsored Financial
Assistance

Our May 1995 transfer of our
research and development and manufacturing activities to Tirex R&D (then
referred to as "Tirex Canada") made us eligible for various Canadian and Quebec
government programs which provide loans, grants, and tax incentives, as well as
government guarantees for loans from private lending institutions, for eligible
investment, research and development, and employee-training activities.

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Tax Incentives

Canadian and Quebec scientific
research and experimental development (SR&ED) tax incentives take the form
of deductions and tax credits with respect to eligible research and development
expenditures previously incurred by Tirex R&D. Certain tax credits are
called "refundable" because, to the extent that the amount of the tax credit
exceeds the taxes otherwise payable, they are paid over or "refunded" to the
taxpayer. Thus, these credits function effectively as monetary grants. Our
company has received all of the tax credits to which we were entitled. The
Company has not produced any tax credit claims following its Fiscal 2002 year.
In the event that the Company would envision restarting its R&D efforts, it
would either reactivate Tirex Canada R&D Inc. or create a new Canadian
subsidiary eligible for such tax credits.

Canadian Government, and Government Sponsored Loans and Grants

We have in the past also received
financial assistance by way of loans and grants from Canadian and Quebec
governmental agencies for the design and development of the TCS-1 Plant and for
export market development. All of the activities for which these loans were
approved have been completed and we received the funds approved. Approximately
80% of the loans previously received have been repaid. Of the remaining
approximately CA$148,000 could be forgiven if the Company does not realize any
sales in Spain and Portugal prior to June 30, 2004 and a further approximately
US$14,000 could also be forgiven because there were no sales in Spain and / or
Portugal prior to June 30, 2007. The Canadian dollar and the US Dollar are
approximately at par. The government contested one claim in the amount of
CA$95,000 on the assertion that the transaction was not at arms length. We are
disputing this assertion. Significantly prior to the contract in question, the
person in question had an indirect but non-exclusive relationship with the
company but this relationship was terminated long before the issuance of the
contract in question. We are vigorously contending the governments assertion
but cannot provide any guarantees that the government could be persuaded to
accept our position.

Patent Protection

We were issued a United States
patent on our Cryogenic Tire Disintegration Process and Apparatus on April 7,
1998 (Patent No. 5,735,471). The duration of the patent is 20 years from the
date the original application was filed. In November 1998, we filed our patent,
for review, with the Canadian Patent Office. Canadian patent number 2193334 was
granted on August 17, 2004. Canadian patents have a duration of seventeen (17)
years. Prior to the issuance of our US patent, we relied solely on trade
secrets, proprietary know-how and technological innovation to develop our
technology and the designs and specifications for the TCS-1 demonstration unit.
The Companys patents are free of liens. We do not presently hold any patents
for our products or systems outside of the United States and Canada. We have
lacked the financial resources to apply for a process patent on an international
basis, but the Company intends to file for additional patent protection, in
accordance with our Agreement with Simpro S.p.A. of Turin, Italy, once
sufficient financial resources will become available.

We have entered into
confidentiality and invention assignment agreements with certain employees and
consultants, which limit access to, and disclosure or use of, our technology.
There can be no assurance, however, that the steps we have taken to deter
misappropriation of our intellectual property or third party development of our
technology and/or processes will be adequate, that others will not independently
develop similar technologies and/or processes or that secrecy will not be
breached. In addition, although Management believes that our technology has been
independently developed and does not infringe on the proprietary rights of
others, there can be no assurance that our technology does not and will not so
infringe or that third parties will not assert infringement claims against us in
the future. Management believes that the steps they have taken to date will
provide some degree of protection, however, no assurance can be given that this
will be the case.

Employees

As of September 2007, we have
four persons employed either directly or under consulting contracts including
its three executive officers. Three of the foregoing persons devote their full
time to our business and affairs, as required. At times, we also utilize the
services of part-time consultants to assist us with market research and
development and other matters. We could hire additional personnel, as needed,
and as financial resources permit.

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Potential Markets

We believe that the potential
markets for our TCS System will be directly affected by the level of demand for
economical, high quality rubber crumb derived from the recycling of scrap tires.
The following discussion of the potential markets for rubber crumb assumes that
the TCS System will actually be capable of economically producing high quality
recycled rubber crumb and in a variety of sizes, and capable of being used in
wide range of products. It should be noted, however, that because of the limited
operating history of our heretofore TCS-1 Production Model Plant, we cannot give
any assurance that our TCS Systems will in fact perform as expected under
continuous, commercial operating conditions. Our manufacturing partner, Simpro,
however, is prepared to offer tire throughput guarantees as a function of scrap
tire weight. Our Manufacturing Licensee, Simpro S.p.A. of Turin, Italy, is also
prepared to offer limited performance guarantees, backed by insurance policies.
Moreover, even if the demand for rubber crumb should increase in accordance with
our expectations, there can be no assurance that a demand for TCS Systems will
likewise develop.

Rubber is a valuable raw material
and we believe that recycling this valuable resource from scrap tires is an
ideal way to recover that value. Recycled scrap tire rubber is already used in a
great variety of products, promoting longevity by adding it to asphalt pavement,
adding bulk and providing drainage as a soil additive, providing durability as a
carpet underpadding, road guardrail posts, increasing resiliency in running
track surfaces and gymnasium floors, absorbing shock and lessening the potential
for injuries as a ground cover for playgrounds and other recreational areas, and
as a significant component added to plastic resins for making extruded or molded
products. We are aware of significant recent developments in making finished
products from crumb rubber compounded with plastic resins, particularly
polypropylene. We believe that the potential for crumb rubber to substitute for
either virgin or recycled plastic resins is very significant, given the relative
market price for crumb rubber versus the commodity prices for such plastic
resins. We believe that TCS operators could realize very attractive profits at
prices even less than US$0.20 per pound. As of September 24, 2007, virgin
general purpose injection grade polypropylene was selling for approximately
US$0.87 to US$0.90 per pound for high-volume users with an average premium of
between 2 and 4 cents per pound for lower volume users. Also in an independent
report for September 24, 2007, recycled polypropylene was selling for between
US$0.40 to US$0.44 (for clean regrind or flake) and US$0.55 to $0.59 per pound
(for pellets), depending on its form. TCS System-produced crumb rubber has been
proven to compound very well with polypropylene in high proportions and with
prices of between US$0.20 to US$0.22 per pound, represents a major cost saving
for industry producers, even relative to recycled resins.

Marketing Activities

To a large extent, we have, in
the past, concentrated our efforts on completing the design, development, and
construction of our heretofore TCS-First Production Model 1 and raising adequate
financing to support such efforts. Our long-term objective, however, is to
market TCS Systems worldwide, through national and international sales
representatives, licensees or strategic partners. Pursuant to an extensive
technical audit, our heretofore First Production Model permitted our company to
be certified as an Accredited Tire Recycler by Recyc-Québec, a
Quebec-governmental agency. Users of the TCS technology in Quebec could have
access to tipping fees paid by Recyc-Québec, which currently work out to
approximately US$0.85 per passenger car tire, based on current exchange rates.
Management believes that this accreditation will be beneficial to our marketing
efforts respecting our technology, not only in Quebec but elsewhere, given its
independent status.

We can make no assurances with
respect to the degree of success of our marketing and distribution strategy of
our TCS Systems. Furthermore, we have limited resources to achieve the
distribution of our TCS Systems and to date we have made no sales, leases or
licenses. We believe that we may need additional financing, which may not be
available, to achieve our long-term objectives.

Government Regulation

Insofar as the Company is not
actually a tire recycler, government regulations have little direct effect on
our activities. Of greater importance is the possible effect on our customers
for the TCS technology. The TCS-System is a "closed loop" system which does not
use any chemicals, solvents, gases or other substances which could result in
noxious emissions of any kind from the operation of the Plant. To the best of
the Company's knowledge, operation of a TCS-System will not result in the
emission of any pollutants, the disposal of combustion residues, the storage of
hazardous substances, or the production of any significant amounts of solid
waste which would have to be landfilled. Our Manufacturing Licensee, Simpro
S.p.A., has undertaken a formal environmental assessment of our technology using
the very stringent European standards, the results of which confirms our
assertions. However, the operation of a TCS System will involve, to varying degrees and for varying periods of time,
the storage of scrap tires or tire pieces representing the feedstock to the
System, and limited storage of crumb rubber prior to shipment to customers.
Rubber, regardless of its physical dimensions or form, is widely defined as
being a fire hazard by fire protection services in most industrially-advanced
countries.

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As a result, many US states and
Canadian provinces have either passed or have pending legislation regarding
discarded tires including legislation limiting the storage of used tires to
specifically designated areas. The regulatory environment of the European Union
is already very stringent. Operators of TCS Systems will therefore be subject to
various local, state, and federal laws and regulations including, without
limitation, regulations promulgated by federal and state environmental, health,
and labor agencies. Establishing and operating a TCS System for tire recycling
will require numerous permits and compliance with environmental and other
government regulations, on the part of our customers, both in the United States
and Canada and in most other foreign countries. The process of obtaining
required regulatory approvals may be lengthy and expensive for some customers of
our TCS Systems. Moreover, regulatory approvals, if granted, may include
significant limitations on operations. The US-EPA and comparable US state and
local regulatory agencies, and similar government bodies in Canada and in other
jurisdictions where TCS Systems will be marketed actively enforce environmental
regulations and conduct periodic inspections to determine compliance with
government regulations. Failure to comply with applicable regulatory
requirements can result in, among other things, fines, suspension of approvals,
seizure or recall of products, operating restrictions, and criminal
prosecutions.

We believe that existing
government regulations, while extensive, will not result in the disenabling of
its TCS System customers to operate profitably and in compliance with such
regulations. While these regulations are usually stringent, the huge scrap tire
problem must also be dealt with on a daily basis and the need for economic and
environmentally friendly recycling operations is critical. The burden of
compliance with laws and regulations governing the installation and/or operation
of TCS Systems could, nonetheless, discourage potential customers from
purchasing a TCS System. This would adversely affect our business, prospects,
results, and financial condition. As a result, our business could be directly
and indirectly affected by government regulations.

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ITEM 2. DESCRIPTION OF PROPERTY

Our corporate headquarters is
located at Stratford, Connecticut. We have occupied offices at this address
since September 2006. Prior to moving to these premises, during Fiscal 2006, the
Company occupied premises in a residential and office complex in west-end
Montreal. Prior to its west-end location, Tirex occupied an industrial building
on St. Patrick Street in Montreal, where the TCS Prototype was located. After
having accumulated very substantial arrearages in rent and property taxes for
which we were financially responsible, our former landlord instructed us to
vacate these premises such that he could rent the space out to another company.
As part of the settlement agreement with this former landlord, we agreed to pay
to this former landlord the sum of US$540,000 out of the proceeds of the first
four sales of TCS Systems, at the rate of US$140,000 per system sold.

ITEM 3. LEGAL PROCEEDINGS

We are presently a party in the
following legal proceedings:

IM2 Merchandising and
Manufacturing, Inc and David B. Sinclair v. The Tirex Corporation, Tirex
Corporation Canada, Inc., et al.

The Plaintiffs, a Canadian
resident and a Canadian corporation sued in the Delaware, U.S. Federal District
Court claiming fraud, breach of contract, unjust enrichment and other
allegations, that the alleged Defendants, which include Tirex Corporation Canada
and The Tirex Corporation, jointly conspired to profit from their failure to
comply with terms of a manufacturing agreement. The monetary demand of this
complaint was unspecified. We were prepared to move to dismiss Plaintiffs'
Complaint, but after consultations with the Plaintiffs' Attorneys, the
Plaintiffs' withdrew this complaint voluntarily. Plaintiffs later filed a second
action in the Chancery Court of Delaware alleging certain of the same
allegations; fraud, breach of contract, unjust enrichment, breach of fiduciary
duty and misrepresentation, but eliminated other counts including the securities
fraud allegations. The Defendants in the State Court action are the same named
in the Federal Court action, and again the monetary damages are unspecified. We
moved to dismiss the State Court Chancery case alleging defective service of
process and asserting that the Court had no jurisdiction over the Defendants in
Delaware and for removal of the case to Canada based on forum non convenience
and other considerations. Our motion was granted and the case dismissed.

Subsequently, on or about April
25, 2001, the Plaintiffs instituted a lawsuit in Superior Court, judicial
district of Montreal alleging breach of contract and claims damages of
Canadian$794,690 (approximately US$755,000 at current exchange rates)
representing expenses and an additional Canadian$5,411,158 (approximately
US$5,140,000 at current exchange rates ) in loss of profits (court docket #
500-05-063730-021). Unlike the suit filed in the US Federal District Court
in Delaware, there was no accusation of fraud.

We have filed a detailed answer
denying all liability, stating further that Plaintiffs failed to comply with
their obligations. We believe we have meritorious defenses to all of the
Plaintiffs' claims. The action is still pending.

There has been no activity relative to this suit for the last
six years.

Surgent v. The Tirex Corporation

An action was brought by the
Plaintiff against us, alleging that we had agreed to issue 1,000,000 shares of
our Common Stock to the Plaintiff in consideration for expenses allegedly paid
by the Plaintiff on our behalf in the amount of approximately $150,000. These
expenses allegedly were incurred in relation to the rental of certain office
space and performance of administrative services. The Plaintiff's complaint
sought to impose an equitable trust or lien on 1,000,000 of our unissued common
shares, demanded the issuance of the 1,000,000 shares and alleged breach of
contract and claimed damages of $1,400,000.

We moved to dismiss the case on
various procedural grounds and in September 2000 the Court granted our motion
based upon the lack of venue in Union County, New Jersey. A new action was
instituted by Plaintiff in the Superior Court of New Jersey, Bergen County in
April 2001 alleging similar claims as set forth in the previous action (Docket
L-08060-00). We denied all of plaintiff's allegations. On July 24, 2002, The
Superior Court of New Jersey, Bergen County, dismissed, with prejudice, the
plaintiffs complaint for "Lack of Prosecution". Plaintiff was granted right to
appeal, which was undertaken. However, Plaintiffs appeal was rejected by the
Appellate Court. Subsequently, plaintiff was convicted of fraud and incarcerated
in a US prison.

Lefebvre Freres Limited v. The
Tirex Corporation

---

Lefebvre Frères Limited
instituted an action against us on August 13, 2001 in the Superior Court,
judicial district of Montreal (court docket # 500-05-066942-010)claiming
Canadian $98,513 (approximately US$96,500 at current exchange rates) is due and
owing for the manufacture and delivery of car tire disintegrators. We have
prepared a defense and cross claim against Plaintiff as the product delivered
was defective and included used parts in direct contravention of the supply
agreement. We believe we are entitled to a reimbursement of sums paid.

