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**UNITED STATESSECURITIES AND EXCHANGE COMMISSION** Washington, D.C. 20549

FORM 10-KSB

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

For the Fiscal Year Ended April 30, 2005

COMMISSION FILE NO. 0-23920

**REGI U.S., INC.**(Name of small business issuer as specified in its charter)

|OREGON                          | 91-1580146            
|------------------------------- | ----------------------
|(State or other jurisdiction of | (I.R.S. Employer      
|incorporation or organization)  | Identification Number)

1103 - 11871 HORSESHOE WAYRICHMOND, BRITISH COLUMBIA V7A 5H5, CANADA
  (Address, including postal code, of registrant's principal executive offices)

(604) 278-5996
  (Telephone number including area code)

Securities registered pursuant to Section 12(b) of the Exchange Act: NONE

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

|Title of each class        | Name of each Exchange on which registered:
|-------------------------- | ------------------------------------------
|Common Stock, no par value | NASD Over the Counter Bulletin Board      
|                           | Berlin Bremen Stock Exchange              

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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.

ý Yes      o
  No

Check if disclosure of delinquent filers pursuant to Item 405 of Regulation
  S-B is not contained in this form, and no disclosure will be contained, to the
  best of the registrant’s knowledge, in definitive proxy or information
  statements incorporated by reference in part III of this form 10-KSB or any
  amendment to this Form 10-KSB. o

State the issuer’s revenues for its most recent fiscal year: nil.

The aggregate market value of the voting stock held by non-affiliates of the registrant on July 25, 2005, computed by reference to the price at which the stock was sold on that date: $11,157,893.

The number of shares outstanding of the registrant's Common Stock, no par value, as of July 25, 2005 was 23,764,475.

Documents incorporated by reference: See Exhibits.

Transitional Small Business Disclosure Format (Check one): Yes o     
  No ý.

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REGI U.S., INC. 
  FORM 10-KSB 
  TABLE OF CONTENTS

|PART I     |          | 4                                                                                           
|---------- | -------- | --------------------------------------------------------------------------------------------
|           | ITEM 1.  | DESCRIPTION OF BUSINESS                                                                     
|           |          | GENERAL                                                                                     
|           |          | BUSINESS OF THE COMPANY AND
      PRODUCTS                                                  
|           |          |                                                                                             
|           |          | PRODUCTS AND PROJECTS                                                                       
|           |          |                                                                                             
|           |          |                                                                                             
|           |          |                                                                                             
|           |          |                                                                                             
|           |          |                                                                                             
|           |          |                                                                                             
|           |          | MARKETING                                                                                   
|           |          | COMPETITION                                                                                 
|           |          | RAW MATERIALS
      AND PRINCIPAL SUPPLIERS                                                 
|           |          | PATENTS, TRADEMARKS, LICENCES,
      FRANCHISES, CONCESSIONS, ROYALTY                       
|           |          | AGREEMENTS, LABOR CONTRACTS,
      INCLUDING DURATION                                       
|           |          |                                                                                             
|           |          |                                                                                             
|           |          | RISK FACTORS                                                                                
|           | ITEM 2.  | DESCRIPTION OF PROPERTY                                                                     
|           | ITEM 3.  | LEGAL PROCEEDINGS                                                                           
|           | ITEM 4.  | SUBMISSION OF MATTERS TO A
      VOTE OF SECURITY HOLDERS                                   
|PART II    |          |                                                                                             
|           | ITEM 5.  | MARKET FOR COMMON EQUITY AND
      RELATED STOCKHOLDER MATTERS                              
|           |          |                                                                                             
|           |          |                                                                                             
|           | ITEM 6:  | MANAGEMENT'S DISCUSSION AND
      ANALYSIS OR PLAN OF OPERATIONS                            
|           |          |                                                                                             
|           | ITEM 7.  | FINANCIAL STATEMENTS                                                                        
|           | ITEM 8.  | CHANGES IN AND DISAGREEEMENTS
      WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 
|           | ITEM 8A. | CONTROLS AND PROCEEDURES.                                                                   
|           | ITEM 8B. | OTHER INFORMATION.                                                                          
|PART III   |          |                                                                                             
|           | ITEM 9.  | DIRECTORS, EXECUTIVE OFFICERS,
      PROMOTERS AND CONTROL PERSONS;                         
|           |          |                                                                                             
|           | ITEM 10. | EXECUTIVE COMPENSATION                                                                      
|           | ITEM 11. | SECURITY OWNERSHIP OF CERTAIN
      BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
|           |          |                                                                                             
|           | ITEM 12. | CERTAIN RELATIONSHIPS AND RELATED
      TRANSACTIONS                                        
|           | ITEM 13. | EXHIBITS.                                                                                   
|           | ITEM 14. | PRINCIPAL ACCOUNTANT FEES AND
      SERVICES.                                               
|SIGNATURES | 31      

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THIS ANNUAL REPORT ON FORM 10-KSB, INCLUDING EXHIBITS THERETO,
  CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE
  SECURITIES ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE SECURITIES EXCHANGE
  ACT OF 1934, AS AMENDED. THESE FORWARD-LOOKING STATEMENTS ARE TYPICALLY IDENTIFIED
  BY THE WORDS "ANTICIPATES", "BELIEVES", "EXPECTS", "INTENDS", "FORECASTS", "PLANS",
  "FUTURE", "STRATEGY", OR WORDS OF SIMILAR MEANING. VARIOUS FACTORS COULD CAUSE
  ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE EXPRESSED IN THE FORWARD-LOOKING
  STATEMENTS, INCLUDING THOSE DESCRIBED IN "RISK FACTORS" IN THIS FORM 10-KSB.
  WE ASSUME NO OBLIGATION TO UPDATE THESE FORWARD-LOOKING STATEMENTS TO REFLECT
  ACTUAL RESULTS, CHANGES IN ASSUMPTIONS, OR CHANGES IN OTHER FACTORS, EXCEPT
  AS REGULATED BY LAW.

PART I

ITEM 1. DESCRIPTION OF BUSINESS

GENERAL

We were organized under the laws of the State of Oregon on
  July 27, 1992 as Sky Technologies, Inc. On August 1, 1994, our name was officially
  changed by a vote of a majority of our shareholders to REGI U.S., Inc. We are
  controlled by Rand Energy Group Inc., a privately held British Columbia corporation
  ("RAND"), which, in turn, is controlled 51% by Reg Technologies Inc., a publicly
  held British Columbia corporation ("Reg Tech").

We are engaged in the business of developing and building
  an improved axial vane-type rotary engine known as the Rand Cam/Direct Charge
  Engine ("RC/DC Engine"), which is a variation of the Rand Cam Rotary Engine,
  an axial vane rotary engine ("Original Engine"). The worldwide, exclusive of
  the United States, intellectual and marketing rights to the RC/DC Engine are
  held by RAND. We hold the rights to develop, build and market the RC/DC Engine
  design in the U.S. pursuant to an agreement with RAND. Under a project cost
  sharing agreement entered into with RAND effective May 1, 1993, each company
  funds 50% of the continuing development cost of the RC/DC Engine.

Our principal offices are located at 1103-11871 Horseshoe
  Way, Richmond, British Columbia V7A 5H5, Canada. Our telephone number is (604)
  278-5996 and our telefacsimile number is (604) 278-3409. Our website is www.regtech.com.

We will likely need to raise additional capital in the future
  beyond any amount currently on hand and which may become available as a result
  of the exercise of warrants and options which are currently outstanding, in
  order to fully implement our intended plan of operations.

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BUSINESS OF THE COMPANY AND PRODUCTS

Overview and History

We are engaged in the business of developing and building
  an improved axial vane-type rotary engine known as the Rand CamTM
  Direct Charge (“RC/DC”) Engine, which is a variation of the Original
  Engine. The Original Engine is an axial vane rotary engine, the worldwide marketing
  rights to which are held by RAND. A United States patent was issued for the
  RC/DC Engine on July 4, 1995, and assigned to us. Since no marketable product
  has yet been developed, we have not received any revenues from operations.

The RC/DC Engine is based upon the Original Engine patented
  in 1983. Brian Cherry, a former officer and director of the Company, has done
  additional development work on the Original Engine which resulted in significant
  changes and improvements for which the U.S. patent has been issued and assigned
  to us. We believe the RC/DC Engine offers important simplification from the
  basic Original Engine, which will make it easier to manufacture and will also
  allow it to operate more efficiently.

Pursuant to an agreement dated October 20, 1986 between Reg
  Tech, Rand Cam Corp. and James McCann, Reg Tech agreed to acquire a 40% voting
  interest in a new corporation to be incorporated to acquire the rights to the
  Original Engine. The new corporation was RAND. Reg Tech acquired the 40% voting
  interest in RAND in consideration of the payment of $250,000.

Pursuant to an agreement made as of April 27, 1993 among Reg
  Tech, Rand Cam Corp., RAND and James McCann, Reg Tech acquired an additional
  330,000 shares (11%) of RAND from Rand Cam Corp. to increase its investment
  to 51%.

On August 20, 1992, we entered in an agreement with RAND and
  Brian Cherry (the "August 1992 Agreement") under which we issued 5,700,000 shares
  of our Common Stock at a deemed value of $0.01 per share to RAND in exchange
  for certain valuable rights, technology, information, and other tangible and
  intangible assets, including improvements, relating to the United States rights
  to the Original Engine.RAND's president is also our president and its
  Vice President and Secretary is also one of our directors. The terms of the
  agreement were negotiated between the parties and were deemed to be mutually
  advantageous based upon conditions and circumstances existing at the time.

We entered into an agreement dated April 13, 1993 with RAND,
  Reg Tech and Brian Cherry (the "April 1993 Agreement") and made as an amendment
  to a previous Amendment Agreement dated November 23, 1992 between RAND, Reg
  Tech and Brian Cherry and an original agreement dated July 30, 1992 between
  RAND, Reg Tech and Brian Cherry, Cherry agreed to: (a) sell, transfer and assign
  to RAND worldwide rights, except for the United States, to all of his right,
  title and interest in and to the technology related to the RC/DC Engine (the
  "Technology"), including all pending and future patent applications in respect
  of the Technology, together with any improvements, changes or other variations
  to the Technology; (b) sell, transfer and assign to the Company United States
  of America rights to all of his right, title and interest in and to the Technology,
  including all pending and future patent applications in respect of the Technology,
  together with any improvements, changes or other variations to the Technology.
  On November 9, 1993, in consideration for this transfer of the Technology, Brian
  Cherry was issued 100,000 shares of Reg Tech with a deemed value of $200,000.

---

A final provision of the April 1993 Agreement assigned and
  transferred ownership of any patents, inventions, copyrights, know-how, technical
  data, and related types of intellectual property conceived, developed or created
  by RAND or its associated companies either to us which results or derives from
  the direct or indirect use of the Original Engine and/or RC/DC Engine technologies
  by RAND.

We entered into a letter of understanding dated December 13,
  1993, with RAND and Reg Tech, as grantors, and West Virginia University Research
  Corporation ("WVURC"), the grantors agreed that WVURC shall own 5% of all patented
  technology relating to the Original Engine and the RC/DC Engine. WVURC performed
  extensive analysis and testing on the RC/DC engine. WVURC provided support and
  development of the RC/DC Engine including research, development, testing evaluation
  and creation of intellectual property. In addition, WVURC introduced us to potential
  customers and licensees. We are entitled to all intellectual property developed
  by WVURC relating to the RC/DC Engine.

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

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

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

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

We are currently testing prototypes for several applications.
  Our strategy is to develop engines and compressors for low to medium horsepower
  applications, then apply the Technology to larger applications. We have licensed
  the Technology for several projects. The licensee’s have agreed to fund
  their projects for research and development of the specific applications. To
  date, we have completed a license agreement with Radian MILPARTS for greater
  than 10 H.P. for military applications. License agreements to Rotary Power have
  been terminated due to non payment. The Advanced Ceramics agreement has also
  terminated due to the fact that Phase II funding was not approved and received
  pursuant to our agreement.

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PRODUCTS AND PROJECTS

Rand Cam Technology

Rand Cam Cold Turbine Engine

On May 7, 2003 we announced that Rotary Power International
  has been granted a license agreement for the power generator applications. On
  June 9, 2003 we announced that the license had been extended to December 31,
  2003. The agreement has now lapsed due to non payment of the $100,000.

Gasoline and Diesel Engine

Two prototype engines were built in 1993 and 1994 by the WVURC
  to run on gasoline. Testing on these prototypes suggested that the concept is
  fundamentally sound and that with a program of engine review, design, testing
  and development, a technically successful range of engines can be developed.
  The current prototype design for the diesel engine was designed by a consortium
  made up of Alliant Techsystems (formerly Hercules Aerospace Company) ("Alliant"),
  WVURC and us. Alliant was involved in the design and development including drawings
  for the RC/DC diesel engine. In addition Alliant performed extensive analysis
  on the diesel engine including bearings, cooling, leakage, rotor, vanes, housing,
  vane tip heating, geometry and combustion. This engine was designed as a general
  purpose power plant for military and commercial applications. A prototype of
  the diesel engine has been assembled and tested.

In May 2004 the Company completed an amended Rand CamTM UAV
  engine license agreement with Radian, Inc. Radian, Inc. agrees to furnish REGI
  U.S., Inc. with a second generation, application specific Rand CamTM 42 H.P.
  diesel engine at the conclusion of their Phase II study program. The Radian,
  Inc. UAV product development program commenced early in 2004. The Phase I/ Study
  Rand CamTM 42 H.P. diesel engine demonstrated that the engine generates sufficient
  pressure and temperature to proceed with the second generation diesel engine.

On November 3, 2004 we announced that the Canadian Patent
  was issued for the Rand CamTM Rotary Engine effective October 5, 2004. The term
  of the patent is twenty years from the date of the filing on December 11, 1992.

On November 29, 2004, we announced that a world wide license
  agreement, excluding the rights for the United States of America that are held
  by REGI U.S. for the Rand CamTM technology has been successfully completed with
  Rand Energy Group Inc. Reg Technologies, Inc., our parent company, has agreed
  to pay a 5% net profit interest and make annual payments of $50,000. Reg
  Technologies, Inc. will be responsible for 50% of the costs for development
  and production of the Rand CamTM technology.

