U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-K



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



For the Fiscal Year Ended November
30, 2012



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



For the transition period from ________________
to __________________



Commission File Number 000-53274







BioPower Operations Corporation

(Exact name of registrant as specified in
its charter)



|Nevada                          | 27-4460232         
|------------------------------- | -------------------
|(State or other jurisdiction of | (IRS Employer      
|incorporation or organization)  | Identification No.)



1000 Corporate Drive, Suite 200, Fort
Lauderdale, Florida 33334

(Address of principal executive offices)



Issuer’s telephone number, including area code: +1
954 202 6660



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



Securities registered pursuant to Section 12(g) of the Act:
None.



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



Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Yesþ   No  ̈



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



Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during
the preceding 12 months (or for such shorter period that the registrant was Required to submit and post such files).þYes ̈No



Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and
will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated
by reference in Part III of this Form 10-K or any amendment to this Form 10-Kþ



Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. (as defined in Rule 12b-2 of the Exchange
Act). Check one:



|Large accelerated filer |  ̈ |  | Non-accelerated filer     |  ̈
|----------------------- | - |  | ------------------------- | -
|                        |   |  |                           |  
|Accelerated Filer       |  ̈ |  | Smaller reporting company | þ



Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).Yes ̈Noþ



As of March 8, 2013, the last day of the Registrant’s
most recently completed first fiscal quarter, the aggregate market value of the shares of the Registrant’s common stock held
by non-affiliates (based upon the closing stock price of $0.10 as per the close on Friday, March 8, was approximately $5,288,625.
Shares of the Registrant’s common stock held by each executive officer and director and by each person who owns 10 percent
or more of the outstanding common stock have been excluded in that such persons may be deemed to be affiliates of the Registrant.
This determination of affiliate status is not necessarily a conclusive determination for other purposes.



As of March 8, 2013, there were outstanding 91,736,250 shares
of the registrant’s common stock, $.0001 par value.



Documents incorporated by reference: None.











BioPower Operations Corporation



Form 10-K



Table of Contents



|                     |     |                                                                                                | Page
|-------------------- | --- | ---------------------------------------------------------------------------------------------- | ----
|PART I               |     |                                                                                                |     
|                     |     |                                                                                                |     
|Item 1.              |     | Business                                                                                       | 3   
|Item 1A.             |     | Risk Factors                                                                                   | 8   
|Item 1B.             |     | Unresolved Staff Comments                                                                      | 15  
|Item 2.              |     | Description of Property                                                                        | 15  
|Item 3.              |     | Legal Proceedings                                                                              | 15  
|Item 4.              |     | Mine Safety Disclosure                                                                         | 16  
|                     |     |                                                                                                | 16  
|PART II              |     |                                                                                                |     
|                     |     |                                                                                                |     
|Item 5.              |     | Market for Common Equity and Related Stockholder Matters                                       | 16  
|Item 6.              |     | Selected Financial Data                                                                        | 18  
|Item 7.              |     | Management's Discussion and Analysis of Financial Condition and Results of Operations          | 18  
|Item 7A.             |     | Quantitative and Qualitative Disclosures About Market Risk                                     | 26  
|Item 8.              |     | Financial Statements and Supplementary Data                                                    | 27  
|Item 9.              |     | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure           | 27  
|Item 9A              |     | Controls and Procedures                                                                        | 27  
|Item 9B.             |     | Other Information                                                                              | 28  
|                     |     |                                                                                                |     
|PART III             |     |                                                                                                |     
|                     |     |                                                                                                |     
|Item 10.             |     | Directors and Executive Officers                                                               | 28  
|Item 11.             |     | Executive Compensation                                                                         | 30  
|Item 12.             |     | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 31  
|Item 13.             |     | Certain Relationships and Related Transactions, and Director Independence                      | 32  
|Item 14.             |     | Principal Accountant Fees and Services                                                         | 34  
|                     |     |                                                                                                |     
|PART IV              |     |                                                                                                |     
|                     |     |                                                                                                |     
|Item 15.             |     | Exhibits                                                                                       | 35  
|                     |     |                                                                                                |     
|Signatures           | 40 
|                     |     |                                                                                                |     
|Financial Statements | F-1



1







FORWARD LOOKING STATEMENTS AND ASSOCIATED
RISK



Statements made in this 10-K that are not historical or current
facts are “forward-looking statements” made pursuant to the safe harbor provisions of Section 27A of the of the Securities
Act of 1933 (the “Act”) and Section 21E of the Securities Exchange Act of 1934.  In  some  cases,
you can  identify  forward-looking statements by terminology such  as "may",  "should",
"intends", "expects", "plans", "anticipates", "believes",  "estimates",
"predicts", "potential", or  "continue"  or  the  negative
of  these  terms  or  other  comparable terminology.  We intend that
such forward-looking statements be subject to the safe harbors for such statements.  We wish to caution readers not to
place undue reliance on any such forward-looking statements, which speak only as of the date made.  Any forward-looking
statements represent management’s best judgment as to what may occur in the future.  However, forward-looking statements
are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ
materially from historical results of operations and events and those presently anticipated or projected.  We disclaim
any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such
statement or to reflect the occurrence of anticipated or unanticipated events.



Introductory Comment - Use of Terminology



Throughout this Annual Report on Form 10-K, the terms “we,”
“us” and “our” refers to BioPower Operations Corporation and, unless the context indicates otherwise, our
subsidiaries in which we hold 100% of such entities’ outstanding equity securities, including BioPower Corporation (“BioPower
Corporation”), Green Oil Plantations Americas Inc. (“Green Oil”), Green Energy Crops Corporation (“GECC”),
FTZ Exchange LLC. and FTZ Energy Corporation, on a consolidated basis. Unless otherwise indicated, all monetary amounts are reflected
in United States Dollars.



2







PART I



ITEM 1. BUSINESS



Overview



BioPower Operations Corporation("we,"
"our," “BioPower”, “BIO” or the “Company") was organized in Nevada on January 5, 2011.
The Company and its subsidiaries intend to grow biomass crops coupled with processing and/or conversion facilities to produce oils,
biofuels, electricity and other biomass products. We also intend to utilize licensed patented technology to convert biomass wastes
into products and reduce the amount of waste going to landfills through license, joint venture and build and own facilities. Further,
we intend to license and create royalties by utilizing our FTZ Exchange subsidiary to help create exchanges.



We are a development stage company and
have only generated minimal revenues from a consulting agreement. Our auditors have issued a going concern opinion. This
means there is substantial doubt that we can continue as an on-going business for the next twelve (12) months unless we obtain
additional capital to pay our bills. This is because we have generated minimal revenues from a consulting agreement and minimal
revenues are anticipated until we begin marketing our products to customers. Accordingly, we must raise cash from sources other
than revenues generated such as from the proceeds of loans, sale of common shares, advances from related parties and consulting
agreements.



From inception (September 13, 2010) to
November 30, 2012, the company's business operations have been primarily focused on developing our business plan, developing potential
products and biomass projects, becoming a trading public company through an S-1 registration statement, raising money, licensing
technologies and licensing and developing on-line exchanges.



Corporate History



On January 6, 2011, we acquired 100% of
BioPower Corporation (“BC”), a Florida corporation incorporated on September 13, 2010, by our CEO and Director contributing
100% of the outstanding shares to the Company. As a result, BC became a wholly-owned subsidiary of the Company.



On November 30, 2010, an exclusive license
agreement was signed between BC and Clenergen Corporation (www.clenergen.com). BC has the exclusive license for the United
States, Central America, Guam and Mexico to utilize Clenergen’s biomass growing technologies.



On January 14, 2011, we formed Global Energy
Crops Corporation (“GECC”), a 100% wholly-owned subsidiary for the future development of global business opportunities.



On January 27, 2011, an agreement was signed
between Green Oil Plantations Ltd. (www.greenoilplantations.com) and their affiliates (“Green Oil”) and the
Company for the exclusive fully paid up license for fifty (50) years to utilize Green Oil’s licensed technologies and turnkey
model for growing energy crops in North America, South America, Central America and the Caribbean. The Company formed Green Oil
Plantations Americas, Inc., as the operating company for this exclusive license. The company has not received the due diligence necessary to utilize the license and therefore considers the license worthless.
The Company has recorded a 100% impairment loss of $240,795 as of November 30, 2012.



On August 1, 2011, the SEC declared our
S-1 effective.



On April 5, 2012, the Company received
notice from The Depository Trust Company "DTC" of the eligibility effective immediately of its common shares for electronic
trading under the OTCQB trading symbol "BOPO."



On May 12, 2012 the Company formed FTZ
Energy Exchange Inc., a 100% wholly-owned subsidiary for the future development of an energy exchange.



On June 7, 2012, the Company’s Chief
Executive Officer contributed 100% of his member interest in FTZ Exchange, LLC, (“FTZ”) a 100% wholly owned subsidiary,
to the Company for no consideration. FTZ is a licensing company that licenses business know-how and technology to build transaction
fee based exchanges for the sale of products and services in vertical markets.



3







On August 2, 2012, the Company formed Agribopo,
Inc., a 100% wholly-owned subsidiary for the development of biomass related projects.



On November 27, 2012 the Company
entered into a non-exclusive global license with Advanced Green Technologies, LLC. to convert biomass wastes from animals, humans
and sugar manufacturers to Cellulosic ethanol, fertilizer and other derivative products.



As of November 30, 2012, we consider the
Green Oils license worthless as the Licensor cannot provide the due diligence necessary for funding projects through traditional
project finance.



The Company and its subsidiaries, have
never declared bankruptcy, have never been in receivership, and have never been involved in any legal action or proceedings.



Neither the Company nor its subsidiaries,
nor our officers, directors, promoters or affiliates, has had preliminary contact or discussions with, nor do we have any present
plans, proposals, arrangements or understandings with any representatives of the owners of any business or company regarding the
possibility of an acquisition or merger. Since incorporation, we have not made any material purchase or sale of assets outside
the ordinary course of business.



We are not a blank check registrant as
that term is defined in Rule 419(a) (2) of Regulation C of the Securities Act of 1933, since we have a specific business plan or
purpose.



Our Business



The Company is a development stage company
and intends to grow biomass crops coupled with processing and/or conversion facilities to produce oils, biofuels, electricity and
other biomass products. We also intend to utilize licensed patented technology to convert biomass wastes into cellulosic ethanol,
fertilizer and other products and reduce the amount of waste going to landfills through licenses, joint ventures and owning facilities.
Further, we intend to utilize our FTZ Exchange subsidiary to help create internet exchanges through licensing our business know
how.



Biomass is all plant and animal matter
on the Earth's surface. Harvesting biomass such as crops, trees or dung and using it to generate energy such as heat, electricity
or motion, is bioenergy. Biomass is a very broad term which is used to describe material of recent biological origin that can be
used either as a source of energy or for its chemical components. As such, it includes trees, crops, algae and other plants, as
well as agricultural and forest residues. It also includes many materials that are considered as wastes by our society including
food and drink manufacturing effluents, sludge, manures, industrial (organic) by-products and the organic fraction of household
waste.



Initially we developed a strategy to license
and grow long-term biomass products that take five to seven years to reach maturation. After commencing development activities
we recognized that the economic climate for lending and investment is focused on shorter term returns of two to three years. 
Therefore,   BioPower analyzed various shorter term biomass technologies and market niche opportunities. As a result,
we developed short term plans to produce and sell biomass products which we call our Castor project.  We have deferred our
plans for the development of our long-term, licensed biomass products until specific funding can be obtained for such projects.



BioPower intends to create a special purpose
entity (“SPE”) company for each biomass project. Every SPE must have a sustainable, biomass growing project with facilities
to process the biomass into saleable products possibly coupled with an end use agreement. This end use agreement may enable the
SPE to obtain financing based upon the potential profitability of each project. The Company intends to offer ownership in our initial
SPEs to partners who can provide land and money. The role BioPower will fulfill in each SPE is executive and general management,
procurement of funding and development of markets for the sale of biomass and biomass products. The initial focus for biomass business
opportunities will be in the United States of America, the Caribbean, South America and Central America.



The Company also intends to investigate
and license and/or joint venture with the most promising, emerging biomass products and processes.



4







Castor Project



The Company has begun the process to obtain
financing for a castor plantation and milling operation to supply castor oil to the U.S.A. and/or international marketplace. We
have located a hybrid seed that should result in high yields per acre. We have identified unique growing protocols that also may
enhance the yield of seed thus oil by weight. We have identified engineering firms to prepare both general and site specific engineering
for permitting and construction purposes. We have identified the mill equipment to process the seed into oil and the agricultural
equipment required to facilitate the growing protocols that have been identified. We are currently working on the development of
a long-term (greater than one year) purchase agreement for the sale of castor oil. Although we have discussed various potential
sites in the center of Florida, we have not made a final determination of the specific location.



The U.S.A. currently imports almost 100%
of the castor oil used as a feedstock into the personal care, pharmaceuticals, polymers and plastics, adhesives, coatings and other
specialty chemical markets. The Company proposes to develop a project in Florida to grow proven hybrid castor which can be harvested
within 110 days per crop.  Given the rainfall, the temperature profile and the nature of the soil, it is anticipated that
the land when developed will produce 2.6 to 3.0 metric tons of oil seeds per acre based on two crops per year. We will process
the seeds into oil (43% of seed weight) with our own, vertically integrated mill which we consider critical to this project. Based
on our ability to obtain financing in this fiscal year, we hope to realize revenues and profits from this operation in 2013. There
can be no assurance the above Castor Project will ever be achieved.



We have been in discussions for a
Castor project in South America with a landowner who would provide the land and financing for the project. The
Company’s consultants have been to South America for initial review of the project and planned testing procedures. The
discussions include the landowner setting up a special purpose entity wherein the initial investment of approximately $10
Million USD will be made by the landowner. The Company would receive certain fees and a percentage of profits. It is
contemplated the growing tests will be completed by March 2014, and if successful, the project would commence. There can be
no assurance that the South American Castor project tests will be successful and that we will ever commence the project or be
profitable.



Licensed Technology



We have recently announced that we have obtained a non-exclusive
global License from AGT Technologies LLC until June 2029 when the patent expires. The license is for the patented one-step enzyme technology which converts wastes from poultry, hogs, humans and sugar to products such as,
fertilizer, ethanol and other products.



BioPower intends to focus initially on Municipalities who have
a significant need to reduce their costs of the handling of sewage by utilizing the Company's licensed technology to reduce landfill
costs by converting a portion of the sewage into products that do not have to go to the landfill but can be used for energy and
fertilizer. The utilization of biomass residues is of paramount importance to achieve environmental sustainability by harnessing
the potential of renewable resources in the production of clean energy and value added products. The Company will also target Fortune
500 companies that seek solutions for their waste sugars.



We pay our Licensor 50% of any sub-license
fees that we receive.  We also pay our Licensor 12% of all royalties on all revenues we earn from utilizing the technology. 
This 12% is calculated on the basis of net gross revenues which equal gross revenues less all direct costs associated with the
production of the revenues.



The patented technology is a one-step platform that integrates
enzymatic fermentation process that requires no pretreatment of the feedstock before fermentation. During the fermentation process
the bacteria within the wastes are inactivated by the injected proprietary microbes that also hydrolyze natural biopolymers and
simultaneously convert the hydrolyzed fermentable sugars into ethanol.



5







The process can also convert human waste which is reduced from
the conversion of it to ethanol and CO2. Once commercialized, BioPower believes that the process will allow sewage treatment
plants to reduce or entirely eliminate their sludge volumes and create saleable Class A fertilizer in lieu of delivering pressed
sludge to a landfill in an environmentally unsound method. The process allows farmers to utilize the bacteria free solids to be
sold and utilized as an environmentally safe soil amendment or fertilizer. Savings result from less energy used in the processing
of sludge, elimination of the hauling costs of treated sludge, and the added profit from ethanol and fertilizer sales. Water utilized
in the fermentation stage is recycled back into the process minimizing waste streams from the process.



FTZ Exchange, LLC



On June 7, 2012, the Company’s Chief
Executive Officer contributed 100% of his member interest in FTZ Exchange, LLC, (“FTZ”) a 100% wholly owned subsidiary,
to the Company for no consideration. FTZ is a licensing company that licenses business know-how to build transaction fee based
exchanges for the sale of products and services. The Company retains 10% of all license fees earned.



Health Exchange



FTZ has been in the development stage of a health exchange since
January, 2012. FTZ currently owns 50% of the Qx Health Exchange with Quture, Inc. (“QUTR”).  This exchange is
for the sale of health products and services for the communities of health product manufacturers, insurance companies, hospitals,
physicians, healthcare providers, medical tourism and patients.  Quture and FTZ need to raise significant funds to build
out the exchange. There can be no assurance such funding will ever be achieved or that the Qx Health Exchange will ever be launched.



Capacity Exchange



FTZ has executed a Strategic Alliance with Capacity 360, LLC
to develop excess capacity transactions. Capacity 360, LLC is a company that assists Global 2000 corporations and other corporations
to develop excess capacity strategies to optimize and monetize their unused, under-utilized manufacturing capacities and assets,
with the goal of meeting each corporation's strategic goals. Capacity 360 needs to raise funding for
their exchange. There can be no assurance such funding will ever be achieved or that the capacity exchange will ever be launched.



FTZ Energy Exchange Corporation



FTZ Energy Exchange Corporation was incorporated on May 14,
2012 as a wholly-owned subsidiary of BioPower to launch an energy exchange. FTZ will require funding to launch an energy exchange.
There can be no assurance such funding will ever be achieved or that the energy exchange will ever be
launched.



6







Business Environment



BioPower has two main business drivers.
The primary business driver is the need for environmentally friendly, profitable and sustainable products. A second driver is the
search for energy alternatives focused on replacement of hydrocarbon based products, which is one of the concerns of governments,
scientists and businesses worldwide.



Competitive business conditions and
the smaller reporting company's competitive position in the industry and methods of competition



The energy crop growing industry is fragmented
worldwide with Universities and energy crop production labs spending the last 15-20 years doing research and development on the
best energy crop yields. The renewable energy industry is extremely competitive in general, with competitors ranging from the largest
tree growing company, International Paper; utilities such as Exelon, Southern Cos., Duke; large oil companies such as BP and Exxon;
and smaller technology companies and early stage renewable energy companies.



There can be no assurance that our plans
relating to castor will ever be achieved.



Many companies have developed solutions
for the handling of poultry, hog, sugar and human wastes. The Company’s patented license utilizes a one-step enzyme process
to convert wastes as opposed to more costly two step enzymatic processes in the market today. Companies also use recycling, composting
and compacting of sludge to reduce the amount of waste going to the landfill. In the United States, sludge is a significant problem
with few solutions being utilized other than composting, compaction and land filling.



There can be no assurance that our plans
related to the use of this patented technology will ever be achieved.



Regulation



The Company will comply with all U.S.A.
and foreign laws and regulations that apply to our agricultural production, mill operation, safety and environmental standards
or are otherwise applicable to our business, processes and products.



Business Development



We are focused on the elements necessary
to initiate our castor project. These elements include financing for the project, a long-term contract for the sale of bio oils,
execution of agreements with engineering and construction contractors, procurement of mill and farming equipment, and purchase
of land for the mill and purchase/lease for agricultural operations.



Further, we are focused on utilizing our
license for the patented process to convert poultry, hog, sugar and human wastes into ethanol, fertilizer and other products. Our
initial target markets include municipalities and major companies that produce sugar and poultry wastes.



Patents, trademarks, licenses, franchises,
concessions, royalty agreements or labor contracts, including duration



We have a non-exclusive global license
agreement from AGT Technologies LLC until the patent expires in June 2029, for a patented one-step enzyme process which converts
sugar, poultry, hog and human wastes into ethanol and fertilizer. We have to pay our Licensor 50% of any sub-license fees that
we receive. We also pay our Licensor 12% of all royalties on revenues produced from utilizing the technology. This 12% is calculated
on the basis of net gross revenues which equal gross revenues less all direct costs associated with the production of the revenues.



7







Effect of existing or probable governmental
regulations on the business



The U.S. Department of Agriculture and
other foreign, U.S., state and local agencies have regulations for growing biomass crops. We intend to use biomass crops that have
been approved or can be approved by governmental agencies for growing in the U.S.A. or other countries in the Americas. We are
aware that we must obtain permits from the appropriate governmental agencies to implement our business model. We will operate in
the same regulatory environment as all other biomass crop growing operations that are dealing with governmental regulations. There
can be no assurance that we would receive such permits or licenses.



Estimate of the amount spent during
each of the last two fiscal years on research and development activities, and if applicable, the extent to which the cost of such
activities is borne directly by customers



As a recently incorporated
company, we have not undertaken any R&D activities, but we intend to have minimal R&D activities in 2013. The costs will be borne by the Company.



Costs and effects of compliance with
environmental laws (foreign, federal, state and local)



While we anticipate costs for compliance
with environmental laws, which will typically be for licensing or permitting growing operations, these are part of the normal and
customary costs for every growing operation. These costs generally vary by state, are not significant as relates to the total project
cost, and are part of the business model costs for each growing operation.