There has been no activity relative to this suit for the last
six years.

Tri-Steel Industries Inc. v. The
Tirex Corporation

Our landlord Tri-Steel Industries
Inc. instituted an action against us, and our subsidiaries Tirex Canada and
Tirex Canada R & D Inc., on or about June 22, 2001 for arrears of rent in
the amount of Canadian $177,973.62 Subsequent to the Plaintiffs instituting
this action, we continued to accumulate very substantial arrearages for rent and
property taxes for which we were financially responsible. Subsequent to our
vacating the premises which had been the object of the lease, we settled with
our former landlord for a total amount of US$560,000, to be paid at the rate of
US$140,000 from each of our first four TCS System sales.

No director, officer, or
affiliate of the Company, or any associate of any of them, is a party to or has
a material interest in any proceeding adverse to us.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

During the fiscal year ended June
30, 2007, no matters were submitted to a vote of the shareholders of the
Company.

PART II

ITEM 5. MARKET FOR THE COMPANY'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS

The Company's common stock, is
traded on a limited basis in the over-the-counter market and, since January
2003, has been listed on the Gray Sheets. We are currently awaiting the
completion of our first unconditional sales contract before attempting to have
our stock re-quoted on the OTC Electronic Bulletin Board, maintained by the
National Association of Securities Dealers, Inc. (the "OTC Bulletin Board").
Since being relegated to the Gray Sheets, bid prices are not posted.

Shareholders

As of September 30, 2007, the
number of holders of record of the Company's common stock, $.001 par value, was
less than 500, which does not include shares held by persons or companies in
street or nominee name.

---

Dividends

The Company has paid no cash
dividends and has no present plan to pay cash dividends, intending instead to
reinvest its earnings, if any. Payment of future cash dividends will be
determined from time to time by its Board of Directors, based upon its future
earnings (if any), financial condition, capital requirements and other factors,
the company is not presently subject to any contractual or similar restriction
on its present or future ability to pay such dividends.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS

Management's Discussion and Analysis of Financial Condition and
Results of Operations

The following discussion of our
financial condition and results of operations should be read in conjunction with
the financial statements and notes thereto included elsewhere in this Report.
This document contains certain forward-looking statements including, among
others, anticipated trends in our financial condition and results of operations
and our business strategy. These forward-looking statements are based largely on
our current expectations and are subject to a number of risks and uncertainties.
Actual results could differ materially from these forward-looking statements.
Important factors to consider in evaluating such forward-looking statements
include (i) changes in external competitive market factors or in our internal
budgeting process which might impact trends in the our results of operations;
(ii) unanticipated working capital or other cash requirements; (iii) changes in
the our business strategy or an inability to execute its strategy due to
unanticipated changes in the industries in which we operates; and (iv) various
competitive factors that may prevent the us from competing successfully in the
marketplace.

Tirex's primary objective is to sell it's patented and
proprietary tire recycling process, called the TCS System, to tire recyclers
throughout the world (www.tirex-tcs.com). In March 2000, we announced that our
TCS technology prototype was ready for replication and commercialization. The
intellectual property owned by Tirex comprises both the patented "fracturing
mill" (both US and Canadian patents) plus the proprietary freezing process of
using super-cooled air (rather than the competitions liquid nitrogen process,
which represents expensive overkill in terms of what is required to freeze
tire chips) to freeze the tire chips to the "glass point" which permits the
effective separation and disintegration of the tire components by our patented
"fracturing mill", producing a semi-cryogenic crumb rubber at a significant cost
saving. The intellectual property of our TCS System process is recognized in the
Manufacturing License Agreement (2003) we have with Simpro S.p.A. of Torino,
Italywww.simpro.it . Simpro has a
semi-exclusive manufacturing license to manufacture the TCS System,
semi-exclusive to the extent that they have a right of first refusal for the
fabrication, installation and installation of any TCS system anywhere in the
world, but the exclusivity is lost on a case-by-case basis in those
circumstances where they would elect to not accept an order, under which
circumstances we have the right to contract the same services to other
companies. Our patent renewals and continuation for both the USA and Canada were
documented in 2005.

In 2001 Tirex's TCS tire
recycling prototype was accredited by Recyc-Québec, the provincial recycling
agency in Montreal, Quebec, Canada, as an economically viable and
environmentally-friendly process that produced quality recycled rubber. During
the year 2000 and 2001, we demonstrated our technology to numerous groups from
Asia, Europe, North and South America and the Caribbean, as well as to some
shareholders and potential strategic alliance partners. While numerous Letters
of Intent were signed during this stage, none materialized into firm purchase
contracts. Management attributed these failures to acquire sales contracts to
the lack of a commercial history for the TCS technology, or alternatively, to
the Company's inability at the time to provide performance guarantees. With the
signing of the License Agreement with Simpro we engaged a reputable, highly
accredited manufacturer that created the potential for performance guarantees to
be offered. The TCS prototype was disassembled and its "fracturing mill" was
sent to Simpro's facility in Italy. Simpro is prepared to build the first
commercial TCS System. As of June 30, 2007, no purchase/sale contracts have been
written.

Tirex has continued with its
marketing structure consisting primarily of Tirex's President, John L. Threshie
Jr., assisted financially by CFO Michael Ash, combined with Simpro's significant
marketing and sales efforts, as well as independent representatives. Simpro also
has a non-exclusive marketing agreement applicable on a worldwide basis. Tirex
continues to entertain requests for marketing agreements on several continents,
but adheres to its policy of offering commissions out of sales proceeds only and
not providing exclusivities in the absence of prior-established results.

---

The lack of a significant track
record relative to the operation and output of the TCS System has proven to be a
difficult hurdle to overcome in acquiring TCS System sales. The installed cost
of a TCS-2 System to a recycler, depending on the system configuration, the
condition of the feedstock and the output requirements and excluding building
and infrastructure costs, is in the vicinity of Euros 5,500,000 (approximately
US$7.75 million at prevailing exchange rates). When one adds infrastructure
costs, preproduction expenses and a reasonable provision for working capital
after system commissioning, we are of the opinion that the entrepreneur has to
consider his gross investment cost (prior to debt financing possibilities) to be
in the vicinity of US$9 million to$10 million, depending on the customs duties
which could be imposed on US and Canadian customers respecting the importing of
products from non-NAFTA countries. We do not actively market the TCS-1 as the
apparent market for this reduced-scale system does not appear to be that
significant. US$9,000,000 or more represents a substantial investment for a
start-up company. Simpro has been able to obtain insurance backing to support
their offer of limited performance guarantees, and such potential is expected to
assist the marketing effort. Simpro is now offering limited feedstock throughput
guarantees on a case by case basis. Management is of the opinion that, insofar
as the systems are normally priced in Euros, the continuing strength of the Euro
against the US dollar is having a negative on the sales efforts in North
America.

Market and sales efforts of the
TCS System continues to evolve and has attracted qualified and capable companies
over the past year. During Fiscal 2007, the Company and Simpro have entertained
numerous potential TCS System customers. Out of these developments, several
opportunities have presented themselves that have merited and continue to merit
the expenditure of considerable effort to close a Purchase and Sales Agreement.
Of the most recent opportunities, it has been represented to us that some
partial and some complete project financing has been offered in the Middle East,
the UK and Malaysia and the northeastern USA, and yet contracts still remain
pending. Our listing on the Internet Recycling Exchange and our web site
www.tirex-tcs.com continues to generate inquiries from all over the world. This
interest confirms the need for new technology in the industry. These
opportunities may not conclude, however, until there is a commercial system in
operation and regardless of Management's optimism there can be no assurance that
these opportunities will actually result in unconditional sales contracts.

The finalizing of the License
Agreement with Simpro means that the gross revenues from sales will be recorded
on Simpro's books, not in the books of Tirex. The amount remitted back to Tirex
will take the form of a royalty and will be accounted for as such. Regardless of
the contract structure and the accounting effects which result, generally
accepted accounting principles in effect in the USA have the effect that the
revenues to Tirex resulting from such transactions will not be recognizable
until the systems will have been accepted by the customers. Given the time line
required to manufacture, install and have accepted these systems, it is clearly
impossible that any revenues would become recognizable during our fiscal year
which will end June 30, 2007. While the Company will benefit from the periodic
cash inflows resulting from progress payments during the next approximately ten
months, the royalty will, in fact, not have been earned until the systems are
accepted by the customers.

In February of 2001, we concluded
a private financing with an investor group. Under the terms of the Agreement, we
had the contractual right to require the Investor to purchase up to US$5,000,000
of put notes. We drew down US$750,000 of this amount and used the proceeds of
this financing toward legal and consulting fees due, normal operating expenses
such as payroll, rent and taxes and the acquisition of equipment for our
prototype TCS-1 Plant. In July of 2001, the Company entered into a technical
default with respect to the Agreement by not having an SB-2 Registration
Statement declared effective by the SEC. After several months of negotiations,
the Company entered into a Settlement Agreement with the Investor Group which
provided for a cash pay down of the amount owed, including interest and
penalties over a period of approximately two years starting with the date the
Settlement Agreement was signed, the right of the Investor Group to continue to
be able to sell up to 600,000 collateral and Rule 144 shares per month and the
issuance of three series of warrants, 500,000 each, exercisable at prices of one
cent, five cents and ten cents over a three year period. This Settlement
Agreement was announced in April of 2002, and details of the terms of the
Agreement are filed as an Exhibit to this Report. The Company, in the absence of
having completed its first sales of TCS Systems according to our expectations,
was unable to generate the cash flow necessary to pay down the Convertible Note
in accordance with the terms of the Settlement Agreement. Thus, the Company once
again finds itself in a position of default. Numerous recourses are available to
the holders of the Convertible Notes, but to date, these recourses have not been
exercised. Such recourses can be exercised at any time and the fact that they
have not been exercised so far does not preclude their being exercised now or in
the future. The Company has kept the Convertible Note holders apprised of its
efforts to sell TCS Systems and thus restart the repayments on the Convertible
Notes.

---

As a result of this period
preceding the commencement of commercial operations, we have had to cover our
overhead costs from sources other than from commercial revenues. We expect that
some portion of our future overhead costs, which may be significant, will
continue to be covered from sources other than commercial revenues. Since March
of 2003, our monthly our-of-pocket cash costs have been reduced to
inconsequential amounts, and thus our requirement to find financial resources to
fund operations is minimal.

Our greatest expense, from an
accounting standpoint, is for salaries. These salaries have not been paid for
over five years, but rather set up as payables. Our cash flow deficit condition
will continue until such time as the Company will start generating revenues from
the sale of TCS Systems. Until we can succeed in securing an unconditional sales
contract for the sale of one or more systems employing our technology, the
company will not be engaging any significant financial commitments and will not
be engaging in any significant research and development activities nor
increasing employment.

Over the last two years, the
expenses of our company have been funded by a series of loans made by a
significant number of individuals investing modest amounts totaling
approximately US$60,000 each through Tirex President, John L. Threshie Jr.
Insofar as Tirex does not have shares to issue at this time, these investors,
fully cognizant of our situation and so documented in writing, have accepted
that their investment is being made via Mr. Threshie and represents a
convertible debt, the conversion of which can occur once Tirex will have shares
available for issuance. To June 30, 2006, approximately 13 million shares are
involved, this number being before any adjustments to our share authorization
structure which would cause a proportionate adjustment to the number of shares
actually issuable. We will require a modification to our share authorization.
This convertible debt is priced at fixed prices rather than as a discount to
market. Insofar as the funds were lent to Mr. Threshie rather than to Tirex
directly, with Mr. Threshie then paying personally the expenses of Tirex, which
expenses have been duly recorded in our accounts offset by a liability to Mr.
Threshie, the liability on our books is still listed as being toward Mr.
Threshie. Thus no direct liability toward these investors is on our books.
However, once shares will become available for issuance, the amounts due to Mr.
Threshie will be transferred by him to these investors and the shares issued
accordingly. Significant amounts were paid on behalf of Tirex by a close
associate, with whom ultimate financial compensation will be negotiated, either
on a cash basis or a share issuance basis or some combination thereof, to be
determined.

From August 2005, the office rent
of Tirex was assumed by Mr. Threshie until his return to Connecticut in
September 2006. This amount was CA$1,500 per month. This amount has been accrued
as a liability to Mr. Threshie on our books since last August.

While we continue to market TCS
Systems and have in place a License Agreement, as of June 30, 2007, no
unconditional sales orders for TCS Systems had been received and manufacturing
of TCS Systems has not been initiated. We anticipate that we will begin selling
or licensing out the sale of TCS Systems and thus initiating the manufacturing
of these systems on a commercial basis inevitably as long as there is a demand
for new recycling technology. Until we successfully develop and commence TCS
System manufacturing and sales operations on a full-scale commercial level,
however, we will not generate significant revenues from operations. Accordingly,
we would be obligated to attempt to seek non-commercial sources of revenues to
support operations until TCS Systems sales and manufacturing operations would
become a reality. In the event of such a circumstance, there can further be no
assurance that such noncommercial revenue funding would be available at all or
on terms acceptable to management. Except for activities related to the recycled
crumb rubber industry, as noted above and in previous filings, we have never
engaged in any other significant business activities.

During the first quarter of
Fiscal 2007, Tirex undertook the negotiation of the employment agreements with
respect to Tirex CEO and President, John L. Threshie Jr., Tirex Vice President
Engineering and Research and Development, Louis V. Muro and Tirex
Secretary-Treasurer and Chief Financial Officer, Michael Ash, although the final
versions have not yet been ratified. Under the terms of these agreements, Mr.
Threshies salary would be augmented to US$150,000 retroactive to July 1, 2002
while Mr. Muros salary would be reduced retroactively to July 1, 2002 to
US$75,000. The salary of Mr. Ash would remain unchanged at US$100,000. Also
under the terms of the agreements, Mr. Threshie would receive an option to
acquire 3,000,000 shares of the corporation at the beginning of each year of his
three-year agreement, the effective inception date being July 1 2004. Similarly,
Mr. Muro would receive options to purchase 1,000,000 shares per year. Mr. Muros
employment would also be effective July 1, 2004. Other than for the number of
shares involved, Mr. Muros options proposed agreement would be identical to
that of Mr. Threshie. As for Mr. Ash, his three-year employment agreement would
be effective January 1, 2004 and would provide for him to acquire 2,000,000
shares of Tirex in each of the three years of his contract. In all cases, the
exercise window is three years. These options could be exercised on a cashless
basis and are described in more detail elsewhere in this report Tirex does
not currently have an adequate share authorization to satisfy any exercises
under these options, and, in fact, is in arrears with respect to options
exercised by Mr. Ash under the previous version of his employment agreement. The
exercised options will result in share issuances once Tirex will have an
adequate number of shares available for issuance. Any such issuances will be
subject to any corporate actions regarding stock splits, reverse splits or stock
dividends on a proportional basis.