The world wide patents cover Canada and several countries
  in Europe, namely, Germany, France, Great Britain, and Italy. Reg Technologies,
  Inc., together with REGI U.S., Inc., is in the process of testing a Rand CamTM
  diesel engine for a generator application for hybrid electric cars. Additionally,
  our licensee for the 42 H.P. production model diesel Rand CamTM is currently
  completing the engine for unmanned aerial applications for the U.S. military.

---

Compressor

We contracted Coltec, Inc., a Columbus, Indiana engineering
  firm, to fabricate the Rand Cam (TM) air conditioning compressor for buses.
  The testing is to be conducted by Trans/Air Manufacturing Corporation, one of
  the largest manufacturers of air conditioning units for buses, which has agreed
  to jointly develop and manufacture the working model compressor. The prototype
  compressor was delivered to Trans/Air in January 2001.

A special 3.2 SCFM air compressor has been designed and built
  for a large fuel cell customer. The customer has reviewed the design and his
  comments including type of drive motor, inlet and outlet piping arrangements
  and mounting considerations were incorporated and final drawings were prepared.

In January, 2004, testing for the air conditioning compressor
  for buses application had commenced by Trans Air Manufacturing. The new manifold
  has been installed on the working prototype compressor and pressure testing
  has commenced. Trans Air Manufacturing will first perform bench testing to baseline
  speed, performance, and power consumption data before designing to install on
  a vehicle for “real world” testing.

Based on the successful completion of the Joint Venture, being
  the development and successful testing of a working prototype of the Bus Compressor,
  Trans Air shall have the exclusive right and shall use its reasonable efforts
  to market, merchandise, sell and exploit the Bus Compressor within the markets
  or geographical areas in which Trans Air, in its sole option and discretion,
  believes such efforts would be appropriate. Currently Brian Cherry, our Vice
  President of Research and Development, is overseeing the testing of the air
  conditioning compressor.

In August 2004, we completed compressor tests which displayed
  encouraging results of up to 25 P.S.I. with only 800 R.P.M. The testing for
  the compressor was completed on behalf of Trans Air Manufacturing for air-conditioning
  in bus applications, and exceeded our expectations. We are currently negotiating
  a license agreement for compressor applications, to be announced when the terms
  and conditions are finalized.

Hydrogen Separator

We purchased the rights to the H2O Hydrogen Separator Technology
  consisting of a hydrogen separator based, which is a unique system for extracting
  hydrogen from water.

In consideration for a 50% interest for the rights to the
  Hydrogen Separator Technology Reg Technologies, Inc. (“Reg”) agrees
  that we shall apply for a patent in the U.S. for the Hydrogen Separator Technology
  at Reg’s expense; and Reg agrees to build a prototype of the Hydrogen
  Separator Technology as designed by GHM, Inc. We declined the option to purchase
  an additional 50% interest. To date, neither patent confirmation nor approval
  has been received by Reg.

Ceramic Rand CamTMEngine

In July 2003, the RadMax TM Engine was announced at the AUVSI
  Conference Association for Unmanned Vehicle Systems. (AUV) by our licensee Radian
  MILPARTS. The announcement stated that plans are in place to start calibration
  testing at the Naval Air Systems Command (NAVAIR) Patuxent River, MD late in
  the summer. Procedures are written and in place to

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determine and document the RadMax TM Engines horsepower, its
  vibration and noise metrics, and so forth. Following completion of the testing,
  to be conducted by engineers, first production units will generally be available
  by the fall, followed by a full production run next year.

The announcement further stated that the RadMax TM Engine,
  a heavy fuel engine that is comprised of only 13 moving parts, is completely
  balanced and on all speeds, loads and orientation angles. Without piston valves,
  a crankshaft or camshaft it is inherently quiet at 60 dB at 1,500 feet.

We have entered into an agreement with Radian which grants
  an exclusive license for the manufacture of the Rand Cam Diesel Engines within
  the United States, for applications in Unmanned Autonomous Vehicles (UAV'S)
  over 10 horsepower, including non-exclusive rights to the worldwide sales for
  this application.

In February, 2004 we announced that a REGI licencee for unmanned
  vehicle system engines had completed testing of the prototype 42 H.P. engine.
  Tests occurred at Adiabatics in Columbus, IN and at the U.S. Navy's test facility
  at Patuxent River, MD. The initial test results demonstrated that the first
  generation prototype engine generated pressure and temperature. The licencee
  has started design of a second generation prototype. The documentation and one
  of the completed 42 H.P. Rand Cam(tm) engines have been delivered to REGI U.S.,
  Inc. as part of the license agreement.

Rand CamTM Generator and Fuel Cell Technology

In September 2004 testing had commenced for the Rand CamTM
  generator application for hybrid electric cars, portable generator application,
  and for back up power for family homes. Brian Cherry, our Vice President of
  the Rand CamTM engine projects and co-inventor of the Rand CamTM technology, is
  overseeing the development and testing in conjunction with two rotary engine
  mechanics with over 10 years experience with the Mazda rotary engine.

In April, 2005 we completed several successful, continuous
  combustion tests for the Rand CamTM engine using gasoline fuel. The series of
  tests took place at SNK’s facilities, in Richmond, BC, on April 14, 2005,
  with starter speed of up to 490 RPM, utilizing a unique vane design that does
  not require vane tip seals. Eliminating the need for vane tip seals will reduce
  the manufacturing and maintenance costs significantly, therefore, resulting
  in a breakthrough with the technology. The Rand CamTM engine design will be further
  tested for generator and hybrid car applications.

On June 29, 2005, REGI U.S., Inc. we entered into an exclusive
  distributor agreement relating to fuel cell technology (the “Technology”)
  with Anuvu Incorporated (“Anuvu”). Our affiliate, Reg Technologies,
  Inc., agrees to pay $200,000.00 as payment in full for the exclusive Canadian
  Distributorship for the Technology. We have an option to pay $300,000 for
  the exclusive European rights for the Technology, of which $150,000.00 is
  to be paid within 90 days from the date of the Agreement and the final payment
  of $150,000.00 is to be paid on or before November 30, 2005

We agree to issue 200,000 treasury shares of REGI U.S., Inc.
  to Anuvu upon confirmation of acceptance of the European fuel cell technology
  patents. Anuvu will submit a patent application for Canada and Europe based
  on the current fuel cell technology claims set forth in claims of the U.S. Patents
  Pending held by Anuvu before the deadline date by the Patent Office. Patents
  will be owned by Anuvu and used exclusively in Europe by REGI during the term
  of the Agreement. REGI agrees to pay for the patent application costs and associated
  legal fees for Europe.

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Reg Technologies, Inc. and REGI agree to pay a 5% royalty
  of the adjusted gross sales relating to the Technology.

REGI and Reg Technologies, Inc. will receive up to 1,000,000
  warrants of Anuvu, based on 2 warrants issued for every $1.00 paid for the
  Distribution rights. The warrants enable REGI and Reg Technologies, Inc. the
  right to purchase up to 1,000,000 shares of Anuvu for a total of $10,000
  for a period of one year.

Anuvu agrees as follows:

|• | to give REGI a right of first refusal
        to purchase Anuvu shares, in the event additional shares  are to
        be issued or purchased, for a period of six months;                                                                                                                                                                                                                                                                                                                                     
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|• | to build a working fuel cell model prototype
        for a vehicle for demonstration purposes in  Canada and Europe on
        behalf of Reg Technologies, Inc. and REGI                                                                                                                                                                                                                                                                                                                                       
|• | to work on the Rand CamTM projects as
        required by Reg Technologies, Inc. and REGI, under  a contract basis;                                                                                                                                                                                                                                                                                                                                                                                            
|• | to grant to REGI and Reg Technologies
        a right of first refusal to exclusively use, manufacture, develop, sell,
        market and distribute products based on new patents and  applications
        for patents, improvements, technology, products, devices, know-how, 
        inventions, ideas, methods, processes and concepts, which are owned or
        developed by Anuvu  and are not included in the Distributorship Patents
        in consideration for 100,000 treasury  shares of REGI.

We believe the companies have a common objective of developing
  a clean burning new source of power for vehicles, which are currently using
  gasoline driven piston engines. We are in the final phase of developing a light
  weight rotary engine that will run on any fuel, including cleaner burning fuels,
  such as hydrogen, propane and natural gas.

Anuvu Fuel Cell Advantages:

|• | Anuvu recently commenced building 1,100
        fuel cell engines for an automotive customer.                                                                                                             
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|• | The Anuvu fuel cell is Integration-Ready,
        complete fuel cell systems have been  integrated into on-road vehicles,
        boats, off-road vehicles and extensively used in driving  simulators.   
|• | Anuvu fuel cells exceed goals for DOE
        weight and volume for mobile applications                                                                                                                   
|• | Improved stack efficiency and life by
        liquid cooling each cell for uniform temperature                                                                                                            
|  | control.                                                                                                                                                                                                  
|• | Improved water management technology
        which allows operation over a broad range of  gas and humidity conditions,
        greatly reducing the complexity and cost of gas  humidification subsystems
|• | Smaller, lighter, more robust and vibration
        tolerant                                                                                                                                              
|• | Carbon-based to reduce catalyst poisoning,
        increasing cell life                                                                                                                                   
|• | Lower cost with no precious metals, except
        a trace amount of platinum                                                                                                                             
|• | Designed for high volume manufacturing
        and consistency of performance                                                                                                                             

---

Corporate

In April 2004 the Company received an additional listing on
  the Berlin Bremen Stock Exchange (www.berlinerboerse.de) under the symbol RGJ,
  German Cusip Number S7589431045/786692. The Company retains the OTC Bulletin
  Board listing Symbol: RGUS.OB.

REGI U.S., Inc.’s market maker is Berliner Freiverkehr
  (Aktien) AG, which is one of the largest German brokerage firms and acts as
  market maker for the Unofficial Regulated Markets in Berlin and Frankfurt. The
  main advantage for REGI U.S., Inc. to trade on the Berlin Bremen Stock Exchange,
  is that the German investors, including small ones, can buy REGI U.S., Inc.
  shares in their domestic currency, thus making transactions easier and less
  expensive.

In June 2004 Brian Cherry was appointed Vice President of
  the Rand CamTM engine technology projects. Brian Cherry is the inventor of the
  Direct Charge Rand CamTM engine patented in 1996 by REGI U.S., Inc. and is currently
  the project manager in charge of developing a Rand CamTM electric generator for
  hybrid electric automobiles, and for residential uses in family homes. Mr. Cherry
  will also be overseeing and preparing the current submission of a new patent
  application on the Rand CamTM technology. The generator can run on any fuel including
  hydrogen and natural gas. The tests are to commence within 30 days utilizing
  an alternator as the electric output, and the Rand CamTM engine as the power
  source. REGI U.S., Inc. has signed an agreement with Brian Cherry to develop
  the generator application and other applications for a period of two years in
  consideration for 150,000 treasury shares of REGI U.S., Inc.

MARKETING

We intend to pursue the development of the RC/DC Engine and
  the air pump, compressor and other products by entering into licensing and/or
  joint venture arrangements with other larger companies, which have the financial
  resources to maximize the potential of the technology. At the present time,
  we have signed license agreements with Advanced Ceramics Research, Inc., Radian,
  Inc. and Rotary Power Generation, Incorporated. We have no current plans to
  become actively involved in either manufacturing or marketing any engine or
  other product which it may ultimately develop to the point of becoming a commercial
  product.

Our current objective is to complete and test the various
  compressor, pump and diesel engine prototypes. Based on the successful testing,
  the prototypes will be used for presentation purposes to potential license and
  joint venture partners.

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

The following marketing activities are all currently underway:

AIR CONDITIONING COMPRESSOR - An agreement with Trans Air
  Manufacturers has been completed to use the Rand Cam(TM) compressor in air conditioning
  units in bus applications. We have delivered a compressor prototype for testing.
  We are awaiting test results from Trans Air. Currently, Brian Cherry, our Vice
  President of Research and Development, is overseeing the testing of the air
  conditioning compressor.

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AIR PUMP – A prototype air pump for a Fuel Cell Application
  has been completed and will be delivered to the Fuel Cell manufacturer and others.
  We plan to build several additional air pumps for demonstration purposes for
  other fuel cell uses.

DIESEL ENGINE – We have signed a license agreement with
  Radian MILPARTS to further develop our Rand Cam Technology for a 42 horsepower
  engine. Our license agreement with Radian calls for a 6% royalty to us and one
  working model 42 horsepower diesel engine for our own use for demonstration
  purposes for the other commercial applications.

GENERATOR AND FUEL CELL - We entered into an exclusive distributor
  agreement with Anuvu Incorporated to build a working fuel cell model prototype
  for a vehicle for demonstration purposes in Canada and Europe on behalf of Reg
  Technologies, Inc. and REGI, to work on the Rand CamTM projects as required by
  Reg Technologies, Inc. and REGI, under a contract basis and to grant to REGI
  and Reg Technologies a right of first refusal to exclusively use, manufacture,
  develop, sell, market and distribute products developed.

COMPETITION

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

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

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

---

RAW MATERIALS AND PRINCIPAL SUPPLIERS

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

PATENTS, TRADEMARKS, LICENCES, FRANCHISES, CONCESSIONS, ROYALTY
  AGREEMENTS, LABOR CONTRACTS, INCLUDING DURATION

Patents

U.S. patent No. 5,429,084 was granted on July 4, 1995, to
  the inventor, Brian Cherry, Patrick Badgley and four other individuals for various
  improvements incorporated in the RC/DC Engine. The patent has been assigned
  to us. U.S. Patent 4,401,070 for the Original Engine was issued on August 30,
  1983, to James McCann and RAND holds the marketing rights.

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

Two additional patents have been issued for improvements to
  the engine including: U.S. Patents 5,509,793 “Rotary Device with Slidable
  Vane Supports) issued April 24, 1996 and 5,551,853 “Axial Vane Rotary
  Device and Sealing System Therefor) issued September 3, 1996. The Company has
  submitted additional Rand CamTM improvements for a patent in the month of July.