Number of total employees and number
of full-time employees



We presently
have 4 employees, Robert Kohn, our Chairman and Chief Executive Officer, Bonnie Nelson, Director of Business Strategy, a scientist, an accountantandvarious consultants and advisors. We intend to hire additional employees for project development and to manage and staff our operations
as we raise capital and complete specific milestones that would require these employees. Each specific special purpose entity that
is created for each biomass project will hire their own employees and staff for growing and milling operations. In the meantime,
we will rely on present management, consultants and advisors to direct our business.



ITEM 1A. RISK FACTORS



An investment in our securities should
be considered highly speculative due to various factors, including the nature of our business and the present stage of our development.  An
investment in our securities should only be undertaken by persons who have sufficient financial resources to afford the total loss
of their investment.  In addition to the usual risks associated with investment in a business, you should carefully consider
the following known material risk factors described below and all other information contained in this report before deciding to
invest in our Common Stock.  If any of the following risks occur, our business, financial condition and results of operations
could be materially and adversely affected.



Risks Relating to our Business



We are subject to a going concern
opinion from our independent auditors.



Our independent auditors have added an
explanatory paragraph to their audit issued in connection with the financial statements for the period ended November 30, 2012,
relative to our ability to continue as a going concern.  We had a working capital deficit of ($1,483,647) and we had
a deficit accumulated during the development stage of ($2,244,437), as at November 30, 2012. Because our auditors have issued a
going concern opinion, it means there is substantial uncertainty we will continue operations in which case you could lose your
investment.  The financial statements do not include any adjustments that might result from the uncertainty about our
ability to continue our business. As such we may have to cease operations and investors could lose their entire investment.



We have had no operations to
date and have earned no operating revenues to date.



We have had no operations to date and no
operating revenues.  We expect to incur losses in the coming fiscal year, and possibly beyond, due to significant costs
associated with our business development activities. There can be no assurance that we will be able to successfully implement our
business plan, or that our business development activities will ever lead to us generating sufficient revenues to fund our
continuing operations or that we will ever generate positive cash flow from our operations.  Further, we can give no
assurance that we will attain or thereafter sustain profitability in any future period. Since our resources are presently very
limited, insufficient future revenues would result in termination of our operations, as we cannot sustain unprofitable operations
unless additional equity or debt financing is obtained.



8







We have had no operations to date,
and are competing with well-established companies in our business sector, and may never achieve profitability.



To date the Company has been focused on
raising money, filing a registration statement and business development activities. We are faced with all of the risks associated
with a company in the early stages of development. Our business is subject to numerous risks associated with a relatively new,
undercapitalized company engaged in our business sector. Such risks include, but are not limited to, competition from well-established
and well-capitalized companies and unanticipated difficulties regarding the marketing and sale of our products. There can be no
assurance that we will ever generate significant commercial sales or achieve profitability. Should this be the case, our common
stock could become worthless and investors in our common stock or other securities could lose their entire investment.



We need to obtain a significant amount
of debt and/or equity capital to commence our castor project, build milling operations and operate plantations, which we may not
be able to obtain on acceptable terms or at all.



We will require additional capital to fund
our business and development plan, including the acquisition of land and planting and management of biomass crops (“biomass
operations”) and milling operations.  In addition, once these farms have been planted, we will have to fund the
start-up costs of these biomass operations until, if ever, the biomass products are sold and generate sufficient cash flow. We
may also encounter unforeseen costs that could also require us to seek additional capital. As a result, we expect to seek to raise
additional debt and/or equity funding. The full and timely development and implementation of our business plan and growth strategy
will require significant additional resources, and we may not be able to obtain the funding necessary to implement our growth strategy
on acceptable terms or at all. An inability to obtain such funding would prevent us from planting any plantations.  Furthermore,
our plantation strategy may not produce revenues even if successfully funded. We have not yet identified the sources for the additional
financing we require and we do not have commitments from any third parties to provide this financing. We might not succeed, therefore,
in raising additional equity capital or in negotiating and obtaining additional and acceptable financing. Our ability to obtain
additional capital will also depend on market conditions, national and global economies and other factors beyond our control. We
might not be able to obtain required working capital, the need for which is substantial given our business and development plan.
The terms of any future debt or equity funding that we may obtain may be unfavorable to us and to our stockholders.



We have limited financial and management
resources to pursue our growth strategy.



Our growth strategy may place a significant
strain on our management, operational and financial resources. We have negative cash flow from our development stage activities and
continue to seek additional capital. We will have to obtain additional capital either through debt or equity financing to continue
our business and development plan. There can be no assurance, however, that we will be able to obtain such financing on terms acceptable
to our company.



If we raise additional funds through the
issuance of equity or convertible securities, these new securities may contain certain rights, preferences or privileges that are
senior to those of our common shares. Additionally, the percentage of ownership of our company held by existing shareholders will
be reduced.



Our projects may be adversely affected
if our license agreement with AGT Technologies, LLC is terminated.



Although we believe our relationships with
our licensor is very good, our license agreement does provide that the licensor may terminate such agreements under certain circumstances.  Such
events include but are not limited to, our failure to perform or observe any of our obligations or our filing of bankruptcy.



In the event that our license agreement
is terminated by the licensor as provided in the license agreement, our business developments may be materially and adversely affected.



We will be dependent on third parties
for expertise in the management of our Biomass plantations and any loss or impairment of these relationships could cause delay
and added expense. In addition, we currently have no binding definitive agreements with such parties and their failure to perform
could hinder our ability to generate revenues.



The number of biomass plantation management
companies with the necessary expertise to manage the biomass plantations is limited. We will be dependent on our relationships
with third parties for their expertise. Any loss of, or damage to, these relationships, particularly during the planting and start-up
period for the plantations, may significantly delay or even prevent us from continuing operations at these plantations and result
in the failure of our business. The time and expense of locating new plantation management companies could result in unforeseen
expenses and delays. Unforeseen expenses and delays may reduce our ability to generate revenue and significantly damage our competitive
position in the industry.



9







We will be required to hire and retain
skilled technical and managerial personnel.



Personnel qualified to operate and manage
our future plantations and product sales are in great demand. Our success depends in large part on our ability to attract, train,
motivate and retain qualified management and skilled employees, particularly managerial, technical, sales and marketing personnel,
technicians, and other critical personnel. Any failure to attract and retain the highly-trained managerial and technical personnel
may have a negative impact on our operations, which would have a negative impact on our future revenues. There can be no assurance
that we will be able to attract and retain skilled persons; and, the loss of skilled technical personnel would adversely affect
our company.



We are dependent upon our officers
for management and direction, and the loss of any of these persons could adversely affect our operations and results.



We are dependent upon Mr. Robert Kohn,
our Chief Executive Officer, Secretary and a Director. The loss of Mr. Kohn or Ms. Nelson, a director, could have a material adverse
effect upon our results of operations and financial position. We do not maintain “key person” life insurance for any
of our officers. The loss of any of our officers could delay or prevent the achievement of our business objectives.



Delays or defects could result in
delays in our proposed future production and sale of castor oil and other products and negatively affect our operations and financial
performance.



Projects often involve delays for a number
of reasons including delays in obtaining permits, delays due to weather conditions, or other events. Also, any changes in political
administrations at each level that result in policy changes towards energy and other products produced from castor could also cause
delays. If it takes us longer to plant our proposed plantations, our ability to generate revenues could be impaired. In addition,
there can be no assurance that defects in materials and/or workmanship will not occur. Such defects could delay the commencement
of operations of the plantation or cause us to halt or discontinue the plantation’s operation or reduce the intended production
capacity. Halting or discontinuing plantation operations could delay our ability to generate revenues.



Our proposed plantation sites may
have unknown environmental problems that could be expensive and time consuming to correct which may delay or halt planting and
delay our ability to generate revenue.



Liability costs associated with environmental
cleanups of contaminated sites historically have been very high as have been the level of fines imposed by regulatory authorities
upon parties deemed to be responsible for environmental contamination. If contamination should take place for which we are deemed
to be liable, potentially liable or a responsible party, the resulting costs could have a material effect on our business.



We may encounter hazardous conditions at
or near each of our proposed facility sites that may delay or prevent planting at a particular location.  If we encounter
a hazardous condition at or near a site, work may be suspended and we may be required to correct the condition prior to continuing
the plantation. The presence of a hazardous condition would likely delay or prevent planting at a particular location and may require
significant expenditure of resources to correct the condition.  If we encounter any hazardous condition during planting,
estimated sales and profitability may be adversely affected.



Changes in environmental regulations
or violations of the regulations could be expensive and hinder our ability to operate profitably.



We are and will continue to be subject
to extensive air, water and other environmental regulations and will need to maintain a number of environmental permits to plant
and operate our future plantations. If for any reason, any of these permits are not granted, costs for the plantations may increase,
or the plantations may not be planted at all. Additionally, any changes in environmental laws and regulations could require us
to invest or spend considerable resources in order to comply with future environmental regulations. Violations of these laws and
regulations could result in liabilities that affect our financial condition and the expense of compliance alone could be significant
enough to reduce profits.



10







Our joint ventures and strategic
alliances may not achieve their goals.



We expect to rely on joint ventures and
strategic alliances for land acquisition and development, plantation, planting, growing and management, sale and marketing of products,
funding of projects and project development. Even if we are successful in forming these alliances, they may not achieve their goals.



Dependence upon our officers without
whose services Company Operations could cease.



At this time, Robert Kohn, who has extensive
experience in the energy and fuels business, are primarily responsible for the development and execution of our business plan.  Mr.
Kohn has a long-term employment contract with the Company commencing January 2011; however after five years the contract may be
terminated by the officer.  If Mr. Kohn should choose to leave us for any reason before we have hired additional personnel,
our operations may fail. Even if we are able to find additional personnel, it is uncertain whether we could find qualified management
who could develop our business along the lines described herein or would be willing to work for compensation the Company could
afford.  Without such management, the Company could be forced to cease operations and investors in our common stock or
other securities could lose their entire investment. We do not maintain “key person” life insurance for any of our
officers.



We do not have a traditional credit
facility with a financial institution. This absence may adversely impact our operations.



We do not have a traditional credit facility
with a financial institution, such as a working line of credit. The absence of a facility could adversely impact our operations,
as it may constrain our ability to have the working capital for inventory purchases or other operational requirements. If adequate
funds are not otherwise available, we may be required to delay, scale back or eliminate portions of our business development efforts.  Without
credit facilities, the Company could be forced to cease operations and investors in our common stock or other securities could
lose their entire investment.



Our inability to successfully achieve
a critical mass of sales could adversely affect our financial condition.



No assurance can be given that we will
be able to successfully achieve a critical mass of sales in order to cover our operating expenses and achieve sustainable profitability.  Without
such critical mass of sales, the Company could be forced to cease operations and investors in our common stock or other securities
could lose their entire investment.



Other companies with greater resources
and operating experience offer products similar to or the same as the products we sell.



We intend to operate in a very competitive
industry with many established and well-recognized competitors. These competitors range from large, international oil companies
such as Shell, Exxon-Mobil and BP who have announced plans to create renewable energy projects as well as International Paper to
smaller renewable energy companies and tree growing companies. Most of our competitors (including all of the competitors named
above) have substantially greater market leverage, distribution networks, and vendor relationships, longer operating histories
and industry experience, greater financial, technical, sales, marketing and other resources, more name recognition and larger customer
bases than we do and potentially may react strongly to our marketing efforts. Other competitive responses might include, without
limitation, intense and aggressive price competition and offers of employment to our key marketing or management personnel. We
may not be successful in the face of increasing competition from existing or new competitors, or the competition may have a material
adverse effect on our business, financial condition and results of operations.  If we are not successful in competing
with our competitors, the Company could be forced to cease operations and investors in our common stock or other securities could
lose their entire investment.



Our Castor project sales and marketing
efforts may not lead to a long-term purchase commitment.



We have not executed a long-term purchase
agreement with a buyer of castor oil at this time. We believe we may have to establish further elements of our Castor project in
order to accomplish this goal. We also believe we will have to establish our Castor project in order to expand our sales contracts
for a larger amount of quantity of bio oils guaranteed to be purchased by the Purchaser. There can be no assurance that we will
be able to expand our efforts to the extent we believe necessary or that any such efforts, if undertaken, will be successful in
achieving substantial sales of our products.  If we are unable to expand our sales and marketing efforts, the Company
could be forced to cease operations and investors in our common stock or other securities could lose their entire investment.



11







The average selling prices of our
products, and our gross margins resulting from the sale of such products, may decline as a result of industry trends, competitive
pressures and other factors.



Castor oil has experienced significant
price volatility over the last three to five years due to a number of factors, particularly competitive and macroeconomic pressures
and timing of oil supply. Suppliers in India are increasing production of castor oil and castor products each year.  This
may result in lower sales prices from time to time in order to gain market share or create more demand. We may have to reduce the
sales prices of our products in response to such pricing competition, which could cause our gross margins to decline and may adversely
affect our business, operating results or financial condition.  If we cannot maintain adequate profit margins on the
sales of our products, the Company could be forced to cease operations and investors in our common stock or other securities could
lose their entire investment.



Our failure to manage growth effectively
could impair our success.



In order for us to expand successfully,
management will be required to anticipate the changing demands of a growth in operations, should such growth occur, and to adapt
systems and procedures accordingly. There can be no assurance that we will anticipate all of the changing demands that a potential
expansion in operations might impose. If we were to experience rapid growth, we might be required to hire and train a large number
of sales and support personnel, and there can be no assurance that the training and supervision of a large number of new employees
would not adversely affect the high standards that we seek to maintain. Our future will depend, in part, on our ability to integrate
new individuals and capabilities into our operations, should such operations expand in the future, and there can be no assurance
that we will be able to achieve such integration. Failure to manage growth effectively during an expansion in our operations (should
such an expansion occur) could adversely affect our business, financial condition and results of operations.



Changes in generally accepted accounting
principles could have an adverse effect on our business, financial condition, cash flows, revenue and results of operations.



We are subject to changes in and interpretations
of financial accounting matters that govern the measurement of our performance. Based on our reading and interpretations of relevant
guidance, principles or concepts issued by, among other authorities, the American Institute of Certified Public Accountants, the
Financial Accounting Standards Board, and the United States Securities and Exchange Commission, our management believes that our
current contract terms and business arrangements have been properly reported. However, there continue to be issued interpretations
and guidance for applying the relevant standards to a wide range of contract terms and business arrangements that are prevalent
in the industries in which we operate. Future interpretations or changes by the regulators of existing accounting standards or
changes in our business practices could result in future changes in our revenue recognition and/or other accounting policies and
practices that could have a material adverse effect on our business, financial condition, cash flows, revenue and results of operations.



The Company is controlled by its
officers and directors and new investors will not have any voice in our management, which could result in decisions adverse to
them.



Our directors and officers collectively
own or have the right to vote approximately 37% of our outstanding Common Shares. In addition, on January 28, 2011, the Company
filed with the Secretary of State of the State of Nevada a Certificate of Designation of Series A Preferred Stock. The Certificate
was approved by the Board and did not require shareholder vote.  The Certificate created a new class of preferred stock
known as Series A Preferred Stock. There is one share designated as Series A Preferred Stock. One share of Series A Preferred Stock
is entitled to 50.1% of the outstanding votes on all shareholder voting matters. Series A Preferred Stock has no dividend rights
and no rights upon a liquidation event.  On January 31, 2011, the Company issued one share of Series A Preferred Stock
to China Energy Partners, LLC, an entity controlled by Mr. Robert Kohn, our Chief Executive Officer and a Director and Ms. Bonnie
Nelson, a Director, with each owning 50% of that entity.  Through this entity, Mr. Kohn and Ms. Nelson are empowered
with supermajority voting rights despite the amount of outstanding voting securities they each own.



As a result they will have the ability
to control substantially all matters submitted to our stockholders for approval including:



| | - | election of our board of directors;
| | - | -----------------------------------



| | - | removal of any of our directors;
| | - | --------------------------------



| | - | amendment of our Articles of Incorporation or By-laws; and
| | - | ----------------------------------------------------------



12







| | - | adoption of measures that could delay or prevent a change in control or impede a merger, takeover
or other business combination involving us.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------



In addition, sales of significant amounts
of shares held by selling stockholders, or the prospect of these sales, could adversely affect the market price of our Common Shares.
Preferred stock and common stock ownership of our principal stockholders and our officers and directors may discourage a potential
acquirer from making a tender offer or otherwise attempting to obtain control of BioPower, which, in turn, could reduce our stock
price or prevent our stockholders from realizing a premium over our stock price.



We will incur significant increased
costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance
initiatives.



As a public company, we will incur significant
legal, accounting and other expenses that we did not incur as a private company. The Sarbanes-Oxley Act of 2002, as well as rules
subsequently implemented by the Securities and Exchange Commission (the “SEC”), have imposed various requirements on
public companies, including requiring establishment and maintenance of effective disclosure and financial controls and changes
in corporate governance practices. Our management and other personnel will need to devote a substantial amount of time to these
new compliance initiatives. Moreover, these rules and regulations will increase our legal and financial compliance costs and will
make some activities more time consuming and costly. We expect these rules and regulations to make it more difficult and more expensive
for us to obtain director and officer liability insurance and we may be required to incur substantial costs to maintain the same
or similar coverage.



Section 404 of the Sarbanes-Oxley Act of
2002 requires, among other things, that we maintain effective internal control over financial reporting and disclosure controls
and procedures. As a smaller reporting company, while we are not required to obtain the attestation of our accounting firm regarding
the effectiveness of our internal control over financial reporting, our management is still required to assess the effectiveness
of such internal controls. If we are unable to comply with the requirements of Section 404 in a timely manner or if we are not
able to remediate any deficiencies, we could be subject to sanctions or investigations by the SEC or other regulatory authorities,
which would require additional financial and management resources.



13







Risks Relating to our Common Shares
and the Trading Market



We may, in the future, issue additional
Common Shares which would reduce investors’ percent of ownership and may dilute our share value.



Our Articles of Incorporation authorize
the issuance of 500,000,000 Common Shares with par value of $0.0001 per share and 10,000 shares of Preferred Stock with par value
of $1.00 per share. The future issuance of our authorized Common Shares and Preferred Stock, to the extent that it is convertible
into shares of common stock, may result in substantial dilution in the percentage of our Common Shares held by our then existing
stockholders.   The issuance of Common Shares in the future for cash, future services or acquisitions or other corporate actions
may have the effect of diluting the value of the Common Shares held by our investors, and might have an adverse effect on any trading
market for our Common Shares.



Because of the early stage of development
and the nature of our business, our securities are considered highly speculative.



Our securities must be considered highly
speculative, generally because of the nature of our business and the early stage of its development.  We are seeking to commence
a new business in the highly competitive renewable energy industry, and we have yet to establish or operate our first planned energy
crop growing operation.  Accordingly, we have not generated any revenues nor have we realized a profit from our operations
to date, and there is little likelihood that we will generate any revenues or realize any profits in the short to medium term.
 Any profitability in the future from our business will be dependent upon our successfully implementing our business plan,
which itself is subject to numerous risk factors as set forth herein.  Since we have not generated any revenues, we will have
to raise additional monies through the sale of our equity securities or debt in order to undertake our business operations.



There is no established trading market
for our securities and purchasers of our securities may have difficulty selling their shares.



Our stock began to trade on the OTC QB
market February 17, 2012. An active trading market in our securities may not develop or, if developed, may not be sustained and purchasers
of the Common Shares may have difficulty selling their shares should they desire to do so.



Our Common Shares are subject to
the “Penny Stock” Rules of the SEC and the trading market in our securities is limited, which makes transactions in
our stock cumbersome and may reduce the value of an investment in our stock.



The SEC has adopted regulations that generally
define a "penny stock" to be any equity security other than a security excluded from such definition by Rule 3a51-1 under
the Securities Exchange Act of 1934, as amended.  For the purposes relevant to our Company, it is any equity security that
has a market price of less than $5.00 per share, subject to certain exceptions.



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



United States securities laws may
limit secondary trading, which may restrict the states in which and conditions under which you can sell the shares offered by this
Offering.



Secondary trading in Common Shares sold
in this Offering will not be possible in any state in the U.S.A. unless and until the Common Shares are qualified for sale under
the applicable securities laws of the state or there is confirmation that an exemption, such as listing in certain recognized securities
manuals, is available for secondary trading in such state. There can be no assurance that we will be successful in registering
or qualifying the Common Shares for secondary trading, or identifying an available exemption for secondary trading in our Common
Shares in every state.  If we fail to register or qualify, or to obtain or verify an exemption for the secondary trading of
the Common Shares in any particular state, the Common Shares could not be offered or sold to, or purchased by, a resident of that
state.  In the event that a significant number of states refuse to permit secondary trading in our Common Shares, the market
for the Common Shares could be adversely affected.



14







We have not and do not intend to
pay any cash dividends on our Common Shares, and consequently our stockholders will not be able to receive a return on their shares
unless they sell them.



We intend to retain any future earnings
to finance the development and expansion of our business.  We have not, and do not, anticipate paying any cash dividends on
our Common Shares in the foreseeable future.  Unless we pay dividends, our stockholders will not be able to receive a return
on their shares unless they sell them.