---

Liquidity and Capital Resources

As of June 30, 2007, the Company had total assets of $25,001 as
compared to $25,001 at June 30, 2006 reflecting no change, and also no change
versus total assets at June 30, 2005. There were no changes in the value of
individual assets, representing Property and Equipment and Patents, from June
30, 2006 to June 30, 2007.

As of June 30, 2007, the Company had total liabilities of
$4,712,098 as compared to $4,212,075 at June 30, 2006, reflecting an increase in
liabilities of $500,023. Total liabilities at June 30, 2006 had reflected a
previous increase of $299,168 over $3,912,907 in total liabilities at June 30,
2005. The increase in total liabilities from June 30, 2006 to June 30, 2007 is
primarily attributable to: (i) an increase in Accounts Payable and Accrued
Liabilities in the amount of $87,523 from $1,400,688 as of June 30, 2006 to
$1,488,211 as of June 30, 2007; (ii) an increase in Convertible Loans in the
amount of $412,500 from $2,008,942 as of June 30, 2006 to $2,421,442 as of June
30, 2007.

Reflecting the foregoing, the financial statements indicate
that as at June 30, 2007, the Company had a working capital deficit (current
assets minus current liabilities) of $1,488,211 and that as at June 30, 2006,
the Company had a working capital deficit of $1,400,688, a working capital
deficit increase of $87,523. There were no changes in current assets, as noted
above, while there were additions to current liabilities due to third parties
represented by Accounts Payable and Accrued Liabilities.

The financial statements which are included in this report
reflect total operations and other expenses of $455,849 for the year ended June
30, 2007, which reflects an increase of $235,277 over the year ended June 30,
2006 when total operations and other expenses were $220,572. The Company has
ceased Research and Development activities thereby resulting in a significant
decrease in personnel expenses and other Research and Development expenses
compared with prior periods.

The success of the tire recycling manufacturing business and
the ability to continue as a going concern will be dependent upon the ability of
the Company to obtain adequate financing to commence profitable, commercial
manufacturing and sales activities and the TCS Systems ability to meet
anticipated performance specifications on a continuous, long term commercial
basis.

The Company believes that the amounts accrued to date in
respect of the shares issued to compensate the executive officers and
consultants reflect the fair value of the services rendered, and that the
recipients of such shares received such shares at an appropriate and reasonable
discount from the then current public market price. The Company believes that
the discount is warranted due to the fact that there are often restrictions on
the transfer of said shares arising out of the absence of registration, and the
uncertainty respecting our ability to continue as a going concern.

From inception (July 15, 1987) through June 30, 2007, the
Company has incurred a cumulative net loss of $29,906,019. Approximately
$1,057,356 of such cumulative net loss was incurred prior to the inception of
the Companys present business plan, in connection with the Companys
discontinued proposed health care business and was due primarily to the
expending of costs associated with the unsuccessful attempt to establish such
health care business. The Company never commenced the proposed health care
operations and therefore, generated no revenues therefrom.

ITEM 7. FINANCIAL STATEMENTS

Our financial statements required
to be included in this Report pursuant to Item 310(a) of Regulation S-B, are set
forth below.

ITEM 8. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

---

Following the end of Fiscal 2004,
our independent certifying accountant informed us that he was abandoning all
SEC-oriented work. Thus, we have no choice but to attempt to change our
certifying accountant effective with the annual financial statements for the
year ended June 30, 2004. The resignation of our former certifying accountant
was not related in any way to any disputes respecting the Companys accounting
or its financial disclosures to shareholders or other interested parties. We
have been attempting to engage new certifying accountants but our financial
condition has not permitted us to find one as of yet. Once our financial
condition will have improved, we will engage independent certifying accountants
and will file amended reports with their certifications.

PART III

|ITEM 9. | DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
      PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.
|------- | ----------------------------------------------------------------------------------------------------------------------

Directors, Executive Officers and Significant Employees

The following sets forth, as of
June 30, 2005 the names and ages of all directors, executive officers, and other
significant employees of the Company; and all positions and offices in the
Company held by each, and the terms of said offices. Each director will hold
office until the next annual meeting of shareholders and until his or her
successor has been elected and qualified:

Offices
    Term ofName
    Age
    
    Held
    OfficeJohn L. Threshie, Jr.
    53
    Chairman of the Board
    November 1999 -of Directors, President, and
    presentChief
      Executive OfficerDirector
    June 1995 -February 1999Vice President
    June 1995-November 1999SecretaryDecember 1996February 1999Louis V. Muro
    75
    Vice President
    January 1996 -of Engineering
    presentand DirectorPresident
    March 1994 -January 1995Director
    December 1992 -PresentHenry Meier
    51
    Director
    Feb. 11, 1999 to presentMichael D.A. Ash
    58
    Secretary, Treasurer,
    February 1999-and Chief Financial
    presentand Accounting Officer


The Board of Directors has no standing committees.

Family Relationships

No family relationships exist
between any director or executive officer of Company or any person contemplated
to become such.

---

Business Experience

The following summarizes the
occupation and business experience during the past five years for each director,
executive officer and significant employee of the Company. A significant
employee is a person who is not an executive officer of the Company but who is
expected to make a significant contribution to the business of the Company.

JOHN L. THRESHIE, JR.Mr. Threshie has served as
President and Chief Executive Officer of the Company since November of 1999.
Prior to that time he served as a Vice President of the Company since June 1995.
He was appointed Assistant Secretary of the Company on February 11, 1999. From
December 1996 until February 11, 1999, Mr. Threshie held the position of
Secretary, and from June 1995 until February 11, 1999, as a Director, of the
Company. He also served as a Director for The Tirex Corporation Canada Inc. and
Tirex Canada R&D Inc. from June 1998 and June 1995, respectively, until
February 11, 1999. He has more than fourteen years of experience in the areas of
management, marketing and sales primarily in the field of advertising. Mr.
Threshie holds a Bachelors Degree in Political Science from the University of
North Carolina. He was employed as an insurance and financial broker by
Primerica Financial Services from 1991 through 1994. From 1988 to 1990, Mr.
Threshie was an advertising account supervisor for Ammirati & Puris Inc., an
advertising firm in New York. From 1983 to 1988 Mr. Threshie was employed as a
senior account executive at the advertising firm of Saatchi and Saatchi, Inc.
From 1979 to 1983 Mr. Threshie was employed by Milliken & Co. as a sales
representative.

LOUIS V. MURO.Mr. Muro acted as an engineering
consultant to the Company from January 18, 1995 until January 1, 1996 when he
was appointed as a Director and as Vice President in charge of engineering. Mr.
Muro served as a Director of the Company from December 29, 1992 until January
18, 1995. He also served as the Company's Secretary from December 29, 1992 until
March 1994 when he was appointed President of the Company, a position he held
until January 18, 1995. He has also served as the Vice President in charge of
engineering and as a director of The Tirex Corporation Canada Inc. and Tirex
Canada R&D Inc. since June 1998 and May 1995 respectively. Mr. Muro received
a B.S. degree in Chemical Engineering from Newark College of Engineering in
1954, since which time he has continually been employed as a chemical engineer.
From 1974 to 1993 Mr. Muro has been the sole proprietor of Ace Refiners Corp. of
New Jersey, a precious metals refinery. From 1971 to 1974, he worked as an
independent consultant and from 1964 until 1971, he was director of research and
development for Vulcan Materials Corporation in Pittsburgh, Pa., a public
company engaged in the business of recovering useable tin and clean steel from
scrap tin plate. From 1960 to 1964, Mr. Muro was the sole proprietor of Space
Metals Refining Co. in Woodbridge, NJ, a company involved in the purification of
scrap germanium to transistor grade metal. From 1959 to 1960 he was employed by
Chemical Construction Co., of New Brunswick, NJ, where he developed a process
for the waste-free production of urea from ammonia, carbon dioxide and water.
From 1954 to 1959, Mr. Muro worked in the research and development department at
U.S. Metals Refining Co. in Carteret, NJ where he was involved with the
refinement of precious metals.

MICHAEL D.A. ASH. Mr. Ash joined the Company on January
11, 1999. On February 11, 1999, Mr. Ash was appointed Secretary, Treasurer, and
Chief Financial and Accounting Officer of the Company. Mr. Ash graduated with a
Bachelor's Degree in Business Administration, Magna Cum Laude, from Bishop's
University in Quebec in 1970, and with an MBA, With Distinction, from Harvard
Business School in 1975. Mr. Ash received his Chartered Accountant
certification, (Canadian equivalent to a CPA) in 1972 while employed by Coopers
& Lybrand (now PriceWaterhouseCoopers). Mr. Ash voluntarily abandoned his
C.A. designation following the ENRON and WorldCom incidents, being no longer
willing to certify financial statements nor to incur the very expensive
professional insurance costs associated with professional private practice as a
sole practitioner. As such, the annual professional fees were no longer
justifiable. Since graduation from Harvard, Mr. Ash spent a large portion of his
career with the Government of Canada, until early 1999 when he joined Tirex,
first with the Office of the Comptroller General in Ottawa and, for the
subsequent eighteen years, with a federal regional economic and industrial
development agency in Montreal where he gained exposure to a very large number
of companies and industrial sectors, ranging from developmental companies to
major multi-national corporations. For ten years during this time period, Mr.
Ash was also a part-time lecturer in accountancy at Concordia University in
Montreal for students registered in the program leading to the Chartered
Accountancy designation.

Compliance With Section 16(a) of the Exchange Act.

None of the securities have been
registered pursuant to Section 12 of the Exchange Act of 1934, as amended (the
"Exchange Act"). Therefore, Section 16(a) of the Exchange Act is not applicable.

ITEM 10. EXECUTIVE COMPENSATION

---

Current Remuneration

The following table sets forth
information concerning the annual compensation received or accrued for services
provided in all capacities for the fiscal years ended June 30, 2005, 2006 and
2007 by our chief executive and all our executive officers serving as such as at
June 30, 2005 or at any time during the year ended June 30, 2007. Future
announcements concerning us, our competitors, results of testing, technological
innovations or new commercial products may have a significant impact on the
market price of our common stock. We believe that, as of the dates when such
shares were issued, the actual market value of such shares was, and as of the
date hereof remains, highly contingent upon, and subject to, extremely high
risks.

SUMMARY COMPENSATION TABLE:

ANNUAL COMPENSATION (See note below)Name and Principal Position
      Year
      Salary $
      Bonus $
      Other $John L. Threshie Jr.
      2007
      $150,000 (1)
      Nil
      nilPresident
      2006
      $150,0002005
      $150,000Louis V. Muro
      2007
      $75,000 (1)
      Nil
      nilVice President - Engineering
      2006
      $75,0002005
      $75,000Michael D.A. Ash
      2007
      $100,000 (1)
      Nil
      nilSecretary-Treasurer & CFO
      2006
      $100,0002005
      $100,000


The salaries noted above are those provided for in proposed
employment agreements based on negotiations, which agreements, as of the date of
this report, have not been ratified.

The employment agreements of all of the above persons were
re-negotiated and drafts thereof were received during the second quarter of
Fiscal 2007. These drafts have not yet been ratified. The primary focus of the
negotiations was on salary and options in all three cases. In the case of Mr.
Threshie, his salary would be increased from US$125,000 to US$150,000
retroactive to July 1, 2002. In the case of Mr. Muro, his salary would be
reduced from US$150,000 to US$75,000 also effective July 1, 2002. Mr. Ashs
salary would remain unchanged at US$100,000. Under the terms of these three
employment agreements, all three persons would receive options with three-year
exercise windows to acquire Tirex shares, with the possibility of a cashless
exercise. These annual options for Mr. Threshie, Mr. Ash and Mr. Muro imply
3,000,00 shares, 2,000,000 and 1,000,000 shares respectively. All exercises are
subject to share structure modifications such as stock splits and reverse splits
on a proportional basis. Tirex does not currently have an adequate share
authorization to satisfy these potential exercises or even the previous
exercises by Mr. Ash under his previous employment agreement. Under the previous
employment agreement with Mr. Ash, who gave notice of exercise on a cashless
basis, 1,500,000 shares are owed to Mr. Ash. It should be emphasized that these
employment agreements have not been ratified. The compensation noted above
reflects preliminary agreements as to compensation.

In 1999, Mr. Ash abrogated his
then existing Employment Agreement. This was replaced by a Consulting Agreement
for a period of sixteen (16) months to the end of Calendar 2000. Under this
consulting agreement, Mr. Ash received 2,000,000 shares of the common stock of
the Company. A new employment Agreement with an effective date of January 2001
was put into effect and the prior Consulting Agreement was allowed to lapse.
Under that Employment Agreement, Mr. Ash earned a salary of $100,000 and Mr. Ash
also had options to purchase stock of the company at the lesser of 20(cent) for
the first year option, 40(cent) for the second year option and 50(cent) for the
third year option, or 50% of market applicable to each series. The options were
exercisable on a cashless basis.. Prorating the stock issuance over the sixteen
month term of the prior Consulting Agreement, in Fiscal 2000, Mr. Ash was
entitled to 1,250,000 shares of stock. There was no cash salary in Fiscal 2000
for Mr. Ash. For Fiscal 2001, Mr. Ash received the balance of his stock
entitlement, i.e. 750,000 shares, and was entitled to receive $50,000 in cash.
For Fiscal 2002 and 2003, Mr. Ash was entitled to receive $100,000 annually. Mr.
Ash exercised the stock options available to him under the Employment Agreement
which terminated December 31, 2003. Mr. Ashs Employment Agreement was recently
the subject of renegotiation for a three-year period starting January 1, 2004,
but the final version has not been signed.