On November 3, 2004 we announced that the Canadian Patent
  was issued for the Rand CamTM Rotary Engine effective October 5, 2004. The term
  of the patent is twenty years from the date of the filing on December 11, 1992.

On November 29, 2004, we announced that a world wide license
  agreement, excluding the rights for the United States of America that are held
  by REGI U.S. for the Rand CamTM technology has been successfully completed with
  Rand Energy Group Inc. Reg Technologies, Inc., our parent company, has agreed
  to pay a 5% net profit interest and make annual payments of $50,000. Reg
  Technologies, Inc. will be responsible for 50% of the costs for development
  and production of the Rand CamTM technology.

The world wide patents cover Canada and several countries
  in Europe, namely, Germany, France, Great Britain, and Italy. Reg Technologies,
  Inc., together with REGI U.S., Inc., is in the process of testing a Rand CamTM
  diesel engine for a generator application for hybrid electric cars. Additionally,
  our licensee for the 42 H.P. production model diesel Rand CamTM is currently
  completing the engine for unmanned aerial applications for the U.S. military.

---

Royalty Payments

The August 1992 Agreement calls for us to pay RAND semi-annually
  a royalty of 5% of any net profits to be derived by us from revenues received
  as a result of its license of the Original Engine. The August 1992 Agreement
  also calls for us to pay Brian Cherry a royalty of 1% semi-annually any net
  profits derived by us from revenue received as a result of our licensing the
  Original Engine.

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

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

No royalties are to be paid to Alliant or Adiabatics, Inc.

RISK FACTORS

You should carefully consider the following risks and the
  other information in this Report and our other filings with the SEC before you
  decide to invest in us or to maintain or increase your investment.

The risks and uncertainties described below are not the only
  ones facing us. Additional risks and uncertainties may also adversely impact
  and impair our business. If any of the following risks actually occur, our business,
  results of operations, or financial condition would likely suffer. In such case,
  the trading price of our common stock could decline, and you may lose all or
  part of your investment.

Developmental Stage Company. We were incorporated on July
  27, 1992. We are a development stage company. In a development stage company,
  management devotes most of its activities to establishing a new business. Planned
  principal activities have not yet produced significant revenues and we have
  suffered recurring operating losses as is normal in development stage companies.
  We also have a working capital deficit of $211,623. These factors raise
  substantial doubt about our ability to continue as a going concern. Our ability
  to emerge from the development stage with respect to our planned principal business
  activity is dependent upon our successful efforts to raise additional equity
  financing, receive funding from affiliates and controlling shareholders, and
  develop a market for our products.

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

---

Negative Shareholders' Equity. We have a negative shareholders
  equity as of the date of this 10-KSB. Our ability to continue as a going business
  will be dependent upon our ability to raise additional capital and/or generate
  revenues from operations.

Need for Additional Capital. We rely on our ability to raise
  capital through the sale of our securities. Our the ultimate success will depend
  upon our ability to raise additional capital or to have other parties bear a
  portion of the required costs to further develop or exploit the potential market
  for our products. REG Tech and REGI have agreed to provide the necessary funds
  for the development of the RC/DC Diesel Engine prototypes and our other operations
  until joint venture or license agreements can be completed.

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

Product/Market Acceptance. Our profitability and survival
  will depend upon our ability to develop a technically and commercially feasible
  product which will be accepted by end users. The RC/DC Engine and the AVFCS
  which we are developing must be technologically superior or at least equal to
  other engines which our competitors offer and must have a competitive price/performance
  ratio to adequately penetrate our potential markets.A number of rotary
  engines have been designed over the past 70 years but only one, the Wankel,
  has been able to achieve mechanical practicality and any significant market
  acceptance. If we are not able to achieve this condition or if we do not remain
  technologically competitive, we may be unprofitable and our investors could
  lose their entire investment. There can be no assurance that we or our potential
  licensees will be able to achieve and maintain end user acceptance of our engine
  or the AFVCS.

No Formal Market Survey. We have not conducted a formal market
  survey but statistics available on the aircraft, marine and industrial markets
  alone indicate an annual market potential of more than one hundred million dollars.

Competition. While not a highly competitive business in terms
  of numbers of competitors, the business of developing engines of a new design
  and attempting to either license or produce them is nonetheless difficult because
  most existing engine producers are large, well financed companies which are
  very concerned about maintaining their market position. There is no assurance
  that we will be successful in meeting or overcoming our current or future competition.

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

History of Losses. We have a history of operating losses,
  and an accumulated deficit, as of April 30, 2005, of $6,723,452.Our
  ability to generate revenues and profits is subject to the risks and uncertainties
  encountered by development stage companies.

---

Our future revenues and profitability are unpredictable. We
  are currently have no signed contracts that will produce revenue and we do not
  have an estimate as to when we will be entering into such contracts. Furthermore,
  we cannot provide assurance that management will be successful in negotiating
  such contracts.

Rapid Technological Changes could Adversely Affect Our Business.
  The market for our engines is characterized by rapidly changing technology,
  evolving industry standards and changing customer demands. Accordingly, if we
  are unable to adapt to rapidly changing technologies and to adapt our product
  to evolving industry standards, our business will be adversely affected.

Management and Conflicts of Interest. Our present officers
  and directors have other unrelated full-time positions or part-time employment.
  Some officers and directors will be available to participate in management decisions
  on a part-time or as-needed basis only. Our management may devote time to other
  companies or projects which may compete directly or indirectly with us.

Control by Current Insiders. 17,165,989 common shares, not
  including currently exercisable options or warrants, are owned by current insiders
  representing control of approximately 72% of the total voting power. Accordingly,
  the present insiders will continue to elect all of our directors and generally
  control our affairs.

Need for Additional Key Personnel. At the present, we employ
  no full time employees. Our success will depend, in part, upon the ability to
  attract and retain qualified employees. We believe that we will be able to attract
  competent employees, but no assurance can be given that we will be successful
  in this regard. If we are unable to engage and retain the necessary personnel,
  our business would be materially and adversely affected.

Indemnification of Officers and Directors for Securities Liabilities.
  Our Bylaws provide that we may indemnify any Director, Officer, agent and/or
  employee as to those liabilities and on those terms and conditions as are specified
  in the Oregon Business Corporation Act. Further, we may purchase and maintain
  insurance on behalf of any such persons whether or not we would have the power
  to indemnify such person against the liability insured against. This could result
  in substantial expenditures by us and prevent any recovery from such Officers,
  Directors, agents and employees for losses incurred by us as a result of their
  actions. Further, we have been advised that in the opinion of the Securities
  and Exchange Commission, indemnification is against public policy as expressed
  in the 1933 Act and is therefore, unenforceable.

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

Limited Public Market for the Common Stock. At present, only
  a limited public market exists for the Common Stock on the over-the-counter
  bulletin board maintained by the National Association of Securities Dealers
  and there is no assurance that a more active trading market will develop, or,
  if developed, that it will be sustained.

Estimates and Financial Statements. The information in this
  Form 10-KSB consists of and relies upon evaluation and estimates made by management.
  Even though management believes in good faith that such estimates are reasonable,
  based upon market studies and data provided by sources knowledgeable in the
  field, there can be no assurance that such estimates will ultimately be found
  to be accurate or even based upon accurate evaluations.

---

No Foreseeable Dividends. We have not paid dividends on our
  Common Stock and do not anticipate paying dividends on our Common Stock in the
  foreseeable future.

Possible Volatility of Securities Prices. The market price
  for our Common Stock traded on the over-the-counter bulletin board has been
  highly volatile since it began trading and will likely to continue to behave
  in this manner in the future. Factors such as our operating results and other
  announcements regarding our development work and business operations may have
  a significant impact on the market price of our securities. Additionally, market
  prices for securities of many smaller companies have experienced wide fluctuations
  not necessarily related to the operating performance of the companies themselves.

GOVERNMENT REGULATIONS

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

DEPENDENCE ON CERTAIN CUSTOMERS

Although we have no key customers at the present time, we
  expect that if our development work is successful, we will likely become dependent,
  at least initially, upon one or very few key customers. Such dependence could
  prove to be risky in the event that one or more such potential customers were
  to be lost and not replaced.

RESEARCH AND DEVELOPMENT

The basic research and development work on the RC/DC Engine
  and other products is being coordinated and funded by Reg Tech and funded as
  to 50%.

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

During the last two fiscal years, we have incurred a total
  of $178,394 in research and development expenses. During the last year,
  the majority of the costs were paid directly toward the building of the 42 horsepower
  prototypes by Radian Milparts and by Advanced Ceramics for the 10 horsepower
  ceramic engine for unmanned aerial applied uses.

COSTS AND EFFECTS OF COMPLIANCE WITH ENVIRONMENTAL LAWS

At the present time there is no direct financial or competitive
  effect upon our business as a result of any need to comply with any federal,
  state or local provisions which have been enacted or adopted regulating the
  discharge of materials into the environment, or otherwise relating to the protection
  of the environment.

NUMBER OF TOTAL EMPLOYEES AND NUMBER OF FULL-TIME EMPLOYEES

---

We currently have two contractors directly involved in technical
  development work on the RC/DC Engine. We expect to hire additional employees
  for those positions which we deem necessary to fill, as needs arise. Most additional
  employees are expected to be in technical and licensing/marketing positions.

ITEM 2.      DESCRIPTION OF PROPERTY

We own no properties. We currently utilizes office space leased
  by Reg Tech in a commercial business park building located in Richmond, British
  Columbia, Canada, a suburb of Vancouver. The monthly rent for our portion of
  this office space is $500.00. The present facilities are believed to be
  adequate for meeting our needs for the immediate future. However we expect that
  we will likely acquire separate space when the level of business activity requires
  us to do so. We do not anticipate that we will have any difficulty in obtaining
  such additional space at favorable rates. There are no current plans to purchase
  or lease any properties in the near future.

ITEM 3.      LEGAL PROCEEDINGS

We are not a party to any legal proceedings or litigation,
  nor are we aware that any litigation is presently being threatened or contemplated
  against us or any officer, director or affiliate.

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

There was no matter submitted to a vote by our security holders
  during the fourth quarter of our fiscal year ended April 30, 2005, through the
  solicitation of proxies or otherwise.

PART II

ITEM 5.      MARKET FOR COMMON EQUITY
  AND RELATED STOCKHOLDER MATTERS

There is a limited public market for our Common Stock which
  currently trades on the OTC Bulletin Board under the symbol "RGUS.OB" where
  it has been traded since September 21, 1994. The Common Stock has traded between
  $0.035 and $6.75 per share since that date.

The following table sets forth the high and low prices for
  our Common Stock as reported on the Bulletin Board for the quarters presented.
  These quotations reflect inter-dealer prices, without retail mark-up, mark-down
  or commissions, and may not reflect actual transactions.

---

|                               | Bid Price | Asked Price
|------------------------------ | --------- | -----------
|                               | High$     | Low $      
|Quarter Ended April 30, 2003   | .09       | .04        
|Quarter Ended July 31, 2003    | .23       | .045       
|Quarter Ended October 31, 2003 | .43       | .12        
|Quarter Ended January 31, 2004 | .45       | .25        
|Quarter Ended April 30, 2004   | .32       | .19        
|Quarter Ended July 31, 2004    | .27       | .15        
|Quarter Ended October 31, 2004 | .4        | .24        
|Quarter Ended January 31, 2005 | 2.21      | .33        
|Quarter Ended April 30, 2005   | 1.07      | .369       

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

As of July 25, 2005, there were 23,764,475 shares of Common
  Stock outstanding, held by 253 shareholders of record.

DIVIDEND POLICY

To date we have not paid any dividends on our Common Stock
  and do not expect to declare or pay any dividends on our Common Stock in the
  foreseeable future. Payment of any dividends will be dependent upon future earnings,
  if any, our financial condition, and other factors as deemed relevant by our
  Board of Directors.

RECENT SALES OF UNREGISTERED SECURITIES

Set forth below is information regarding the issuance and
  sales of our securities without registration during the last fiscal year. No
  such sales involved the use of an underwriter. See Note 4 to our audited financial
  statements for the fiscal year ended April 30, 2005 for more information on
  recent sales of unregistered securities.

On December 24, 2004, the Company closed a private placement
  offering for subscriptions of 1,032,800 units of the Company at a purchase price
  of $0.25 per unit for total cash proceeds of $258,200. Each unit consisted
  of one common share of the Company and one-half non-transferable share purchase
  warrant. Each two one-half warrants may be exercised within one year of the
  date of issuance to the purchaser at a price of $0.35. This offering was
  exempt from registration under Rule 506 and Section 4(2) of the Securities Act
  of 1933, as amended (the "Act"). Each certificate representing securities issued
  to the investors in this private placement bears a legend restricting transfer.
  In addition, if the exemptions under Rule 506 under and Section 4(2) of the
  Act are not available, the sales to non-U.S. residents were exempt pursuant
  to Regulation S under the Act.

ITEM 6:      MANAGEMENT'S DISCUSSION
  AND ANALYSIS OR PLAN OF OPERATIONS

We are a development stage company engaged in the business
  of developing and commercially exploiting an improved axial vane type rotary
  engine known as the Rand Cam/Direct Charge Engine (the "RC/DC Engine").

---

As a development stage company, we devote most of our activities
  to establishing our business. Planned principal activities have not yet produced
  significant revenues and we have a working capital deficit. We have undergone
  mounting losses to date totaling $6,723,452 and further losses are expected
  until we complete a licensing agreement with a manufacturer and reseller. At
  April 30, 2005, our working capital deficit is $211,623. Our only assets
  are prepaid expenses, totaling $17,214. These factors raise substantial
  doubt about our ability to continue as a going concern. Our ability to emerge
  from the development stage with respect to our planned principal business activity
  is dependent upon our successful efforts to raise additional equity financing,
  receive funding from affiliates and controlling shareholders, and develop a
  market for our products.