The elimination of monetary liability
against the Company’s directors, officers and employees under Nevada law and the existence of indemnification rights to the
Company’s directors, officers and employees may result in substantial expenditures by the Company and may discourage lawsuits
against the Company’s directors, officers and employees.



The Company’s certificate of incorporation
contains a specific provision that eliminates the liability of directors for monetary damages to the Company and the Company’s
stockholders; further, the Company is prepared to give such indemnification to its directors and officers to the extent provided
by Nevada law. The Company may also have contractual indemnification obligations under its employment agreements with its executive
officers. The foregoing indemnification obligations could result in the Company incurring substantial expenditures to cover the
cost of settlement or damage awards against directors and officers, which the Company may be unable to recoup. These provisions
and resultant costs may also discourage the Company from bringing a lawsuit against directors and officers for breaches of their
fiduciary duties and may similarly discourage the filing of derivative litigation by the Company’s stockholders against the
Company’s directors and officers even though such actions, if successful, might otherwise benefit the Company and its stockholders.



If we do not comply with the state
regulations in regard to the sale of these securities or find an exemption therefrom there may be potential limitations on the
resale of your stock.



With few exceptions, every offer or sale
of a security must, before it is offered or sold in a state, be registered or exempt from registration under the securities, or
blue sky laws, of the state(s) in which the security is offered and sold. Similarly, every brokerage firm, every issuer selling
its own securities and an individual broker or issuer representative (i.e., finder) engaged in selling securities in a state, must
also be registered in the state, or otherwise exempt from such registration requirements. Most states securities laws are modeled
after the Uniform Securities Act of 1956. To date, approximately 40 states use the Uniform Securities Act of 1956 as the basis
for their state blue sky laws.



However, although most blue sky laws are
modeled after the Uniform Securities Act of 1956 blue sky statutes, they vary widely and there is very little uniformity among
state securities laws. Therefore, it is vital that each state's statutes and regulations be reviewed before embarking upon any
securities sales activities in a state to determine what is permitted, or not permitted, in a particular state. While we intend
to review the blue sky laws before the distribution of any securities in a particular state, should we fail to properly register
the securities as required by the respective states or find an exemption from registration, then you may not be able to resell
your stock once purchased.



ITEM 1B.
UNRESOLVED STAFF COMMENTS



None.



ITEM 2. DESCRIPTION OF PROPERTY



On March 18, 2011, the Company entered
into a twenty-six month lease at $4,150 monthly that commenced on April 1, 2011, and expires on May 31, 2013. The office space
is approximately 2,000 square feet and includes five executive offices, a lunchroom and conference room. The lease also includes
fully furnished offices with executive furniture and equipment.



15







ITEM 3. LEGAL PROCEEDINGS



From time to time, we may become
involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is
subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our
business.  We are currently not aware of any such legal proceedings or claims that we believe will have a material adverse
effect on our business, financial condition or operating results. We know of no pending proceedings to which any director,
member of senior management, or affiliate is either a party adverse to us.



ITEM 4. MINE SAFETY PROCEDURES.



Not applicable.



PART II



ITEM 5. MARKET FOR REGISTRANT’S
COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES



Market for Our Common Stock



Our common stock is presently listed on
the OTC QB market. On August 1, 2011, the SEC declared our registration statement on form S-1 effective. We were notified by FINRA
on Friday, February 10, 2012, that we were approved to commence trading under the stock symbol “BOPO”. We commenced
trading on Friday, February 17, 2012. There can be no assurance that a market for our common stock will be sustained. Therefore,
purchasers of our shares may be unable to sell their securities, because there may not be a sustainable public market for our securities.
As a result, you may find it more difficult to dispose of, or obtain accurate quotes of our common stock. Any purchaser of our
securities should be in a financial position to bear the risks of losing their entire investment.



Our authorized capital consists of 500,000,000
common shares, par value $0.0001 per share (“Common Stock”), Holders of our Common Stock are entitled to one vote for
each share held of record on all matters submitted to a vote of stockholders. At March 8, 2013, 91,736,250shares
of our Common Stock are outstanding. Our shares of Common Stock are held by approximately 137 stockholders of record. The number
of record holders was determined from the records of our transfer agent and NOBO lists.



Notwithstanding, certain shareholders have
each entered into a lockup agreement with the Company effectively restricting them from transferring some or all of their common
stock for a period of time without the prior written consent of the Company, which consent may be unreasonably withheld. The selling
stockholders named in the S-1 prospectus are subject to a one-year lockup for some of their shares and our officers and directors
are subject to a two-year lockup on all of their shares. Subsequent to the lockup period, the stockholder may sell its common stock
every calendar quarter in an amount equal to no more than one percent (1%) of the Company’s issued and outstanding shares
of common stock; provided, however, that the stockholder shall not be permitted to make any transfer, or portion thereof, that
would exceed twenty percent (20%) of the average weekly reported volume of trading of the Company’s common stock on all national
securities exchanges and/or reported through the automated quotation system of a registered securities association during the calendar
week preceding the transfer. Moreover, as per the lockup agreement, prior to any transfer, the stockholder must first offer its
shares of common stock to be sold to the Company and allow the Company to purchase such shares at a price that is ninety percent
(90%) of the average closing price for the Company’s Common Stock, as reported or quoted on its
principal exchange or trading market, for the consecutive five (5) trading days prior to the transfer notice given to the Company.







16







For the period indicated,
the following table sets forth the high and low closing prices per share of common stock. These prices represent inter-dealer quotations
without retail markup, markdown, or commission and may not necessarily represent actual transactions.



|Fiscal Year 2012 |  | High ($) |      |  | Low ($) | 
|---------------- |  | -------- | ---- |  | ------- | 
|Fourth Quarter   |  |          | 0.15 |  |         | 
|Third Quarter    |  |          | 0.49 |  |         | 
|Second Quarter   |  |          | 0.75 |  |         | 
|First Quarter    |  |          | 0.75 |  |         | 



|Fiscal Year 2011 (1) |  | High ($) |      |  | Low ($) | 
|-------------------- |  | -------- | ---- |  | ------- | 
|Fourth Quarter       |  |          | 0.00 |  |         | 
|Third Quarter        |  |          | 0.00 |  |         | 
|Second Quarter       |  |          | 0.00 |  |         | 
|First Quarter        |  |          | 0.00 |  |         | 



| | (1) | BOPO commenced trading on February 17, 2012.
| | --- | --------------------------------------------



Dividends



We have not paid dividends on our common
stock and do not anticipate paying such dividends in the foreseeable future.



Sale of Unregistered Securities



On January 11, 2011, the Company
issued 4,150,000 shares to a consultant for investor relations, consulting and IT services. The foregoing issuance of the shares
was effectuated pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities
Act”), provided by Section 4(2) of the Securities Act.



As of January 18, 2011, the Company
sold 83,900,000 shares of our common stock at par value $0.0001, for $8,390, comprised of 33,500,000 shares of common stock to
officers and directors of the Company, and the balance of 50,400,000 common shares of stock to ten (10) related parties of officers
and directors totaling 39,850,000 common shares of stock of which the officers and directors disclaim beneficial ownership. The
foregoing issuance of the shares was effectuated pursuant to the exemption from the registration requirements of the Securities
Act of 1933, as amended (the “Securities Act”), provided by Section 4(2) of the Securities Act.



On January 27, 2011, the Company
issued 1,000,000 shares to Green Oil Plantations for an exclusive license for North, South, Central America and the Caribbean.



The Company accepted subscription
agreements on February 2, 2011, for sales of 1,200,000 shares of our common stock at a price of $0.25 per share with no commissions
paid, for total proceeds of $300,000. The foregoing issuance of the shares was effectuated pursuant to the exemption from the registration
requirements of the Securities Act of 1933, as amended (the “Securities Act”), provided by Section 4(2) of the Securities
Act.



On August 26, 2011, the Company
sold 30,000 shares of our common stock for $0.50 per share under the effective registration statement. The foregoing issuance of
the shares was effectuated pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended
(the “Securities Act”), provided by Section 434(b) of the Securities Act.



On February 19, 2012,
the Company authorized the issuance of 150,000 shares to be issued to an investment banker for services to be rendered
primarily for project finance funding of Castor operations. The foregoing authorization of the shares was effectuated
pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities
Act”), provided by Section 4(2) of the Securities Act. These shares are accounted for as common stock payable.



On February 22, 2012,
the Company sold 200,000 shares of our common stock for $0.25 per share. The foregoing authorization of the shares to be
issued was effectuated pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended
(the “Securities Act”), provided by Section 4(2) of the Securities Act. These shares are accounted for as common
stock payable.



17







On June 7, 2012 the
Company authorized the issuance of 30,000 shares of our common stock to be issued as payment for services rendered to a
non-management director and an additional 20,000 shares for his position as Chairman of the audit committee. The foregoing
authorization of the shares was effectuated pursuant to the exemption from the registration requirements of the Securities
Act of 1933, as amended (the “Securities Act”), provided by Section 4(2) of the Securities Act. These shares are
accounted for as common stock payable.



On October 18, 2012 a
note holder exchanged $50,000 in debt for 200,000 shares at $.25 per share. The foregoing authorization of the shares to be
issued was effectuated pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended
(the “Securities Act”), provided by Section 4(2) of the Securities Act. These shares are accounted for as common
stock payable.



Securities authorized for issuance
under equity compensation plans



As of the date of this Annual Report, we
do not have any securities authorized for issuance under any equity compensation plans and we do not have any equity compensation
plans.



ITEM 6.   SELECTED FINANCIAL
DATA



We are a smaller reporting
company as defined in Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.



ITEM 7. MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION



SPECIAL NOTE OF CAUTION REGARDING FORWARD-LOOKING
STATEMENTS



Statements made in this 10-K that are not
historical or current facts are “forward-looking statements” made pursuant to the safe harbor provisions of Section
27A of the of the Securities Act of 1933 (the “Act”) and Section 21E of the Securities Exchange Act of 1934.  In  some  cases,
you can  identify  forward-looking statements by terminology such  as "may",  "should",
"intends", "expects", "plans", "anticipates", "believes",  "estimates",
"predicts", "potential", or  "continue"  or  the  negative
of  these  terms  or  other  comparable terminology.  We intend that
such forward-looking statements be subject to the safe harbors for such statements.  We wish to caution readers not to
place undue reliance on any such forward-looking statements, which speak only as of the date made.  Any forward-looking
statements represent management’s best judgment as to what may occur in the future.  However, forward-looking statements
are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ
materially from historical results of operations and events and those presently anticipated or projected.  We disclaim
any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such
statement or to reflect the occurrence of anticipated or unanticipated events.



Unless the context otherwise requires,
The "Company", "we," "us," and "our," refer to (i) BioPower Operations Corporation.; (ii)
BioPower Corporation (“BC”), (iii) Green Oil Plantations Americas, Inc. (“GOP”), (iv) Global Energy
Crops Corporation (GECC), FTZ Exchange LLC. and FTZ Energy Exchange Corporation.



Overview



BioPower Operations Corporationwas incorporated in Nevada on January 5, 2011. On January 6, 2011, we acquired 100% of BioPower Corporation (“BC”),
a Florida corporation incorporated on September 13, 2010, by our CEO and Director contributing 100% of the outstanding shares to
the Company. As a result, BC became a wholly-owned subsidiary of the Company.



On November 30, 2010, an exclusive
license agreement was signed between BC and Clenergen Corporation. BC has the exclusive license for the United States, Central
America, Guam and Mexico to utilize Clenergen’s biomass growing technologies.



On January 14, 2011, we formed
Global Energy Crops Corporation (“GECC”), a 100% wholly-owned subsidiary for the future development of global business
opportunities.



On January 27, 2011, an agreement was
signed between Green Oil Plantations Ltd. and their affiliates (“Green Oil”) and the Company for the exclusive
fully paid up license for fifty (50) years to utilize Green Oil’s licensed technologies and turnkey model for growing
energy crops in North America, South America, Central America and the Caribbean. The Company formed Green Oil Plantations
Americas, Inc., as the operating company for this exclusive license. The Company has recorded a 100% impairment loss of
$240,795 as relates to its license for Green Oils Plantations as of November 30, 2012. The company has not received the due
diligence necessary to utilize the license and therefore considers the license worthless.



18











On August 1, 2011, our S-1 was approved
by the Securities and Exchange Commission. On October 3, 2011, we closed the S-1.



On April 5, 2012, the Company received
notice from The Depository Trust Company "DTC" of the eligibility effective immediately of its common shares for electronic
trading under the OTCQB trading symbol "BOPO."



On May 12, 2012 we incorporated
FTZ Energy Exchange Corporation, a 100% wholly-owned subsidiary for the future development of an energy exchange.



On June 7, 2012, the Company’s Chief
Executive Officer contributed 100% of his member interest in FTZ Exchange, LLC, (“FTZ”) a 100% wholly owned subsidiary,
to the Company for no consideration. FTZ is a licensing company that licenses business know-how and technology to build transaction
fee based exchanges for the sale of products and services in vertical markets.



On August 2, 2012, the Company formed Agribopo,
Inc., a 100% wholly-owned subsidiary for the future development of biomass related projects.



On November 27, 2012 the Company
entered into a non-exclusive global license with Advanced Green Technologies, LLC. to convert biomass wastes from animals, humans
and sugar manufacturers to ethanol, fertilizer and derivative products including animal feed.



As of November 30, 2012, we consider the
Green Oils license worthless as the Licensor has not provided the due diligence necessary to enable funding for projects.



We are a development stage company and
have not yet generated or realized any revenues from business operations. Our auditors have issued a going concern opinion. This
means there is substantial doubt that we can continue as an on-going business for the next twelve (12) months unless we obtain
additional capital to pay our bills. This is because we have not generated any revenues and no revenues are anticipated until we
begin marketing our products to customers. Accordingly, we must raise cash from sources other than revenues generated such as from
the proceeds of loans, sale of common shares and advances from related parties.



From inception (September 13, 2010) to
November 30, 2012, the company's business operations have been primarily focused on developing our business plan, developing potential
biomass projects, with a focus on castor oil projects, becoming a trading public company through an S-1 registration statement,
raising money, and more recently, licensing technologies that can convert sugar, human, poultry and hog wastes into products such
as ethanol, fertilizer and derivative products.



The Company has two primary focuses at
this time, the castor projects in South America and Florida and the utilization of the license for the patented technology for
the conversion of sugar, hog, poultry and human wastes.



Castor project



The Company has begun the process to obtain
financing for a castor plantation and milling operation to supply castor oil to the U.S.A. We have located a hybrid seed that should
result in high yields per acre. We have identified unique growing protocols that also may enhance the yield of seed thus oil by
weight. We have identified an engineering firm to prepare both general and site specific engineering for permitting and construction
purposes. We have identified the mill equipment to process the seed into oil and the agricultural equipment required to facilitate
the growing protocols that have been identified. We are currently working on the development of a long-term (greater than one year)
purchase agreement for the sale of castor oil. Although we have discussed various potential sites in the center of Florida, we
have not made a final determination of the specific location.



We have also been in discussions
for a Castor project in South America with a landowner who would provide initially 1681 hectares or 4,150 acres of land and
the initial investment of approximately $10 Million USD financing for the project including a mill. The Company’s
consultants have been to South America for initial review of the project and planned testing procedures. The discussions
include the landowner setting up a special purpose entity wherein the Company would receive certain fees and a percentage of
profits. It is contemplated the growing tests will be completed in less than one year, and if successful, the project would
commence. The Company may have minimal revenues in 2013 from the testing. There can be no assurance that the South American
Castor project will ever commence or be profitable.



19







The U.S.A. currently imports almost 100%
of the castor oil used as a feedstock for the production of personal care, pharmaceuticals, polymers and plastics, adhesives, coatings
and other specialty chemical products. The Company proposes to develop a project in Florida to grow proven hybrid castor which
can be harvested within approximately 110 days per crop.  Given the rainfall, the temperature profile and the nature of the
soil, it is anticipated that the land when developed will produce 2.6 to 3.0 metric tons of oil seeds per acre based on two crops
per year. We will process the seeds into oil (43% of seed weight) with our own, vertically integrated mill which we consider critical
to this project. Based on our ability to obtain financing in this fiscal year, we hope to realize revenues and profits from this
operation in 2014.



There can be no assurance the above Castor
projects will ever be achieved.



Licensed Technology



We have a global License for the patented one-step enzyme technology
which converts wastes from poultry, hogs, humans and sugar to products such as fertilizer, cellulosic ethanol and other products.
The patent expires in June 2029. We pay our Licensor 50% of any sub-license fees that we receive.  We also pay our Licensor
12% of all royalties on all revenues we earn from utilizing the technology.  This 12% is calculated on the basis of net gross
revenues which equal gross revenues less all direct costs associated with the production of the revenues.



BioPower intends to focus initially on Municipalities who have
a significant need to reduce their costs of the handling of sewage by utilizing the Company's licensed technology to reduce landfill
costs by converting a portion of the sewage into products that do not have to go to the landfill but can be used for energy and
fertilizer. The utilization of biomass residues is of paramount importance to achieve environmental sustainability by harnessing
the potential of renewable resources in the production of clean energy and value added products.



The patented technology is a one-step platform that integrates
enzymatic fermentation process that requires no pretreatment of the feedstock before fermentation. During the fermentation process
the bacteria within the wastes are inactivated by the injected proprietary microbes that also hydrolyze natural biopolymers and
simultaneously convert the hydrolyzed fermentable sugars into ethanol.



The process can also convert human waste which is reduced from
the conversion of it to ethanol and CO2. Once commercialized, BioPower believes that the process will allow sewage treatment
plants to potentially reduce or significantly eliminate their sludge volumes and create saleable Class A fertilizer in lieu of
delivering pressed sludge to a landfill in an environmentally unsound method. The process allows farmers to utilize the bacteria
free solids to be sold and utilized as an environmentally safe soil amendment or fertilizer. The process can also convert human
waste which is reduced from the conversion of it to ethanol and CO2.



Once commercialized, BioPower believes that the process will
allow sewage treatment plants to potentially reduce or significantly eliminate their sludge volumes and create saleable Class A
fertilizer in lieu of delivering pressed sludge to a landfill in an environmentally unsound method. Savings result from less energy
used in the processing of sludge, elimination of the hauling costs of treated sludge, reduced costs for land filling because of
reduced volumes of sludge, and the added profit from ethanol and fertilizer sales. Water utilized in the fermentation stage is
recycled back into the process minimizing waste streams from the process.



FTZ Exchange, LLC



On June 7, 2012, the Company’s Chief
Executive Officer contributed 100% of his member interest in FTZ Exchange, LLC, (“FTZ”) a 100% wholly owned subsidiary,
to the Company for no consideration. FTZ is a licensing company that licenses business know-how to build transaction fee based
internet exchanges for the sale of products and services. The Company retains 10% of all license fees.



20







Health Exchange



FTZ has been in the development stage of a health exchange since
January, 2012. FTZ currently owns 50% of the Qx Health Exchange with Quture, Inc. (“QUTR”).  This exchange is
for the sale of health products and services for the communities of health product manufacturers, insurance companies, hospitals,
physicians, healthcare providers, medical tourism and patients.  Quture and FTZ need to raise significant funds to build
out the exchange. There can be no assurance such funding will ever be achieved or that the Qx Health Exchange will ever be launched.



Capacity Exchange



FTZ has executed a Strategic Alliance with Capacity 360, LLC
to develop excess capacity transactions. Capacity 360, LLC is a company that assists Global 2000 corporations and other corporations
to develop excess capacity strategies to optimize and monetize their unused, under-utilized manufacturing capacities and assets,
with the goal of meeting each corporation's strategic goals. Capacity 360 needs to raise funding for
their exchange. There can be no assurance such funding will ever be achieved or that the capacity exchange will ever be launched.



FTZ Energy Exchange Corporation



FTZ Energy Exchange Corporation was incorporated on May 14,
2012 as a wholly-owned subsidiary of BioPower to launch an energy exchange. FTZ will require funding to launch an energy exchange.
There can be no assurance such funding will ever be achieved or that the energy exchange will ever be
launched.



PLAN OF OPERATION



Since inception (September 13, 2010) to
November 30, 2012, the Company has spent a total of $1,950,809 on the general and administrative costs. We have only generated minimal consulting revenue from non-business operations.



Since inception (September 13, 2010),
the majority of the company's time has been spent refining its business plan, conducting industry research, developing
potential projects, licensing biomass opportunities, reviewing technologies, preparing an S-1 and preparing for additional
financing, funding of operations and funding of projects.



The Company is a development stage company
primarily focused on (1) growing castor coupled with processing and/or conversion facilities to produce oils and biofuels and other
derivative products and (2) to utilize the licensed waste conversion technology to convert human, sugar, hog and poultry
wastes into ethanol, fertilizer and derivative products.