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|(1) | No compensation was paid either in cash or in shares to
      Messrs. Threshie, Muro and Ash during Fiscal 2006 and 2007. The amounts
      due have been recorded as liabilities of the
Company.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Executive Stock Options

As discussed elsewhere in this
Report, the following is a summary of those options and warrants outstanding or
proposed to be outstanding, with respect to the purchase of the common stock of
the Company:

Beneficiary
    Issuable
    Exercise Window
    PriceJohn L. Threshie Jr.
    3,000,000 share options
    Three (3) years from
    Series 1: lesser of 20at the beginning of each
    date of issue
    cents or 50% of marketof Fiscal Years 2003,
    
    Series 2: lesser of 402004 and 2005
    
    cents or 50% of marketSeries 3: lesser of 50cents or 50% of marketMichael Ash
    2,000,000 share options
    Three (3) years from
    Series 1: lesser of 20at the beginning of each
    date of issue
    cents or 50% of marketof Calendar Years
    
    Series 2: lesser of 402004, 2005 and 2006
    
    cents or 50% of marketSeries 3: lesser of 50cents or 50% of marketLouis V. Muro
    1,000,000 share options
    Three (3) years from
    Series 1: lesser of 20at the beginning of each
    date of issue
    cents or 50% of marketof Fiscal Years 2003,
    
    Series 2: lesser of 402004 and 2005
    
    cents or 50% of marketSeries 3: lesser of 50cents or 50% of marketConvertible Debenture
    1,500,000 in three
    Series 1: At any time
    Series 1 at one (1) centseries of 500,000 each
    during the 3-year period
    eachfollowing the date of the
    Series 2 at five (5) centsSettlement Agreement,
    eachto wit, April 26, 2002
    Series 3 at ten (10)Series 2: During the
    cents eachsecond and third yearsfollowing April 26, 2002Series 3: During thethird year following April26, 2002


Mr. Ash has exercised the options which had been granted to him
with respect to the options granted under the Employment Agreement which
terminated December 31, 2003. This was done on a cashless basis, resulting in
1,500,000 shares being issuable to Mr. Ash. These shares will be issued, subject
to adjustments for stock splits and stock dividends, if any, occurring prior to
the issuance to Mr. Ash, at such time when the Company will have an adequate
number of shares available for issue.

Compensation of Directors

The Directors of the Company were
not compensated for their services as such in fiscal 2007.

Employment Agreements

We seek to maintain employment
agreements with all of our executive officers (the "Executive Agreements"). We
currently have a proposed employment agreement with Mr. Threshie that provides
for an annual salary of $150,000 would have had a duration until June 30, 2007.
A new agreement will have to be negotiated. Mr. Threshie would also have past
service options , as noted above, to purchase shares of the Company. Mr. Threshie would be granted options to purchase
3,000,000 shares at each anniversary date of his Employment Agreement for the
three years following the effective date of his employment contract, and, for
each series of options, would have a three-year period to exercise that option.
The options are exercisable at the lesser of 50% of market and 20(cent) for the
first series, 40(cent) for the second series and 50(cent) for the third series.
We currently employ Mr. Muro on a month-to-month basis, based on a projected
revised annual salary of $75,000, retroactive to July 1, 2002. Mr. Muro would
also have share options which, other than for the number of shares implicated,
are identical to the options of Mr. Threshie. In Mr. Muros case the number of
shares would be 1,000,000 shares annually. During fiscal 2000 Mr. Ash
voluntarily abrogated his Executive Agreement with us and entered into a new
agreement under which his compensation was in the form of shares. Under this new
agreement, Mr. Ash continued to act as Secretary-Treasurer and Chief Financial
Officer on a consulting basis. Under the terms of the original Executive
Agreement, Mr. Ash's annual compensation was US$125,000. The consulting
agreement extended to December 31, 2000 and was renewable by mutual consent of
the Company and Mr. Ash. Mr. Ash's compensation for the sixteen-month period
ended December 31, 2000 was 2,000,000 common shares, subject to prorated
adjustment in the event of a stock split. At the beginning of Calendar 2001, Mr.
Ash's consulting agreement was converted back to an Employment Agreement under
which Mr. Ash earned an annual salary of $100,000 and had options, as noted
above, to purchase company stock on terms identical to the options granted to
Mr. Threshie. As of the date of this Report, Mr. Ash had exercised all of his
options under the previous agreement on a cashless basis, thus resulting in
1,500,000 shares being issuable to Mr. Ash. Under the terms of his proposed
renewed agreement, Mr. Ash would have the option to acquire 2,000,000 shares of
Tirex in each calendar year starting January 1, 2004. If the proposed employment
agreement is ratified, Mr. Ash has indicated that he would give notice of
exercise with respect to calendars 2004, 2005 and 2006, with the result that the
Corporation currently owes Mr. Ash 3,000,000 shares, issued on a cashless basis,
in addition to the shares previously issuable under the previous employment
agreement, for a total of 4,500,000 shares.. The Company currently has less than
105,000 shares available for issue. Thus, the shares issuable to Mr. Ash would
remain as such until the Company would have adequate shares to satisfy this
transaction. Any shares ultimately issuable to Mr. Ash would be automatically
adjusted for stock splits and stock dividends, if any, occurring prior to the
issuance of shares to Mr. Ash. To the extent that Mr. Threshie and Mr. Muro
exercise their options, the Corporations liability to issue shares will remain
a Note entry.

---

All of the above agreements
provide for the payment of bonuses at the sole discretion of the Board of
Directors based upon an evaluation of the executive's performance, with payment
of any such bonuses to be reviewed annually. The Executive Agreements also
provide for the participation by each of the foregoing persons in any pension
plan, profit-sharing plan, life insurance, hospitalization or surgical program,
or insurance program hereafter adopted by us, reimbursement of business related
expenses, the non-disclosure of information which we deem to be confidential to
it, non-competition by the executive with us for the one-year period following
termination of employment with us and for various other terms and conditions of
employment.

The Executive Agreements with
Messrs. Threshie, Muro and Ash also include severance provisions which provide,
among other things, for severance compensation in the event that the employment
of the executive is terminated by us other than for cause, or by the executive
for "good reason", as that term is defined in the Executive Agreements, or
pursuant to a change in control of the Company. The various Executive Agreements
provide for severance compensation, as follows:

In the case of Messrs. Threshie,
Muro and Ash, 200% of the amount of the base salary for a period of twelve
months, except that in the event of the new employment agreements being ratified
and thence in the case of a termination following a hostile takeover of the
Corporation, the termination is 300%. In addition, the amount of severance
compensation for termination other than for cause, or by the executive for "good
reason", as that term is defined in the Executive Agreements, or pursuant to a
change in control of the Company, amounts to the compensation as described above
plus two months of base salary for each year of service, either under an
employment agreement or under a consulting agreement.

Because of the early stage of our
development, our lack of operations and insignificant cash flow, since January
18, 1995, we have not had the resources to meet fully our financial obligations
under the Executive Agreements. As a result, a major portion of compensation
which has been available to our executive officers has consisted of shares of
our common stock, which such individuals accepted, in lieu of cash compensation,
for a substantial portion of salary and/or consulting fees due to them. For the
last four years, no significant numbers of shares were available for issuance to
the executives.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT

---

The following table sets forth
information as of September 30, 2007, with respect to the persons known to the
Company to be the beneficial owners of more than 5% of the common stock, $.001
par value of the Company and of more than 5% of the Class A Common Stock of the
Company's subsidiary, Tirex R&D and of all Officers and Directors of the
Company as that term is defined in Item 402(a)(2) of Regulation S-B. Neither the
Company nor Tirex R&D have any shares of any other class issued or
outstanding.

|            | Name and                       | Amount and      |             
|----------- | ------------------------------ | --------------- | ------------
|Title       | Address of                     | Nature of       |             
|of          | Beneficial                     | Percent         | Percent     
|Class       | Owner                          | Ownership       | of Class (1)
|            |                                |                 |             
|            |                                |                 |             
|Common      | John L. Threshie, Jr.          | 2,000,000(2)    | 0.8%        
|The Tirex   | P.O. Box 1000                  |                 |             
|Corporation | Stratford Postal Store         |                 |             
|            | 411 Barnum Avenue Cutoff       |                 |             
|            | Stratford CT 06614-9991        |                 |             
|            |                                |                 |             
|Class A     |                                |                 |             
|Common      |                                | 34 (5)          | 34%         
|Tirex R&D   |                                |                 |             
|            |                                |                 |             
|Common      | Louis V. Muro                  | 5,978,957(2)(3) | 2.39%       
|The Tirex   | 2063 Desjardins Avenue, Apt #2 |                 |             
|Corporation | Montreal, Quebec               |                 |             
|            | Canada H1V 2H1                 |                 |             
|Class A     |                                |                 |             
|Common      |                                | 17(5)           | 17%         
|Tirex       |                                |                 |             
|R&D         |                                |                 |             
|            |                                |                 |             
|Common      | Henry P. Meier                 | 335,000 (6)     | 0.13%       
|The Tirex   | P.O. Box 895                   |                 |             
|Corporation | Lakehurst NJ 07755             |                 |             
|            |                                |                 |             
|            |                                |                 |             
|Common      | Estate of Louis A. Sanzaro     | 16,281,088(2)   | 6.52%       
|The Tirex   | 1497 Lakewood Road             |                 |             
|Corporation | Toms River, NJ 08755           |                 |             
|            |                                |                 |             
|Common      | Michael Ash                    | 2,980,000 (4)   | 1.19%       
|The Tirex   | 310 Montée Sabourin            |                 |             
|Corporation | St. Bruno, Quebec              |                 |             
|            | Canada, J3V 4P6                |                 |             
|            |                                |                 |             
|Common      | All directors and              | 11,293,957      | 4.52%       
|The Tirex   | officers as a group            |                 |             
|Corporation | (4 persons)                    |                 |             
|            |                                |                 |             
|Class A     | All directors and              | 51              | 51.0%       
|Common      | officers as a group            |                 |             
|Tirex       | (2 persons)                    |                 |             
|R&D         |                                |                 |             

-------------------------(1) The percentages listed in the
table is calculated on the basis of 249,895,892 shares of the common stock,
$.001 par value, of the Company outstanding as at September 30, 2007. The
significant drop in the collective ownership of shares by officers and directors
versus June 30, 2005 is attributable to the death of former Tirex director,
Louis A. Sanzaro, who has not yet been replaced.

---

(2) Our executive officers, directors (including deceased
director, Louis A. Sanzaro) and principal shareholders pledged an aggregate of
11,986,315 (approximately 6% of our then outstanding shares) of their personal
shareholdings in the Company as a security interest for our issuance of $750,000
of 8% convertible notes, pursuant to a Subscription Agreement and Security
Agreement dated February 26, 2001. Specifically, John L. Threshie, Jr. pledged
1,891,204 shares, Louis Muro pledged 1,723,514 shares and Louis Sanzaro pledged
8,371597 shares of our common stock. The Company was unable to respect its
financial obligations under the terms of a Settlement Agreement and negotiations
with respect to a new settlement have not been started. Under the terms of the
first settlement agreement, the investors acquired a right to dispose of the
collateral shares in their possession. According to a confirmation received from
the investors with respect to the convertible note, as of June 30, 2005, they
were in possession of 4,000,000 conversion shares, issued in 2003, but the
collateral shares have been sold. Thus, the shares pledged by Messrs. Threshie,
Muro and Sanzaro (now Mr. Sanzaro`s estate) now represent a liability of the
Corporation. These shares will be replaced once the Corporation will have enough
shares available for issuance, subject to adjustments for stock splits, reverse
splits and stock dividends, if any, which occur prior to any such issuance.
These 4 million conversion shares represent approximately 1.6% of our current
outstanding stock.

(3) Includes: (i) 5,244,957 shares held of record by Mr. Muro
as of October 1, 2004; and (ii) 734,000 shares held of record by Mr. Muro's
wife, Nina Aviles Muro. There have been no subsequent changes.

(4) Includes: (i) 2,750,000 shares held of record by Mr. Ash
since of September 30, 2004; and (ii) 230,000 shares held of record in the name
of Loryta Investments Limited an entity beneficially owned by the family of Mr.
Ash. Does not include the 1,500,000 shares issuable to Mr. Ash as a result of
his having exercised stock options, and for which an inadequate number of
issuable shares exists to satisfy this option. There have been no changes
subsequent to September 30, 2004.

(5) Messrs. Threshie and Muro hold all shares of Tirex R&D
Class A Common Stock pursuant to the terms of a Shareholders agreement among
them and the Company (the "Tirex R&D Shareholders Agreement"), pursuant to
which they will be obligated to transfer all such shares to the Company, for no
consideration, on May 2, 2001, unless the term of such Agreement would be
unilaterally extended by the Company. The Company does not intend to take any
actions of any kind with respect to such shares which would be in violation of
any Canadian government regulations governing tax and other financial incentives
which may be available. Tirex Canada R&D Inc. was dissolved by the Quebec
government for lack of filing of annual returns. The company can be
re-established through the filing of appropriate documentation and the payment
of required government fees. It is for this reason that we continue to list Mr.
Threshie and Mr. Muro as shareholders, but until such time as such action would
be undertaken, such share distribution has no effect.

(6) Includes 50,000 shares owned in the name of Mr. Meiers two
children.

Changes in Control

On February 26, 2001 we issued
$750,000 worth of convertible notes at an annual rate of eight percent (8%) to
certain investors. Interest payable on these notes is payable quarterly
commencing June 30, 2001. In addition, all principal and unpaid interest due on
the outstanding notes is immediately due and payable on February 26, 2003, or
earlier in the event of a default. One of the conditions of this transaction was
that we would file with the Securities and Exchange Commission a Registration
Statement on Form SB-2 to register various securities issuable upon the
conversion of notes by a certain date and that the Registration Statement would
be effective by August 15, 2001. We failed to meet these deadlines and the
investors served a notice of default on us on July 19, 2001. Negotiations were
undertaken throughout the remainder of Calendar 2001 and into 2002 until a
Settlement Agreement was reached on April 26, 2002. Under the terms of the
Agreement, a copy of which was previously filed, the Company was obligated to
pay down the amount owed to the Investor Group, including interest and
penalties, over a period of approximately two years. During the time when an
amount continues to be owed to the Investor Group, the Investor Group had the
right to sell up to 600,000 collateral or Rule 144 shares per month and apply
the proceeds to interest due, fees and finally to reduction of the principle
amount outstanding. As of June 30, 2005, all of the collateral shares had been
sold. The Investor Group was also given three series of warrants for 500,000
shares each, exercisable at prices of $0.01, $0.05 and $0.10 respectively and
exercisable within pre-defined time windows over a three year period starting
with the date of signature of the Settlement Agreement. . As of June 30, 2005,
the Investor Group had 4,000,000 conversion shares, issued in 2003, in their
possession. Despite repeated requests, the investors have not confirmed the
amount still due to them or the shares still in their possession

---

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The following is a description of
transactions during the last two fiscal years or any presently proposed
transactions to which the Company was or is to be a party, in which the amount
involved in such transaction (or series of transactions) was $60,000 or more and
which any of the following persons had or is to have a direct or indirect
material interest: (i) any director or executive officer of the Company; (ii)
any person who owns or has the right to acquire 5% or more of the issued and
outstanding common stock of the Company; and (iii) any member of the immediate
family of any such persons.