During the year, we raised $258,200 pursuant to a private
  placement of 1,032,800 units issued at $0.25 per unit. Each unit contains
  one share and one-half warrant. Each two one-half warrants may be exercised
  within one year of date of issuance to acquire one additional share at $0.35
  per share. During the year, we also raised $29,750 from the exercise of
  133,750 stock options, and $34,624 from the exercise of 173,120 share purchase
  warrants. During the fiscal year ended April 30, 2004, we raised $20,000
  from the exercise of 100,000 stock options, and $86,000 from the exercise
  of 550,000 share purchase warrants. These funds raised do not provide enough
  working capital to fund ongoing operations for the next twelve months. We may
  also raise additional funds through the exercise of warrants and stock options.

Results of operations for the year ended April 30, 2005 ("2005")
  compared to the year ended April 30, 2004 ("2004")

There were no revenues from product licensing during 2004
  and 2003.

The net loss in 2005 decreased by $25,024 to $584,889
  compared to $609,913 in 2004. The decrease was due to a decrease of $70,814
  in general and administrative expenses and a decrease in research and development
  expenses of $33,468. The decrease in administrative expenses was mainly
  due to a decrease in stock-based compensation of $91,222 from $142,354
  in 2004 to $51,132 in 2005. The decrease of $33,468 in research and
  development was mainly attributed to the increase in prototype design and construction
  contracts of $29,862 offset by a decrease in technical prototype design
  consulting fees of $60,000. The majority of prototype construction and testing
  costs continues to be borne by potential licensees and manufacturers. See above
  progress reports for research and development activity conducted during the
  year.

LIQUIDITY AND CAPITAL RESOURCES

During 2005, we financed our operations mainly through proceeds
  of $64,374 from the exercise of stock options and share purchase warrants,
  as well as proceeds of $258,200 from the completion of a private placement
  offering.

We received funding in 2004 from our affiliated companies
  (common officers and directors) and our 18% shareholder, Rand Energy Group,
  Inc. (“Rand”) and Reg Technologies Inc., the controlling shareholder
  of Rand Energy Group, Inc. The total amount owing to related parties is $137,650
  or 60% of total current liabilities as at April 30, 2005. The balances owing
  to related parties are non-interest bearing, unsecured and repayable on demand.
  Our affiliated companies have indicated that they will not be demanding repayment
  of these funds during the next fiscal year and will advance, or pay expenses
  on behalf of, further funds if needed.

---

As at April 30, 2005, we had a working capital deficit of
  $211,623. We receive interim support from our ultimate parent company and
  plan to raise additional funds from equity financing which is yet to be negotiated.
  We also plan to raise funds through loans from a major shareholder (Rand). Rand
  owns 4,079,036 sharesand plans to sell shares as needed to meet our
  ongoing funding requirements if traditional equity sources of financing prove
  to be insufficient.

ITEM 7.      FINANCIAL STATEMENTS

Our financial statements are included and begin immediately
  following the signature page to this report. See Item 13 for a list of the financial
  statements and financial statement schedules included.

ITEM 8.      CHANGES IN AND DISAGREEEMENTS
  WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 8A. CONTROLS AND PROCEEDURES.

(a) Evaluation of disclosure controls and procedures.

As required by Rule 13a-15 under the Exchange Act, as of the
  end of the period covered by this annual report, being April 30, 2005, we have
  carried out an evaluation of the effectiveness of the design and operation of
  our company's disclosure controls and procedures. This evaluation was carried
  out under the supervision and with the participation of our company's management,
  including our President and our Chief Financial Officer. Based upon that evaluation,
  our President and our Chief Financial Officer concluded that our company's disclosure
  controls and procedures are effective. There have been no changes in our company's
  internal controls or in other factors, which could significantly affect internal
  controls subsequent to the date we carried out our evaluation.

Disclosure controls and procedures and other procedures that
  are designed to ensure that information required to be disclosed in our reports
  filed or submitted under the Exchange Act is recorded, processed, summarized
  and reported, within the time period 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 in our reports filed under the Exchange Act is accumulated and
  communicated to management, including our President and our Chief Financial
  Officer as appropriate, to allow timely decisions regarding required disclosure.

(b) Changes in internal controls.

Subsequent to the date of their evaluation, there were no
  corrective actions taken by our Company or other changes made to these internal
  controls. Our Company's management does not believe there were changes in other
  factors that could affect these controls subsequent to the date of the evaluation.

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ITEM 8B. OTHER INFORMATION.

None.

PART III

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

Directors and Executive Officers of the Registrant

The following table sets forth the name, age and position
  of each of our Executive Officers and Directors:

|Name              | Age | Position                                                                                 
|----------------- | --- | -----------------------------------------------------------------------------------------
|                  |     |                                                                                          
|John G. Robertson | 64  | Director, Chairman of the Board of Directors, President and
      Chief Executive Officer
|Jennifer Lorette  | 33  | Director, Vice-President                                                                 
|James Vandeberg   | 61  | Director and Chief Operating Officer and Chief Financial Officer                         
|Brian Cherry*     | 65  | Vice President, Rand CamTM Engine Technology Projects                                    

BUSINESS EXPERIENCE AND PRINCIPAL OCCUPATION OF DIRECTORS,
  EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES

Mr. Robertson has held his position since our formation in
  July, 1992. All officers currently devote part-time services to our operation.

There are no family relationships between any director or
  executive officer and any other director or executive officer.

The present and principal occupations of our directors and
  executive officers during the last five years are set forth below:

John G. Robertson - Chairman of the Board of Directors, President,
  Chief Executive Officer

Mr. Robertson has been our Chairman, President and Chief Executive
  Officer since our formation. Since October 1984 Mr. Robertson has been President
  and a Director of Reg Technologies Inc., a British Columbia corporation listed
  on the TSX Venture Exchange that has financed the research on the Rand Cam Engine
  since 1986. REGI U.S. is controlled by Rand Energy Group, Inc., a British Columbia
  corporation of which Reg Technologies Inc. is the majority shareholder. REGI
  U.S. owns the U.S. rights to the Rand Cam (TM) technology and Rand Energy Group,
  Inc. owns the worldwide rights exclusive of the U.S. Mr. Robertson is President,
  Principal Executive Officer and a member of the Board of Directors of IAS Communications,
  Inc., an Oregon corporation traded on the OTC bulletin board, which is developing
  a new type of antenna system. Since June 1997 Mr. Robertson has been President,

---

Principal Executive Officer and a Director of Information-Highway.com,
  Inc., a Florida corporation which is currently inactive, and its predecessor.
  He is also the President and Founder of Teryl Resources Corp., a public company
  trading on the TSX Venture Exchange involved in gold, diamond, and oil and gas
  exploration. He is also President of Linux Gold Corp., a public company trading
  on the OTC Bulletin Board. Since May 1977 Mr. Robertson has been President and
  a member of the Board of Directors of SMR Investments Ltd., a British Columbia
  corporation engaged in the business of management and investment consulting.

Jennifer Lorette - Vice President

Ms. Lorette became a member of the board of directors in January
  2001. She has been our Vice President since June 1994, and was also previously
  Chief Financial Officer. Since 2001 she has also been a director for Reg Technologies,
  Inc., a British Columbia corporation listed on the TSX Venture Exchange that
  has financed the research on the Rand Cam Engine since 1986. REGI U.S. is controlled
  by Rand Energy Group, Inc., a British Columbia corporation of which Reg Technologies
  Inc. is the majority shareholder. Since February 1995 Ms. Lorette has been Secretary
  and a director of IAS Communications Inc., an Oregon corporation traded on the
  OTC bulletin board. Since June 1997 Ms. Lorette has been Executive Vice President
  and a Director of Information-Highway.com, Inc., a Florida corporation traded
  which is currently inactive, and its predecessor. Since November 2000 Ms. Lorette
  has also been a director of Linux Gold Corp. Since February 2001 Ms. Lorette
  has been a director of Teryl Resources Corp., a public company trading on the
  TSX Venture Exchange involved in gold, diamond, and oil and gas exploration.

James L. Vandeberg - Chief Operating Officer and Chief Financial
  Officer, and a Member of the Board of Directors

Mr. Vandeberg became a Director and Chief Operating Officer
  in November 1999 and Chief Financial Officer in 2000. Mr. Vandeberg is an attorney
  in Seattle, Washington. He has served as our legal counsel since 1996. Mr. Vandeberg's
  practice focuses on the corporate finance area, with an emphasis on securities
  and acquisitions. Mr. Vandeberg was previously general counsel and secretary
  of two NYSE companies and is a director of Information-Highway.com, Inc., a
  Florida corporation which is currently inactive. He is also a director of IAS
  Communications, Inc. an Oregon corporation traded on the OTC bulletin board
  since November 1998. Mr. Vandeberg is also a director of Linux Gold Corp., a
  British Columbia company traded on the OTC bulletin board. Mr. Vandeberg is
  also a director of Cyber Merchants Exchange, Inc. since May 2001. He is a member
  and former director of the American Society of Corporate Secretaries. He became
  a member of the Washington Bar Association in 1969 and of the California Bar
  Association in 1973. Mr. Vandeberg graduated cum laude from the University of
  Washington with a Bachelor of Arts degree in accounting in 1966, and from New
  York University School of Law in 1969, where he was a Root-Tilden Scholar.

Brian Cherry - Vice President, Rand CamTM Engine Technology
  Projects

Mr. Cherry was Vice President and a Director of the Company
  since its inception in July 1992, until January 2001 when he left the Company
  to pursue personal interests. Mr. Cherry was appointed Vice President, Rand
  CamTM Engine Technology Projects in June 2004.

---

Section 16(a) Beneficial Ownership Reporting Compliance

Based solely upon a review of Forms 3, 4 and 5 furnished to
  us, other than Messrs. Vandeberg and Cherry who furnished us with no forms during
  the year, none of our officers, directors or beneficial owners of more than
  ten percent of the Common Stock failed to file on a timely basis reports required
  to be filed by Section 16(a) of the Exchange Act during the most recent fiscal
  year.

ITEM 10.     EXECUTIVE COMPENSATION

No executive officer had an annual salary and bonus in excess
  of $100,000 during the past fiscal year. Mr. Robertson received no compensation
  from us in fiscal year 2005.

|Name and Principal Position         | Year         | Annual Compensation           | Long-Term Compensation       
|----------------------------------- | ------------ | ----------------------------- | -----------------------------
|                                    |              |                               | Awards                       
|Salary ($)                          | Bonus ($)    | Other Annual Compensation ($) | Restricted Stock Award(s) (#)
|John G. Robertson,President and CEO | 200520042003 | Nil Nil Nil                   | Nil Nil Nil                  

|(1) | "SARS"or "stock appreciation right"means
        a right granted by US, as compensation for services rendered, to receive
        a payment of cash or an issue or transfer of securities based wholly or
        in part on changes in the trading price of our publicly traded securities.                                                                    
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) | "LTIP"or "long term incentive plan"means
        any plan which provides compensation intended to serve as incentive for
        performance to occur over a period longer than one financial year, but
        does not include option or stock appreciation right plans or plans for
        compensation through restricted shares or restricted share units.
|   
|(3) | Access Information Services, Inc., a Washington
        corporation which is owned and controlled by the Robertson Family Trust,
        received or is to receive $2,500 per month from us for management
        services provided to us. Mr. Robertson is a trustee of the Robertson Family
        Trust.                                                   

On March 31, 1994, we entered into a management agreement
  with Access Information Services, Inc., a Washington corporation, which is owned
  and controlled by the Robertson Family Trust. We retained Access at the rate
  of $2,500 per month to provide certain management, administrative, and financial
  services.

We may in the future create retirement, pension, profit sharing,
  insurance and medical reimbursement plans covering our Officers and Directors.
  At the present time, no such plans exist. No advances have been made or are
  contemplated by us to any of our Officers or Directors. Directors receive no
  compensation for their service as such. Compensation of officers and directors
  is determined by our Board of Directors and is not subject to shareholder approval.

The following table sets forth certain information with respect
  to options exercised during the fiscal year ended April 30, 2005 by our Chief
  Executive Officer, and with respect to unexercised options held by our Chief
  Executive Officer at the end of fiscal 2005.

---

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND YEAR END OPTION VALUES

|Name              | Shares Acquired
      On Exercise (#) | Value realized ($) | Number of Unexercised Options at Years
      End Exercisable /
      Unexercisable | Value of Unexercised Options at Year End
      (1) Exercisable /
      Unexercisable
|----------------- | ------------------------------------- | ------------------ | ---------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------
|John G. Robertson | -0-                                   | -0-                | 570,000 / 0                                                                        | $131,100 / -0-                                                                      

(1) The calculation of the value of unexercised options is
  based on the difference between the last sale price of $0.43 per share for
  our Common Stock on April 29, 2005 and the exercise price of each option (then
  $0.20), multiplied by the number of shares covered by the option.

We do not have any Long Term Incentive Plans.

We do not have any employment contracts, termination of employment
  and change of control arrangements.

ITEM 11.     SECURITY OWNERSHIP OF CERTAIN
  BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth, as of July 25, 2005, our outstanding
  Class A Common Stock owned of record or beneficially by each person who owned
  of record, or was known by us to own beneficially, more than 5% of our Common
  Stock, and the name and shareholdings of each Executive Officer and Director
  and all Executive Officers and Directors as a group. A person is deemed to be
  the beneficial owner of securities that can be acquired by such person within
  60 days from the date of this report upon the exercise of warrants or options.
  Each beneficial owner's percentage ownership is determined by assuming that
  options that are held by such person and which are exercisable within 60 days
  from the date are exercised.