We have been in discussions for a
Castor project in South America with a landowner who would provide the land and financing for the project. The
Company’s consultants have been to South America for initial review of the project and planned testing procedures. The
discussions include setting up a special purpose entity wherein the initial investment of approximately $10 Million USD
would be made by the landowner. The Company could receive certain fees and a percentage of profits. It is contemplated the
growing tests will be completed within one year, and if successful, the project would commence. There can be no assurance
that the South American Castor project will ever commence or be profitable.



Second, we are focused on utilizing our
patented licensed technology to convert human, sugar, poultry and hog waste to fertilizer and ethanol. Municipalities are our first
target for the utilization of this process.



We estimate our maximum operating expenses
and working capital requirements for the next twelve month period to be as follows:



|Business development costs                     |  | $ | 500,000   | 
|---------------------------------------------- |  | - | --------- | 
|Research & development costs including patents |  |   | 600,000   | 
|Management and Consulting                      |  |   | 1,200,000 | 
|General and Administrative                     |  |   | 600,000   | 
|Total                                          |  | $ | 2,900,000 | 



21







We anticipate that we will be required
to raise additional funds through private sales of debt or equity securities of our company, to fund our operations and execute
our business plan. There is no assurance that the financing will be completed on terms advantageous to us, or at all. If we are
not successful in raising additional funding, we may be forced to curtail or cease some of all of our operations and/or curtail
or elect not to proceed with certain aspects of our business plan.



We may also encounter unforeseen costs
that could also require us to seek additional capital.  As a result, we will need to raise additional debt and/or equity funding. 
However, no assurance can be given that we will be able to sell any of such securities.   An inability to obtain such
funding would prevent us from developing any biomass feedstock plantations.  Our ability to obtain additional capital also
will depend on market conditions, national and global economies and other factors beyond our control.   The terms of
any future debt or equity funding that we may obtain may be unfavorable to us and to our stockholders.



If we are successful and we are
able to raise the entire $2,900,000, we will have sufficient funds to meet business development costs, management and
consulting fees, and research and development costs  for  the  current fiscal year, and we will be able  to
implement key aspects  of  our  business  plan,  including  business  development costs  for
 our  energy growing operations and use of the license for the patented biomass waste conversion process.  
We would have a total of $600,000 remaining for working capital.   We expect these amounts will be sufficient to initiate
and sustain our business development activities for one year.



Upon  having  been
 successful in raising  $2,500,000, the salary  obligation to our CEO and Director of Business Strategy  will
come  into  effect,  and  one year’s salary accrual will be due with  amounts  accrued for
expenses to  date,  and  then monthly salary amounts  going  forward.   The initial annual amounts
are $200,000 and $125,000 respectively.



The  amount
 and timing  of additional funds that  might  be required cannot  be definitively stated  as at the 
date  of this  report  and will  be dependent on a variety  of factors,  including  the success
 of our initial  operations and the rate  of future  expansion that  we might  plan  to undertake.
 If we were  to determine that  additional funds are required, we would  be required  to raise  additional
capital  either by way of loans  or equity,  which,  in the case  of equity,  would  be potentially
dilutive  to existing stockholders.   The Company cannot be certain that we will be able to raise any additional
capital to fund our operations or expansion past the current fiscal year.



OUR CHALLENGES



Our ability to successfully operate our
business and achieve our goals and strategies is subject to numerous challenges and risks as discussed more fully in the section
titled "Risk Factors," including for example:



| | · | any failure to develop our projects and our inability
to sufficiently meet our customers' demands for our products;
| | - | -------------------------------------------------------------------------------------------------------------------



| | · | any inability to effectively manage rapid growth;
| | - | -------------------------------------------------



| | · | risks associated with future joint ventures, strategic
alliances or acquisitions;
| | - | ---------------------------------------------------------------------------------



| | · | economic, political, regulatory, legal and foreign risks
associated with alternative energy; and,
| | - | -------------------------------------------------------------------------------------------------



| | · | any loss of key members of our management.
| | - | ------------------------------------------



You should read and
consider the information set forth in "Risk Factors" and all other information set forth in this filing.



Regulation



The Company will comply with all U.S.A.
and foreign regulations and laws where they apply to agricultural production, mill operation, safety and environmental standards.



22







CONSOLIDATED RESULTS OF OPERATIONS



The following analysis reflects the consolidated
results of operations of BioPower Operations Corporation and its subsidiaries.



Fiscal 2012 as Compared with Fiscal 2011



|2012                          |  | BioPower Operations Corp |            |   | BioPower Corporation |   |         | FTZ Exchange, LLC |  |   | Total  |  
|----------------------------- |  | ------------------------ | ---------- | - | -------------------- | - | ------- | ----------------- |  | - | ------ | -
|Operating expenses (1)        |  | $                        | (912,773   | ) |                      | $ | (57,766 | )                 |  | $ | (3,779 | )
|Depreciation and amortization |  |                          | (10,552    | ) |                      |   | -       |                   |  |   | -      |  
|Consulting revenue            |  |                          | 63,571     |   |                      |   | -       |                   |  |   | -      |  
|Other income (expense)        |  |                          | (352,638   | ) |                      |   | (511    | )                 |  |   | -      |  
|Net income (loss) (1)         |  | $                        | (1,212,392 | ) |                      | $ | (58,277 | )                 |  | $ | (3,779 | )





|2011                          |  | BioPower Operations Corp |          |   | BioPower Corporation |   |         | FTZ Exchange, LLC |  |   | Total | 
|----------------------------- |  | ------------------------ | -------- | - | -------------------- | - | ------- | ----------------- |  | - | ----- | 
|Operating expenses            |  | $                        | (868,360 | ) |                      | $ | (88,593 | )                 |  | $ | -     | 
|Depreciation and amortization |  |                          | (7,652   | ) |                      |   | -       |                   |  |   | -     | 
|Other income (expense)        |  |                          | (3,690   | ) |                      |   | (360    | )                 |  |   | -     | 
|Net income (loss)             |  | $                        | (879,702 | ) |                      | $ | (88,953 | )                 |  | $ | -     | 



| | (1) | Includes $400.00 for Global Energy Crops Corporation and Green Oils Plantations of America filing
fees of $150.00 each and FTZ Energy Corporation $100.00 in filing fees.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Other Income - Consulting Fee.  Other
income from consulting fees was 63,571 for the year ended November 30, 2012, compared to $0 for the comparable period in
2011, for an increase of $63,571. The increase is due to a non-operating business consulting agreement.



Cost of Sales.There is no cost of sales
as operations have not commenced.



Operating Expenses and Depreciation.Operating expenses and depreciation for the year ended November 30, 2012, increased $20,465 (2%) to $984,870 for 2012 as compared to $964,605 for the same period in 2011. The table below details the components of operating expense, as
well as the dollar and percentage changes for the year ended November 30.



|                                    |  | For Years Ended November 30, |        
|----------------------------------- |  | ---------------------------- | -------
|                                    |  | 2012                         |        
|                                    |  |                              |        
|Wage and wage related costs         |  | $                            | 551,243
|Professional fees                   |  |                              | 232,530
|Insurance costs                     |  |                              | 45,853 
|Rent - building and equipment       |  |                              | 44,058 
|Travel and related                  |  |                              | 61,000 
|Miscellaneous expenses              |  |                              | 39,634 
|Depreciation and amortization       |  |                              | 10,552 
|                                    |  |                              |        
|Total Operating Exp. & Depreciation |  | $                            | 984,870



23







Wage and wage related costs, which includes
salaries, commissions, taxes and benefits, increased $16,195 (3%), due to salaries being recorded for a full year in 2012 versus
11 months in 2011.



Professional fees include
legal, accounting, stock transfer agent, SEC filing, and general consulting fees. Professional fees increased for the year
ended November 30, 2012 versus the same period last year by 24,732, 12% due to: increased accounting and legal fees and
transfer agent fees starting in 2012.



Insurance costs in the year ended November
30, 2012, were $45,853 compared to $20,409 for the same period in 2011, an increase of $25,444 (125%). The increase is attributable
to the cost of directors’ and officers’ liability insurance in 2012 which was not in effect in 2011.



Rent increased by $14,686 (50%) to $44,058
in the year ended November 30, 2012, as compared to $29,372 for the same period in 2011, due to the Company’s corporate office
rental commencing in April 2011.



Travel expense for the year ended November
30, 2012 of $61,000 compared to the same period for 2011 of $79,602 for a decrease of $18,602 (23%) is a result of international
travel associated with our licensed technologies in 2011 that was not repeated during 2012 and less travel related to business
development activities in 2012.



Miscellaneous expense decreased 45,089 (53%) to $39,634 for the year ended November 30, 2012, as compared to $84,723 for the same period in 2011. The decrease is attributable
to a mix of increases and decreases in expenses that are not material in aggregate.



Depreciation expense in our operating expenses
for the year ended November 30, 2012 of $10,552 compared to the same period for 2011 of $7,652 increased as a result of the amortization
of the license.



Other
Income (Expense).Other income (expense) includes interest income, interest expense and other non-operating income.
Other expense for the year ended November 30, 2012 was $353,149 compared to other expense of $4,050 for the same period last
year. The increase in other expense from 2011 of $349,099 is the result of consulting revenue of $63,571, loss on the sale of
securities of $118,640, loss on impairment of $240,795, interest expense of $120,453 and loan cost of $6,250 in 2012 as
compared to interest expense of $4,050 in 2011.



Net Loss and Net Loss per Share.Net
loss for the year ended November 30, 2012 was $1,274,448, compared to $968,655 for the same period in 2011, for an increased net
loss of $305,793 (31.5%). Net loss per share for the year ended November 30, 2012 was $0.01 compared to $0.01 in the same period
for 2011, based on the weighted average shares outstanding of 90,280,000 and 78,142,274, respectively. The decreased net loss for
the year ended November 30, 2012 compared to the same period in 2011 arose from the following: (i) non-operating consulting revenues
of $63,571, (ii) an increase in professional fees of $24,732 (iii) decreased travel and related expenses of $18,602, and (iv) a
decrease in miscellaneous expenses if $45,089 offset partially by (i) increased wage and wage related costs of $16,195, (ii) increased
insurance costs of $25,444, (iii) increased rent costs of $14,686, and (iv) increased depreciation and amortization expense of
$2,900.



We did not have any operating revenues
during the years ended November 30, 2012 and 2011, or since inception in September of 2010.



We incurred operating
expenses of $984,870 and $964,604 for the years ended November 30, 2012 and 2011, respectively. Our operating expenses primarily
consisted of development, accounting, audit and legal, consulting, employee accrued salaries and administrative expenses.



The Company realized
a net loss from continuing operations of $1,274,448 and $2,244,437 for the year ended November 30, 2012, and since inception in
2010, respectively.



Liquidity and Capital Resources



The Company does not
currently have sufficient resources to cover on-going expenses and expansion. As of November 30, 2012, the Company had cash of
$16,956 and current liabilities of $1,539,355.  Our current liabilities include accrued salaries of $755,365. Our operations
used $561,710 in cash since inception in September 2010.  We have historically financed our operations primarily through
private placements of common stock, loans from third parties and loans from our Officer.



24







We plan on raising additional funds from
investors to implement our business model.  In the event we are unsuccessful, this will have a negative impact on our
operations.



LIMITED OPERATING HISTORY: NEED FOR ADDITIONAL
CAPITAL



There is no historical financial information
about us upon which to base an evaluation of our performance. BioPower Corporation was incorporated September 13, 2010 in the State
of Florida and re-domiciled as BioPower Operations Corporation which was incorporated in the State of Nevada on January 5, 2011.
We are a development stage company. We have not generated any revenues from our operations. We cannot guarantee we will be successful
in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including
the financial risks associated with the limited capital resources currently available to us for the implementation of our business
strategies. (See "Risk Factors"). To become profitable and competitive, we must develop and execute the business plan.
We must raise funds over the next twelve (12) month period partially through advances from related parties, sale of securities;
and, we will seek alternative financing through means such as borrowings from institutions or private individuals. There are no
assurances that third party borrowings or financings are available to the Company and, if so, under the terms and conditions acceptable.



Critical Accounting Policies



Principles of Consolidation



All inter-company accounts and transactions
have been eliminated in consolidation.



Development Stage



The Company's audited consolidated
financial statements are presented as those of a development stage enterprise as defined in FASB ASC 915 because since
September 2010 it has not commenced operations that have resulted in revenues being generated from planned and principal
operations. The Company’s efforts have been devoted primarily to activities related to raising capital and activities
working toward the development of our first biomass project and utilization of a license with a patented technology for the
conversion of wastes including poultry, hog, human and sugar. The Company, while seeking to implement its business plan, will
look to obtain additional debt and/or equity related funding opportunities. The Company has not generated any operating
revenues since inception.



Going concern



As reflected in the accompanying audited
consolidated financial statements, the Company has a net loss of $1,274,448 and net cash used in operations of $242,390 for the
year ended November 30, 2012; and a working capital deficit of $1,483,467 and a deficit accumulated during the development stage
of $2,244,437 at November 30, 2012.



The ability of the Company to continue
as a going concern is dependent on Management's plans, which include further implementation of its business plan and continuing
to raise funds through debt or equity financings. The Company will likely rely upon related party debt or equity financing in order
to ensure the continuing existence of the business.



The accompanying audited consolidated financial
statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities
in the normal course of business.  These consolidated financial statements do not include any adjustments relating to
the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable
to continue as a going concern.



Issuance of Common Stock & Warrants



On January 11, 2011, the Company issued
4,150,000 shares to a consultant for investor relations, consulting and IT services and 1,000,000 warrants exercisable at $1.00
per share until January 10, 2012. The warrants were not exercised and have expired. The foregoing issuance of the shares was effectuated
pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”),
provided by Section 4(2) of the Securities Act.



25







The warrants were valued using the Black
Scholes model using the following assumptions:  stock price at valuation, $0.25; strike price, $1.00; risk free rate
0%; 1 year term; and volatility of 150%.  The Company attributed $60,800, related to the Series A warrants of the total
proceeds associated with the transaction to the warrants based on the relative fair value of the warrants.  After applying
the fair market values of the warrants, the remaining value was attributed to the 4,150,000 shares of common stock.



As of January 18, 2011, the Company sold
83,900,000 shares of our common stock at par value $0.0001, for $8,390, comprised of 33,500,000 shares of common stock to officers
and directors of the Company, and the balance of 50,400,000 common shares of stock to ten (10) related parties of officers and
directors totaling 39,850,000 common shares of stock of which the officers and directors disclaim beneficial ownership. The foregoing
issuance of the shares was effectuated pursuant to the exemption from the registration requirements of the Securities Act of 1933,
as amended (the “Securities Act”), provided by Section 4(2) of the Securities Act.



On January 27, 2011, the Company issued
1,000,000 shares to Green Oil Plantations for an exclusive license for North, South, Central America and the Caribbean.



The Company accepted subscription agreements
on February 2, 2011, for sales of 1,200,000 shares of our common stock at a price of $0.25 per share with no commissions paid,
for total proceeds of $300,000. The foregoing issuance of the shares was effectuated pursuant to the exemption from the registration
requirements of the Securities Act of 1933, as amended (the “Securities Act”), provided by Section 4(2) of the Securities
Act.



On August 26, 2011, the Company sold 30,000
shares of our common stock for $0.50 per share under the effective registration statement. The foregoing issuance of the shares
was effectuated pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities
Act”), provided by Section 434(b) of the Securities Act.



The following shares were authorized but have not been issued. They have been accounted for as common stock payable.



On February 23, 2012, the
Company sold an investor 200,000 shares of our common stock at par value $0.0001 for $0.25 per share. The shares to be issued
will be effectuated pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended
(the “Securities Act”), provided by Section 4(2) of the Securities Act. These shares are accounted for as common
stock payable.



On March 26, 2012, the Company
entered into a consulting agreement. The Company paid a fee of 150,000 shares of common stock, having a fair value of $97,500
($0.65/share), based upon the quoted closing trading price. The shares to be issued
will be  effectuated
pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities
Act”), provided by Section 4(2) of the Securities Act. These shares are accounted for as common stock payable.



On April 26, 2012, the Company paid a
fee of 50,000 shares, 30,000 shares to an outside Director and 20,000 shares the same outside Director for his role as
Chairman of the Audit committee. The shares to be issued
will be effectuated pursuant to the exemption
from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), provided by
Section 4(2) of the Securities Act. These shares are accounted for as common stock payable.



On October 18, 2012 a third party
lender who had advanced $50,000 during April and May 2012, converted the loan into 200,000 restricted shares of the Company
at $0.25 per share. The shares to be issued
will be  effectuated pursuant to the exemption from the
registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), provided by Section
4(2) of the Securities Act. These shares are accounted for as common stock payable.



Off-Balance Sheet Arrangements



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



Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK



We have not entered into, and do not expect to enter into, financial instruments for trading or hedging purposes to manage
our interest rate risks.



26









ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY
DATA



The Company's consolidated audited financial
statements for the fiscal years ended November 30, 2012 and 2011, together with the report of the independent certified public
accounting firm thereon and the notes thereto, are presented beginning at page F-1.



ITEM 9. CHANGES IN AND DISAGREEMENTS
WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE



None.



ITEM 9A. CONTROLS AND PROCEDURES



Disclosure Controls and Procedures



The Securities and Exchange Commission
defines the term “disclosure controls and procedures” to mean controls and other procedures of an issuer that are designed
to ensure that information required to be disclosed in the reports that it files or submits under the Securities Exchange Act of
1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s
rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that
information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of
1934 is accumulated and communicated to the issuer’s management, including its principal executive and principal financial
officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.  The
Company maintains such a system of controls and procedures in an effort to ensure that all information which it is required to
disclose in the reports it files under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within
the time periods specified under the SEC's rules and forms and that information required to be disclosed is accumulated and communicated
to principal executive and principal financial officers to allow timely decisions regarding disclosure.



As of the end of the period covered by
this report, we carried out an evaluation, under the supervision and with the participation of our chief executive officer/chief
financial officer of the effectiveness of the design and operation of our disclosure controls and procedures. Based upon its current
evaluation, the Company has concluded that the Company's current disclosure controls and procedures are not effective to ensure
that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act,
is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms, and that such
information is accumulated and communicated to the Company's management, including the Company's CEO, as appropriate, to allow
timely decisions regarding required disclosure.





Management’s Annual Report
on Internal Control over Financial Reporting



Our management is responsible for establishing
and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities
Exchange Act.  Our internal control over financial reporting is designed to provide reasonable assurance regarding the
(i) effectiveness and efficiency of operations, (ii) reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting principles, and (iii) compliance with applicable laws and
regulations.





Management assessed the effectiveness of
our internal control over financial reporting as of November 30, 2012. In making this assessment, we used the criteria set forth
by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control - Integrated Framework. Based
on our assessment, we determined that, as of November 30, 2012, our internal control over financial reporting was not effective
based on those criteria. The Company's management, including its Chief Executive Officer and Principal Financial Officer, does
not expect that the Company's disclosure controls and procedures and its internal control processes will prevent all error. A control
system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of
the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints,
and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems,
no evaluation of controls can provide absolute assurance that all control issues and instances of error if any, within the Company
have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that
the breakdowns can occur because of simple error or mistake. The design of any system of controls also is based in part upon certain
assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its
stated goals under all potential future conditions. Because of its inherent limitations, internal control over financial reporting
may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to
the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies
and procedures may deteriorate. However, these inherent limitations are known features of the financial reporting process. Therefore,
it is possible to design into the process safeguards to reduce, though not eliminate, this risk. This annual report does not include
an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's
report was not subject to attestation by the Company's registered public accounting firm pursuant to rules of the Securities and
Exchange Commission, which permanently exempt smaller reporting companies.



27







Changes in Internal Controls over
Financial Reporting



No change in our system of internal control
over financial reporting occurred during the fiscal year ended November 30, 2012, that has materially affected,
or is reasonably likely to materially affect, our internal control over financial reporting.



ITEM 9B. OTHER INFORMATION



None



PART III



ITEM 10. DIRECTORS, EXECUTIVE OFFICERS
AND CORPORATE GOVERNANCE.



The following are the officers and directors
of the Company as of the date of this report.



|Name                       |  | Age |  | Position                                                                  
|-------------------------- |  | --- |  | --------------------------------------------------------------------------
|                           |  |     |  |                                                                           
|Robert D. Kohn             |  | 62  |  | Chairman of the Board, Chief Executive
Officer and Chief Financial Officer
|                           |  |     |  |                                                                           
|Bonnie Nelson              |  | 61  |  | Director and Director of Business Strategy                                
|                           |  |     |  |                                                                           
|Michael Dinkes Esq. C.P.A. |  | 70  |  | Director and Chairman of the Audit Committee                              



Robert Kohn, CEO and Chief Executive
Officer, Director and Co-Founder



Mr. Kohn has been a director and officer
of BioPower Corporation of Florida since September 13, 2010, and has been integrally involved in the formation and development
of this business. At present, this role requires 100% of his time. From July 2009 until September 2010, Mr. Kohn was the Chief
Financial Officer of Proteonomix, Inc., a public company involved in stem cell research. Mr. Kohn from November 2009 to September
2010 had also been a consultant to Clenergen Corporation, a reporting issuer and was also a board member until January 25, 2011.
From 2006 to 2008, Mr. Kohn was the CEO and CFO of Global Realty Development Corp. and was hired to liquidate multiple Australian
real estate development companies, which he accomplished. From 1999 – 2002, Mr. Kohn was the co-founder and CEO of AssetTrade
which today is GoIndustry with approximately 1,300 employees in 20 countries. From 1996 to 1999 Mr. Kohn was President of Entrade
(“energy trading”), a subsidiary of Exelon Corporation, one of the largest electric utilities in the United States.
Mr. Kohn has a B.B.A. in accounting from Temple University and is a C.P.A. and formerly a tax consultant with Deloitte Touché.