Pursuant to a Subscription
Agreement dated February 26, 2001 we issued $750,000 of 8% convertible notes,
due February 26, 2003 to three investors. Under the Subscription Agreement, we
had the option, subject to conditions, to require the investors to purchase
additional convertible put notes up to $4,250,000. Interest only payments were
due quarterly commencing June 30, 2001, and the principal was due in one lump
sum on February 26, 2003, or upon certain events of default. The number of
shares of common stock issuable upon conversion of the convertible notes is
15,000,000, based on a conversion price of $0.05 per share. One of the
conditions of this transaction was that we would file with the Securities and
Exchange Commission a Registration Statement on Form SB-2 to register various
securities issuable upon the conversion of the notes by a date certain and that
the Registration Statement would be effective by August 15, 2001. We failed to
meet these deadlines and the investors served a notice of default on us on July
19, 2001. The conversion price for the convertible notes is the lesser of (i)
80% of the average of the three lowest closing bid prices of the common stock
for the twenty-two (22) trading days prior to the closing date, or (ii) 80% of
the average of the five lowest closing bid prices of the common stock for the
sixty (60) trading days prior to the conversion date, as defined in the
convertible note. The maximum number of shares of common stock that any
subscriber or group of affiliated subscribers may own after conversion at any
given time is 4.99% .

During the years ended June 30,
2005, 2006 and 2007, the Company's executive officers and certain consultants to
the Company have waived cash payment of all of their salaries, fees and/or
unreimbursed expenses made by them on behalf of, and for the account of, the
Company, and, in 2003, have accepted shares of the Company's common stock in
partial payment in lieu thereof, with the remaining amounts payable still being
listed as liabilities of the Company. No cash payments nor payments in common
stock were made to such persons during Fiscal 2005, 2006 and 2007. Eventually,
these unpaid salaries and expenses will have to be paid by the Company, either
in cash, shares or some combination thereof, as a function of available
resources, to be determined at a later date. The liabilities for these amounts
are recorded in the current liabilities of the Company.

---

ITEM 13. EXHIBITS

FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

Financial Statements

| | The financial statements filed as a part of this report
      are as follows:                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                            
| | Consolidated Balance Sheet - June 30,
      2007                                                                                                                           
| |                                                                                                                                                                            
| | Consolidated Statements of Operations
      for the years ended June 30, 2006 and 2007, and cumulative for the period
      from inception (July 15, 1987) to June 30, 2007
| |                                                                                                                                                                            
| | Consolidated
      Statements of Owners' Equity (Deficit) as at July 15, 1987 and June 30,
      2001 - 2007                                                               
| |                                                                                                                                                                            
| | Consolidated
      Statements of Cash Flows for the years ended June 30, 2006 and 2007 and
      cumulative for the period from inception (July 15,1987) to June 30, 2006  

Reports filed on Form 8-K

None

Financial Statement Schedules

Financial statements schedules
have been omitted for the reason that they are not required or are not
applicable, or the required information is shown in the financial statements or
notes thereto.

Exhibits

The exhibits filed as a part of
this Report or incorporated herein by reference are as follows:

Exhibits Incorporated Herein By Reference, Exhibit No.
As Filed With Document Indicated

|3. | (a) Certificate of Incorporation
      filed August 19, 1987                                                                                 | 3(a)
|-- | -------------------------------------------------------------------------------------------------------------------------------------------- | ----
|   | (b) Certificate of Amendment
      filed June 20, 1989                                                                                       | 3(b)
|   | (c) Certificate of Amendment
      filed March 10, 1993                                                                                      | 3   
|   | (d) Certificate of Amendment
      filed December 5, 1995                                                                                    | 3(e)
|   | (e) By-Laws                                                                                                                                  | 3(b)
|   | (f) Certificate of Amendment
      filed August 11, 1997                                                                                     |     
|   | (g) Certificate of Amendment
      filed February 3, 1998                                                                                    | 3   
|   | (h) Certificate of Incorporation
      of Tirex Acquisition Corp., filed with the Secretary of State of Delaware
      on December 15, 1997  | 3(h)
|   | (k) Certificate of Amendment to
      the Certificate of Incorporation, filed with the Secretary of State of
      Delaware on July 10, 1998 | 3   

Reports on 8-K

None

---

SIGNATURES

In accordance with Section 15(d)
of the Exchange Act of 1934, the Company has caused this Report to be signed on
its behalf by the undersigned thereunto duly authorized.

THE TIREX CORPORATION

By /s/ JOHN L. THRESHIE, JR.

Date: September 30, 2007      
John L. Threshie, Jr.
                                                  
Chairman of the Board of Directors
and                                                   
Chief Executive Officer

In accordance with Section 15(d) of the Securities Exchange Act
of 1934, this Report has been signed below by the following persons on behalf of
the Company in the capacities and on the dates indicated.

|SIGNATURES                                  |  | TITLE                   | DATE              
|------------------------------------------- |  | ----------------------- | ------------------
|                                            |  |                         |                   
|                                            |  |                         |                   
|Principal Executive Officer:                |  |                         |                   
|/s/ JOHN L. THRESHIE, JR                    |  | Chairman of the Board   | September 30, 2007
|                                            |  | of Directors and Chief  |                   
|John L. Threshie, Jr                        |  | Executive Officer       |                   
|                                            |  |                         |                   
|                                            |  |                         |                   
|Principal Financial and Accounting Officer: |  |                         |                   
|                                            |  |                         |                   
|/s/ MICHAEL D.A. ASH                        |  | Secretary, Treasurer,   | September 30, 2007
|                                            |  | and Chief Financial and |                   
|Michael D.A. Ash                            |  | Accounting Officer      |                   
|                                            |  |                         |                   
|                                            |  |                         |                   
|A Majority of the Board of Directors:       |  |                         |                   
|/s/ JOHN L. THRESHIE, JR.                   |  | Chairman of the Board   | September 30, 2007
|                                            |  | of Directors            |                   
|John L. Threshie, Jr.                       |  |                         |                   
|                                            |  |                         |                   
|/s/ Henry Meier                             |  | Director                | September 30, 2007
|                                            |  |                         |                   
|Henry Meier                                 |  |                         |                   
|                                            |  |                         |                   
|/s/ LOUIS V. MURO                           |  | Director                | September 30, 2007
|                                            |  |                         |                   
|Louis V. Muro                               |  |                         |                   

---

SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED
PURSUANT TO SECTION 15(D) OF THE EXCHANGE ACT BY NON-REPORTING ISSUERS

No annual report or proxy
materials have been sent to security-holders during the fiscal year ended June
30, 2007 or the subsequent interim period. As at the date hereof, the Company
plans to furnish proxy materials relating to its annual meeting, which is
presently contemplated to be held during the current fiscal year. All such
materials will be furnished to the Commission at the same time as they are sent
to securities holders.

---



THE TIREX CORPORATIONA DEVELOPMENT STAGE
COMPANY

CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2007

---





---

THE TIREX CORPORATIONA DEVELOPMENT STAGE
COMPANY

CONSOLIDATED BALANCE SHEET AS AT JUNE 30, 2007

|                                                                   |   | June 30,    |  
|------------------------------------------------------------------ | - | ----------- | -
|                                                                   |   | 2007        |  
|                                                                   |   |             |  
|ASSETS                                                             |   |             |  
|                                                                   |   |             |  
|Current Assets                                                     |   |             |  
|Cash and cash equivalents                                          | $ | -           |  
|Accounts receivable                                                |   | -           |  
|Notes receivable                                                   |   | -           |  
|Inventory                                                          |   | -           |  
|Research and Experimental Development tax credits
      receivable |   | -           |  
|Total Current Assets                                               |   | -           |  
|                                                                   |   |             |  
|Property and equipment                                             |   | 25,000      |  
|                                                                   |   |             |  
|Other assets                                                       |   |             |  
|Patents                                                            |   | 1           |  
|Investment, at cost                                                |   | -           |  
|Total Other Assets                                                 |   | 1           |  
|                                                                   |   |             |  
|                                                                   |   |             |  
|Total Assets                                                       | $ | 25,001      |  
|                                                                   |   |             |  
|                                                                   |   |             |  
|LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)                     |   |             |  
|                                                                   |   |             |  
|Current Liabilities                                                |   |             |  
|Accounts payable and accrued
      liabilties                      | $ | 1,488,211   |  
|Current portion of long-term debt                                  |   | -           |  
|Total Current Liabilities                                          |   | 1,488,211   |  
|                                                                   |   |             |  
|Other liabilities                                                  |   |             |  
|Long-term deposits and notes                                       |   | 217,500     |  
|Government loans (net of current)                                  |   | -           |  
|Capital lease obligations (net of current)                         |   | -           |  
|Convertible notes                                                  |   | 399,389     |  
|Convertible notes                                                  |   | 185,556     |  
|Convertible loans                                                  |   | 2,421,442   |  
|Total Other Liabilities                                            |   | 3,223,887   |  
|                                                                   |   |             |  
|Total Liabilities                                                  |   | 4,712,098   |  
|                                                                   |   |             |  
|Stockholders' Equity (Deficit)                                     |   |             |  
|Common stock, $.001 par value,
      authorized                    |   |             |  
|250,000,000 shares, issued and outstanding                         |   |             |  
|249,895,892 shares (June 30, 2006 -
      249,895,892 shares)      |   | 249,896     |  
|Additional paid-in capital                                         |   | 25,222,219  |  
|Deficit accumulated during the
      development stage             |   | (29,560,135 | )
|Unrealized gain (loss) on foreign exchange                         |   | (599,077    | )
|Total Stockholders' Equity (Deficit)                               |   | (4,687,097  | )
|                                                                   |   |             |  
|                                                                   |   |             |  
|Total Liabilities and Stockholders' Equity (Deficit)               | $ | 25,001      |  

See Notes to Consolidated Financial Statements

---

THE TIREX CORPORATIONA DEVELOPMENT STAGE
COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS____________________________________________________________________

|                                             |   | Twelve months ended |   |   | Cumulative from   |  
|-------------------------------------------- | - | ------------------- | - | - | ----------------- | -
|                                             |   | June
      30       |   |   | March 26, 1993 to |  
|                                             |   | 2007                |   |   | 2006              |  
|                                             |   |                     |   |   |                   |  
|Revenues                                     | $ | -                   |   | $ | -                 |  
|                                             |   |                     |   |   |                   |  
|Cost of Sales                                |   | -                   |   |   | -                 |  
|                                             |   |                     |   |   |                   |  
|Gross profit                                 |   | -                   |   |   | -                 |  
|                                             |   |                     |   |   |                   |  
|Operations                                   |   |                     |   |   |                   |  
|General and administrative                   |   | 409,054             |   |   | 173,778           |  
|Depreciation and amortization                |   | -                   |   |   | -                 |  
|Research and development                     |   | -                   |   |   | -                 |  
|                                             |   |                     |   |   |                   |  
|Total Expense                                |   | 409,054             |   |   | 173,778           |  
|                                             |   |                     |   |   |                   |  
|Income (loss) before other expenses          |   | (409,054            | ) |   | (173,778          | )
|                                             |   |                     |   |   |                   |  
|Other expenses (income)                      |   |                     |   |   |                   |  
|Interest expense                             |   | 46,795              |   |   | 46,794            |  
|Interest income                              |   | -                   |   |   | -                 |  
|Income from stock options                    |   | -                   |   |   | -                 |  
|Gain from extinguishment of debt             |   | -                   |   |   | -                 |  
|Loss on disposal of equipment                |   | -                   |   |   | -                 |  
|                                             |   |                     |   |   |                   |  
|Total Other expenses (income)                |   | 46,795              |   |   | 46,794            |  
|                                             |   |                     |   |   |                   |  
|Provision for income taxes                   |   | -                   |   |   | -                 |  
|                                             |   |                     |   |   |                   |  
|Net income (loss)                            |   | (455,849            | ) |   | (220,572          | )
|                                             |   |                     |   |   |                   |  
|Other comprehensive loss                     |   |                     |   |   |                   |  
|Loss (gain) on foreign exchange              |   | -                   |   |   | -                 |  
|                                             |   |                     |   |   |                   |  
|Net income (loss) and comprehensive loss     | $ | (455,849            | ) | $ | (220,572          | )
|                                             |   |                     |   |   |                   |  
|Basic and Diluted net loss and comprehensive |   |                     |   |   |                   |  
|loss per common share                        | $ | (0.00               | ) | $ | (0.00             | )
|                                             |   |                     |   |   |                   |  
|Weighted average shares of common            |   |                     |   |   |                   |  
|stock outstanding                            |   | 249,895,892         |   |   | 249,895,892       |  

See Notes to Consolidated Financial Statements

---

**THE TIREX**CORPORATION
  A DEVELOPMENT STAGE COMPANY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
  ____________________________________________________________________

DeficitAccumulated
      
      
      UnrealizedAdditional
      
      
      During
      
      
      gain (loss)
      
      
      TotalCommon
        Stock
      
      
      Paid-in
      
      
      Developmental
      
      
      on foreign
      
      
      Stockholders'Shares
      
      
      Amount
      
      
      Capital
      
      
      Stage
      
      
      exchange
      
      
      Equity (Deficit)Balance June 30, 1992
      
      3,383,050
      
      
      3,383
      
      
      194,980
      
      
      (1,057,356
      )
      $
      -
      
      
      (858,993
      )Stock issued for reorganization
      
      18,650,000
      
      
      18,650
      
      
      76,155
      
      
      
      
      
      
      
      
      94,805Stock issued for services
      
      100,000
      
      
      100
      
      
      (100
      )Stock issued in exchange for Warrants
      
      363,656
      
      
      364
      
      
      (364
      )Forgiveness of debt
      
      
      
      
      
      
      
      728,023
      
      
      
      
      
      
      
      
      728,023Net loss and comprehensiveloss for the year
      
      
      
      
      
      
      
      
      
      
      (165,296
      )
      
      
      
      
      (165,296
      )Balance June 30, 1993
      
      22,496,706
      
      
      22,497
      
      
      998,694
      
      
      (1,222,652
      )
      
      -
      
      
      (201,461
      )Stock issued for services
      
      100,000
      
      
      100
      
      
      (100
      )
      
      
      
      
      
      
      
      -Exchange for Debt
      
      
      
      
      
      
      
      149,170
      
      
      
      
      
      
      
      
      149,170Payments received for stockpreviously issued
      
      
      
      
      
      
      
      237,430
      
      
      
      
      
      
      
      
      237,430Net loss and comprehensive
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      -loss for the year
      
      
      
      
      
      
      
      
      
      
      (179,296
      )
      
      
      
      
      (179,296
      )Balance June 30, 1994
      
      22,498,706
      
      
      22,499
      
      
      1,385,292
      
      
      (1,401,948
      )
      
      -
      
      
      5,843Revision of common stock
      
      (11,900,000
      )
      
      (11,900
      )
      