---

|Name                                                                            | Class A Shares Owned | Percentage of 
|------------------------------------------------------------------------------- | -------------------- | --------------
|                                                                                |                      | Class A Shares
|                                                                                |                      | Owned         
|John G. Robertson, Chairman of the Board of                                     | 7,085,736            | 29.9%         
|Directors, President and Director (1) (2) (3) (4)                               |                      |               
|                                                                                |                      |               
|James McCann (5)                                                                | 3,700,976            | 15.6%         
|                                                                                |                      |               
|Rand Energy Group Inc. (6)                                                      | 3,700,976            | 15.6%         
|                                                                                |                      |               
|Jennifer Lorette, Vice President and Director (7)                               | 200,500              | *             
|                                                                                |                      |               
|James Vandeberg, Chief Operating Officer and Director (8)                       | 76,000               | *             
|                                                                                |                      |               
|Brian Cherry, Vice President of the Rand CamTM Engine Technology
      Projects | 150,000              | *             
|                                                                                |                      |               
|ALL EXECUTIVE OFFICERS & DIRECTORS AS A GROUP (FOUR                             | 7,362,236            | 31.04%        
|INDIVIDUALS) (9)                                                                |                      |               

Except as noted below, all shares are held beneficially and
  of record and each record shareholder has sole voting and investment power.

*Less than one percent of the issued and outstanding on July
  25, 2005, which was 23,764,475

(1) These individuals may be deemed to be our "parents or
  founders" as that term is defined in the Rules and Regulations promulgated under
  the Securities Act of 1933.

(2) Includes 3,700,976 shares registered in the name of Rand
  Energy Group Inc. See Note (5) below for an explanation of the beneficial ownership
  of Rand Energy Group Inc. Mr. Robertson disclaims beneficial ownership of these
  shares beyond the extent of his pecuniary interest. Also includes 570,000 options
  that are currently exercisable. Mr. Robertson's address is the same as the Company's.

(3) Includes 2,747,860 common shares registered in the name
  of Access Information Services, Ltd., a corporation controlled by the Robertson
  Family Trust, and 600,000 options that are currently exercisable. Mr. Robertson
  is one of three trustees of the Robertson Family Trust, which acts by the majority
  vote of the three trustees. Mr. Robertson disclaims beneficial ownership of
  the shares owned or controlled by the Robertson Family Trust. Mr. Robertson's
  address is the same as our address.

(4) Rainbow Network is a private Turks and Caicos Island company.
  Mr. Robertson is the President and director of Rainbow Network. Mr. Robertson
  disclaims beneficial ownership of the shares owned or controlled by the Rainbow
  Network. Mr. Robertson's address is the same as our address.

(5) Includes 3,700,976 shares registered in the name of Rand
  Energy Group Inc. See Note (6) below for an explanation of the beneficial ownership
  of Rand Energy Group Inc.

---

(6) Rand Energy Group Inc. is owned 51% by Reg Technologies
  Inc. and 49% by Rand Cam Engine Corp. Under Rule 13d-3 under the Securities
  Exchange Act of 1934, both Reg Technologies Inc. and Rand Cam Engine Corp. could
  be considered the beneficial owner of the 3,700,976 shares registered in the
  name of Rand Energy Group Inc.

Reg Technologies Inc. is a British Columbia corporation listed
  on the TSX Venture Exchange that has financed the research on the Rand Cam Engine
  since 1986. Since October 1984 Mr. Robertson has been President and a Director
  of Reg Technologies Inc. SMR Investment Ltd., a British Columbia corporation,
  holds a controlling interest in Reg Technologies Inc. Since May 1977 Mr. Robertson
  has been President and a member of the Board of Directors of SMR Investments
  Ltd. Susanne M. Robertson, Mr. Robertson's wife, owns SMR Investment Ltd. Accordingly,
  in Note (2) above, beneficial ownership of the 3,700,976 shares registered in
  the name of Rand Energy Group Inc. has been attributed to Mr. Robertson. We
  believe it would be misleading and not provide clear disclosure to list as beneficial
  owners in the table the other entities and persons discussed in this paragraph,
  although a strict reading of Rule 13d-3 under the Securities Exchange Act of
  1934 might require each such entity and person to be listed in the beneficial
  ownership table.

Rand Cam Engine Corp. is a privately held company whose stock
  is controlled by James McCann and minor interest by several other shareholders.
  We believe it would be misleading and not provide clear disclosure to list as
  beneficial owners in the table the other entities and persons discussed in this
  paragraph, although a strict reading of Rule 13d-3 under the Securities Exchange
  Act of 1934 might require each such entity and person to be listed in the beneficial
  ownership table.

(7) Includes 162,500 options that are currently exercisable.
  Ms. Lorette's address is the same as the Company's.

(8) Includes 75,000 options that are currently exercisable.
  Mr. Vandeberg's address is 601 Union Street, Suite 4500, Seattle, WA 98101.

(9) Includes 3,700,976 shares registered in the name of Rand
  Energy Group Inc. whose beneficial ownership is attributed to Mr. Robertson
  as set forth in Note (2) above. See Note (5) above for an explanation of the
  beneficial ownership of Rand Energy Group Inc. Mr. Robertson disclaims beneficial
  ownership of these shares beyond the extent of his pecuniary interest. Also
  includes 570,000 options that are currently exercisable.

ITEM 12.     CERTAIN RELATIONSHIPS AND
  RELATED TRANSACTIONS

Pursuant to the August 1992 Agreement we issued 5,700,000
  shares of our Common Stock at a deemed value of $0.01 per share to Rand
  Energy Group Inc., a privately held British Columbia corporation ("RAND") in
  exchange for certain valuable rights, technology, information, and other tangible
  and intangible assets relating to the United States rights to the Original Engine.
  RAND is owned 51% by Reg Technologies Inc., a British Columbia corporation listed
  on the TSX Venture Exchange ("Reg Tech"), and 49% by Rand Cam Engine Corp. Reg
  Tech's President is also our President and its Vice President is also Vice President
  of the Company.

We also agreed to pay semi-annually to RAND a royalty of 5%
  of any net profits to be derived by us from revenues received as a result of
  its license of the Original Engine.

---

In the April 1993 Agreement, an amendment to a previous Amendment
  Agreement dated November 23, 1992, between RAND, Reg Tech and Brian Cherry (a
  former officer and director) and an original agreement dated July 30, 1992,
  between RAND, Reg Tech and Brian Cherry, Cherry agreed to: (a) sell, transfer
  and assign to RAND all his right, title and interest in and to the technology
  related to the RC/DC Engine, including all pending and future patent applications
  in respect of the Technology for all countries except the United States of America,
  together with any improvements, changes or other variations to the Technology;
  (b) sell, transfer and assign to us (then called Sky Technologies Inc.), all
  his right, title and interest in and to the Technology, including all pending
  and future patent applications in respect of the Technology for the United States
  of America, together with any improvements, changes or other variations to the
  Technology.

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

A final provision of the April 1993 Agreement assigns and
  transfers ownership to us of any patents, inventions, copyrights, know-how,
  technical data, and related types of intellectual property conceived, developed
  or created by RAND or its associated companies either prior to or subsequent
  to the date of the agreement, which results or derives from the direct or indirect
  use of the Original Engine and/or RC/DC Engine technologies by RAND.

The terms of the agreements referenced above were negotiated
  by the parties in non-arm's-length transactions but were deemed by the parties
  involved to be fair and equitable under the circumstances existing at the time.

We are controlled by Rand Energy Group Inc., a privately held
  British Columbia corporation ("RAND"), which, in turn, is controlled 51% by
  Reg Technologies Inc., a publicly held British Columbia corporation ("Reg Tech")
  and 49% by Rand Cam Engine Corp. SMR Investment Ltd., a British Columbia corporation,
  holds a controlling interest in Reg Technologies Inc. Since May 1977, Mr. Robertson
  has been President and a member of the Board of Directors of SMR Investments
  Ltd. Susanne M. Robertson, Mr. Robertson's wife, owns SMR Investment Ltd. Rand
  Cam Engine Corp. is a privately held company whose stock is reportedly majority
  owned and controlled by James McCann and the balance by several other shareholders.

---

ITEM 13.     EXHIBITS.

|Number                              | Description                                                                                                                                                                                                         |    
|----------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---
|3.1                                 | Articles of Incorporation                                                                                                                                                                                           | (1)
|3.2                                 | Article of Amendment changing name to REGI U.S., Inc                                                                                                                                                                | (2)
|3.3                                 | By-Laws                                                                                                                                                                                                             | (1)
|4.1                                 | Specimen Share Certificate                                                                                                                                                                                          | (1)
|4.2                                 | Specimen Warrant Certificate                                                                                                                                                                                        | (1)
|10.1                                | Consulting Agreement, dated December 1, 1999, between                                                                                                                                                               | (3)
|Regi U.S., Inc. and Patrick Badgley
|10.2                                | Special Service Proposal, dated December 21, 1999, between
      Regi U.S. and ColTec, Inc                                                                                                                          | (3)
|10.3                                | Agreement between Coltec and REGI dated October 2000                                                                                                                                                                | (4)
|10.4                                | Agreement between REGI and Advanced Ceramics Research dated
      March 20, 2002                                                                                                                                    | (5)
|10.5                                | License Agreement between Rand Energy Group, Inc., and Reg
      Technologies, Inc. REGI U.S., Inc. and Radian Incorporated made as of April
      24, 2002                                                         | (5)
|10.6                                | Agreement between REGI U.S., Inc. and Rotary Power Generation,
      Incorporated made as of April 22, 2002                                                                                                         | (6)
|10.7                                | Amendment to Agreement between REGI U.S., Inc. and Rotary
      Power Generation, Incorporated made as of April 2, 2003                                                                                             | (6)
|23.1                                | Consent of Independent Auditors                                                                                                                                                                                     | (7)
|31.1                                | Certification of Chief Executive
      Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                            |    
|31.2                                | Certification of Chief Financial
      Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                            |    
|32.1                                | Certification of John G. Robertson,
      President (Principal Executive Officer), pursuant to 18 U.S.C. Section 1350,
      as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                   |    
|32.2                                | Certification of James Vandeberg,
      Chief Financial Officer (Principal Financial Officer), pursuant to
      18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
      Act of 2002 |    

|(1) | Incorporated by reference from Form 10-SB Registration Statement filed
      April 26, 1994.
|--- | --------------------------------------------------------------------------------------------
|(2) | Incorporated by reference from 10-Q Report for the quarter ended 7-30-94.                   
|(3) | Incorporated by reference from our 10-KSB for the fiscal year ended April
      30, 2000.   
|(4) | Incorporated by reference from our 10-KSB for the fiscal year ended April
      30, 2001    
|(5) | Incorporated by reference from our 10-KSB for the fiscal year ended April
      30, 2002    
|(6) | Incorporated by reference from our 10-KSB for the fiscal year ended April
      30, 2003    
|(7) | Incorporated herein.                                                                        

|Report of Independent Registered Public
      Accounting Firm | F-1        
|------------------------------------------------------------- | -----------
|Balance Sheets                                                | F-2        
|Statements of Operations                                      | F-3        
|Statements of Cash Flows                                      | F-4        
|Statement of Stockholders' Equity                             | F-5        
|Notes to the Financial Statements                             | F-8 to F-15

---

ITEM 14.     PRINCIPAL ACCOUNTANT FEES AND SERVICES.

The following table discloses accounting fees and services which we paid to
  our auditor, Manning Elliott:

| |                           | 2005        | 2004       
| | ------------------------- | ----------- | -----------
| | Type of Services Rendered | Fiscal Year | Fiscal Year
| |                           |             |            

|(a)   Audit Fees         | $10,900 | $10,400
|------------------------ | ------- | -------
|(b)   Audit-Related Fees | $Nil    | $Nil   
|(c)   Tax Fees           | $Nil    | $Nil   
|(d)   All Other Fees     | $Nil    | $Nil   

---

EXHIBIT INDEX

|Number                              | Description                                                                                                                                                                                                         |    
|----------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---
|3.1                                 | Articles of Incorporation                                                                                                                                                                                           | (1)
|3.2                                 | Article of Amendment changing name to REGI U.S., Inc                                                                                                                                                                | (2)
|3.3                                 | By-Laws                                                                                                                                                                                                             | (1)
|4.1                                 | Specimen Share Certificate                                                                                                                                                                                          | (1)
|4.2                                 | Specimen Warrant Certificate                                                                                                                                                                                        | (1)
|10.1                                | Consulting Agreement, dated December 1, 1999, between                                                                                                                                                               | (3)
|Regi U.S., Inc. and Patrick Badgley
|10.2                                | Special Service Proposal, dated December 21, 1999, between
      Regi U.S. and ColTec, Inc                                                                                                                          | (3)
|10.3                                | Agreement between Coltec and REGI dated October 2000                                                                                                                                                                | (4)
|10.4                                | Agreement between REGI and Advanced Ceramics Research dated
      March 20, 2002                                                                                                                                    | (5)
|10.5                                | License Agreement between Rand Energy Group, Inc., and Reg
      Technologies, Inc. REGI U.S., Inc. and Radian Incorporated made as of April
      24, 2002                                                         | (5)
|10.6                                | Agreement between REGI U.S., Inc. and Rotary Power Generation,
      Incorporated made as of April 22, 2002                                                                                                         | (6)
|10.7                                | Amendment to Agreement between REGI U.S., Inc. and Rotary
      Power Generation, Incorporated made as of April 2, 2003                                                                                             | (6)
|23.1                                | Consent of Independent Auditors                                                                                                                                                                                     | (7)
|31.1                                | Certification of Chief Executive
      Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                            |    
|31.2                                | Certification of Chief Financial
      Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                            |    
|32.1                                | Certification of John G. Robertson,
      President (Principal Executive Officer), pursuant to 18 U.S.C. Section 1350,
      as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                   |    
|32.2                                | Certification of James Vandeberg,
      Chief Financial Officer (Principal Financial Officer), pursuant to
      18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
      Act of 2002 |    

|(1) | Incorporated by reference from Form 10-SB Registration Statement filed
      April 26, 1994.
|--- | --------------------------------------------------------------------------------------------
|(2) | Incorporated by reference from 10-Q Report for the quarter ended 7-30-94.                   
|(3) | Incorporated by reference from our 10-KSB for the fiscal year ended April
      30, 2000.   
|(4) | Incorporated by reference from our 10-KSB for the fiscal year ended April
      30, 2001    
|(5) | Incorporated by reference from our 10-KSB for the fiscal year ended April
      30, 2002    
|(6) | Incorporated by reference from our 10-KSB for the fiscal year ended April
      30, 2003    
|(7) | Incorporated herein.                                                                        

|Independent Auditor's Report      | F-1        
|--------------------------------- | -----------
|Balance Sheets                    | F-2        
|Statements of Operations          | F-3        
|Statements of Cash Flows          | F-4        
|Statement of Stockholders' Equity | F-5        
|Notes to the Financial Statements | F-8 to F-15

---

REGI U.S., Inc. 
  (A Development Stage Company)

April 30, 2005

|                                                              | Index
|------------------------------------------------------------- | -----
|                                                              |      
|Report of Independent Registered Public
      Accounting Firm | F-1  
|                                                              |      
|Balance Sheets                                                | F-2  
|                                                              |      
|Statements of Operations                                      | F-3  
|                                                              |      
|Statements of Cash Flows                                      | F-4  
|                                                              |      
|Statement of Stockholders’ Equity
      (Deficit)             | F-5  
|                                                              |      
|Notes to the Financial Statements                             | F-8  

---



Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors 
  of REGI U.S., Inc. 
  (A Development Stage Company)

We have audited the accompanying balance sheets of REGI U.S.,
  Inc. as of April 30, 2005 and 2004 and the related statements of operations,
  cash flows and stockholders’ deficit for the period from July 27, 1992
  (Inception) to April 30, 2005 and the years ended April 30, 2005 and 2004. 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. 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 financial statements referred to above
  present fairly, in all material respects, the financial position of REGI U.S.,
  Inc., as of April 30, 2005 and 2004, and the results of its operations and its
  cash flows for the period from July 27, 1992 (Inception) to April 30, 2005 and
  the years ended April 30, 2005 and 2004, in conformity with accounting principles
  generally accepted in the United States.