28







Bonnie Nelson, Director and Director
of Business Strategy, Co-founder



Ms. Nelson has been a director of BioPower
Corporation of Florida since September 13, 2010, and has been integrally involved in the formation and development of this business.
Ms. Nelson currently sits on the Board of Directors of Allied Artists and was a Board Advisor to Clenergen Corporation in 2010.
From 1990 to present, with a career spanning over 20 years of investment and merchant banking, Ms. Nelson has extensive experience
in consulting and corporate finance for public and private companies. Ms. Nelson has been responsible for developing and guiding
many corporate turnarounds, joint ventures and strategic alliances. Bonnie Nelson was the prior owner and CEO of the Wall Street
brokerage firm, Vanderbilt Securities, Inc. from 1983-1990. At Vanderbilt, she was specifically responsible for taking companies
public, OTC trading, mergers and acquisitions, and the development of joint ventures and strategic alliances for her clients.



Michael Dinkes, Esq., C.P.A. Director



Mr. Dinkes has been a Director of the
Company since April 26, 2012. For the last four years he has been a self employed C.P.A. Prior to 2009, Mr. Dinkes was a
Partner at Lazard, Levine and Felix C.P.A. firm in New York for 14 years. For two years prior to Lazard he was employed by
the A.I.C.P.A. He serves as the Chairman of the Audit committee. Mr. Dinkes has a J.D. from NYU School of Law and is admitted
to practice in the State of New York. Mr. Dinkes is also a C.P.A. and admitted to practice in the States of New York and
Connecticut. He earned a B.B.A. from Baruch School of Business.



Board Committees



We currently have an audit committee but
do not have nominating or compensation committees.  Currently, Michael Dinkes, Esq. C.P.A. is the Chairman of the Audit Committee.
Our entire board of directors is responsible for the functions that would otherwise be handled by these committees.  We intend,
however, to establish, a nominating committee and a compensation committee of the board of directors as soon as practicable.  We
envision that the audit committee will be primarily responsible for reviewing the services performed by our independent auditors,
evaluating our accounting policies and our system of internal controls.  The nominating committee would be primarily responsible
for nominating directors and setting policies and procedures for the nomination of directors. The nominating committee would also
be responsible for overseeing the creation and implementation of our corporate governance policies and procedures.  The compensation
committee will be primarily responsible for reviewing and approving our salary and benefit policies (including stock options),
including compensation of executive officers.



Audit Committee Financial Expert



The Board of Directors has determined that
Michael Dinkes, Esq., C.P.A. is our Audit Committee financial expert, as defined under Item 407(d)(5)(i) of Regulation S-K.



Code of Ethics



We have adopted a code of ethics that applies
to all of our employees and officers, and the members of our Board of Directors. A copy of the code of ethics has been previously
filed as Exhibit 14.1.



Section 16(a) Beneficial Reporting
Compliance



Directors, executive officers and holders
of more than 10% of our outstanding common stock are required to comply with Section 16(a) of the Securities Exchange Act of 1934,
which requires generally that such persons file reports regarding ownership of transactions in securities of the Company on Forms
3, 4, and 5. Based solely on its review of such forms received by it, the Company believes that all Section 16(a) filing requirements
applicable to its officers and directors were complied with during the fiscal year ended November 30, 2012.



29







ITEM 11. EXECUTIVE COMPENSATION



The following is a summary of the compensation
we accrued for our executive officers, for the two fiscal years ended November, 2012 and 2011.



Summary Compensation Table





|Name and Position(s)                       |  | Year |      |  | Salary($) |   |         | Total  Compensation | 
|------------------------------------------ |  | ---- | ---- |  | --------- | - | ------- | ------------------- | 
|                                           |  |      |      |  |           |   |         |                     | 
|Robert D. Kohn (1)                         |  |      | 2012 |  |           | $ | 200,000 |                     | 
|CEO and Director                           |  |      | 2011 |  |           | $ | 183,333 |                     | 
|                                           |  |      |      |  |           |   |         |                     | 
|Bonnie Nelson (2)                          |  |      | 2012 |  |           | $ | 125,000 |                     | 
|Director and Director of Business Strategy |  |      | 2011 |  |           | $ | 114,583 |                     | 
|                                           |  |      |      |  |           |   |         |                     | 
|Dale S. Shepherd (3)                       |  |      | 2012 |  |           | $ |         |                     | 
|Former President and COO                   |  |      | 2011 |  |           | $ | 125,000 |                     | 



|(1) | Mr. Kohn was appointed as our Chief Executive Officer, Chief Financial Officer, Secretary and Director on January 5, 2011.        
|--- | ----------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                   
|(2) | Ms. Nelson was appointed as our Director and Executive VP of Business Strategy on January 5, 2011.                                
|    |                                                                                                                                   
|(3) | Mr. Shepherd was appointed as our President and Chief Operating Officer effective February 1, 2011 and resigned on August 9, 2012.



On January 5, 2011, each of Mr. Kohn, Mr.
Shepherd and Ms. Nelson entered into employment agreements with the Company. Each contract stipulates that unpaid salary amounts
shall accrue if unpaid; such salary amounts have been verbally agreed to be unpaid, but accrue, until such time as the Company
is successful in raising a minimum of $2,500,000. The general terms of the contracts are as follows:



Commencement:January 5,
2011, February 1, 2011, January 5, 2011

Term:Five years, Two years
and Five years

Base Salary:$200,000 Mr.
Kohn, $150,000 Mr. Shepherd, $125,000 Ms. Nelson



Incentive Compensation:Each
shall be entitled to receive such bonus payments or incentive compensation as may be determined at any time or from time to time
by the Board of Directors of the Company (or any authorized committee thereof) in its discretion. Such potential bonus payments
and/or incentive compensation shall be considered at least annually by the Board or committee. No bonus payments or incentive compensation
has been determined to date.



Stock Options.Each shall
be entitled to participate in all stock option plans of the Company in effect during the Term of employment. There are presently
no stock option plans.



Incentive, Savings and Retirement
Plans.During the Term of Employment, each shall be entitled to participate in all incentive, savings and retirement plans,
practices, policies and programs applicable to other key executives of the Company and its subsidiaries, in each case comparable
to those currently in effect or as subsequently amended. Such plans, practices, policies and programs, in the aggregate, shall
provide the Executive with compensation, benefits and reward opportunities at least as favorable as the most favorable of such
compensation, benefits and reward opportunities provided at any time hereafter with respect to other key executives. No such programs
presently are in place.



30







Welfare Benefit Plans:During
the Term, each person and/or his family, as the case may be, shall be eligible for participation in and shall receive all benefits
under welfare benefit plans, practices, policies and programs provided by the Company and its subsidiaries (including, without
limitation, medical, prescription, dental, disability, salary continuance, employee life, group life, accidental death and travel
accident insurance plans and programs), at least as favorable as the most favorable of such plans, practices, policies and programs
in effect at any time hereafter with respect to other key executives. In August 2012, the Board of Directors agreed to set a policy
that would reimburse the executives up to $2,000 per month for medical expenses and up to $500 for home office expenses on a use
or lose basis for each month.



Vacation.Each shall be
entitled to paid vacation in accordance with the most favorable plans, policies, programs and practices of the Company and its
subsidiaries as in effect at any time hereafter with respect to other key executives of the Company and its subsidiaries; provided,
however, that in no event shall Executive be entitled to fewer than three weeks paid vacation per year, as well as pay for holidays
observed by the Company.



Optional Termination.Each
party, after two (2) years, with 30 days’ notice, may terminate the agreement, upon which termination he shall receive a
payment valued at his base salary for one (1) year.



Termination without Cause:Upon termination without cause, each shall be entitled to a payout of all remaining salary amounts for duration of the contract
(one year minimum), and the receipt of the value of any benefits for the period of one year from termination.



The Company's directors who are
also employees do not receive remuneration from the Company unless approved by the Board. No compensation has been paid to the
Company's directors since inception. Mr. Dinkes, an outside Director received 30,000 shares of common stock as a Director and 20,000
shares of stock as Chairman of the audit committee.



ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS



The following table provides information
concerning beneficial ownership of our capital stock as of January 12, 2012 by:



|£ | each stockholder, or group of affiliated stockholders, who owns more than 5% of our outstanding capital stock;
|- | --------------------------------------------------------------------------------------------------------------



|£ | each of our named executive officers;
|- | -------------------------------------



|£ | each of our directors; and
|- | --------------------------



|£ | all of our directors and executive officers as a group.
|- | -------------------------------------------------------



The following table lists the number of
shares and percentage of shares beneficially owned based on 91,736,250 shares of Common Stock outstanding as of March 8, 2013.



Beneficial ownership is determined in accordance
with the rules of the SEC, and generally includes voting power and/or investment power with respect to the securities held. Except as indicated in the footnotes to this table,
and subject to applicable community property laws, the persons or entities named have sole voting and investment power with respect
to all shares of our Common Stock shown as beneficially owned by them.



31









|Name                                                          |  | Office                                     |  | Shares  Beneficially Owned (1) |            |  | Percent of Class (2) | 
|------------------------------------------------------------- |  | ------------------------------------------ |  | ------------------------------ | ---------- |  | -------------------- | 
|                                                              |  |                                            |  |                                |            |  |                      | 
|Officers and Directors                                        |  |                                            |  |                                |            |  |                      | 
|                                                              |  |                                            |  |                                |            |  |                      | 
|Robert D. Kohn                                                |  | Director and CEO, CFO                      |  |                                | 18,475,000 |  |                      | 
|                                                              |  |                                            |  |                                |            |  |                      | 
|Michael Dinkes, C.P.A. Esq.                                   |  | Director                                   |  |                                | 50,000     |  |                      | 
|                                                              |  |                                            |  |                                |            |  |                      | 
|Bonnie Nelson                                                 |  | Director and Director of Business Strategy |  |                                | 14,025,000 |  |                      | 
|                                                              |  |                                            |  |                                |            |  |                      | 
|All officers and directors as a group (3 persons named above) |  |                                            |  |                                | 32,550,000 |  |                      | 





Security Ownership of Certain Beneficial Owners



The following table sets forth all of the beneficial
owners known to us to own more than five (5) percent of any class of our voting securities as of February 20, 2012.





|                         |  |                                       |  | Amount and Nature of Beneficial |                  
|------------------------ |  | ------------------------------------- |  | ------------------------------- | -----------------
|Title of Class           |  | Name and Address of Beneficial Owner* |  | Ownership                       |                  
|                         |  |                                       |  |                                 |                  
|Common                   |  | Robert Kohn                           |  |                                 | 18,475,000 Direct
|                         |  |                                       |  |                                 |                  
|Series A Preferred Stock |  | China Energy Partners, LLC (2)        |  |                                 | 1 Indirect       
|                         |  |                                       |  |                                 |                  
|Common                   |  | Riskless Partners, LLC (3)            |  |                                 | 14,025,000 Direct
|                         |  |                                       |  |                                 |                  
|Series A Preferred Stock |  | China Energy Partners, LLC (2)        |  |                                 | 1 Indirect       



*The address of each shareholder is c/o
BioPower Operations Corporation, 1000 Corporate Drive, Suite 200, Fort Lauderdale, Florida, 33334.



(1) The percent of class is based on the
total number of shares outstanding of 91,736,250 as of March 8, 2013, and excludes 38,850,000 shares owned by certain related parties.



(2) China Energy Partners, LLC is an entity
owned 50% by Robert Kohn, our CEO and Chairman of the Board, and 50% owned by Ms. Bonnie Nelson, a Director of the Company. China
Energy Partners, LLC owns one share of Series A Preferred Stock entitling China Energy Partners to vote 50.1% of the issued and
outstanding shares of common stock of the Company on all matters presented to shareholders for approval.



(3) The sole managing member of Riskless
Partners, LLC is Ms. Bonnie Nelson, a director and vice president of business development. Ms. Nelson has sole voting and dispositive
control of the shares of common stock owned by Riskless Partners, LLC.



Securities Authorized for Issuance under Equity Compensation
Plan



None.



ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS,
AND DIRECTOR INDEPENDENCE



Transactions with Related Persons



On January 18, 2011, the Company sold 18,475,000
shares of its common stock at par value of $0.0001 for $1,847.50 in cash to Robert Kohn, our co-founder, Chairman, CEO and a director
of the Company and 16,600,000 shares of its common stock to certain related parties for $1,660.00 of which Mr. Kohn disclaims beneficial
ownership.



On January 18, 2011, the Company sold 14,025,000
shares at par value of $0.0001 per share to Riskless Partners LLC, and entity controlled by Bonnie Nelson, a co-founder and director,
for total proceeds of $1,402.50 in cash and 23,250,000 shares of its common stock to certain related parties for $2,325.00 of which
Ms. Nelson disclaims beneficial ownership.



32







On January 31, 2011, the Company sold one
share of its Series A Preferred Stock, par value $1.00 for total proceeds of $1 to China Energy Partners LLC, a limited partnership
owned equally by Robert Kohn and Bonnie Nelson.



On February, 1, 2011, the Company sold
1,000,000 shares of its common stock at par value of $0.0001per share for $100 in cash to Dale Shepherd, our former President and
COO.



Aside from the transactions identified
herein, there are no other transactions nor are there any proposed transactions in which any of our directors or nominees, executive
officers, or any member of the immediate family of any of the foregoing had or is to have a direct or indirect material interest.



The Company’s Board conducts an appropriate
review of and oversees all related party transactions on a continuing basis and reviews potential conflict of interest situations
where appropriate.  The Board has not adopted formal standards to apply when it reviews, approves or ratifies any related
party transaction.  However, the Board believes that the related party transactions are fair and reasonable to the Company
and on terms comparable to those reasonably expected to be agreed to with independent third parties for the same goods and/or services
at the time they are authorized by the Board.



Mr. Kohn, a director and officer of the
Company holds a total of 18,475,000 common shares and Ms. Nelson a Director holds 14,025,000 common shares of the Company and together
as partners in China Energy Partners LLC hold Series A Preferred stock which entitles them to vote 50.1% of the issued and outstanding
shares of common stock of the Company.



Director Independence



As of the date of this filing, we have
one independent director.



The Company has developed the following
categorical standards for determining the materiality of relationships that the Directors may have with the Company. A Director
shall not be deemed to have a material relationship with the Company that impairs the Director's independence as a result of any
of the following relationships:



- the Director is an officer or
other person holding a salaried position of an entity (other than a principal, equity partner or member of such entity) that provides
professional services to the Company and the amount of all payments from the Company to such entity during the most recently completed
fiscal year was less than two percent of such entity’s consolidated gross revenues;



- the Director is the beneficial
owner of less than five percent of the outstanding equity interests of an entity that does business with the Company;



- the Director is an executive
officer of a civic, charitable or cultural institution that received less than the greater of $1 million or two percent of its
consolidated gross revenues, as such term is construed by the New York Stock Exchange for purposes of Section 303A.02 (b) (v) of
the Corporate Governance Standards, from the Company or any of its subsidiaries for each of the last three fiscal years;



- the Director is an officer of
an entity that is indebted to the Company, or to which the Company is indebted, and the total amount of either the Company's or
the business entity's indebtedness is less than three percent of the total consolidated assets of such entity as of the end of
the previous fiscal year; and



- the Director obtained products
or services from the Company on terms generally available to customers of the Company for such products or services. The Board
retains the sole right to interpret and apply the foregoing standards in determining the materiality of any relationship.



The Board shall undertake an annual
review of the independence of all non-management Directors. To enable the Board to evaluate each non-management Director, in advance
of the meeting at which the review occurs, each non-management Director shall provide the Board with full information regarding
the Director’s business and other relationships with the Company, its affiliates and senior management.



Directors must inform the Board
whenever there are any material changes in their circumstances or relationships that could affect their independence, including
all business relationships between a Director and the Company, its affiliates, or members of senior management, whether or not
such business relationships would be deemed not to be material under any of the categorical standards set forth above. Following
the receipt of such information, the Board shall re-evaluate the Director's independence.



33







ITEM 14. PRINCIPAL ACCOUNTANT FEES AND
SERVICES



The following lists fees billed by Berman
& Co., current auditors for the Company, for the years ended November 30, 2012 and 2011:



|                   |  | 2012 |        |  | 2011 |  
|------------------ |  | ---- | ------ |  | ---- | -
|                   |  |      |        |  |      |  
|Audit Fees         |  | $    | 42,500 |  |      | $
|Audit Related Fees |  |      |        |  |      |  
|Tax Fees           |  |      | -      |  |      |  
|All Other Fees     |  | $    |        |  |      | $



In the event that we should require substantial
non-audit services, the audit committee would pre-approve such services and fees.



34







PART IV



ITEM 15. EXHIBITS



EXHIBITS



|Number |  | Description                                                                       |  |                    
|------ |  | --------------------------------------------------------------------------------- |  | -------------------
|       |  |                                                                                   |  |                    
|3.1    |  | Articles of Incorporation                                                         |  | Previously filed(1)
|       |  |                                                                                   |  |                    
|3.1(a) |  | Amendment to Articles of Incorporation                                            |  | Previously filed(1)
|       |  |                                                                                   |  |                    
|3.1(b) |  | Certificate of Designation of the Rights, Preferences and Privileges              |  |                    
|       |  | Of Series A Preferred Stock of BioPower Operations Corporation                    |  | Previously filed(1)
|       |  |                                                                                   |  |                    
|3.2    |  | Bylaws                                                                            |  | Previously filed(1)
|       |  |                                                                                   |  |                    
|4.1    |  | Specimen of Stock Certificate                                                     |  | Previously filed(1)
|       |  |                                                                                   |  |                    
|5.1    |  | Legal Opinion & Consent of Attorney                                               |  | Filed herewith     
|       |  |                                                                                   |  |                    
|10.1   |  | Employment Agreement between Robert Kohn and the Company dated January 5, 2011.   |  | Previously filed(1)
|       |  |                                                                                   |  |                    
|10.2   |  | Employment Agreement between Bonnie Nelson and the Company dated January 5, 2011. |  | Previously filed(1)
|       |  |                                                                                   |  |                    
|10.3   |  | Employment Agreement between Dale Shepherd and the Company dated January 5, 2011. |  | Previously filed(1)



35







|10.4  |  | Lock-Up Agreement between the Company and the Ford Irrevocable Trust, dated January 18, 2011                    |  | Previously filed(2) 
|----- |  | --------------------------------------------------------------------------------------------------------------- |  | --------------------
|      |  |                                                                                                                 |  |                     
|10.5  |  | Lock-Up Agreement between the Company and the Fox Irrevocable Trust, dated January 18, 2011                     |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.6  |  | Exclusive License Agreement between Clenergen Corporation and BioPower Corporation, dated November 30, 2010     |  | Previously filed(5) 
|      |  |                                                                                                                 |  |                     
|10.7  |  | Form of Subscription Agreement for Offering                                                                     |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.8  |  | Exclusive Fully Paid Up License Agreement between Green Oil Plantations LTD.                                    |  | Previously filed (4)
|      |  | and BioPower Operations Corporation                                                                             |  |                     
|      |  |                                                                                                                 |  |                     
|10.9  |  | Warrant to Purchase 1,000,000 shares of Common Stock of BioPower Operations Corporation, dated January 11, 2011 |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.10 |  | Lock-Up Agreement between the Company and Robert Kohn, dated January 18, 2011                                   |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.11 |  | Lock-Up Agreement between the Company and Janet Kohn, dated January 18, 2011                                    |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.12 |  | Lock-Up Agreement between the Company and Noslen, LLC, dated January 31, 2011                                   |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.13 |  | Lock-Up Agreement between the Company and LB Persistence, LLC, dated January 31, 2011                           |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.14 |  | Lock-Up Agreement between the Company and the David B. Cohen 2011 Irrevocable Trust, dated January 31, 2011     |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.15 |  | Lock-Up Agreement between the Company and the Cohen Family 2011 Irrevocable Trust, dated January 31, 2011       |  | Previously filed(2) 