      11,900
      
      
      
      
      
      
      
      
      -Stock issued for services
      
      5,592,857
      
      
      5,592
      
      
      513,908
      
      
      
      
      
      
      
      
      519,500Exchange for Debt
      
      200,000
      
      
      200
      
      
      24,300
      
      
      
      
      
      
      
      
      24,500Issuance of common stock
      
      402,857
      
      
      401
      
      
      21,915
      
      
      
      
      
      
      
      
      22,316previously issuedNet loss and comprehensive
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      -loss for the year
      
      
      
      
      
      
      
      
      
      
      (575,771
      )
      
      
      
      
      (575,771
      )Balance June 30, 1995
      
      16,794,420
      
      
      16,792
      
      
      1,957,315
      
      
      (1,977,719
      )
      
      -
      
      
      (3,612
      )


See Notes to Consolidated Financial Statements

---

**THE TIREX**CORPORATION
  A DEVELOPMENT STAGE COMPANY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
  ____________________________________________________________________

DeficitAccumulated
      
      
      UnrealizedAdditional
      
      
      During
      
      
      gain (loss)
      
      
      TotalCommon
        Stock
      
      
      Paid-in
      
      
      Developmental
      
      
      on foreign
      
      
      Stockholders'Shares
      
      
      Amount
      
      
      Capital
      
      
      Stage
      
      
      exchange
      
      
      Equity (Deficit)Balance June 30, 1995
      
      16,794,420
      
      
      16,792
      
      
      1,957,315
      
      
      (1,977,719
      )
      
      -
      
      
      (3,612
      )Stock issued
      
      3,975,662
      
      
      5,090
      
      
      846,612
      
      
      
      
      
      
      
      
      851,702Exchange for Debt
      
      391,857
      
      
      392
      
      
      29,008
      
      
      
      
      
      
      
      
      29,400Issuance of common stock
      
      710,833
      
      
      710
      
      
      80,161
      
      
      
      
      
      
      
      
      80,871Net loss and comprehensive
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      -loss for the year
      
      
      
      
      
      
      
      
      
      
      (1,127,044
      )
      
      
      
      
      (1,127,044
      )Balance June 30, 1996
      
      21,872,772
      
      
      22,984
      
      
      2,913,096
      
      
      (3,104,763
      )
      
      -
      
      
      (168,683
      )Stock issued for options
      
      
      
      
      
      
      
      912,838
      
      
      
      
      
      
      
      
      912,838Stock issued for services
      
      5,067,912
      
      
      3,955
      
      
      690,234
      
      
      
      
      
      
      
      
      694,189Stock in Exchange for Debt
      
      251,382
      
      
      252
      
      
      43,965
      
      
      
      
      
      
      
      
      44,217Issuance of common stock
      
      10,257,936
      
      
      10,259
      
      
      335,132
      
      
      
      
      
      
      
      
      345,391Grants received
      
      
      
      
      
      
      
      408,597
      
      
      
      
      
      
      
      
      408,597Net loss and comprehensive
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      -loss for the year
      
      
      
      
      
      
      
      
      
      
      (2,376,279
      )
      
      
      
      
      (2,376,279
      )Balance June 30, 1997
      
      37,450,002
      
      
      37,450
      
      
      5,303,862
      
      
      (5,481,042
      )
      
      -
      
      
      (139,730
      )Stock issued for options
      
      
      
      
      
      
      
      948,500
      
      
      
      
      
      
      
      
      948,500Stock issued for services
      
      4,396,466
      
      
      4,396
      
      
      922,180
      
      
      
      
      
      
      
      
      926,576Issuance of common stock
      
      21,795,000
      
      
      21,796
      
      
      1,176,755
      
      
      
      
      
      
      
      
      1,198,551Stock options issued and outstanding
      
      
      
      
      
      
      
      1,236,913
      
      
      
      
      
      
      
      
      1,236,913Grants received
      
      
      
      
      
      
      
      669,906
      
      
      
      
      
      
      
      
      669,906Unrealized foreign exchange
      
      
      
      
      
      
      
      
      
      
      
      
      
      183,785
      
      
      183,785Net loss and comprehensive
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
      -loss for the year
      
      
      
      
      
      
      
      
      
      
      (4,570,441
      )
      
      
      
      
      (4,570,441
      )Balance June 30, 1998
      
      63,641,468
      
      
      63,642
      
      
      10,258,116
      
      
      (10,051,483
      )
      
      183,785
      
      
      454,060


See Notes to Consolidated Financial Statements

---

**THE TIREX**CORPORATION
  A DEVELOPMENT STAGE COMPANY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
  ____________________________________________________________________

DeficitAccumulated
      
      
      UnrealizedAdditional
      
      
      During
      
      
      gain (loss)
      
      
      TotalCommon
        Stock
      
      
      Paid-in
      
      
      Developmental
      
      
      on foreign
      
      
      Stockholders'Shares
      
      
      Amount
      
      
      Capital
      
      
      Stage
      
      
      exchange
      
      
      Equity (Deficit)Balance June 30, 1998
      
      63,641,468
      
      
      63,642
      
      
      10,258,116
      
      
      (10,051,483
      )
      
      183,785
      
      
      454,060Stock issued for options
      
      2,234,567
      
      
      2,235
      
      
      38,765
      
      
      
      
      
      
      
      
      41,000Stock issued for services
      
      24,200,439
      
      
      24,200
      
      
      2,735,544
      
      
      
      
      
      
      
      
      2,759,744Shares issued in exchange for debt
      
      3,787,947
      
      
      3,788
      
      
      340,164
      
      
      
      
      
      
      
      
      343,952Conversion of debentures
      
      2,816,966
      
      
      2,817
      
      
      290,102
      
      
      
      
      
      
      
      
      292,919Issuance of common stock
      
      677,966
      
      
      678
      
      
      49,322
      
      
      
      
      
      
      
      
      50,000Stock options issued and outstanding
      
      
      
      
      
      
      
      385,600
      
      
      
      
      
      
      
      
      385,600Grants received
      
      
      
      
      
      
      
      1,057,742
      
      
      
      
      
      
      
      
      1,057,742Unrealized foreign exchange
      
      
      
      
      
      
      
      
      
      
      
      
      
      (29,142
      )
      
      (29,142
      )Net loss and comprehensiveloss for the year
      
      
      
      
      
      
      
      
      
      
      (4,909,879
      )
      
      
      
      
      (4,909,879
      )Balance June 30, 1999
      
      97,359,353
      
      
      97,360
      
      
      15,155,355
      
      
      (14,961,362
      )
      
      154,643
      
      
      445,996Stock issued for options
      
      5,327,486
      
      
      5,327
      
      
      381,600
      
      
      
      
      
      
      
      
      386,927Stock issued for services
      
      28,873,210
      
      
      28,873
      
      
      2,217,758
      
      
      
      
      
      
      
      
      2,246,631Shares issued in exchange for debt
      
      7,342,055
      
      
      7,342
      
      
      382,556
      
      
      
      
      
      
      
      
      389,898Conversion of debentures
      
      12,010,073
      
      
      12,010
      
      
      815,796
      
      
      
      
      
      
      
      
      827,806Issuance of common stock
      
      221,000
      
      
      221
      
      
      16,039
      
      
      
      
      
      
      
      
      16,260Grants received
      
      
      
      
      
      
      
      395,683
      
      
      
      
      
      
      
      
      395,683Unrealized foreign exchange
      
      
      
      
      
      
      
      
      
      
      
      
      
      5,789
      
      
      5,789Net loss and comprehensiveloss for the year
      
      
      
      
      
      
      
      
      
      
      (5,548,829
      )
      
      
      
      
      (5,548,829
      )Balance June 30, 2000
      
      151,133,177
      
      
      151,133
      
      
      19,364,787
      
      
      (20,510,191
      )
      
      160,432
      
      
      (833,839
      )


See Notes to Consolidated Financial Statements

---

**THE TIREX**CORPORATION
  A DEVELOPMENT STAGE COMPANY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)____________________________________________________________________

DeficitAccumulated
      
      
      UnrealizedAdditional
      
      
      During
      
      
      gain (loss)
      
      
      TotalCommon
        Stock
      
      
      Paid-in
      
      
      Developmental
      
      
      on foreign
      
      
      Stockholders'Shares
      
      
      Amount
      
      
      Capital
      
      
      Stage
      
      
      exchange
      
      
      Equity (Deficit)Balance June 30, 2000
      
      151,133,177
      
      
      151,133
      
      
      19,364,787
      
      
      (20,510,191
      )
      
      160,432
      
      
      (833,839
      )Stock issued for services
      
      7,375,483
      
      
      7,375
      
      
      864,840
      
      
      
      
      
      
      
      
      872,215Stock issued for options
      
      5,378,507
      
      
      5,379
      
      
      506,998
      
      
      
      
      
      
      
      
      512,377Shares issued in exchange for debt
      
      11,646,312
      
      
      11,646
      
      
      1,547,455
      
      
      
      
      
      
      
      
      1,559,101Conversion of debentures
      
      100,000
      
      
      100
      
      
      19,900
      
      
      
      
      
      
      
      
      20,000Issuance of common stock
      
      732,929
      
      
      733
      
      
      39,427
      
      
      
      
      
      
      
      
      40,160Unrealized foreign exchange
      
      
      
      
      
      
      
      
      
      
      
      
      
      (340,661
      )
      
      (340,661
      )Grants issued
      
      
      
      
      
      
      
      249,294
      
      
      
      
      
      
      
      
      249,294Net loss and comprehensive lossfor the year
      
      
      
      
      
      
      
      
      
      
      (3,112,138
      )
      
      
      
      
      (3,112,138
      )Balance June 30, 2001
      
      176,366,408
      
      
      176,366
      
      
      22,592,701
      
      
      (23,622,329
      )
      
      (180,229
      )
      
      (1,033,491
      )Stock issued for services
      
      18,466,162
      
      
      18,466
      
      
      314,859
      
      
      
      
      
      
      
      
      333,325Shares issued in exchange for debt
      
      24,075,502
      
      
      24,076
      
      
      1,649,442
      
      
      
      
      
      
      
      
      1,673,518Issuance of common stock
      
      5,849,487
      
      
      5,850
      
      
      61,897
      
      
      
      
      
      
      
      
      67,747Unrealized foreign exchange
      
      
      
      
      
      
      
      
      
      
      
      
      
      (19,940
      )
      
      (19,940
      )Net loss and comprehensive lossfor the year
      
      
      
      
      
      
      
      
      
      
      (3,421,460
      )
      
      
      
      
      (3,421,460
      )Balance June 30, 2002
      
      224,757,559
      
      
      224,758
      
      
      24,618,899
      
      
      (27,043,789
      )
      
      (200,169
      )
      
      (2,400,301
      )


See Notes to Consolidated Financial Statements

---

THE TIREX CORPORATIONA DEVELOPMENT STAGE COMPANY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)____________________________________________________________________

DeficitAccumulated
      
      
      UnrealizedAdditional
      
      
      During
      
      
      gain (loss)
      
      
      TotalCommon
        Stock
      
      
      Paid-in
      
      
      Developmental
      
      
      on foreign
      
      
      Stockholders'Shares
      
      
      Amount
      
      
      Capital
      
      
      Stage
      
      
      exchange
      
      
      Equity (Deficit)Balance June 30, 2002
      
      224,757,559
      
      
      224,758
      
      
      24,618,899
      
      
      (27,043,789
      )
      
      (200,169
      )
      
      (2,400,301
      )Stock issued for services
      
      5,455,000
      
      
      5,455
      
      
      130,920
      
      
      
      
      
      
      
      
      136,375Shares issued in exchange for debt
      
      15,400,000
      
      
      15,400
      
      
      441,183
      
      
      
      
      
      
      
      
      456,583Issuance of common stock
      
      4,283,333
      
      
      4,283
      
      
      31,217
      
      
      
      
      
      
      
      
      35,500Unrealized foreign exchange
      
      
      
      
      
      
      
      
      
      
      
      
      
      (182,365
      )
      
      (182,365
      )Net loss and comprehensive lossfor the year
      
      
      
      
      
      
      
      
      
      
      (1,561,375
      )
      
      
      
      
      (1,561,375
      )Balance June 30, 2003
      
      249,895,892
      
      
      249,896
      
      
      25,222,219
      
      
      (28,605,164
      )
      
      (382,534
      )
      
      (3,515,583
      )Unrealized foreign exchange
      
      
      
      
      
      
      
      
      
      
      
      
      
      (30,325
      )
      
      (30,325
      )Net profit (loss) and comprehensive profit(loss) for the year
      
      
      
      
      
      
      
      
      
      
      298,216
      
      
      
      
      
      298,216Balance June 30, 2004
      
      249,895,892
      
      
      249,896
      
      
      25,222,219
      
      
      (28,306,948
      )
      
      (412,859
      )
      
      (3,247,692
      )Unrealized foreign exchange
      
      
      
      
      
      
      
      
      
      
      
      
      
      (63,448
      )
      
      (63,448
      )Net loss and comprehensive lossfor the year
      
      
      
      
      
      
      
      
      
      
      (576,766
      )
      
      
      
      
      (576,766
      )Balance June 30, 2005
      
      249,895,892
      
      
      249,896
      
      
      25,222,219
      
      
      (28,883,714
      )
      
      (476,307
      )
      
      (3,887,906
      )


See Notes to Consolidated Financial Statements

---

THE TIREX CORPORATION

A DEVELOPMENT STAGE COMPANY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)____________________________________________________________________

DeficitAccumulated
      
      
      UnrealizedAdditional
      
      
      During
      
      
      gain (loss)
      
      
      TotalCommon
        Stock
      
      
      Paid-in
      
      
      Developmental
      
      
      on foreign
      
      
      Stockholders'Shares
      
      
      Amount
      
      
      Capital
      
      
      Stage
      
      
      exchange
      
      
      Equity (Deficit)Balance June 30, 2005
      
      249,895,892
      
      
      249,896
      
      
      25,222,219
      
      
      (28,883,714
      )
      
      (476,307
      )
      
      (3,887,906
      )Unrealized foreign exchange
      
      
      
      
      
      
      
      
      
      
      
      
      
      (78,596
      )
      
      (78,596
      )Net loss and comprehensive lossfor the year
      
      
      
      
      
      
      
      
      
      
      (220,572
      )
      
      
      
      
      (220,572
      )Balance June 30, 2006
      
      249,895,892
      
      
      249,896
      
      
      25,222,219
      
      
      (29,104,286
      )
      
      (554,903
      )
      
      (4,187,074
      )Unrealized foreign exchange
      
      
      
      
      
      
      
      
      
      
      
      
      
      (44,174
      )
      