The accompanying financial statements have been prepared assuming
  the Company will continue as a going concern. As discussed in Note 1 to the
  financial statements, the Company has a significant working capital deficit,
  has not generated any revenues and has accumulated operating losses since inception.
  These factors raise substantial doubt about the Company’s ability to continue
  as a going concern. Management’s plans in regard to these matters are
  also discussed in Note 1. The financial statements do not include any adjustments
  that might result from the outcome of this uncertainty.

/s/ Manning Elliott

CHARTERED ACCOUNTANTS

Vancouver, Canada

August 9, 2005

F-1

---

REGI U.S., Inc. 
  (A Development Stage Company) 
  Balance Sheets 
  (expressed in U.S. dollars)

|                                                                                | April 30,  |   | April 30,  |  
|------------------------------------------------------------------------------- | ---------- | - | ---------- | -
|                                                                                | 2005       |   | 2004       |  
|                                                                                | $          |   | $          |  
|                                                                                |            |   |            |  
|ASSETS                                                                          |            |   |            |  
|                                                                                |            |   |            |  
|Current Assets                                                                  |            |   |            |  
|                                                                                |            |   |            |  
|Prepaid
      expenses                                                          | 17,214     |   | –          |  
|                                                                                |            |   |            |  
|Total Current Assets                                                            | 17,214     |   | –          |  
|                                                                                |            |   |            |  
|Intangible Assets (Note 3)                                                      | –          |   | 64,865     |  
|                                                                                |            |   |            |  
|Total Assets                                                                    | 17,214     |   | 64,865     |  
|                                                                                |            |   |            |  
|LIABILITIES AND STOCKHOLDERS’ DEFICIT                                           |            |   |            |  
|                                                                                |            |   |            |  
|Current Liabilities                                                             |            |   |            |  
|                                                                                |            |   |            |  
|Bank indebtedness                                                               | 3,514      |   | 3,133      |  
|Accounts payable                                                                | 78,077     |   | 77,950     |  
|Accrued liabilities                                                             | 9,596      |   | 8,300      |  
|Due
      to related parties (Note 5(a))                                        | 137,650    |   | 136,923    |  
|                                                                                |            |   |            |  
|Total Liabilities                                                               | 228,837    |   | 226,306    |  
|                                                                                |            |   |            |  
|Commitments (Note 6)                                                            |            |   |            |  
|Subsequent Events (Note 8)                                                      |            |   |            |  
|                                                                                |            |   |            |  
|Stockholders’ Deficit                                                           |            |   |            |  
|                                                                                |            |   |            |  
|Common Stock (Note 4):                                                          |            |   |            |  
|50,000,000 shares authorized without par value; 23,720,725
      and 22,231,055 |            |   |            |  
|shares issued and outstanding, respectively                                     | 5,838,841  |   | 5,492,267  |  
|                                                                                |            |   |            |  
|Additional Paid-in Capital                                                      | 138,488    |   | 115,184    |  
|                                                                                |            |   |            |  
|Donated Capital (Note 5)                                                        | 547,500    |   | 397,500    |  
|                                                                                |            |   |            |  
|Deferred Compensation                                                           | (13,000    | ) | (27,829    | )
|                                                                                |            |   |            |  
|Deficit Accumulated During the Development
      Stage                          | (6,723,452 | ) | (6,138,563 | )
|                                                                                |            |   |            |  
|Total Stockholders’ Deficit                                                     | (211,623   | ) | (161,441   | )
|                                                                                |            |   |            |  
|Total Liabilities and Stockholders’
      Deficit                               | 17,214     |   | 64,865     |  

(The Accompanying Notes are an Integral Part of the Financial
  Statements)

F-2

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Statements of Operations 
  (expressed in U.S. dollars)

|                                                       | Accumulated From    |  |                    |   |            |  
|------------------------------------------------------ | ------------------- |  | ------------------ | - | ---------- | -
|                                                       | July 27,1992        |  |                    |   |            |  
|                                                       | (Date of Inception) |  | For the Year Ended |  
|                                                       | to April 30,        |  | April 30,          |  
|                                                       | 2005                |  | 2005               |   | 2004       |  
|                                                       | $                   |  | $                  |   | $          |  
|                                                       |                     |  |                    |   |            |  
|Revenue                                                | –                   |  | –                  |   | –          |  
|                                                       |                     |  |                    |   |            |  
|Expenses                                               |                     |  |                    |   |            |  
|                                                       |                     |  |                    |   |            |  
|Amortization                                           | 130,533             |  | 5,292              |   | 4,787      |  
|General and administrative
      1(Note 5)             | 2,877,247           |  | 434,311            |   | 505,125    |  
|Impairment loss on intangible
      assets (Note 3(d)) | 72,823              |  | 72,823             |   | –          |  
|Research
      and development 1(Note 5)               | 3,757,734           |  | 72,463             |   | 105,931    |  
|                                                       |                     |  |                    |   |            |  
|Operating Loss                                         | 6,838,337           |  | 584,889            |   | 615,846    |  
|                                                       |                     |  |                    |   |            |  
|Other Income                                           |                     |  |                    |   |            |  
|                                                       |                     |  |                    |   |            |  
|Accounts
      payable written-off                     | 114,885             |  | –                  |   | 5,933      |  
|                                                       |                     |  |                    |   |            |  
|Net Loss                                               | 6,723,452           |  | 584,889            |   | 609,913    |  
|                                                       |                     |  |                    |   |            |  
|Net Loss Per Share – Basic and
      Diluted           |                     |  | (0.03              | ) | (0.03      | )
|                                                       |                     |  |                    |   |            |  
|Weighted Average Shares Outstanding                    |                     |  | 22,836,000         |   | 19,346,000 |  
|                                                       |                     |  |                    |   |            |  
|1Stock-based compensation is included in:              |                     |  |                    |   |            |  
|General and administrative                             | 488,283             |  | 51,132             |   | 142,354    |  
|Research
      and development                         | 11,000              |  | 11,000             |   | –          |  
|                                                       |                     |  |                    |   |            |  
|                                                       | 499,283             |  | 62,132             |   | 142,354    |  

(The Accompanying Notes are an Integral Part of the Financial
  Statements)

F-3

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Statements of Cash Flows 
  (expressed in U.S. dollars)

|                                                                      | From                |   |                    |   |          |  
|--------------------------------------------------------------------- | ------------------- | - | ------------------ | - | -------- | -
|                                                                      | July 27, 1992       |   |                    |   |          |  
|                                                                      | (Date of Inception) |   | For the Year Ended |  
|                                                                      | to April 30,        |   | April 30,          |  
|                                                                      | 2005                |   | 2005               |   | 2004     |  
|                                                                      | $                   |   | $                  |   | $        |  
|                                                                      |                     |   |                    |   |          |  
|Cash Flows to Operating Activities                                    |                     |   |                    |   |          |  
|                                                                      |                     |   |                    |   |          |  
|Net loss for the period                                               | (6,723,452          | ) | (584,889           | ) | (609,913 | )
|                                                                      |                     |   |                    |   |          |  
|Adjustments to reconcile
      net loss to net cash used in operating |                     |   |                    |   |          |  
|activities                                                            |                     |   |                    |   |          |  
|                                                                      |                     |   |                    |   |          |  
|Accounts payable written-off                                          | (102,688            | ) | –                  |   | (5,933   | )
|Amortization                                                          | 130,532             |   | 5,292              |   | 4,787    |  
|Amortization
      of deferred compensation and other stock-based     |                     |   |                    |   |          |  
|compensation                                                          | 499,283             |   | 62,132             |   | 142,354  |  
|Donated services                                                      | 547,500             |   | 150,000            |   | 210,000  |  
|Impairment loss on intangible assets                                  | 72,823              |   | 72,823             |   | –        |  
|Intellectual property written-off                                     | 578,509             |   | –                  |   | –        |  
|                                                                      |                     |   |                    |   |          |  
|Changes in operating assets
      and liabilities                     |                     |   |                    |   |          |  
|                                                                      |                     |   |                    |   |          |  
|Amounts receivable                                                    | (3,000              | ) | –                  |   | –        |  
|Prepaid expenses                                                      | (17,214             | ) | (17,214            | ) | –        |  
|Accounts payable and accrued liabilities                              | 198,518             |   | 1,423              |   | (2,255   | )
|                                                                      |                     |   |                    |   |          |  
|Net Cash Used in Operating Activities                                 | (4,819,189          | ) | (310,433           | ) | (260,960 | )
|                                                                      |                     |   |                    |   |          |  
|Cash Flows from Investing Activities                                  |                     |   |                    |   |          |  
|                                                                      |                     |   |                    |   |          |  
|Patent protection costs                                               | (38,197             | ) | (13,250            | ) | (6,445   | )
|Purchase
      of property and equipment                              | (198,419            | ) | –                  |   | –        |  
|                                                                      |                     |   |                    |   |          |  
|Net Cash Used by Investing Activities                                 | (236,616            | ) | (13,250            | ) | (6,445   | )
|                                                                      |                     |   |                    |   |          |  
|Cash Flows from Financing Activities                                  |                     |   |                    |   |          |  
|                                                                      |                     |   |                    |   |          |  
|Increase in bank indebtedness                                         | 3,514               |   | 381                |   | 3,133    |  
|Increase in due to related
      parties                              | 425,497             |   | 728                |   | 158,185  |  
|Proceeds from convertible
      debenture                             | 5,000               |   | –                  |   | –        |  
|Proceeds
      from the sale of common stock                          | 4,621,794           |   | 322,574            |   | 106,000  |  
|                                                                      |                     |   |                    |   |          |  
|Net Cash Provided by Financing Activities                             | 5,055,805           |   | 323,683            |   | 267,318  |  
|                                                                      |                     |   |                    |   |          |  
|Increase (Decrease) In Cash and Cash Equivalents                      | –                   |   | –                  |   | (87      | )
|                                                                      |                     |   |                    |   |          |  
|Cash and Cash Equivalents - Beginning
      of Period                 | –                   |   | –                  |   | 87       |  
|                                                                      |                     |   |                    |   |          |  
|Cash and Cash Equivalents - End of
      Period                       | –                   |   | –                  |   | –        |  
|                                                                      |                     |   |                    |   |          |  
|Non-cash Investing and Financing Activities                           |                     |   |                    |   |          |  
|                                                                      |                     |   |                    |   |          |  
|Stock-based compensation                                              | 512,283             |   | 47,303             |   | 170,184  |  
|Shares issued to settle
      debt                                    | 496,000             |   | –                  |   | 166,000  |  
|Shares issued for convertible
      debenture                         | 5,000               |   | –                  |   | –        |  
|Shares issued for intellectual
      property                         | 345,251             |   | –                  |   | –        |  
|Affiliate’s
      shares issued for intellectual property             | 200,000             |   | –                  |   | –        |  
|                                                                      |                     |   |                    |   |          |  
|Supplemental Disclosures                                              |                     |   |                    |   |          |  
|                                                                      |                     |   |                    |   |          |  
|Interest paid                                                         | –                   |   | –                  |   | –        |  
|Income
      tax paid                                                 | –                   |   | –                  |   | –        |  

(The Accompanying Notes are an Integral Part of the Financial
  Statements)