36







|10.16 |  | Lock-Up Agreement between the Company and E10ST LLC, dated January 31, 2011                                     |  | Previously filed(2) 
|----- |  | --------------------------------------------------------------------------------------------------------------- |  | --------------------
|      |  |                                                                                                                 |  |                     
|10.17 |  | Lock-Up Agreement between the Company and the Jessica Leopold Irrevocable Trust, dated January 31, 2011         |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.18 |  | Lock-Up Agreement between the Company and Green Oil Plantations, Ltd, dated March 9, 2011                       |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.19 |  | Lock-Up Agreement between the Company and Dale Shepherd, dated January 23, 2011                                 |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.20 |  | Lock-Up Agreement between the Company and Riskless Partners, LLC, dated January 18, 2011                        |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.21 |  | Lock-Up Agreement between the Company and TipTop Irrevocable Trust, dated January 19, 2011                      |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.22 |  | Amended Exclusive License Agreement between Clenergen Corporation and BioPower Corporation, dated March 9, 2011 |  | Previously filed(2) 
|      |  |                                                                                                                 |  |                     
|10.23 |  | Demand Note, dated November 30, 2010, issued to Mr. Robert Kohn                                                 |  | Previously filed (4)
|      |  |                                                                                                                 |  |                     
|10.24 |  | Demand Note, dated November 30, 2010, issued to Ms. Bonnie Nelson                                               |  | Previously filed (4)
|      |  |                                                                                                                 |  |                     
|10.25 |  | Sublease, dated March 18, 2011 between the Company and Carlson Wagonlit Travel, Inc.                            |  | Previously filed (5)
|      |  |                                                                                                                 |  |                     
|10.26 |  | Amended Exclusive License Agreement between Clenergen Corporation and BioPower Corporation, dated March 9, 2011 |  | Previously filed (4)



37









|10.27 |  | Letter Agreement by and between the Company and Halcyon Cabot Ltd. dated January 5, 2012 |  |                             
|----- |  | ---------------------------------------------------------------------------------------- |  | ----------------------------
|      |  |                                                                                          |  |                             
|10.28 |  | Quture Advisory Agreement dated February 13, 2012 (7)                                    |  |                             
|      |  |                                                                                          |  |                             
|10.29 |  | Dale Shepherd, President of BioPower, Loan Agreement dated February 22, 2012             |  |                             
|      |  |                                                                                          |  |                             
|21.1  |  | List of Subsidiaries                                                                     |  | Previously filed(2)         
|      |  |                                                                                          |  |                             
|23.1  |  | Consent of Independent Registered Public Accounting Firm                                 |  | Filed herewith              
|      |  |                                                                                          |  |                             
|23.2  |  | Consent of Gersten Savage LLP (included in Exhibit 5.1)                                  |  | Previously
        Filed (6)



38







|31.1 |  | Certifications of Robert Kohn pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------
|     |  |                                                                                                                                                           
|31.2 |  | Certifications of Robert Kohn pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|     |  |                                                                                                                                                           
|32.1 |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                    
|     |  |                                                                                                                                                           
|101  |  | Interactive data files pursuant to Rule 405 of Regulation S-T                                                                                             



Footnotes:

|(1) | Incorporated by reference to our Registration Statement on Form S-1 (Reg. No. 333-172139) filed with the SEC on February 09, 2011.
|--- | ----------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                   
|(2) | Filed as an Exhibit to the Company’s Registration Statement on Form S-1, dated March 16, 2011.                                    
|    |                                                                                                                                   
|(3) | Filed as an Exhibit to the Company’s Registration Statement
on Form S-1, dated April 8, 2011.                                     
|    |                                                                                                                                   
|(4) | Filed as an Exhibit to the Company’s Registration Statement
on Form S-1, dated April 29, 2011.                                    
|    |                                                                                                                                   
|(5) | Filed as an Exhibit to the Company’s Registration Statement on Form S-1, dated May 18, 2011.                                      
|    |                                                                                                                                   
|(6) | Filed as an Exhibit to the Company’s Registration Statement
on Form S-1, dated July 21, 2011.                                     
|    |                                                                                                                                   
|(7) | Incorporated by reference to our Current Report on Form 8-K filed with the SEC on February 17, 2012.                              



39







SIGNATURES



Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly
authorized.



|                     | BIOPOWER OPERATIONS CORPORATION.
|-------------------- | --------------------------------
|                     |                                 
|                     |                                 
|                     |                                 
|Date: March 18, 2013 | By:                             
|                     |                                 
|                     |                                 



40









Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant in the capacities
and on the dates indicated.



|Name and Title                                                         |  | Date          
|---------------------------------------------------------------------- |  | --------------
|                                                                       |  |               
|                                                                       |  |               
|                                                                       |  |               
|/s/ Robert Kohn                                                        |  | March 18, 2013
|Robert Kohn                                                            |  |               
|Chief Executive Officer and Director                                   |  |               
|(Principal Executive officer)                                          |  |               
|                                                                       |  |               
|/s/ Robert Kohn                                                        |  | March 18, 2013
|Robert Kohn                                                            |  |               
|Chief Financial Officer and Director                                   |  |               
|(Principal Financial Officer and
        Principal Accounting Officer) |  |               





41







BioPower Operations Corporation and Subsidiaries



(A Development Stage Company)



Consolidated Financial Statements



November 30, 2012 and 2011













CONTENTS



|                                                                                                                                                                                   | Page(s)
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------
|                                                                                                                                                                                   |        
|Report of Independent Registered Public Accounting Firm                                                                                                                            | F-3    
|                                                                                                                                                                                   |        
|Balance Sheets – As of November 30, 2012 (Consolidated) and November 30, 2011                                                                                                      | F-4    
|                                                                                                                                                                                   |        
|Statements of Operations and accumulated other comprehensive loss
    –                                                                                                            |        
|Year Ended November 30, 2012 (Consolidated), from September 13, 2010 (Inception) to November 30, 2011, and from September 13, 2010 (Inception) to November 30, 2012 (Consolidated) | F-5    
|                                                                                                                                                                                   |        
|Statement of Stockholders’ Deficit –                                                                                                                                               |        
|From September 13, 2010 (Inception) to November 30, 2012 (Consolidated)                                                                                                            | F-6    
|                                                                                                                                                                                   |        
|Statements of Cash Flows –                                                                                                                                                         |        
|Year Ended November 30, 2012 (Consolidated), from September 13, 2010 (Inception) to November 30, 2011, and from September 13, 2010 (Inception) to November 30, 2012 (Consolidated) | F-7    
|                                                                                                                                                                                   |        
|Notes to Consolidated Financial Statements                                                                                                                                         | F-8    





F-2













REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM



To the Board of Directors and Stockholders
of:

BioPower Operations Corporation



We have audited the accompanying consolidated
balance sheets of BioPower Operations Corporation and Subsidiaries, (a development stage company) as of November 30, 2012 and 2011,
and the related consolidated statements of operations and comprehensive loss, stockholders’ deficit and cash flows for the
years ended November 30, 2012 and 2011 and the period from September 13, 2010 (inception) to November 30, 2012. These financial
statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements
based on our audits.



We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company
is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits
included considerations of internal control over financial reporting as a basis for designing audit procedures that are appropriate
in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control
over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide
a reasonable basis for our opinion.



In our opinion, the consolidated financial
statements referred to above present fairly, in all material respects, the consolidated financial position of BioPower Operations
Corporation and Subsidiaries as of November 30, 2012 and 2011, and the results of its operations and comprehensive loss, and its
cash flows for the years ended November 30, 2012 and 2011 and the period from September 13, 2010 (inception) to November 30, 2012,
in conformity with accounting principles generally accepted in the United States of America.



The accompanying financial statements have
been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the consolidated financial
statements, the Company has a net loss of $1,274,448 and net cash used in operations of $242,190 for the year ended November 30,
2012. The Company also has a working capital deficit of $1,483,467 and a stockholders’ deficit of $1,478,046 at November
30, 2012. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s
plan in regards to these matters is also described in Note 3. The consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.



Berman & Company, P.A.







Boca Raton, Florida

March 15, 2013









F-3









|BioPower Operations Corporation and Subsidiaries
|------------------------------------------------
|(A Development Stage Company)                   
|Consolidated Balance Sheets                     



|                                                                                                                        |  | November 30, 2012 |            |   | November 30, 2011 |  
|----------------------------------------------------------------------------------------------------------------------- |  | ----------------- | ---------- | - | ----------------- | -
|Assets                                                                                                                  |  |                   |            |   |                   |  
|Current Assets                                                                                                          |  |                   |            |   |                   |  
|Cash                                                                                                                    |  | $                 | 16,956     |   |                   | $
|Available-for-sale securities                                                                                           |  |                   | 38,250     |   |                   |  
|Prepaid expenses                                                                                                        |  |                   | 682        |   |                   |  
|Total Current Assets                                                                                                    |  |                   | 55,888     |   |                   |  
|                                                                                                                        |  |                   |            |   |                   |  
|Equipment - net                                                                                                         |  |                   | 18,761     |   |                   |  
|                                                                                                                        |  |                   |            |   |                   |  
|Other Assets                                                                                                            |  |                   |            |   |                   |  
|License - net                                                                                                           |  |                   | -          |   |                   |  
|Security deposit                                                                                                        |  |                   | 11,660     |   |                   |  
|Total Other Assets                                                                                                      |  |                   | 11,660     |   |                   |  
|                                                                                                                        |  |                   |            |   |                   |  
|Total Assets                                                                                                            |  | $                 | 86,309     |   |                   | $
|                                                                                                                        |  |                   |            |   |                   |  
|Liabilities and Stockholders' Deficit                                                                                   |  |                   |            |   |                   |  
|                                                                                                                        |  |                   |            |   |                   |  
|Current Liabilities                                                                                                     |  |                   |            |   |                   |  
|Accounts payable and accrued expenses                                                                                   |  | $                 | 413,586    |   |                   | $
|Accounts payable and accrued expenses - related parties                                                                 |  |                   | 755,365    |   |                   |  
|Deferred consulting revenue                                                                                             |  |                   | 31,429     |   |                   |  
|Common stock payable                                                                                                    |  |                   | 208,500    |   |                   |  
|Note payable                                                                                                            |  |                   | 89,800     |   |                   |  
|Notes payable - related parties                                                                                         |  |                   | 40,675     |   |                   |  
|Convertible debt - net                                                                                                  |  |                   | -          |   |                   |  
|Total Current Liabilities                                                                                               |  |                   | 1,539,355  |   |                   |  
|                                                                                                                        |  |                   |            |   |                   |  
|Long-Term Liabilities                                                                                                   |  |                   |            |   |                   |  
|Deferred consulting revenue                                                                                             |  |                   | 25,000     |   |                   |  
|Total Long Term Liabilities                                                                                             |  |                   | 25,000     |   |                   |  
|Total Liabilities                                                                                                       |  |                   | 1,564,355  |   |                   |  
|                                                                                                                        |  |                   |            |   |                   |  
|Stockholders' Deficit                                                                                                   |  |                   |            |   |                   |  
|Preferred stock, $1 par value; 10,000 shares authorized; 1 share issued and outstanding                                 |  |                   | 1          |   |                   |  
|Common stock, $0.0001 par value, 500,000,000 shares authorized; 90,280,000 and 90,280,000 shares issued and outstanding |  |                   | 9,028      |   |                   |  
|Additional paid-in capital                                                                                              |  |                   | 795,162    |   |                   |  
|Deficit accumulated during the development stage                                                                        |  |                   | (2,244,437 | ) |                   |  
|Accumulated other comprehensive loss                                                                                    |  |                   | (37,800    | ) |                   |  
|Total Stockholders' Deficit                                                                                             |  |                   | (1,478,046 | ) |                   |  
|                                                                                                                        |  |                   |            |   |                   |  
|Total Liabilities and Stockholders' Deficit                                                                             |  | $                 | 86,309     |   |                   | $



See accompanying notes to consolidated financial statements



F-4







|BioPower Operations Corporation and Subsidiaries                                  
|----------------------------------------------------------------------------------
|(A Development Stage Company)                                                     
|Consolidated Statements of Operations
    and accumulated other comprehensive loss



|                                                                                                    |  | Year Ended November 30, 2012 |            |   | September 13, 2010 (Inception) |  
|--------------------------------------------------------------------------------------------------- |  | ---------------------------- | ---------- | - | ------------------------------ | -
|                                                                                                    |  | 2012                         |            |   | 2011                           |  
|                                                                                                    |  |                              |            |   |                                |  
|Expenses                                                                                            |  |                              |            |   |                                |  
|General and administrative expenses                                                                 |  | $                            | 421,155    |   |                                | $
|General and administrative expenses - related parties                                               |  |                              | 563,715    |   |                                |  
|Total                                                                                               |  |                              | 984,870    |   |                                |  
|                                                                                                    |  |                              |            |   |                                |  
|Other Income (Expense)                                                                              |  |                              |            |   |                                |  
|Consulting revenue                                                                                  |  |                              | 63,571     |   |                                |  
|Interest expense                                                                                    |  |                              | (51,665    | ) |                                |  
|Interest expense - related parties                                                                  |  |                              | (69,299    | ) |                                |  
|Loan cost                                                                                           |  |                              | (6,250     | ) |                                |  
|Loss on impairment of license agreement                                                             |  |                              | (240,795   | ) |                                |  
|Gain on settlement of consulting revenue receivable                                                 |  |                              | 133,500    |   |                                |  
|Loss on sale of available-for-sale
    marketable securities                                        |  |                              | (118,640   | ) |                                |  
|Total Other (Expense) - net                                                                         |  |                              | (289,578   | ) |                                |  
|                                                                                                    |  |                              |            |   |                                |  
|Net loss                                                                                            |  |                              | (1,274,448 | ) |                                |  
|                                                                                                    |  |                              |            |   |                                |  
|Net loss per common share - basic and diluted                                                       |  | $                            | (0.01      | ) |                                | $
|                                                                                                    |  |                              |            |   |                                |  
|Weighted average number
    of common shares outstanding during the year/period - basic and diluted |  |                              | 90,280,000 |   |                                |  
|                                                                                                    |  |                              |            |   |                                |  
|Comprehensive loss                                                                                  |  |                              |            |   |                                |  
|Net loss                                                                                            |  | $                            | (1,274,448 | ) |                                | $
|Unrealized loss on available-for-sale marketable
    securities                                     |  |                              | (37,800    | ) |                                |  
|Comprehensive loss                                                                                  |  | $                            | (1,312,248 | ) |                                | $



See accompanying notes to consolidated financial statements



F-5







|BioPower Operations Corporation and Subsidiaries        
|--------------------------------------------------------
|(A Development Stage Company)                           
|Consolidated Statement of Stockholders' Deficit         
|From September 13, 2010 (Inception) to November 30, 2012



|                                                               |  |                                   |   |  |                                     |   |   |         |  |  | Additional         |   |  | Deficit       |       |   | Accumulated Other |   |         | Total | 
|-------------------------------------------------------------- |  | --------------------------------- | - |  | ----------------------------------- | - | - | ------- |  |  | ------------------ | - |  | ------------- | ----- | - | ----------------- | - | ------- | ----- | 
|                                                               |  | Preferred Stock, $1
    Par Value |   |  | Common Stock, $0.0001
    Par Value |   |   | Paid In |  |  | Accumulated during |   |  | Comprehensive |       |   | Stockholder's     |  
|                                                               |  | Shares                            |   |  | Amount                              |   |   | Shares  |  |  | Amount             |   |  | Capital       |       |   | Development Stage |   |         | Loss  | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Issuance of common stock - founders ($0.0001)                  |  |                                   | - |  |                                     | $ | - |         |  |  | 10,000             |   |  | $             | 1     |   |                   | $ | -       |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Net loss - September 13, 2010 (Inception) to November 30, 2010 |  |                                   | - |  |                                     |   | - |         |  |  | -                  |   |  |               | -     |   |                   |   | -       |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Balance - November 30, 2010                                    |  |                                   | - |  |                                     |   | - |         |  |  | 10,000             |   |  |               | 1     |   |                   |   | -       |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Cancellation of common stock - founders                        |  |                                   | - |  |                                     |   | - |         |  |  | (10,000            | ) |  |               | (1    | ) |                   |   | -       |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Issuance of preferred stock - founders ($1/share)              |  |                                   | 1 |  |                                     |   | 1 |         |  |  | -                  |   |  |               | -     |   |                   |   | -       |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Issuance of common stock - founders ($0.0001/share)            |  |                                   | - |  |                                     |   | - |         |  |  | 32,500,000         |   |  |               | 3,250 |   |                   |   | -       |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Issuance of common stock - related parties ($0.0001/share)     |  |                                   | - |  |                                     |   | - |         |  |  | 12,300,000         |   |  |               | 1,230 |   |                   |   | -       |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Issuance of common stock ($0.0001/share)                       |  |                                   | - |  |                                     |   | - |         |  |  | 39,100,000         |   |  |               | 3,910 |   |                   |   | -       |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Issuance of common stock ($0.25/share)                         |  |                                   | - |  |                                     |   | - |         |  |  | 1,200,000          |   |  |               | 120   |   |                   |   | 299,880 |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Issuance of common stock ($0.50/share)                         |  |                                   | - |  |                                     |   | - |         |  |  | 30,000             |   |  |               | 3     |   |                   |   | 14,997  |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Issuance of common stock for services rendered ($0.012/share)  |  |                                   | - |  |                                     |   | - |         |  |  | 4,150,000          |   |  |               | 415   |   |                   |   | 49,585  |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Issuance of common stock for license ($0.25/share)             |  |                                   | - |  |                                     |   | - |         |  |  | 1,000,000          |   |  |               | 100   |   |                   |   | 249,900 |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Warrants issued for services rendered                          |  |                                   | - |  |                                     |   | - |         |  |  | -                  |   |  |               | -     |   |                   |   | 60,800  |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Debt discount - related party                                  |  |                                   | - |  |                                     |   | - |         |  |  | -                  |   |  |               | -     |   |                   |   | 30,000  |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Net loss for the year ended November 30, 2011                  |  |                                   | - |  |                                     |   | - |         |  |  | -                  |   |  |               | -     |   |                   |   | -       |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Balance - November 30, 2011                                    |  |                                   | 1 |  |                                     |   | 1 |         |  |  | 90,280,000         |   |  |               | 9,028 |   |                   |   | 705,162 |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Debt discount                                                  |  |                                   | - |  |                                     |   | - |         |  |  | -                  |   |  |               | -     |   |                   |   | 50,000  |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Debt Discount - related party                                  |  |                                   | - |  |                                     |   | - |         |  |  | -                  |   |  |               | -     |   |                   |   | 40,000  |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Unrealized loss on available-for-sale marketable securities    |  |                                   | - |  |                                     |   | - |         |  |  | -                  |   |  |               | -     |   |                   |   | -       |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Net loss for the year ended November 30, 2012                  |  |                                   | - |  |                                     |   | - |         |  |  | -                  |   |  |               | -     |   |                   |   | -       |       | 
|                                                               |  |                                   |   |  |                                     |   |   |         |  |  |                    |   |  |               |       |   |                   |   |         |       | 
|Balance - November 30, 2012                                    |  |                                   | 1 |  |                                     | $ | 1 |         |  |  | 90,280,000         |   |  | $             | 9,028 |   |                   | $ | 795,162 |       | 