      (44,174
      )Net loss and comprehensive lossfor the year
      
      
      
      
      
      
      
      
      
      
      (455,849
      )
      
      
      
      
      (455,849
      )Balance June 30, 2007
      
      249,895,892
      
      
      249,896
      
      
      25,222,219
      
      
      (29,560,135
      )
      
      (599,077
      )
      
      (4,687,097
      )


See Notes to Consolidated Financial Statements

---

THE TIREX CORPORATIONA DEVELOPMENT STAGE
COMPANY

CONSOLIDATED STATEMENTS OF CASH
FLOWS____________________________________________________________________

|                                                                    |   | Twelve months ended |   |   | Cumulative from   |  
|------------------------------------------------------------------- | - | ------------------- | - | - | ----------------- | -
|                                                                    |   | June
      30       |   |   | March 26, 1993 to |  
|                                                                    |   | 2007                |   |   | 2006              |  
|                                                                    |   |                     |   |   |                   |  
|Operating activities:                                               |   |                     |   |   |                   |  
|                                                                    |   |                     |   |   |                   |  
|Net loss                                                            | $ | (455,849            | ) | $ | (220,572          | )
|                                                                    |   |                     |   |   |                   |  
|Adjustments to reconcile
      net loss to net cash                 |   |                     |   |   |                   |  
|used
      in operating activities:                                 |   |                     |   |   |                   |  
|Depreciation and
      amortization                                 |   | -                   |   |   | -                 |  
|(Gain) loss on disposal and abandonment
      of assets             |   | -                   |   |   | -                 |  
|Stock issued in
      exchange for interest                         |   | -                   |   |   | -                 |  
|Stock issued in exchange for services
      and expenses            |   | -                   |   |   | -                 |  
|Stock options issued
      in exchange for services                 |   | -                   |   |   | -                 |  
|Unrealized (loss) gain on foreign
      exchange                    |   | (44,174             | ) |   | (78,596           | )
|Other non-cash items                                                |   | 358,500             |   |   | 170,000           |  
|                                                                    |   |                     |   |   |                   |  
|Changes in assets and liabilities:                                  |   |                     |   |   |                   |  
|(Increase) decrease in:                                             |   |                     |   |   |                   |  
|Account receivable                                                  |   | -                   |   |   | -                 |  
|Inventory                                                           |   | -                   |   |   | -                 |  
|Sales tax receivable                                                |   | -                   |   |   | -                 |  
|Research and experimental development
      tax credits receivable  |   | -                   |   |   | -                 |  
|Other assets                                                        |   | -                   |   |   | -                 |  
|(Decrease) increase in :                                            |   |                     |   |   |                   |  
|Accounts payables
      and accrued liabilities                     |   | (37,477             | ) |   | 205,968           |  
|Accrued salaries                                                    |   | 125,000             |   |   | (137,500          | )
|Due to stockholders                                                 |   | -                   |   |   | -                 |  
|                                                                    |   |                     |   |   |                   |  
|Net cash used in operating activities                               |   | (54,000             | ) |   | (60,700           | )
|                                                                    |   |                     |   |   |                   |  
|Investing activities:                                               |   |                     |   |   |                   |  
|Increase in notes receivable                                        |   | -                   |   |   | -                 |  
|Reduction in notes
      receivable                                 |   | -                   |   |   | -                 |  
|Investment                                                          |   | -                   |   |   | -                 |  
|Equipment                                                           |   | -                   |   |   | -                 |  
|Equipment assembly costs                                            |   | -                   |   |   | -                 |  
|Organization cost                                                   |   | -                   |   |   | -                 |  
|Reduction in security deposit                                       |   | -                   |   |   | -                 |  
|                                                                    |   |                     |   |   |                   |  
|Net cash used in investing activities                               |   | -                   |   |   | -                 |  
|                                                                    |   |                     |   |   |                   |  
|Financing activities:                                               |   |                     |   |   |                   |  
|Loans from related
      parties                                    |   |                     |   |   |                   |  
|Deferred financing costs                                            |   | -                   |   |   | -                 |  
|Proceeds from deposits                                              |   | -                   |   |   | -                 |  
|Payments on notes payable                                           |   | -                   |   |   | -                 |  
|Proceeds from convertible
      notes                               |   | -                   |   |   | -                 |  
|Proceeds from notes payable                                         |   | 54,000              |   |   | 60,700            |  
|Payments on lease
      obligations                                 |   | -                   |   |   | -                 |  
|Proceeds from issuance of convertible
      subordinated debentures |   | -                   |   |   | -                 |  
|Proceeds from loan
      payable                                    |   | -                   |   |   | -                 |  
|Payments on loan payable                                            |   | -                   |   |   | -                 |  
|Proceeds from issuance
      of stock options                       |   | -                   |   |   | -                 |  
|Proceeds from grants                                                |   | -                   |   |   | -                 |  
|Proceeds from issuance
      of common stock                        |   | -                   |   |   | -                 |  
|Proceeds from additional paid-in
      capital                      |   | -                   |   |   | -                 |  
|                                                                    |   |                     |   |   |                   |  
|Net cash provided by financing activities                           |   | 54,000              |   |   | 60,700            |  
|                                                                    |   |                     |   |   |                   |  
|Net (decrease) increase in cash and cash equivalents                |   | -                   |   |   | -                 |  
|                                                                    |   |                     |   |   |                   |  
|Cash and cash equivalents - beginning of period                     |   | -                   |   |   | -                 |  
|                                                                    |   |                     |   |   |                   |  
|Cash and cash equivalents - end of period                           | $ | -                   |   | $ | -                 |  

See Notes to Consolidated Financial Statements

---

THE TIREX CORPORATIONA DEVELOPMENT STAGE
COMPANY

CONSOLIDATED STATEMENTS OF CASH
FLOWS____________________________________________________________________

|                                                                                      |   | Twelve months ended |  |   | Cumulative from   | 
|------------------------------------------------------------------------------------- | - | ------------------- |  | - | ----------------- | 
|                                                                                      |   | June
      30       |  |   | March 26, 1993 to | 
|                                                                                      |   | 2007                |  |   | 2006              | 
|                                                                                      |   |                     |  |   |                   | 
|Supplemental Disclosure of Non-Cash Activities:                                       |   |                     |  |   |                   | 
|During the year ended
      June 30, 2007, the Company did not issue common stock     |   |                     |  |  
|in recognition of the
      payment of debt. During the year ended June 30, 2006, the |   |                     |  |  
|Company did not issue
      common stock in recognition of the payment of debt.       |   |                     |  |  
|                                                                                      |   |                     |  |   |                   | 
|During the year ended
      June 30, 2007, the Company did not issue common stock     |   |                     |  |  
|in exchange for services
      performed and expenses. During the year ended June 30, |   |                     |  |  
|2006, the Company did
      not issue common stock in exchange for services           |   |                     |  |  
|performed and expenses.                                                               |   |                     |  |   |                   | 
|                                                                                      |   |                     |  |   |                   | 
|Supplemental Disclosure of Cash Flow Information:                                     |   |                     |  |   |                   | 
|                                                                                      |   |                     |  |   |                   | 
|Interest paid                                                                         | $ | -                   |  | $ | -                 | 
|                                                                                      |   |                     |  |   |                   | 
|Income taxes paid                                                                     | $ | -                   |  | $ | -                 | 

See Notes to Consolidated Financial Statements

---

THE TIREX CORPORATION A DEVELOPMENT STAGE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2007

Note
1           SUMMARY OF
ACCOUNTING POLICIES

NATURE OF BUSINESS

The Tirex Corporation (the "Company") was incorporated under
the laws of the State of Delaware on August 19, 1987 as Tirex America, Inc. The
Company was originally organized to provide comprehensive health care services,
but due to its inability to raise sufficient capital, was unable to implement
its business plan. The Company became inactive in November 1990.

REORGANIZATION

On March 26, 1993, the Company entered into an acquisition
agreement (the "Acquisition Agreement") with Louis V. Muro, currently an officer
and a director of the Company, and former Officers and Directors of the Company
(collectively the "Seller"), for the purchase of certain technology owned and
developed by the Seller (the "Technology") to be used to design, develop and
construct a prototype machine and thereafter a production quality machine for
the cryogenic disintegration of used tires. The Technology was conceptually
developed by the Seller prior to their affiliation or association with the
Company.

CHANGE OF NAME

On July 11, 1997, the Company changed its name from Tirex
America, Inc. to The Tirex Corporation.

DEVELOPMENTAL STAGE

At June 30, 2007, the Company is still in the development
stage. The operations consist mainly of raising capital, obtaining financing,
developing equipment, obtaining customers and supplies, installing and testing
equipment and administrative activities.

BASIS OF CONSOLIDATION

The consolidated financial statements include the consolidated
accounts of The Tirex Corporation, Tirex Canada R&D Inc., The Tirex
Corporation Canada Inc., Tirex Advanced Products Quebec Inc. and Tirex
Acquisition Corp., all of these subsidiaries currently being dormant. Certain of
these companies have actually been de-registered by government authorities but
could easily be revived if circumstances would warrant such action. Tirex Canada
R&D Inc. is held 51% by two shareholders of the Company. The shares owned by
these shareholders are held in escrow by the Company's attorney and are
restricted from transfer thereby, substantively for recording purposes, allowing
for a full consolidation of this Company. The Tirex Corporation Canada Inc.,
Tirex Advanced Products Quebec Inc. and Tirex Acquisition Corp. are 100% held by
the Company. All subsidiary companies are dormant. All inter-company
transactions and accounts have been eliminated in consolidation.

CASH AND CASH EQUIVALENTS

For purposes of the statement of cash flows, all highly liquid
debt instruments purchased with a maturity of three months or less, were deemed
to be cash equivalents.

INVENTORY

The Company values inventory, which consists of finished goods
and equipment held for resale, at the lower of cost (first-in, first-out method)
or market.

---

THE TIREX CORPORATION A DEVELOPMENT STAGE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2007

PROPERTY AND EQUIPMENT

Property and equipment are recorded at cost less accumulated
depreciation and provisions for write-downs. Depreciation is computed using the
straight-line method over the estimated useful lives of five years. No
depreciation is recorded for equipment written down to salvage value.

Repairs and maintenance costs are expensed as incurred while
additions and betterments are capitalized. The cost and related accumulated
depreciation of assets sold or retired are eliminated from the accounts and any
gains or losses are reflected in earnings.

INVESTMENT

An investment made by the Company, in which the Company owns
less than a 20% interest, is stated at cost value. The cost value approximates
the fair market value of the investment.

ESTIMATES

Preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results may differ from those
estimates.

ADOPTION OF STATEMENT OF ACCOUNTING STANDARD NO. 123

In 1997, the Company adopted Statement of Financial Accounting
Standards ("SFAS") No. 123, Accounting for Stock-Based Compensation. SFAS 123
encourages, but does not require, companies to record stock-based Compensation
and other costs paid by the issuance of stock at fair value. The Company has
chosen to account for stock-based compensation, stock issued for non-employee
services and stock issued to obtain assets or in exchange for liabilities using
the fair value method prescribed in SFAS 123. Accordingly, compensation cost for
stock options is measured as the excess, if any, of the quoted market price of
the Company's stock at the date of the grant over the amount an employee must
pay to acquire the stock.

ADOPTION OF STATEMENT OF ACCOUNTING STANDARD NO. 128

In 1997, the Company adopted Statement of Financial Accounting
Standards ("SFAS") No. 128, Earnings per Share. SFAS 128 changes the standards
for computing and presenting earnings per share (EPS) and supersedes Accounting
Principles Board Opinion No. 15, Earnings per Share. SFAS 128 replaces the
presentation of Primary EPS with a presentation of Basic EPS and replaces the
presentation of Fully Diluted EPS with a presentation of Diluted EPS. It also
requires dual presentation of Basic and Diluted EPS on the face of the income
statement for all entities with complex capital structures and requires a
reconciliation of the numerator and denominator of the Basic EPS computation to
the numerator and denominator of the Diluted EPS computation. SFAS 128 is
effective for financial statements issued for periods ending after December 15,
1997, including interim periods. SFAS 128 also requires restatement of all
prior-period EPS data presented.

As it relates to the Company, the principal differences between
the provisions of SFAS 128 and previous authoritative pronouncements are the
exclusion of common stock equivalents in the determination of Basic Earnings Per
Share and the market price at which common stock equivalents are calculated in
the Determination of Diluted Earnings Per Share.

A Basic Earnings per Share is computed using the weighted
average number of shares of common stock outstanding for the period. Diluted
Earnings per Share is computed using the weighted average number of shares of
common stock and dilutive common equivalent shares related to stock options and
warrants outstanding during the period.

---

THE TIREX CORPORATION A DEVELOPMENT STAGE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2007

The adoption of SFAS 128 had no effect on previously reported
loss per share amounts for the year ended June 30, 1997. For the years ended
June 30, 2006 and June 30, 2005, Primary Loss per Share was the same as Basic
Loss per Share and Fully Diluted Loss per Share was the same as Diluted Loss per
Share. A net loss was reported in 2006 and 2005, and accordingly, in those
years, the denominator for the Basic EPS calculation was equal to the weighted
average of outstanding shares with no consideration for outstanding options and
warrants to purchase shares of the Company's common stock because to do so would
have been anti-dilutive.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amount of the Company's financial instruments,
which principally include cash, note receivable, accounts payable and accrued
expenses, approximates fair value due to the relatively short maturity of such
instruments.

The fair values of the Company's debt instruments are based on
the amount of future cash flows associated with each instrument discounted using
the Company's borrowing rate. At June 30, 2007 and June 30, 2006, respectively,
the carrying value of all financial instruments was not materially different
from fair value.

INCOME TAXES

The Company has net operating loss carryovers of approximately
$29.7 million as of June 30, 2007, expiring through 2027. However, based upon
present Internal Revenue Service regulations governing the utilization of net
operating loss carryovers where the corporation has issued substantial
additional stock and there has been a change in control as defined by the
Internal Revenue Service regulations, a substantial portion of this loss
carryover may not be available to the Company.

The Company adopted Statement of Financial Accounting Standards
("SFAS") No. 109, Accounting for Income Taxes, effective July 1993. SFAS No. 109
requires the establishment of a deferred tax asset for all deductible temporary
differences and operating loss carryforwards. Because of the uncertainties
discussed in Note 2, however, any deferred tax asset established for utilization
of the Company's tax loss carryforwards would correspondingly require a
valuation allowance of the same amount pursuant to SFAS No. 109. Accordingly, no
deferred tax asset is reflected in these financial statements.

The Company does not currently have research and experimental
development tax credits receivable from the Canadian Federal government and the
Quebec Provincial government as at June 30, 2007.