F-4

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Statements of Stockholders’ Equity (Deficit) 
  From July 27, 1992 (Date of inception) to April 30, 2005
  (expressed in U.S. dollars)

|                                               |              |           |            |            |          |              | Deficit     |        |               |  
|---------------------------------------------- | ------------ | --------- | ---------- | ---------- | -------- | ------------ | ----------- | ------ | ------------- | -
|                                               |              |           |            |            |          |              | Accumulated |        | Total         |  
|                                               |              |           | Additional | Common     |          |              | During the  |        | Stockholders’ |  
|                                               | Common Stock | Paid-in   | Stock      | Donated    | Deferred | Development  |             | Equity |              
|                                               | Shares       | Amount    | Capital    | Subscribed | Capital  | Compensation | Stage       |        | (Deficit)     |  
|                                               | #            | $         | $          | $          | $        | $            | $           |        | $             |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Balance – July 27, 1992 (Date of  inception)   | –            | –         | –          | –          | –        | –            | –           |        | –             |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Stock issued for intellectual                  |              |           |            |            |          |              |             |        |               |  
|property at $0.001 per share                   | 5,700,000    | 57,000    | –          | –          | –        | –            | –           |        | 57,000        |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Stock issued for cash                          | 300,000      | 3,000     | –          | –          | –        | –            | –           |        | 3,000         |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Net loss                                       | –            | –         | –          | –          | –        | –            | (23,492     | )      | (23,492       | )
|                                               |              |           |            |            |          |              |             |        |               |  
|Balance – April 30, 1993                       | 6,000,000    | 60,000    | –          | –          |          | –            | (23,492     | )      | 36,508        |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Stock issued for cash pursuant to a            |              |           |            |            |          |              |             |        |               |  
|public offering                                | 500,000      | 500,000   | –          | –          | –        | –            | –           |        | 500,000       |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Net loss                                       | –            | –         | –          | –          | –        | –            | (394,263    | )      | (394,263      | )
|                                               |              |           |            |            |          |              |             |        |               |  
|Balance – April 30, 1994                       | 6,500,000    | 560,000   | –          | –          |          | –            | (417,755    | )      | 142,245       |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Stock issued for cash pursuant to:             |              |           |            |            |          |              |             |        |               |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Options exercised                              | 10,000       | 1,000     | –          | –          | –        | –            | –           |        | 1,000         |  
|Private placement                              | 250,000      | 562,500   | –          | –          | –        | –            | –           |        | 562,500       |  
|Warrants exercised                             | 170,200      | 213,000   | –          | –          | –        | –            | –           |        | 213,000       |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Net loss                                       | –            | –         | –          | –          | –        | –            | (1,225,743  | )      | (1,225,743    |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Balance – April 30, 1995                       | 6,930,200    | 1,336,500 | –          | –          | –        | –            | (1,643,498  | )      | (306,998      | )
|                                               |              |           |            |            |          |              |             |        |               |  
|Stock issued for cash pursuant to:             |              |           |            |            |          |              |             |        |               |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Options exercised                              | 232,500      | 75,800    | –          | –          | –        | –            | –           |        | 75,800        |  
|Warrants exercised                             | 132,200      | 198,300   | –          | –          |          | –            | –           |        | 198,300       |  
|A private offering                             | 341,000      | 682,000   | –          | –          | –        | –            | –           |        | 682,000       |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Net loss                                       | –            | –         | –          | –          | –        | –            | (796,905    | )      | (796,905      | )
|                                               |              |           |            |            |          |              |             |        |               |  
|Balance – April 30,1996                        | 7,635,900    | 2,292,600 | –          | –          | –        | –            | (2,440,403  | )      | (147,803      | )
|                                               |              |           |            |            |          |              |             |        |               |  
|Stock issued for cash pursuant to:             |              |           |            |            |          |              |             |        |               |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Options exercised                              | 137,000      | 13,700    | –          | –          | –        | –            | –           |        | 13,700        |  
|Warrants exercised                             | 185,400      | 278,100   | –          | –          | –        | –            | –           |        | 278,100       |  
|Private placements                             | 165,000      | 257,500   | –          | –          | –        | –            | –           |        | 257,500       |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Net loss                                       | –            | –         | –          | –          | –        | –            | (510,184    | )      | (510,184      | )
|                                               |              |           |            |            |          |              |             |        |               |  
|Balance – April 30, 1997                       | 8,123,300    | 2,841,900 | –          | –          | –        | –            | (2,950,587  | )      | (108,687      | )
|                                               |              |           |            |            |          |              |             |        |               |  
|Stock issued for cash pursuant to:             |              |           |            |            |          |              |             |        |               |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Options exercised                              | 50,000       | 5,000     | –          | –          | –        | –            | –           |        | 5,000         |  
|A units offering                               | 500,000      | 500,000   | –          | –          | –        | –            | –           |        | 500,000       |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Stock issued for acquisition of AVFS rights    | 400,000      | 288,251   | –          | –          | –        | –            | –           |        | 288,251       |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Stock issued for financial consulting services | 125,000      | 170,250   | –          | –          | –        | –            | –           |        | 170,250       |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Stock issued to settle an accrued liability    | 50,000       | 25,000    | –          | –          | –        | –            | –           |        | 25,000        |  
|                                               |              |           |            |            |          |              |             |        |               |  
|Net loss                                       | –            | –         | –          | –          | –        | –            | (580,901    | )      | (580,901      | )
|                                               |              |           |            |            |          |              |             |        |               |  
|Balance – April 30, 1998                       | 9,248,300    | 3,830,401 | –          | –          | –        | –            | (3,531,488  | )      | 298,913       |  

(The Accompanying Notes are an Integral Part of the Financial
  Statements)

F-5

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Statements of Stockholders’ Equity (Deficit) 
  From July 27, 1992 (Date of inception) to April 30, 2005
  (expressed in U.S. dollars)

|                                        |              |           |         |            |            |         |          |              | Deficit     |        |               |  
|--------------------------------------- | ------------ | --------- | ------- | ---------- | ---------- | ------- | -------- | ------------ | ----------- | ------ | ------------- | -
|                                        |              |           |         |            |            |         |          |              | Accumulated |        | Total         |  
|                                        |              |           |         | Additional | Common     |         |          |              | During the  |        | Stockholders’ |  
|                                        | Common Stock |           | Paid-in | Stock      |            | Donated | Deferred | Development  |             | Equity |              
|                                        | Shares       | Amount    |         | Capital    | Subscribed |         | Capital  | Compensation | Stage       |        | (Deficit)     |  
|                                        | #            | $         |         | $          | $          |         | $        | $            | $           |        | $             |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Balance – April 30, 1998                | 9,248,300    | 3,830,401 |         | –          | –          |         | –        | –            | (3,531,488  | )      | 298,913       |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock issued for financial              |              |           |         |            |            |         |          |              |             |        |               |  
|consulting services                     | 100,000      | 71,046    |         | –          | –          |         | –        | –            | –           |        | 71,046        |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Net loss                                | –            | –         |         | –          | –          |         | –        | –            | (397,924    | )      | (397,924      | )
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Balance – April 30, 1999                | 9,348,300    | 3,901,447 |         | –          | –          |         | –        | –            | (3,929,412  | )      | (27,965       | )
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock issued for cash pursuant to a     |              |           |         |            |            |         |          |              |             |        |               |  
|private placement                       | 852,101      | 639,075   |         | –          | –          |         | –        | –            | –           |        | 639,075       |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Less cash commission paid               | –            | (47,607   | )       | –          | –          |         | –        | –            | –           |        | (47,607       | )
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Warrants exercised                      | 17,334       | 17,334    |         | –          | –          |         | –        | –            | –           |        | 17,334        |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock-based compensation                | –            | –         |         | 15,417     | –          |         | –        | –            | –           |        | 15,417        |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Net loss                                | –            | –         |         | –          | –          |         | –        | –            | (413,495    | )      | (413,495      | )
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Balance – April 30, 2000                | 10,217,735   | 4,510,249 |         | 15,417     | –          |         | –        | –            | (4,342,907  | )      | 182,759       |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock issued for cash pursuant to       |              |           |         |            |            |         |          |              |             |        |               |  
|warrants exercised                      | 4,000        | 2,000     |         | –          | –          |         | –        | –            | –           |        | 2,000         |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock-based compensation                | –            | –         |         | 18,500     | –          |         | –        | –            | –           |        | 18,500        |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock to be issued                      | –            | –         |         | –          | 72,000     |         | –        | –            | –           |        | (72,000       | )
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Net loss                                | –            | –         |         | –          | –          |         | –        | –            | (808,681    | )      | (808,681      | )
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Balance – April 30, 2001                | 10,221,735   | 4,512,249 |         | 33,917     | 72,000     |         | –        | –            | (5,151,588  | )      | (533,422      | )
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock issued for cash pursuant to a     |              |           |         |            |            |         |          |              |             |        |               |  
|private placement                       | 1,066,200    | 266,550   |         | –          | (72,000    | )       | –        | –            | –           |        | 194,550       |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Amount receivable                       | –            | (3,000    | )       | –          | –          |         | –        | –            | –           |        | (3,000        | )
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock-based compensation                | –            | –         |         | 3,083      | –          |         | –        | –            | –           |        | 3,083         |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Net loss                                | –            | –         |         | –          | –          |         | –        | –            | (156,090    | )      | (156,090      | )
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Balance - April 30, 2002                | 11,287,935   | 4,775,799 |         | 37,000     | –          |         | –        | –            | (5,307,678  | )      | (494,879      | )
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock issued to settle debt             | 6,100,000    | 305,000   |         | –          | –          |         | –        | –            | –           |        | 305,000       |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock issued for services               | 250,000      | 16,500    |         | –          | –          |         | –        | –            | –           |        | 16,500        |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock issued for convertible  debenture | 50,000       | 5,000     |         | –          | –          |         | –        | –            | –           |        | 5,000         |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Stock to be issued                      | –            | –         |         | –          | 25,968     |         | –        | –            | –           |        | 25,968        |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Donated consulting services             | –            | –         |         | –          | –          |         | 187,500  | –            | –           |        | 187,500       |  
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Net loss                                | –            | –         |         | –          | –          |         | –        | –            | (220,972    | )      | (220,972      | )
|                                        |              |           |         |            |            |         |          |              |             |        |               |  
|Balance – April 30, 2003                | 17,687,935   | 5,102,299 |         | 37,000     | 25,968     |         | 187,500  | –            | (5,528,650  | )      | (175,883      | )

(The Accompanying Notes are an Integral Part of the Financial
  Statements)

F-6

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Statements of Stockholders’ Equity (Deficit) 
  From July 27, 1992 (Date of inception) to April 30, 2005
  (expressed in U.S. dollars)

|                                        |                    |           |            |            |         |          |              |             | Deficit     |        |               |  
|--------------------------------------- | ------------------ | --------- | ---------- | ---------- | ------- | -------- | ------------ | ----------- | ----------- | ------ | ------------- | -
|                                        |                    |           |            |            |         |          |              |             | Accumulated |        | Total         |  
|                                        |                    |           | Additional | Common     |         |          |              |             | During the  |        | Stockholders’ |  
|                                        | Common
      Stock | Paid-in   | Stock      |            | Donated | Deferred |              | Development |             | Equity |              
|                                        | Shares             | Amount    | Capital    | Subscribed |         | Capital  | Compensation |             | Stage       |        | (Deficit)     |  
|                                        | #                  | $         | $          | $          |         | $        | $            |             | $           |        | $             |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Balance – April 30, 2003                | 17,687,935         | 5,102,299 | 37,000     | 25,968     |         | 187,500  | –            |             | (5,528,650  | )      | (175,883      | )
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Donated consulting services             | –                  | –         | –          | –          |         | 210,000  | –            |             | –           |        | 210,000       |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Stock issued for cash pursuant to a     |                    |           |            |            |         |          |              |             |             |        |               |  
|private placement:                      | 173,120            | 25,968    | –          | (25,968    | )       | –        | –            |             | –           |        | –             |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Stock issued for cash pursuant to  the: |                    |           |            |            |         |          |              |             |             |        |               |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Exercise of warrants                    | 550,000            | 86,000    | –          | –          |         | –        | –            |             | –           |        | 86,000        |  
|Exercise of stock options               | 100,000            | 20,000    | –          | –          |         | –        | –            |             | –           |        | 20,000        |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Stock-based compensation                | –                  | –         | 78,184     | –          |         | –        | (78,184      | )           | –           |        | –             |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Stock issued for services               | 400,000            | 92,000    | –          | –          |         | –        | (92,000      | )           | –           |        | –             |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Stock issued to settle debt             | 3,320,000          | 166,000   | –          | –          |         | –        | –            |             | –           |        | 166,000       |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Deferred compensation                   | –                  | –         | –          | –          |         | –        | 142,355      |             | –           |        | 142,355       |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Net loss                                | –                  | –         | –          | –          |         | –        | –            |             | (609,913    | )      | (609,913      | )
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Balance – April 30, 2004                | 22,231,055         | 5,492,267 | 115,184    | –          |         | 397,500  | (27,829      | )           | (6,138,563  | )      | (161,441      | )
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Stock issued for services               | 150,000            | 24,000    | –          | –          |         | –        | (24,000      | )           | –           |        | –             |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Stock issued for cash pursuant to:      |                    |           |            |            |         |          |              |             |             |        |               |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Options exercised                       | 133,750            | 29,750    | –          | –          |         | –        | –            |             | –           |        | 29,750        |  
|Warrants exercised                      | 173,120            | 34,624    | –          | –          |         | –        | –            |             | –           |        | 34,624        |  
|Private placement                       | 1,032,800          | 258,200   | –          | –          |         | –        | –            |             | –           |        | 258,200       |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Stock-based compensation                | –                  | –         | 23,304     | –          |         | –        | –            |             | –           |        | 23,304        |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Donated consulting services             | –                  | –         | –          | –          |         | 150,000  | –            |             | –           |        | 150,000       |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Amortization of deferred compensation   | –                  | –         | –          | –          |         | –        | 38,829       |             | –           |        | 38,829        |  
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Net loss                                | –                  | –         | –          | –          |         | –        | –            |             | (584,889    | )      | (584,889      | )
|                                        |                    |           |            |            |         |          |              |             |             |        |               |  
|Balance - April 30, 2005                | 23,720,725         | 5,838,841 | 138,488    | –          |         | 547,500  | (13,000      | )           | (6,723,452  | )      | (211,623      | )

(The Accompanying Notes are an Integral Part of the Financial
  Statements)