See accompanying notes to consolidated financial statements



F-6







|BioPower Operations Corporation and Subsidiaries
|------------------------------------------------
|(A Development Stage Company)                   
|Consolidated Statements of Cash Flows           





|                                                                                       |  | Year Ended
    November 30, |            |   | September
    13, 2010 (Inception) |  
|-------------------------------------------------------------------------------------- |  | --------------------------- | ---------- | - | ---------------------------------- | -
|                                                                                       |  | 2012                        |            |   | 2011                               |  
|CASH FLOWS FROM OPERATING ACTIVITIES:                                                  |  |                             |            |   |                                    |  
|Net loss                                                                               |  | $                           | (1,274,448 | ) |                                    | $
|Adjustments to reconcile net
    loss to net cash used in operating activities:        |  |                             |            |   |                                    |  
|Amortization of license                                                                |  |                             | 5,000      |   |                                    |  
|Impairment of license                                                                  |  |                             | 240,795    |   |                                    |  
|Depreciation                                                                           |  |                             | 5,552      |   |                                    |  
|Amortization of debt discount                                                          |  |                             | 116,429    |   |                                    |  
|Loan cost                                                                              |  |                             | 6,250      |   |                                    |  
|Stock issued for services
    rendered                                                 |  |                             | -          |   |                                    |  
|Warrants issued for services
    rendered                                              |  |                             | -          |   |                                    |  
|Available-for-sale
    securities     received as consideration for consulting revenue |  |                             | (120,000   | ) |                                    |  
|Gain on settlement of consulting revenue receivable                                    |  |                             | (133,500   | ) |                                    |  
|Loss on sale of available-for-sale
    marketable securities                           |  |                             | 118,640    |   |                                    |  
|Changes in operating assets
    and liabilities:                                       |  |                             |            |   |                                    |  
|(Increase)/Decrease in:                                                                |  |                             |            |   |                                    |  
|Prepaid expenses                                                                       |  |                             | 5,672      |   |                                    |  
|Security deposit                                                                       |  |                             | -          |   |                                    |  
|Increase/(Decrease) in:                                                                |  |                             |            |   |                                    |  
|Accounts payable and accrued
    liabilities                                           |  |                             | 325,811    |   |                                    |  
|Accounts payable and accrued
    liabilities - related party                           |  |                             | 296,680    |   |                                    |  
|Common stock payable for services rendered                                             |  |                             | 108,500    |   |                                    |  
|Deferred
    revenue                                                                   |  |                             | 56,429     |   |                                    |  
|Net
    Cash Used In Operating Activities                                              |  |                             | (242,190   | ) |                                    |  
|                                                                                       |  |                             |            |   |                                    |  
|CASH FLOWS FROM INVESTING ACTIVITIES:                                                  |  |                             |            |   |                                    |  
|Proceeds from the sale of
    available-for-sale securities                            |  |                             | 52,560     |   |                                    |  
|Purchase of equipment                                                                  |  |                             | -          |   |                                    |  
|Net
    Cash Provided By (Used In) Investing Activities                                |  |                             | 52,560     |   |                                    |  
|                                                                                       |  |                             |            |   |                                    |  
|CASH FLOWS FROM FINANCING ACTIVITIES:                                                  |  |                             |            |   |                                    |  
|Proceeds from convertible
    debt                                                     |  |                             | 50,000     |   |                                    |  
|Proceeds from convertible
    debt - related party                                     |  |                             | 40,000     |   |                                    |  
|Proceeds from notes payable
    - related parties                                      |  |                             | 42,092     |   |                                    |  
|Proceeds from notes payable                                                            |  |                             | 20,800     |   |                                    |  
|Repayment of notes payable
    - related parties                                       |  |                             | (1,417     | ) |                                    |  
|Repayment of notes payable                                                             |  |                             | (1,000     | ) |                                    |  
|Proceeds from issuance of
    preferred stock                                          |  |                             | -          |   |                                    |  
|Proceeds
    from issuance of common stock to be issued                                |  |                             | 50,000     |   |                                    |  
|Net
    Cash Provided By Financing Activities                                          |  |                             | 200,475    |   |                                    |  
|                                                                                       |  |                             |            |   |                                    |  
|Net Increase (Decrease) in
    Cash                                                    |  |                             | 10,845     |   |                                    |  
|                                                                                       |  |                             |            |   |                                    |  
|Cash - Beginning of Year/Period                                                        |  |                             | 6,111      |   |                                    |  
|                                                                                       |  |                             |            |   |                                    |  
|Cash - End of Year/Period                                                              |  | $                           | 16,956     |   |                                    | $
|                                                                                       |  |                             |            |   |                                    |  
|SUPPLEMENTARY CASH FLOW INFORMATION:                                                   |  |                             |            |   |                                    |  
|Cash Paid During the Period
    for:                                                   |  |                             |            |   |                                    |  
|Income
    Taxes                                                                       |  | $                           | -          |   |                                    | $
|Interest                                                                               |  | $                           | -          |   |                                    | $
|                                                                                       |  |                             |            |   |                                    |  
|SUPPLEMENTARY DISCLOSURE OF
    NON-CASH INVESTING AND FINANCING ACTIVITIES:           |  |                             |            |   |                                    |  
|                                                                                       |  |                             |            |   |                                    |  
|Issuance of common stock
    for license                                               |  | $                           | -          |   |                                    | $
|Debt discount recorded
    on convertible debt                                         |  | $                           | 50,000     |   |                                    | $
|Debt discount recorded
    on convertible debt - related party                         |  | $                           | 40,000     |   |                                    | $
|Conversion of convertible debt to common Stock Payable                                 |  | $                           | 50,000     |   |                                    | $
|Reclassification of related party note to third party note payable                     |  | $                           | 70,000     |   |                                    | $
|Cancellation of common
    stock - founders                                            |  | $                           | -          |   |                                    | $





See accompanying notes to consolidated financial statements



F-7







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



Note 1 Nature of Operations



BioPower Corporation (“BioPower”
or “the Company”) was incorporated in the State of Florida on September 13, 2010. On January 5, 2011, the Company
re-domiciled to Nevada and formed BioPower Operations Corporation, a Nevada corporation. On January 6, 2011, the shareholders
of BioPower Corporation contributed their shares of BioPower Corporation to BioPower Operations Corporation and BioPower Corporation
became a wholly-owned subsidiary.



The Company intends to grow biomass crops
and will use milling operations to produce oils, biofuels, electricity and other biomass products. The Company also intends to license, joint venture and build facilities by utilizing its license for the patented technology
that converts, poultry, hog, human and sugar wastes to cellulosic ethanol, fertilizer and other products.





On June 8, 2012, the Company's Chief Executive Officer contributed
100% of his member interest in FTZ Exchange, LLC, (“FTZ”) which became a 100% wholly subsidiary to the Company for
no consideration. On the date of contribution, FTZ has a 50-50 joint venture, known as, the Qx Health Exchange (“QX”)
and a wholly-owned subsidiary, called FTZ Energy Exchange Corporation, which intends to launch an energy exchange. FTZ is a licensing
company which intends to use its business know-how to develop multiple distribution channels, known as exchanges, for the sale
of various products and services. On the date of contribution, FTZ had a nominal net book value.



The Company’s fiscal year end is
November 30.



Note 2 Summary of Significant Accounting
Policies



Principles of Consolidation



All inter-company accounts and transactions have been eliminated
in consolidation.



Development Stage



The Company's consolidated financial statements
are presented as those of a development stage enterprise. Activities during the development stage primarily include negotiating
distribution agreements and marketing the territory for distribution outlets for the product. The Company, while seeking to implement
its business plan, will look to obtain additional debt and/or equity related funding opportunities. The Company has not generated
any revenues from its planned and principal operations since inception.



Risks and Uncertainties



The Company intends to operate in an industry
that is subject to rapid change. The Company's operations will be subject to significant risk and uncertainties including financial,
operational, technological, regulatory and other risks, including the potential risk of business failure. Also, see Note 3 regarding
going concern matters.



F-8







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



Use of Estimates



The preparation of financial statements
in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period.



Such estimates and assumptions for the
periods ended November 30, 2012 and 2011, affect, among others, the following:



| | · | estimated
                                                                                                               fair value of share
                                                                                                               based payments,
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | estimated
                                                                                                               carrying value,
                                                                                                               useful lives and
                                                                                                               related impairment
                                                                                                               of equipment and
                                                                                                               intangible assets;
                                                                                                               and
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | estimated
                                                                                                               valuation allowance
                                                                                                               for deferred tax
                                                                                                               assets, due to
                                                                                                               continuing and
                                                                                                               expected future
                                                                                                               losses
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Making estimates requires management to
exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or
set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate
could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly
from estimates.



Cash



The Company considers all highly liquid
instruments purchased with a maturity of three months or less and money market accounts to be cash equivalents. The Company had
no cash equivalents at November 30, 2012 and 2011.



Marketable
Securities



(A) Classification
of Securities



At the time of acquisition, a
security is designated as held-to-maturity (“HTM”), available-for-sale (“AFS”), or trading, which
depends on ability and intent to hold such security to maturity. Securities classified as trading and AFS are reported at
fair value, while securities classified as HTM are reported at amortized cost.



Any unrealized gains and losses are reported
as other comprehensive income (loss). Realized gains (losses) are computed on a specific identification basis and are recorded
in net capital gains (losses) on investments in the combined consolidated statements of operations.



During 2012, the Company sold
10,000,000 shares of their AFS securities, having a cost basis of $169,000 (0.0169/share), for proceeds of $52,560, resulting
in a loss on sale of $116,440. In addition, the Company was required to pay 500,000 shares in AFS securities, having a
cost basis of $8,450 and FMV of $6,250 as a collection fee, which resulted in an additional loss of $2,200. See Note 12



F-9







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



The Company’s cost basis in AFS
was as follows:



|                             |  | Amount |          |   | Shares | 
|---------------------------- |  | ------ | -------- | - | ------ | 
|AFS Acquired – February 2012 |  | $      | 253,500  |   |        | 
|Sales in 2012 – at cost      |  |        | (169,000 | ) |        | 
|Collection fee               |  |        | (8,450   | ) |        | 
|Balance – November 30, 2012  |  | $      | 76,050   |   |        | 



The composition of the Company’s
investments at November 30, 2012, classified as current assets, is as follows:



|                                    |  | Cost |        |  | Fair Value |   |        | Unrealized Loss | 
|----------------------------------- |  | ---- | ------ |  | ---------- | - | ------ | --------------- | 
|Common stock – public company       |  | $    | 76,050 |  |            | $ | 38,250 |                 | 
|Total available for sale securities |  | $    | 76,050 |  |            | $ | 38,250 |                 | 



Investment income (loss) for the year ended
November 30, 2012 and 2011 is as follows:



|                                                                 |  | 2012 |          |   | 2011 |  
|---------------------------------------------------------------- |  | ---- | -------- | - | ---- | -
|                                                                 |  |      |          |   |      |  
|Gross realized losses from sale of available for sale securities |  | $    | (118,640 | ) |      | $
|Net unrealized holding gain (loss)                               |  |      | (37,800  | ) |      |  
|Net investment income (loss)                                     |  | $    | (156,440 | ) |      | $



The Company
has a 100% concentration on one publicly traded stock.



(B) Impairment



The Company reviews its equity investment
portfolio for any unrealized losses that would be deemed other-than-temporary and require the recognition of an impairment loss
in income. If the cost of an investment exceeds its fair value, the Company evaluates, among other factors, general market conditions,
the duration and extent to which the fair value is less than cost, and the Company’s intent and ability to hold the investments.
Management also considers the type of security, related-industry and sector performance, as well as published investment ratings
and analyst reports, to evaluate its portfolio. Once a decline in fair value is determined to be other than temporary, an impairment
charge is recorded and a new cost basis in the investment is established. If market, industry, and/or investee conditions deteriorate,
the Company may incur future impairments. At November 30, 2012, no such impairments were recorded.



F-10







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



Equipment



Equipment is stated at cost, less accumulated
depreciation computed on a straight-line basis over the estimated useful lives. Maintenance and repairs are charged to operations
when incurred.  Betterments and renewals are capitalized when deemed material.  When equipment is sold or
otherwise disposed of, the asset account and related accumulated depreciation account are relieved, and any gain or loss is included
in operations.



Equipment is reviewed for impairment whenever
events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  There were
no impairment charges taken during the periods ended November 30, 2012 and 2011.



Intangible Assets



Identifiable intangible assets with finite
lives are amortized over their estimated useful lives and are reviewed for impairment if indicators of potential impairment exist.
See Notes 8(c) and 9.



Investment in Joint Venture



FTZ has entered into a Joint Venture with
QX, a third party, to engage in the business of becoming an independent medical & health network for hospitals, physicians,
outpatient and urgent care centers, dental care, vision care, insurance companies, alternative medicine, medical tourism, pharmaceutical
companies, vendors and patients.



FTZ owns fifty percent of the QX joint
venture and will record its investment on the equity basis of accounting. The Company’s proportionate share of expenses
incurred by the Joint Venture will be charged to the statement of operations and adjusted against the Investment in Joint Venture.
Losses from the Joint Venture are only recognized until the investment in the Joint Venture is reduced to zero. Losses in excess
of the investment must be restored from future profits before the Company can recognize its proportionate share of profits.



As of November 30, 2012, the Joint Venture
had no activity.



Convertible debt, Beneficial
Conversion Feature and Debt Discount



For conventional convertible debt where
the rate of conversion is below market value at the date of the agreement, the Company records a “beneficial conversion
feature” (“BCF”) and related debt discount.



When the Company records a BCF, the relative
fair value of the BCF would be recorded as a debt discount against the face amount of the respective debt instrument. The discount
would be amortized to interest expense over the life of the debt. When a conversion of the underlying debt occurs, a proportionate
share of the unamortized amounts is immediately expensed.



F-11







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



Derivative Liabilities



Fair value accounting requires bifurcation
of embedded derivative instruments such as conversion features in convertible debt or equity instruments, and measurement of their
fair value for accounting purposes. In determining the appropriate fair value, the Company expects to use the Black-Scholes option-pricing
model. In assessing the convertible debt instruments, management would determine if the convertible debt host instrument is conventional
convertible debt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered
conventional convertible debt, the Company will continue its evaluation process of these instruments as derivative financial instruments.



Once determined, derivative liabilities
are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded
in results of operations as an adjustment to fair value of derivatives. In addition, the fair value of freestanding derivative
instruments such as warrants, are also valued using the Black-Scholes option-pricing model.



Share-based payments



The Company recognizes all forms of share-based
payments, including stock option grants, warrants, and restricted stock grants, at their fair value on the grant date, which are
based on the estimated number of awards that are ultimately expected to vest.



Share based
payments, excluding restricted stock, are valued using a Black-Scholes option pricing model.Share based payment awards
issued to non-employees for services rendered are recorded at either the fair value of the services rendered or the fair value
of the share-based payment, whichever is more readily determinable.



The grants
are amortized on a straight-line basis over the requisite service periods, which is generally the vesting period. If an
award is granted, but vesting does not occur, any previously recognized compensation cost is reversed in the period related to
the termination of service.



When computing fair value, the Company
may consider the following variables:



| | ● | The
                                                                                                            risk-free interest
                                                                                                            rate assumption is
                                                                                                            based on the U.S.
                                                                                                            Treasury yield for
                                                                                                            a period consistent
                                                                                                            with the expected
                                                                                                            term of the option
                                                                                                            in effect at the time
                                                                                                            of the grant.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | The
                                                                                                            Company has not paid
                                                                                                            any dividends on common
                                                                                                            stock since inception
                                                                                                            and does not anticipate
                                                                                                            paying dividends on
                                                                                                            its common stock in
                                                                                                            the near future.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | The
                                                                                                                              expected
                                                                                                                              option
                                                                                                                              term
                                                                                                                              is
                                                                                                                              computed
                                                                                                                              using
                                                                                                                              the
                                                                                                                              “simplified”
                                                                                                                              method
                                                                                                                              as
                                                                                                                              permitted
                                                                                                                              under
                                                                                                                              the
                                                                                                                              provisions
                                                                                                                              of
                                                                                                                              Staff
                                                                                                                              Accounting
                                                                                                                              Bulletin
                                                                                                                              (“SAB”) 110.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-12







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



| | ● | The
                                                                                                            expected volatility
                                                                                                            is based on the historical
                                                                                                            volatility of the
                                                                                                            Company’s common
                                                                                                            stock, based on the
                                                                                                            daily quoted closing
                                                                                                            trading prices.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ● | The forfeiture rate is based on the historical forfeiture
rate for unvested stock options.
| | - | ------------------------------------------------------------------------------------------



As of November 30, 2012, all shares not yet issued are included as a component of common stock payable.



Earnings per share



Basic earnings (loss) per share is computed
by dividing net income (loss) by weighted average number of shares of common stock outstanding during each period. Diluted earnings
(loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock, common stock
equivalents and potentially dilutive securities outstanding during the period. The Company does not include shares not yet issued that were included as a component of common stock payable
in the earnings per share calculation.



Since the Company reflected a net loss
in 2012 and 2011, considering any common stock equivalents, if exercisable, would have been anti-dilutive. A separate computation
of diluted earnings (loss) per share is not presented.



The Company has the following potential
common stock equivalents at November 30, 2012 and 2011:



|                               |  | November 30, 2012 |   |  | November 30, 2011 | 
|------------------------------ |  | ----------------- | - |  | ----------------- | 
|                               |  |                   |   |  |                   | 
|Warrants (1)                   |  |                   | - |  |                   | 
|Convertible debt (2)           |  |                   | - |  |                   | 
|Total common stock equivalents |  |                   | - |  |                   | 



(1) On January 11, 2012, the 1,000,000 warrants expired unexercised.

(2)
As of November 30, 2012, the convertible notes matured and were reclassified to demand notes.

Also see Note 7.



Income Taxes



Provisions for income taxes are calculated
based on reported pre-tax earnings and current tax law.



Significant judgment is required in determining
income tax provisions and evaluating tax positions. The Company periodically assesses its liabilities and contingencies for all
periods that are currently open to examination or have not been effectively settled based on the most current available information.
When it is not more likely than not that a tax position will be sustained, the Company records its best estimate of the resulting
tax liability and any applicable interest and penalties in the financial statements.



F-13







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



Deferred tax assets and liabilities are
recorded for temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial
statements using statutory rates in effect for the year in which the differences are expected to reverse. The Company presents
the tax effects of these deferred tax assets and liabilities separately for each major tax jurisdiction.



The effect on deferred tax assets and
liabilities of a change in tax rates is recognized in the results of operations in the period that the changes are enacted. The
Company records a valuation allowance to reduce deferred tax assets when it is more likely than not that some portion of the asset
may not be realized. The Company evaluates its deferred tax assets and liabilities on a periodic basis.



Deferred Revenue



Deferred revenue represents revenues that
were received, but not earned as of November 30, 2012. This is composed of revenues for advisory fees that were received in advance
and will be recorded as revenue when earned over the term of the consulting agreement. See Note 12.



Recent Accounting Pronouncements



There are no new accounting pronouncements
that are expected to have any material impact on the Company’s consolidated financial statements.



Reclassification



We have reclassified certain prior period amounts to conform to the current period presentation. These reclassifications have
no effect on the financial position or on the results of operations or cash flows for the periods presented.





Note 3 Going Concern



As reflected in the accompanying consolidated
financial statements, the Company had a net loss of $1,274,448 and net cash used in operations of $242,190 for the year ended
November 30, 2012; and a working capital deficit of $1,483,467 and a stockholders’ deficit of $1,478,046 at November 30,
2012. These factors raise substantial doubt about the Company’s ability to continue as a going concern.



The ability of the Company to continue
as a going concern is dependent on Management's plans, which include potential asset acquisitions, mergers or business combinations
with other entities, further implementation of its business plan and continuing to raise funds through debt or equity financings.
The Company will likely rely upon related party debt or equity financing in order to ensure the continuing existence of the business.



The accompanying consolidated financial
statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities
in the normal course of business. These financial statements do not include any adjustments relating to the recovery of the recorded
assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.



Note 4 Equipment



At November 30, 2012 and 2011, equipment
consists of the following:



|                               |  | 2012 |        |   | 2011 |   |        | Estimated Useful Life
|------------------------------ |  | ---- | ------ | - | ---- | - | ------ | ---------------------
|Computer Equipment             |  | $    | 27,760 |   |      | $ | 27,760 |                      
|Less: Accumulated depreciation |  |      | (8,999 | ) |      |   | (3,447 | )                    
|Equipment, net                 |  | $    | 18,761 |   |      | $ | 24,313 |                      



F-14







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



Note 5 Income Taxes



The Company recognizes deferred tax assets and liabilities
for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and
for the expected future tax benefit to be derived from tax losses and tax credit carryforwards.  The Company has established
a valuation allowance to reflect the likelihood of the realization of deferred tax assets.



The Company has a net operating loss carryforward for tax purposes
totaling approximately $560,000 at November 30, 2012, expiring through 2032. U.S. Internal Revenue Code Section 382 places a limitation
on the amount of taxable income that can be offset by carryforwards after a change in control (generally greater than a 50% change
in ownership).  Temporary differences, which give rise to a net deferred tax asset, are as follows:



Significant deferred tax assets at November 30, 2012 and 2011
are approximately as follows:



|                                 |  | 2012 |          |   | 2011 |  
|-------------------------------- |  | ---- | -------- | - | ---- | -
|Gross deferred tax assets:       |  |      |          |   |      |  
|Net operating loss carryforwards |  | $    | 229,000  |   |      | $
|Accrued payroll/taxes            |  |      | 340,000  |   |      |  
|Total deferred tax assets        |  |      | 569,000  |   |      |  
|Less: valuation allowance        |  |      | (569,000 | ) |      |  
|Net deferred tax asset recorded  |  | $    | -        |   |      | $



The valuation allowance at November
30, 2011 was approximately $225,000. The net change in valuation allowance during the period ended November 30, 2012 was an
increase of approximately $344,000.



In assessing the reliability of deferred tax assets, management
considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized.  The
ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods
in which those temporary differences become deductible.  Management considers the scheduled reversal of deferred income
tax liabilities, projected future taxable income, and tax planning strategies in making this assessment.   Based
on consideration of these items, management has determined that enough uncertainty exists relative to the realization of the deferred
income tax asset balances to warrant the application of a full valuation allowance as of November 30, 2012.



F-15







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



The actual tax benefit differs from the expected tax benefit
for the period ended November 30, 2012 and 2011 (computed by applying the U.S. Federal Corporate tax rate of 34% to income before
taxes and 5.5% for State income taxes, a blended rate of 37.63%) approximately as follows:



|                                                 |  | 2012 |          |   | 2011 |  
|------------------------------------------------ |  | ---- | -------- | - | ---- | -
|Expected tax expense (benefit) - Federal         |  | $    | (410,000 | ) |      | $
|Expected tax expense (benefit) - State           |  |      | (70,000  | ) |      |  
|Meals and Entertainment @50%                     |  |      | 4,000    |   |      |  
|Impairment loss on license agreement             |  |      | 91,000   |   |      |  
|Stock/stock options/warrants issued for services |  |      | 41,000   |   |      |  
|Change in valuation allowance                    |  |      | 344,000  |   |      |  
|Actual tax expense (benefit)                     |  | $    | -        |   |      | $



Note 6 Notes Payable – Related
Parties



| | (A) | Period Ended November 30,
                                                                   2010
| | --- | -------------------------------------------------------------------------------------------------



During November 2010, the Company’s
Chief Executive Officer advanced $10,927. The loan bears interest at 4%, is unsecured and due on demand.