FOREIGN CURRENCY TRANSLATION

Assets and liabilities of non-U.S. subsidiaries that operate in
a local currency environment are translated to U.S. dollars at exchange rates in
effect at the balance sheet date for monetary items and historical rates of
exchange for non-monetary items with the resulting translation adjustment
recorded directly to a separate component of shareholders' equity. Income and
expense accounts are translated at average exchange rates during the year.
Currency transaction gains or losses are recognized in current operations.

REVENUE RECOGNITION

Revenue from the sale of TCS Systems will be recognized when
the installed product is accepted by the Customer. All other revenue from other
products will be recognized when shipped to the customer.

---

THE TIREX CORPORATION A DEVELOPMENT STAGE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2007

Note
2           GOING CONCERN

As reported in the accompanying financial statements, the
Company incurred a net loss of $455,849 for the year ended June 30, 2007 and a
net loss of $220,572 for the year ended June 30, 2006.

In March 1993, the Company had begun its developmental stage
with a new business plan. As of March 2000, the Company had developed a
production quality prototype of its patented system for the disintegration of
scrap tires, but nonetheless continued its research and development efforts to
improve the machine's performance and to permit greater flexibility in design
for specific customer applications. Due to the Companys lack of working capital
during the year ended June 30, 2002, all rubber crumb production was suspended
and research and development efforts have been hampered. Pending receipt of
funding from operations, government assistance, loans or equity financing, crumb
rubber production and previous research and development efforts will not be
resumed. While the Company has engaged the process of marketing the TCS System
to numerous potential clients since the beginning of the fiscal year commencing
July 1, 2000, as of June 30, 2007, the Company had not yet consummated an
unconditional purchase order for a TCS System.

The Company is dependent on the success of its marketing of its
TCS Systems, and/or raising funds through equity sales, bank or investor loans,
governmental grants or a combination of these, to continue as a going concern.
The Company's uncertainty as to its ability to generate revenue and its ability
to raise sufficient capital, raise substantial doubt about the entity's ability
to continue as a going concern. The financial statements do not include any
adjustments that might be necessary if the Company is unable to continue as a
going concern.

Note
3           PROPERTY AND
EQUIPMENT

As at June 30, 2007, plant and equipment consisted of the
following:

|Furniture, fixtures and equipment                     | $ | 149,516 | 
|----------------------------------------------------- | - | ------- | 
|Manufacturing equipment                               |   | 62,400  | 
|Subtotal                                              |   | 211,916 | 
|                                                      |   |         | 
|Less: Accumulated depreciation and
      amortization |   | 186,916 | 
|                                                      |   |         | 
|Total                                                 | $ | 25,000  | 

A valuation write-down charged to operations for the year ended
June 30, 2007 was zero. Depreciation and amortization expense charged to
operations for the year ended June 30, 2006 was zero.

Note
4           PATENTS

The Companys technology is patent protected in both the United
States and Canada. Patent maintenance fees are current in both countries. The
valuation on the Balance Sheet reflects recognition of valid patents and does
not attempt to establish true commercial value.

---

THE TIREX CORPORATION A DEVELOPMENT STAGE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2007

Note
5           CAPITAL LEASE
OBLIGATIONS

The Company leased certain manufacturing equipment under
agreements classified as capital leases. The cost and the accumulated
amortization for such equipment as of June 30, 2007 and June 30, 2006 was
$62,400 and $62,400, respectively. The equipment under capital leases has been
included in property and equipment on the balance sheet. The Company is in
arrears on payment of these leases but default has not been declared. The lease
expired on June 30, 2004. The leased equipment is not part of the Companys TCS
System prototype.

Note
6           CONVERTIBLE
SUBORDINATED DEBENTURES

The Company issued Type B Convertible Subordinated Debentures
between December 1997 and February 1998. These debentures bore interest at 10%
and were convertible into common shares of the Company at $0.20 per share. The
conversion privilege on the remaining $55,000 of these debentures expired and
the amount is now included on the Balance Sheet in Long term deposits and notes.

Note
7           CONVERTIBLE
NOTES

The Convertible Notes appearing on the balance sheet consisted
of an investment arrangement with a group of institutional investors involving a
multi-stage financing under which the Company had access to, at its option, up
to $5,000,000. A first tranche of $750,000 was completed but no further draw
downs were made. The terms of the convertible note were:

|Balance at June 30, 2007 | $399,389                                                                                                                                                                                                                                                                                              
|------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                         |                                                                                                                                                                                                                                                                                                       
|Interest rate            | 8%, payable quarterly, commencing June 30, 2001                                                                                                                                                                                                                                                       
|                         |                                                                                                                                                                                                                                                                                                       
|Issue date               | February 26, 2001                                                                                                                                                                                                                                                                                     
|                         |                                                                                                                                                                                                                                                                                                       
|Maturity date            | February 26, 2003                                                                                                                                                                                                                                                                                     
|                         |                                                                                                                                                                                                                                                                                                       
|Redemption rights        | If not converted, the holder may require the Company to
      redeem at any time after maturity for the principal amount plus interest.                                                                                                                                                               
|                         |                                                                                                                                                                                                                                                                                                       
|Conversion ratio         | Lower of (i)  80% of the average of the three lowest
      closing bid prices for the thirty trading days prior to the issue date,
      which equals $.073, or (ii)  80% of the average of the three lowest
      closing bid prices for the sixty trading days prior to the conversion
      date.
|                         |                                                                                                                                                                                                                                                                                                       
|Common stock warrants    | The Convertible Notes carried an option to purchase
      Common stock warrants at the rate of one Warrant for each $1.25 of
      purchase price. The exercise price on the first tranche of $ 750,000 is $
      .077 per share.                                                                    

Certain current and previous Directors and Officers of the
Company have pledged approximately 12,000,000 of their personal shares of Common
Stock of the Company as security for the Convertible Notes until such time as
the Company files with the Securities and Exchange Commission a Registration Statement on Form SB-2, to register
common stock and warrants issuable upon the conversion of the notes, no later
than 150 days after the issue date of the Convertible Notes. This deadline was
not met and, as such, the investors served a notice of default to the Company on
July 19, 2001. The Registration Statement was never declared effective by the
Securities and Exchange Commission and was eventually withdrawn. Thus, the
Convertible Notes cannot be converted to Common Stock nor may the Common Stock
warrants be exercised. On April 24, 2002 the Company entered into a Settlement
Agreement with the Note holders. The Company was forced to default on this
Settlement Agreement. Accordingly, the terms of the Convertible Notes have
become effective once again. Approximately two-thirds of the collateral shares
provided to the investors were the property of former Tirex Director, Louis A,
Sanzaro, now deceased. While we have not confirmed the disposition of the
liabilities of our company toward the estate of Mr. Sanzaro, the company intends
to act in accordance with the testament of Mr. Sanzaro.

---

THE TIREX CORPORATION A DEVELOPMENT STAGE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30,
2007

Note
8           CONVERTIBLE
NOTES

A convertible note, under a private arrangement, consists of
the following:

|Balance at June 30, 2007 | $ 185,556                                                                                                                                                                                                                    
|------------------------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                         |                                                                                                                                                                                                                              
|Interest rate            | 8%                                                                                                                                                                                                                           
|                         |                                                                                                                                                                                                                              
|Issue date               | July 19th, 2000                                                                                                                                                                                                              
|                         |                                                                                                                                                                                                                              
|Maturity date            | January 19th, 2002                                                                                                                                                                                                           
|                         |                                                                                                                                                                                                                              
|Redemption rights        | If not converted, the holder may require the Company to
      redeem at any time after maturity for the principal amount plus interest.                                                                                      
|                         |                                                                                                                                                                                                                              
|Conversion ratio         | Not convertible prior to July 19th, 2001, at
      20% discount to market between July 19th, 2001 and January
      19th, 2002 or at 25% to market if held to maturity, to a
      maximum of not more than 2,500,000 shares.

During the first quarter of Fiscal 2006, the Company completed
a private placement with two investors having a total aggregate value of
US$10,000, one for $2,500 and the other for $7,500. Insofar as the Company does
not have enough common shares available for issuance, the investors agreed to
accept that the investment would be in the form of non-interest-bearing
convertible debt with no fixed terms of repayment. When an adequate number of
common shares become available, these investors will be able to convert their
loans. Any conversion would be proportionally adjusted in the event of stock
splits or reverse splits. In consideration of the agreed upon conversion price,
prior to any possible adjustments, the company would issue 2,000,000 common
shares. Until such time of any conversion, the US$10,000 is recorded as a
liability on the Companys Balance Sheet.

Over the entire twelve months ended June 30, 2006, the expenses
of our company have been funded by a series of loans made by a significant
number of individuals investing modest amounts totaling US$60,700. During the
year ended June 30, 2007 a further amount of US$54,000 was secured under
substantially the same terms. Insofar as Tirex does not have shares to issue at
this time, these investors, fully cognizant of our situation and so documented
in writing, have accepted that their investment is a convertible debt, the
conversion of which can occur once Tirex will have shares available for issuance. This
debt is convertible at fixed prices rather than as a discount to market. To June
30, 2006, 13,140,000 shares were involved and a further 12,900,000 shares would
be required as a result of the borrowings during the year ended June 30, 2007,
these numbers being before any adjustments to our share authorization structure
which would cause a proportionate adjustment to the number of shares actually
issuable.

---

THETIREX CORPORATION A DEVELOPMENT STAGE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2007

In addition to the above liability for shares, Tirex is liable
for the replacement of 11,986,315 shares which were delivered as collateral by
Tirex Directors, Threshie, Muro and Sanzaro (recently deceased) for the $750,000
of convertible debt contracted for in 2001, which shares were sold by the debt
holders.

Note 9         
 RELATED PARTY TRANSACTIONS

Convertible loans include amounts primarily due to Directors,
Officers and employees. Historically, such amounts due have been repaid through
the issuance of stock. At June 30, 2007 and June 30, 2006, the balances owing to
Directors and Officers was $2,284,429 and $1,959,429, respectively. These
amounts are without interest or terms of repayment.

Long-term deposits and notes included an amount of $118,500 at
June 30, 2007, which is payable to Ocean Tire Recycling & Processing Co.,
Inc., a company previously owned by a former Director of the Company, Louis A.
Sanzaro, recently deceased. We expect that the Executor of the estate of Mr.
Sanzaro will contact us with respect to the disposition of our liabilities
toward the estate of Mr. Sanzaro.

Note 10        
COMMON STOCK

During the year ended June 30, 2007 and the year ended June 30,
2006, the Company did not issue any common stock in exchange for services
performed.

During the year ended June 30, 2004, an Officer of the Company
exercised stock options pursuant to a services agreement. The exercise of these
stock options entitled the Officer to 1,500,000 common shares of the Company on
a cash-less basis. The Company does not have sufficient authorized and unissued
shares available at June 30, 2007 for issuance of this stock and as such, the
amount attributable to these shares has been recorded as part of the balances
owing to Directors and Officers included in Convertible loans.

On January 31, 2001, the Company's stockholders approved an
amendment to the Articles of Incorporation of the Company to increase the number
of authorized shares of common stock, par value $0.001, from 165,000,000 shares
to 250,000,000 shares.

As at June 30, 2007, the Company had 249,895,892 Common shares
issued and outstanding, versus its authorization of 250,000,000 shares.

Note 11        
CONVERTIBLE DEBT

In the event that holders of convertible rights of option
exercise such rights of conversion, the Company does not have sufficient number
of authorized shares conversion stock to fulfill such obligations and a
shareholder meeting would be required to approve the additional authorized
number of shares. There is no assurance that the shareholders would approve the
increase to the number of authorized shares of stock to meet the conversion
obligations under the various conversion agreements or options or agree to a
reverse split of the stock.

---

THETIREX CORPORATION A DEVELOPMENT STAGE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2007

Note 12        
GOVERNMENT ASSISTANCE

The Company is eligible for and has made claims for tax credits
related to scientific research and experimental development expenditures made in
Canada in previous years. These amounts, under Canadian Federal and Provincial
tax law in conjunction with its annual tax return filings, need not be offset
against taxes otherwise payable to become refundable to the Company at the end
of its fiscal year. As such, during the year ended June 30, 2003, the Company
received approximately $246,970, which was recorded as an increase in
stockholders equity paid-in capital. During the years ended June 30, 2004 and
June 30, 2005 and the three month period ended September 30, 2005, the Company
did not make any additional claims for tax credits as it was not eligible to do
so and, as such, the Company did not record any additional tax credits
receivable. The previous receivable balance in respect of tax credits from these
governments went from $246,970 as of June 30, 2002 to zero as of June 30, 2003
and remained as such as of June 30, 2004, June 30, 2005, June 30, 2006 and June
30, 2007.

Note 13        
COMMITMENTS

Rental expense for the year ended June 30, 2007 amounted to
zero. Rental expense for the year ended June 30, 2006 amounted to $6,392.

At June 30, 2007, the Company was in arrears of rent, including
  interest and related charges, in the approximate amount of $560,000. A settlement
  agreement with the former landlord is in place under the terms of which the
  Company would pay to the former landlord the sum of $140,000 from the proceeds
  to the Company of revenues from each of the first four sales of TCS Systems.

Note 14        
LITIGATION

An action was instituted by Plaintiffs, an individual and a
corporation, in a Canadian court alleging a breach of contract and claims
damages of approximately $508,600 representing expenses and an additional
approximate amount of $1,874,000 in loss of profits. The current action follows
two similar actions taken in United States courts, the first of which was
withdrawn and the second of which was dismissed based on forum non convenience
and other considerations. A detailed answer has been filed by the Company
denying all liability, stating further that Plaintiffs failed to comply with
their obligations. Counsel for the Company believes that the Company has
meritorious defenses to all of the Plaintiff's claims. The action is still
pending.

A Plaintiff instituted an action, a corporation, in August 2001
in a Canadian court claiming approximately $63,000 is due and owing for the
manufacture and delivery of tire disintegrators. The Company has prepared its
defense and a cross claim against the Plaintiff as the product delivered was
defective and the Company believes it is entitled to a reimbursement of sums
paid. The action is still pending.

An action was instituted by a Plaintiff, the Companys
landlord, against the Company in June 2001 for arrears of rent in the amount of
approximately $113,900. Subsequent additions to arrearages with respect to rent
and property taxes raised the amount due to approximately $560,000. A settlement
agreement with the former landlord is in place, under the terms of which the
Company would pay to the former landlord the sum of $140,000 from the proceeds
to the Company of revenues from the first four sales of TCS Systems.

Note 15       
ACCUMULATED OTHER COMPREHENSIVE INCOME

The deficit accumulated during the development stage included
accumulated comprehensive other income totaling $103,396.

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