F-7

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Notes to the Financial Statements 
  (expressed in U.S. dollars)

|1. | Nature of Operations and Continuance of
        Business                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   | REGI U.S., Inc. (the “Company”)
        was incorporated in the State of Oregon, U.S.A. on July 27, 1992.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|  
|   | The Company is a development stage company
        engaged in the business of developing and commercially exploiting an improved
        axial vane type rotary engine known as the Rand Cam/Direct Charge Engine
        (the “RC/DC Engine”). The world-wide marketing and intellectual
        rights, other than in the U.S., are held by Rand Energy Group Inc. (“Rand”
        or “REGI”), which is a major shareholder of the Company. The
        Company owns the U.S. marketing and intellectual rights and has a project
        cost sharing agreement, whereby it will fund 50% of the further development
        of the RC/DC Engine and REGI will fund 50%.                                                                                                                                                                                                                                               
|  
|   | In a development stage company, management
        devotes most of its activities to establishing a new business. Planned
        principal activities have not yet produced any revenues and the Company
        has suffered recurring operating losses as is normal in development stage
        companies. As at April 30, 2005, the Company has a working capital deficit
        of $211,623 and has accumulated losses of $6,723,452 since inception.
        These factors raise substantial doubt about the Company’s ability
        to continue as a going concern. The ability of the Company to emerge from
        the development stage with respect to its planned principal business activity
        is dependent upon its successful efforts to raise additional equity financing,
        receive funding from affiliates and controlling shareholders, and develop
        a market for its products.
|  
|   | The Company plans to raise funds through
        loans from Rand. Rand owns approximately 18% of the shares of the Company,
        having an approximate current market value of $1,754,000 as at April
        30, 2005, and plans to sell shares as needed to meet ongoing funding requirements
        if traditional equity sources of financing prove to be insufficient. The
        Company also receives interim support from affiliated companies and plans
        to raise additional capital through debt and/or equity financings. There
        continues to be insufficient funds to provide enough working capital to
        fund ongoing operations for the next twelve months. The Company may also
        raise additional funds through the exercise of warrants and stock options,
        if exercised.                                                                                          
|  
|2. | Summary of Significant Accounting Policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|  
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  
|   | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  
|   | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  
|   | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

F-8

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Notes to the Financial Statements 
  (expressed in U.S. dollars)

|2. | Summary of Significant Accounting Policies
        (continued)
|-- | --------------------------------------------------------------
|  
|   | (f)                                                           
|  
|   |                                                               
|  
|   | (g)                                                           
|  
|   |                                                               
|  
|   | (h)                                                           
|  
|   |                                                               
|  
|   | (i)                                                           
|  
|   |                                                               
|  
|   | (j)                                                           
|  
|   |                                                               
|  
|   | (k)                                                           
|  
|   |                                                               
|  
|   |                                                               

F-9

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Notes to the Financial Statements 
  (expressed in U.S. dollars)

|2. | Summary of Significant Accounting Policies
        (continued)
|-- | --------------------------------------------------------------
|  
|   | (k)                                                           
|  
|   |                                                               
|  
|   |                                                               
|  
|   |                                                               

| |  |                                                                                                                                                                                                    | Year Ended |  
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------- | -
| |  |                                                                                                                                                                                                    | April 30,  |  
| |  |                                                                                                                                                                                                    | 2005       |  
| |  |                                                                                                                                                                                                    | $          |  
| |  |                                                                                                                                                                                                    |            |  
| |  |                                                                                                                                                                                                    |            |  
| |  | Net loss — as reported                                                                                                                                                                             | (584,889   | )
| |  | Add: Stock-based compensation expense included in net                                                                                                                                              |            |  
| |  | loss — as reported                                                                                                                                                                                 | 62,132     |  
| |  | Deduct: Stock-based compensation expense determined under                                                                                                                                          |            |  
| |  | fair value method                                                                                                                                                                                  | (64,712    | )
| |  |                                                                                                                                                                                                    |            |  
| |  | Net loss — pro forma                                                                                                                                                                               | (587,469   | )
| |  |                                                                                                                                                                                                    |            |  
| |  | Net loss per share – basic and diluted
      — as reported                                                                                                                                         | (0.03      | )
| |  | Net loss per share – basic and diluted — pro forma                                                                                                                                                 | (0.03      | )
| |  |                                                                                                                                                                                                    |            |  
| |  | The fair value of the options
        granted during the year was measured at the grant date using the Black-Scholes
        option pricing model with the following weighted average assumptions:

| |  | Expected dividend yield         | 0%    | 0%  
| |  | ------------------------------- | ----- | ----
| |  | Risk-free interest rate         | 2.44% | 4.6%
| |  | Expected volatility             | 172%  | 221%
| |  | Expected option life (in years) | 1.36  | 3.0 

| | (l) | Basic and Diluted Net Income (Loss) per Share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |     | The Company computes net income (loss) per share
        in accordance with SFAS No. 128, “Earnings per Share” (SFAS
        128). SFAS 128 requires presentation of both basic and diluted earnings
        per shares (EPS) on the face of the income statement. Basic EPS is computed
        by dividing net income (loss) available to common shareholders (numerator)
        by the weighted average number of common shares outstanding (denominator)
        during the period. Diluted EPS gives effect to all dilutive potential
        common shares outstanding during the period including stock options, using
        the treasury stock method, and convertible preferred stock, using the
        if- converted method. In computing diluted EPS, the average stock price
        for the period is used in determining the number of shares assumed to
        be purchased from the exercise of stock options or warrants. Diluted EPS
        excludes all dilutive potential common shares if their effect is anti-dilutive.
|
| | (m) | Financial Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| |     | The carrying value of bank indebtedness, accounts
        payable, accrued liabilities and due to related parties approximate fair
        value due to the relatively short maturity of these instruments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

F-10

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Notes to the Financial Statements 
  (expressed in U.S. dollars)

|2. | Summary of Significant Accounting Policies
        (continued)
|-- | --------------------------------------------------------------
|  
|   | (n)                                                           
|  
|   |                                                               
|  
|   |                                                               
|  
|   |                                                               
|  
|   |                                                               
|  
|   | (o)                                                           
|  
|   |                                                               
|  
|3. | Intangible Assets                                             

| |                              |         |              | April 30,    | April 30,   
| | ---------------------------- | ------- | ------------ | ------------ | ------------
| |                              |         |              | 2005         | 2004        
| |                              |         | Accumulated  | Net Carrying | Net Carrying
| |                              | Cost    | Amortization | Value        | Value       
| |                              | $       | $            | $            | $           
| |                              |         |              |              |             
| | Patents - RC/DC
      Engine | 111,251 | 111,251      | –            | 64,865      

| | (a) | On August 20, 1992 the Company acquired the U.S.
        rights to the original Rand Cam-Engine from REGI by issuing 5,700,000
        shares at a fair value of $0.01 per share. REGI will receive a 5%
        net profit royalty. The $57,000 was charged to operations as research
        and development.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-11

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Notes to the Financial Statements 
  (expressed in U.S. dollars)

|3. | Intangible Assets (continued)
|-- | -----------------------------
|  
|   | (b)                          
|  
|   | (c)                          
|  
|   | (d)                          
|  
|4. | Common Stock                 
|  
|   | (a)                          
|  
|   |                              
|  
|   |                              
|  
|   |                              

| |  |                                   |           |   | Weighted      
| |  | --------------------------------- | --------- | - | --------------
| |  |                                   |           |   | average       
| |  |                                   | Number of |   | exercise price
| |  |                                   | Shares    |   | $             
| |  |                                   |           |   |               
| |  | Outstanding, April 30, 2003       | 1,850,000 |   | 0.20          
| |  | Granted                           | 350,000   |   | 0.27          
| |  | Exercised                         | (100,000  | ) | 0.20          
| |  | Cancelled                         | (200,000  | ) | 0.20          
| |  |                                   |           |   |               
| |  | Outstanding, April 30, 2004       | 1,900,000 |   | 0.50          
| |  | Granted                           | 246,500   |   | 0.50          
| |  | Exercised                         | (133,750  | ) | 0.24          
| |  | Expired                           | (400,000  | ) | 0.20          
| |  |                                   |           |   |               
| |  | Outstanding, April
      30, 2005 | 1,612,750 |   | 0.26          

| |  | Additional information regarding options outstanding
      as at April 30, 2005 is as follows:
| |  | ----------------------------------------------------------------------------------------------
| |  |                                                                                               
| |  |                                                                                               
| |  |                                                                                               
| |  |                                                                                               
| |  |                                                                                               
| |  |                                                                                               
| |  | Exercise prices                                                                               
| |  |                                                                                               
| |  | $0.00 – $ 0.25                                                                                
| |  | $0.26 – $ 0.50                                                                                
| |  | $ 0.51 – $ 0.75                                                                               
| |  |                                                                                               
| |  |                                                                                               

F-12

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Notes to the Financial Statements 
  (expressed in U.S. dollars)

|4. | Common Stock (continued)
|-- | ------------------------
|  
|   | (b)                     
|  
|   |                         
|  
|   | (c)                     
|  
|   |                         
|  
|   | (d)                     
|  
|   |                         

| |  |                             |           |   | Weighted      
| |  | --------------------------- | --------- | - | --------------
| |  |                             |           |   | average       
| |  |                             |           |   | exercise price
| |  |                             | Number of |   | $             
| |  |                             | Shares    |   |               
| |  | Balance, April 30, 2003     | -         |   | -             
| |  | Issued                      | 973,120   |   | 0.21          
| |  | Exercised                   | (550,000  | ) | 0.16          
| |  | Expired                     | (250,000  | ) | 0.30          
| |  | Balance, April 30, 2004     | 173,120   |   | 0.20          
| |  | Issued                      | 516,400   |   | 0.35          
| |  | Exercised                   | (173,120  | ) | 0.20          
| |  | Outstanding, April 30, 2005 | 516,400   |   | 0.35          

| |  | At April 30, 2005, the following share purchase
      warrants were outstanding:
| |  | --------------------------------------------------------------------------------
| |  |                                                                                 
| |  | Number of                                                                       
| |  | Warrants                                                                        
| |  |                                                                                 
| |  | 516,400                                                                         

|   | (e)                        | Private Placement                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|-- | -------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |                            | On December 24, 2004, the Company closed a private
        placement offering for 1,032,800 units of the Company at a purchase price
        of $0.25 per unit for total cash proceeds of $258,200. Each unit
        consisted of one common share of the Company and one-half non-transferable
        share purchase warrant. Each two one- half warrants may be exercised within
        one year of the date of issuance to the purchaser at a price of $0.35
        per share.
|  
|5. | Related Party Transactions
|  
|   | (a)                        | Amounts owing to related parties are unsecured,
        non-interest bearing and are due on demand. These companies are related
        through significant ownership of the Company, having common officers and
        directors, and sharing the same office.                                                                                                                                                                                                                     
|  
|   | (b)                        | During the year ended April 30, 2005, the value
        of consulting services of $90,000 (2004 - $90,000) was contributed
        by the President, CEO and director of the Company, charged to general
        and administrative expenses and treated as donated capital.                                                                                                                                                                                                         
|  
|   | (c)                        | During the year ended April 30, 2005, the value
        of consulting services of $30,000 (2004 - $30,000) was contributed
        by the Vice President and director of the Company, charged to general
        and administrative expenses and treated as donated capital.                                                                                                                                                                                                         

F-13

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Notes to the Financial Statements 
  (expressed in U.S. dollars)

|5. | Related Party Transactions (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|  
|   | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|  
|   | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|  
|   | (g)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|  
|6. | Commitments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|  
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|  
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|  
|7. | Income Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|  
|   | Potential benefits of income tax losses
        are not recognized in the accounts until realization is more likely than
        not. The Company has net operating losses of $5,433,000, which commence
        expiring in 2013. Pursuant to SFAS No. 109 the Company is required to
        compute tax asset benefits for net operating losses carried forward. The
        potential benefits of net operating losses has not been recognized in
        these financial statements because the Company cannot be assured it is
        more likely than not it will utilize the net operating losses carried
        forward in future years. For the years ended April 30, 2005 and 2004,
        the valuation allowance established against the deferred tax assets increased
        by $157,000 and $88,000, respectively
|  
|   | The components of the net deferred tax
        asset at April 30, 2005 and 2004 and the statutory tax rate, the effective
        tax rate and the elected amount of the valuation allowance are scheduled
        below:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

|                       | April 30,   |  | April 30,   | 
|---------------------- | ----------- |  | ----------- | 
|                       | 2005        |  | 2004        | 
|                       | $           |  | $           | 
|                       |             |  |             | 
|Net Operating Loss     | 5,433,000   |  | 5,133,000   | 
|                       |             |  |             | 
|Statutory Tax Rate     | 35%         |  | 34%         | 
|                       |             |  |             | 
|Effective Tax Rate     | –           |  | –           | 
|                       |             |  |             | 
|Deferred Tax Asset     | 1,902,000   |  | 1,745,000   | 
|                       |             |  |             | 
|Valuation Allowance    | (1,902,000) |  | (1,745,000) | 
|                       |             |  |             | 
|Net Deferred Tax Asset | –           |  | –           | 

|8. | Subsequent Events
|-- | -----------------
|  
|   | (a)              
|  
|   | (b)              

F-14

---

REGI U.S., Inc. 
  (A Development Stage Company)
  Notes to the Financial Statements 
  (expressed in U.S. dollars)

|8. | Subsequent Events (continued)
|-- | -----------------------------
|  
|   | (c)                          
|  
|   | (d)                          
|  
|   | (e)                          

F-15

---

SIGNATURES

In accordance with Section 13 or 15(d) of the Securities Exchange
  Act of 1934, the Registrant has duly caused this report or amendment to be signed
  on its behalf by the undersigned, thereunto duly authorized.

| | REGI U.S., INC.                     
| | ------------------------------------
| |                                     
| |                                     
| | By: /s/ John G. Robertson           
| | John G. Robertson, President        
| | Chief Executive Officer and Director

Dated: August 12, 2005

In accordance with the Securities Exchange Act of 1934, this
  report has been signed by the following persons on behalf of the Registrant
  and in the capacities and on the dates indicated below.

|Signature             | Title                                | Date   
|--------------------- | ------------------------------------ | -------
|                      |                                      |        
|/s/ John G. Robertson | President, Chief                     | 8/12/05
|(John G. Robertson)   | Executive Officer and Director       |        
|                      |                                      |        
|                      |                                      |        
|/s/James Vandeberg    | Chief Operating Officer              | 8/12/05
|(James Vandeberg)     | Chief Financial Officer and Director |        
|                      |                                      |        
|                      |                                      |        
|/s/ Jennifer Lorette  | Vice President and Director          | 8/12/05
|(Jennifer Lorette)    |                                      |        

---