During November 2010, a Company Director
advanced $10,000. The loan bears interest at 4%, is unsecured and due on demand.



| | (B) | Year Ended November 30,
                                                                   2011
| | --- | -----------------------------------------------------------------------------------------------



During December 2010, a Company Director
advanced $506. The loan bears interest at 4%, is unsecured and due on demand.



During January 2011, the Company’s
Chief Executive Officer advanced $832. The loan bears interest at 4%, is unsecured and due on demand.



During January 2011, a Company Director
advanced $631. The loan bears interest at 4%, is unsecured and due on demand.



During February 2011, a Company Director
advanced $985. The loan bears interest at 4%, is unsecured and due on demand.



During May 2011, the Company repaid all
related party advances totaling $23,881.



During October 2011, the Company's
former President/Chief Operating Officer, advanced $25,000. The loan bears interest at 4%, is unsecured and due on demand.
The lender may convert the loan into 100,000 restricted shares of the Company at $0.25 per share. The Company has determined
that this is conventional convertible debt, with a BCF. See Note 7(C). As of November 30, 2012, this loan has been reflected
as on demand payable to a third party given the individual has resigned from his position as of August of 2012 and has made
a demand for payment. Given the Company’s inability to repay the note, the note is currently in default.



During November 2011, the Company's
former President/Chief Operating Officer until August 2012, advanced $5,000. The loan bears interest at 4%, is unsecured and
due on demand. The lender may convert the loan into 20,000 restricted shares of the Company at $0.25 per share. The Company
has determined that this is conventional convertible debt, with a BCF. See Note 7(C) As of November 30, 2012, this loan has
been reflected on demand payable to a third party given the individual has resigned from his position as of August of 2012
and has made a demand for payment. Given the Company’s inability to repay the note, the note is currently in default.



As of November 30, 2011, the Company owed
$479 in accrued interest, which has been recorded as a component of accounts payable and accrued expenses.





F-16







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011





| | (C) | Year Ended November 30,
                                                                   2012
| | --- | -----------------------------------------------------------------------------------------------



During February 2012, the Company’s
Chief Executive Officer advanced $2,500. The loan bears interest at 4%, is unsecured and due on demand.



During March 2012, the Company’s
Chief Executive Officer advanced $17,000. The loan bears interest at 4%, is unsecured and due on demand.



During April 2012, the Company’s
Chief Executive Officer advanced $9,000. The loan bears interest at 4%, is unsecured and due on demand.



During June 2012, the
Company’s Chief Executive Officer advanced $1,592. The loan is non-interest bearing, unsecured and due on demand. In
October 2012, the Company repaid an advance of $1,417 to its Chief Executive Officer.



During July 2012, the Company’s
Chief Executive Officer advanced $12,000. The loan bears interest at 4%, is unsecured and due on demand.



As of November 30, 2012, the Company owes
$854 in accrued interest, which has been recorded as a component of accounts payable and accrued expenses.



F-17







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



Note 7 Notes Payable and Convertible
Debt



(A) Year Ended November 30, 2012



During December 2011 and
January 2012, the Company’s  former President, until August 2012, advanced $40,000. The loans bear interest at 4%,
are unsecured and due on demand. Originally, the lender had the option to convert the loan into 160,000 restricted shares of
the Company at $0.25 per share. As of November 30, 2012, the note has matured and demand has been made so the Company has
reclassified this note as a demand note.



During April 2012 and May 2012, a third
party investor advanced $50,000 due on July 31, 2012. The loan bears interest at 4% and is unsecured. The lender may convert the
loan into 200,000 restricted shares of the Company at $0.25 per share. On July 31, 2012, the notes maturity dates were extended
until November 30, 2012. On October 18, 2012, the third party investor converted the above $50,000 loan into 200,000 restricted
shares of the Company's common stock at $0.25/share. See Note 7(C). As of November 30, 2012, the 200,000 shares have not been
issued and are included in  common stock payable.



During June 2012, a third party
investor advanced $1,000. The loan bears interest at 4%, is unsecured and due on demand. In June 2012, the Company repaid an advance
of $1,000 to a third party investor.





During July 2012, a third party investor
advanced $12,000. The loan bears interest at 4%, is unsecured and due on demand.



During October 2012, a third party investor
advanced $7,800. The loan bears interest at 4%, is unsecured and due on demand.



As of November 30, 2012, the Company owes
$3,674 in accrued interest, which has been recorded as a component of accounts payable and accrued expenses.



(B) Debt Discount



For the years ended November 30, 2012
and November 30, 2011, the Company recorded debt discounts totaling of $90,000 and $30,000, respectively.



As a component of the computation
for BCF, the Company’s market price was determined based upon recent third party cash offerings at the date of issuance
prior to February 2012 when the Company's stock began to trade.





The following is a summary of the Company’s
convertible debt discount at November 30, 2012 and November 30, 2011.



|                              |  | 2012 |          |   | 2011 |  
|----------------------------- |  | ---- | -------- | - | ---- | -
|Debt Discount                 |  | $    | 120,000  |   |      |  
|Amortization of Debt Discount |  |      | (120,000 | ) |      |  
|Remaining debt discount       |  | $    | -        |   |      | $



The following is a
summary of the Company's convertible debt at November 30, 2012 and November 30, 2011.





|                                                                               |  | 2012 |          |   | 2011 |  
|------------------------------------------------------------------------------ |  | ---- | -------- | - | ---- | -
|Convertible Debt                                                               |  | $    | 120,000  |   |      | $
|Debt Discount                                                                  |  |      | (120,000 | ) |      |  
|Amortization of Debt Discount                                                  |  |      | 120,000  |   |      |  
|Conversion of Debt into 200,000 shares of common stock to be issued            |  |      | (50,000  | ) |      |  
|Reclassification
    of Convertible Note to Demand Note - former related party |  |      | (70,000  | ) |      |  
|Convertible Debt – Net                                                         |  | $    | -        |   |      | $





As of November 30,
2012, the convertible notes were reclassified to demand notes given the maturity of the notes and demand for payment being made.





F-18







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



Note 8 Stockholders’ Deficit



| | (A) | Preferred Stock
| | --- | ---------------



On January 28, 2011, the Company issued
one share of Series A, preferred stock for $1. This series of preferred stock had a provision that the holder of the one share,
a related party controlled by the Company’s Chief Executive Officer and a Director, can vote 50.1% of the total votes. There
are no preferences, dividends, or conversion rights.



| | (B) | Common Stock
| | --- | ------------



On September 13, 2010, the Company issued
10,000 shares of common stock to its founders for $1 ($0.0001/share). On January 5, 2011, in connection with the re-domiciling
to Nevada, these shares were cancelled for no consideration.



In 2011, the Company issued the following
shares for cash and services:



|Type                   |  | Quantity |            |  | Valuation |   |         | Range of Value per share | 
|---------------------- |  | -------- | ---------- |  | --------- | - | ------- | ------------------------ | 
|Cash                   |  |          | 40,330,000 |  |           | $ | 318,910 |                          | 
|Cash – related parties |  |          | 44,800,000 |  |           |   | 4,480   |                          | 
|License agreement (1)  |  |          | 1,000,000  |  |           |   | 250,000 |                          | 
|Services rendered (2)  |  |          | 4,150,000  |  |           |   | 50,000  |                          | 
|Total                  |  |          | 90,280,000 |  |           | $ | 623,390 |                          | 



(1) See Note 8(C)

(2) In connection with the stock issued
for services rendered, the Company determined fair value based upon the value of the services provided, which was the most readily
available evidence.



During the year ended November 30, 2012,
the Company authorized for issuance the following shares for cash and services:



|Type                                |  | Quantity |         |  | Valuation |   |         | Range of Value per share | 
|----------------------------------- |  | -------- | ------- |  | --------- | - | ------- | ------------------------ | 
|Cash                                |  |          | 200,000 |  |           | $ | 50,000  |                          | 
|Services rendered – related parties |  |          | 50,000  |  |           |   | 11,000  |                          | 
|Services rendered                   |  |          | 150,000 |  |           |   | 97,500  |                          | 
|Debt Conversion                     |  |          | 200,000 |  |           |   | 50,000  |                          | 
|Total (3)                           |  |          | 600,000 |  |           | $ | 208,500 |                          | 





(3) The 600,000 shares
are recorded as a current liability, common stock payable because they have not been issued. Given these shares have not been issued, they are not included in earnings per share for the year ended
November 30, 2012.



(C) Stock issued for license



In connection with the license agreement, the following occurred:



F-19







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



On January 27, 2011, an agreement was
executed with Green Oil Plantations Ltd. and their affiliates (“Green Oil”) for an exclusive license of fifty years
in exchange for 1,000,000 shares of common stock, having a fair value of $250,000 ($0.25/share), based upon recent cash offerings
to third parties, at that time, to utilize Green Oil’s licensed technologies and turnkey model for growing energy crops
in North America, South America, Central America and the Caribbean excluding Cuba.



On November 30, 2012, we determined that the license was worthless
because we could not get the technical information we needed to proceed with utilizing the
license. Therefore, we recorded an impairment loss of $240,795 as of November 30, 2012.



As of November 30, 2012 and 2011 the license
is summarized as follows:



|                         |  | 2012 |          |   | 2011 |  
|------------------------ |  | ---- | -------- | - | ---- | -
|License                  |  | $    | 250,000  |   |      | $
|Accumulated Amortization |  |      | (9,205   | ) |      |  
|Impairment               |  |      | (240,795 | ) |      |  
|License - Net            |  | $    | -        |   |      | $



(D) Warrants



On January 11, 2011, the Company issued
1-year warrants for 1,000,000 shares with a consultant, with an exercise price of $1 per share. The warrants were granted for
services rendered. The warrants had a fair value of $60,800, based upon the Black-Scholes option-pricing model. The Company used
the following weighted average assumptions:



|Expected dividends      |  |  | 0      | %
|----------------------- |  |  | ------ | -
|Expected volatility     |  |  | 150    | %
|Expected term           |  |  | 1 year |  
|Risk free interest rate |  |  | 0.28   | %
|Expected forfeitures    |  |  | 0      | %



F-20







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



|                                        |  |          |            |   |          |   |      | Weighted Average |  |  |           | 
|--------------------------------------- |  | -------- | ---------- | - | -------- | - | ---- | ---------------- |  |  | --------- | 
|                                        |  |          |            |   | Weighted |   |      | Remaining        |  |  |           | 
|                                        |  |          |            |   | Average  |   |      | Contractual      |  |  |           | 
|                                        |  |          |            |   | Exercise |   |      | Life in          |  |  | Intrinsic | 
|                                        |  | Warrants |            |   | Price    |   |      | Years            |  |  | Value     | 
|Balance - November 30, 2011             |  |          | 1,000,000  |   |          | $ | 1.00 |                  |  |  | .12       | 
|Granted                                 |  |          | -          |   |          |   | -    |                  |  |  |           | 
|Forfeited/Cancelled(1)                  |  |          | (1,000,000 | ) |          |   | -    |                  |  |  |           | 
|Exercised                               |  |          | -          |   |          |   | -    |                  |  |  |           | 
|Balance – November 30, 2012-outstanding |  |          | -          |   |          |   | -    |                  |  |  |           | 
|Balance – November 30, 2012-exercisable |  |          | -          |   |          | $ | -    |                  |  |  | -         | 



| | (1) | On January 11, 2012, the 1,000,000 warrants expired unexercised.
| | --- | ----------------------------------------------------------------



Note 9 Related Party Transactions



(A) License Agreement –
Former Affiliate of Chief Executive Officer



On November 30, 2010, the Company entered
into an exclusive license agreement with a company that is a former affiliate of the Company’s Chief Executive Officer.
The license gives the Company the right to utilize Intellectual Property rights (“IP”) and technology licenses to
produce high-density short rotation biomass energy crops on an exclusive basis in the United States, Central America, Mexico,
and Guam in perpetuity.



If the former affiliate company charges
a lesser percentage to another entity, then the first $50,000,000 will be decreased to the lowest percentage charged.



(B) Other related party transactions



The Company has separated accounts payable
and accrued expenses on the balance sheet and expenses on the statement of operations to reflect the expenses that pertain to related
parties primarily consisting of officer compensation, health insurance, interest on notes and reimbursable expenses to officers for travel, meals and entertainment, vehicle and other related business
expenses.



During the years ended November 30, 2012
and 2011, the Company recorded related party general and administrative expenses of $563,715 and $543,006, respectively, and related
party interest expense of $69,299 and $4,050, respectively.



Note 10 Formation of Subsidiaries



On January 14, 2011, the Company formed
Global Energy Crops Corporation (“GECC”), a 100% wholly owned subsidiary. GECC intends to:



| | - | Seek financing from US aid and similar
                                                              organizations for energy crop growing projects in third world countries
                                                              for the conversion to electricity and biofuels,
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | - | Joint venture with both international
                                                              and smaller technology companies who are currently producing electricity
                                                              and biofuels wherein GECC intends to provide biomass feedstock,
                                                              and
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | - | Execute supply chain contracts with
                                                              major buyers of energy crop products including electricity and biofuels.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-21







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



On May 12, 2012 the company formed FTZ
Energy Exchange Corporation, a 100% wholly owned subsidiary.



On August 2, 2012 the Company formed Agribopo,
Inc., a 100% wholly-owned subsidiary for the development of biomass related projects.



All of the above subsidiaries other than
GECC are currently inactive except for their formation. Global Energy Crops Corporations signed the license agreement with AGT
Technologies LLC.



Note 11 Commitments and Contingencies



Commitments



(A) Employment Agreements – Officers
and Directors



As of November 30, 2012, the Company had
employment agreements with certain officers and directors (two individuals) containing the following provisions:



|Term of contract | 5 years                                                                  
|---------------- | -------------------------------------------------------------------------
|Salary           | $125,000 - $200,000                                                      
|Salary deferral  | All salaries will be accrued until
    the Company has raised $2,500,000.



(B) Lease Agreement



On March 18, 2011, the Company entered
into a 26-month lease that commenced on April 1, 2011 and will expire on May 31, 2013. The Company’s monthly lease payment
of $4,150 commenced on July 1, 2011. The Company recognizes rent expense on a straight-line basis over the occupancy period.



Rent expense was $44,058 and $29,372 for
the year ended November 30, 2012 and 2011, respectively.



Deferred rent payable (component of accounts
payable and accrued expenses) at November 30, 2012 and 2011 was $2,874 and $8,620, respectively. Deferred rent payable is
the sum of the difference between the monthly rent payment and the monthly rent expense of an operating lease that contains escalated
payments in future periods.



(C) Consulting Agreements



On January 5, 2012, the
Company entered into a consulting agreement for financing. The Company paid a retainer fee of $15,000 by agreeing to issue 60,000
shares of restricted common stock at $0.25 per share. The fair value of the Company’s common stock was based upon third
party cash offerings at that time. The Company expensed this issuance as a component of general and administrative
expenses. The consultant failed to honor the commitments in the agreement. On  May 18, 2012, the Company reversed the expense and the shares were cancelled.



F-22







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



On March 26, 2012, the Company entered
into a consulting agreement to provide various investment banking services including putting together business models for project
finance and introducing the Company to potential lenders for a castor project. The Company paid a fee of 150,000 shares of common
stock, having a fair value of $97,500 ($0.65/share), based upon the quoted closing trading price. During the year ended November
30, 2012, the Company expensed this issuance as a component of general and administrative expenses. These shares have not been
issued, are included in common stock payable and are not included in earnings per share calculations as of November 30, 2012.





Note 12 Other Income - Consulting Revenue



On February 13, 2012, the Company was
engaged by a third party to provide consulting services in a three year contract for $60,000 per year plus a non-refundable $60,000
initial payment upon execution. The Company may earn fees in the form of cash or common stock of the third party, a public company,
at their election. In lieu of cash payments for services to be rendered under the terms of the agreement, the third party elected
to pay the Company 15,000,000 shares of public company restricted common stock, at a fifty percent discount using the preceding
five days average trading price per the terms of the agreement. $120,000 was due upon execution of agreement. The fair value of
the shares received upon the execution of this agreement was $253,500, as evidenced by the quoted closing trading price. The Company
recorded the value of the shares received as deferred revenue totaling $120,000 which evidenced the fair value of the services
to be performed and recorded a gain of $133,500, with a corresponding asset classified as available for sale securities. A gain
was recorded since the value of the shares received was greater than the value of the services to be rendered upon the execution
of the agreement.





In August 2012, the Company executed a
loan agreement with a lender, who is also a shareholder, to obtain 10,000,000 free trading shares of the public company The shares
received were sold during 2012. In exchange for the free trading shares, the Company was required to repay 10,500,000 shares in
free trading stock of this public company. The 500,000 shares are deemed to be a loan cost, having a fair value of $6,250 ($0.0125/share),
based upon the quoted closing trading price on the date of the agreement.



During 2012, the Company, received 15,000,000 shares of the public company for services to be rendered and sold 10,000,000
shares as noted above based upon the ability to obtain the 10,000,000 shares of free trading stock from the lender. The 15,000,000
shares is currently held in escrow of which 4,500,000 shares will be released to the Company and the balance of the 10,500,000
shares will be paid to the shareholder for the 10,000,000 shares borrowed and the 500,000 shares for the loan cost as noted
above upon the shares becoming unrestricted. The Company does not have any rights to the 10,500,000 shares. The Company has
not recorded any asset or liability for the shares held in escrow.



● $60,000 is due on February 13,
2013; and

● $60,000 is due on February 13,
2014



As of November 30, 2012, the Company recorded
consulting revenue of $63,571 and deferred revenue of $56,429, consisting of short term deferred revenue of $31,429 and long term deferred revenue of $25,000.



See Note 2 for reconciliation of amounts
associated with the purchase and sale of certain AFS securities.



Note 13 License Agreement



On November 27, 2012, the Company
entered into a non-exclusive global License from AGT Technologies LLC until June 2029 when the patent expires. The license is
for the patented one-step enzyme technology which converts wastes from poultry, hogs, humans and sugar to cellulosic ethanol,
fertilizer and other products. We would pay our Licensor 50% of any sub-license fees that we receive. We also would pay our
Licensor 12% of all royalties on all revenues we earn from utilizing the technology. This 12% is calculated on the basis of
net gross revenues which equal gross revenues less all direct costs associated with the production of the revenues. Once we
order a facility we have 120 days to pay $300,000 for the enzymes.



F-23







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



Note 14 Fair Value of Financial
Assets and Liabilities



The Company measures assets and liabilities
at fair value based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents
the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction
between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an
asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair
value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level.
The following are the hierarchical levels of inputs to measure fair value:



| | • | Level 1: Observable inputs that
                                                              reflect quoted prices (unadjusted) for identical assets or liabilities
                                                              in active markets.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



•              Level 2: Inputs reflect quoted
prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in
active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived
principally from or corroborated by observable market data by correlation or other means.



•              Level 3: Unobservable inputs
reflecting the Company’s assumptions incorporated in valuation techniques used to determine fair value. These assumptions
are required to be consistent with market participant assumptions that are reasonably available.



The Company has assets measured at fair
market value on a recurring basis. Consequently, the Company had gains and losses reported in the statement of comprehensive income
(loss), that were attributable to the change in unrealized gains or losses relating to those assets and liabilities still held
at the reporting date for the period ended November 30, 2012.



The following is the Company’s assets
measured at fair value at November 30, 2012 and 2011:



|                                      |  | 2012 |        |  | 2011 |  
|------------------------------------- |  | ---- | ------ |  | ---- | -
|Level 1 – None                        |  | $    | -      |  |      | $
|Level 2 – Marketable Securities (AFS) |  |      | 38,250 |  |      |  
|Level 3 – None                        |  |      | -      |  |      |  
|Total                                 |  | $    | 38,250 |  |      | $



F-24







BioPower Operations Corporation and
Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

November 30, 2012 and 2011



The carrying amounts reported in the balance
sheet for available for sale securities, prepaid expenses, accounts payable and accrued expenses, accounts payable and accrued
expenses – related parties, notes payable, notes payable – related parties, convertible debt and convertible debt
– related party, approximate fair value based on the short-term nature of these instruments.



Note 15 Subsequent Events



On February 5, 2013  the Company
entered in an investor relations agreement for a period of one year covering financial and public relations activities
including conception and implementation relating to our corporate and business development plan and assist in corporate
communications, press releases and presentations. The contract can be cancelled after three months on a quarterly basis. The
Company has agreed to pay 800,000 restricted shares of common stock per quarter and $3,000 per month in cash or stock. The
initial payment was for 256,250 shares covering the first quarter of the contract.



During March, 2013, a third party investor
advanced $125,000. The loan bears interest at 8%, is unsecured and due on demand.



F-25