| Delaware                               | 95-4106894                                |
|----------------------------------------|-------------------------------------------|
| (State      or other jurisdiction      | (I.R.S.      Employer Identification No.) |
| of      incorporation or organization) |                                      |

| Large      Accelerated Filer ¨ |   | Accelerated      Filer ¨         |
|-------------------------------------|--------|---------------------------------------|
| Non-accelerated      filer ¨   |   | Smaller      Reporting Company      x |

----

| Class                                          |   | Outstanding      January  7, 2010 |
|------------------------------------------------|--------|---------------------------------------------|
|                                           |   |                                        |
| Common      Stock, par value $0.0001 per share |   | 50,715,001      shares                      |

----

|  Index   |                               |                                                                                                                               |   | Page      No. |
|---------------|------------------------------------|------------------------------------------------------------------------------------------------------------------------------------|--------|---------------|
| PART      I.  | FINANCIAL      INFORMATION         |                                                                                                                               |   |          |
|          |                               |                                                                                                                               |   |          |
|          | ITEM      1.                       | Financial      Statements (Unaudited)                                                                                              |   |          |
|          |                               |                                                                                                                               |   |          |
|          |                               | Statement      Regarding Financial Information                                                                                     |   | 4             |
|          |                               |                                                                                                                               |   |          |
|          |                               | Unaudited      Condensed Consolidated Balance Sheets as of November 30, 2009 and February      28, 2009                            |   | 5             |
|          |                               |                                                                                                                               |   |          |
|          |                               | Unaudited      Condensed Consolidated Statements of Operations for the Three and Nine      Months Ended November 30, 2009 and 2008 |   | 6             |
|          |                               |                                                                                                                               |   |          |
|          |                               | Unaudited      Condensed Consolidated Statements of Cash Flows for the Nine Months Ended      November 30, 2009 and 2008           |   | 7             |
|          |                               |                                                                                                                               |   |          |
|          |                               | Notes      to Unaudited Condensed Consolidated Financial Statements                                                                |   | 8             |
|          |                               |                                                                                                                               |   |          |
|          | ITEM      2.                       | Management's      Discussion and Analysis of Financial Condition and Results of      Operations                                    |   | 15            |
|          |                               |                                                                                                                               |   |          |
|          | ITEM      4T.                      | Controls      and Procedures                                                                                                       |   | 19            |
|          |                               |                                                                                                                               |   |          |
| PART      II. | OTHER      INFORMATION             |                                                                                                                               |   |          |
|          |                               |                                                                                                                               |   |          |
|          | ITEM      2.                       | Unregistered      Sales of Equity Securities and Use of Proceeds                                                                   |   | 20            |
|          |                               |                                                                                                                               |   |          |
|          | ITEM      6.                       | Exhibits                                                                                                                           |   | 20            |
|          |                               |                                                                                                                               |   |          |
|          | SIGNATURES      AND CERTIFICATIONS |                                                                                                                               | 21     |

----

----

|                                                                                                                                                                                    |   | As      at November 30, 2009 |         |   | As      at February 28, 2009 |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------|--------------|--------|------------------------------|--------|
| ASSETS                                                                                                                                                                                  |   |                         |         |   |                         |   |
| Current      assets:                                                                                                                                                                    |   |                         |         |   |                         |   |
| Cash      and cash equivalents                                                                                                                                                          |   | $                            | 21,224       |   |                         | $      | 317,256 |   |
| Accounts      receivable, net of allowance for doubtful accounts of    $60,000                                                                                                          |   |                         | 608,542      |   |                         |   | 319,249 |   |
| Current      inventories                                                                                                                                                                |   |                         | 1,500,000    |   |                         |   | 1,500,000 |   |
| Other      current assets                                                                                                                                                               |   |                         | 363,373      |   |                         |   | 255,620 |   |
| Total      current assets                                                                                                                                                               |   |                         | 2,493,139    |   |                         |   | 2,392,125 |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
| Property,      plant, and equipment, net                                                                                                                                                |   |                         | 579,143      |   |                         |   | 353,444 |   |
| Non-current      inventories net of allowance for obsolete inventories of $2,544,547 and      $2,425,994                                                                                |   |                         | 2,330,376    |   |                         |   | 2,545,978 |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
| Total      assets                                                                                                                                                                       |   | $                            | 5,402,658    |   |                         | $      | 5,291,547 |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
| Current      liabilities:                                                                                                                                                               |   |                         |         |   |                         |   |   |   |
| Accounts      payable                                                                                                                                                                   |   | $                            | 1,350,707    |   |                         | $      | 1,075,202 |   |
| Current      portion of notes payable, net of debt discount                                                                                                                             |   |                         | 897,500      |   |                         |   | 225,000 |   |
| Notes      payable- related party                                                                                                                                                       |   |                         | 4,400,000    |   |                         |   | 1,800,000 |   |
| Customer      advances                                                                                                                                                                  |   |                         | 335,033      |   |                         |   | 418,612 |   |
| Accrued      expenses                                                                                                                                                                   |   |                         | 2,018,908    |   |                         |   | 1,037,917 |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
| Total      current liabilities                                                                                                                                                          |   |                         | 9,002,148    |   |                         |   | 4,556,731 |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
| Convertible      notes payable, net of current portion                                                                                                                                  |   |                         | 500,000      |   |                         |   | 500,000 |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
| Total      liabilities                                                                                                                                                                  |   |                         | 9,502,148    |   |                         |   | 5,056,731 |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
| Commitments      and contingencies                                                                                                                                                      |   |                         |         |   |                         |   |   |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
| Stockholders'      equity (deficit):                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
| Common      stock, $0.0001par value, 75,000,000 and 50,000,000 shares authorized,      49,380,431 and 46,344,470 issued and outstanding at November 30, 2009 and      February 28, 2009 |   |                         | 4,938        |   |                         |   | 4,634 |   |
| Additional      paid-in capital                                                                                                                                                         |   |                         | 373,416,442  |   |                         |   | 364,222,963 |   |
| Subscription  receivable                                                                                                                                                      |   |                         | (27,416      | )      |                         |   | (27,416 | ) |
| Accumulated      deficit                                                                                                                                                                |   |                         | (377,493,454 | )      |                         |   | (363,965,365 | ) |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
| Total      stockholders' equity (deficit)                                                                                                                                               |   |                         | (4,099,490   | )      |                         |   | 234,816 |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
| Total      liabilities and stockholders' equity                                                                                                                                         |   | $                            | 5,402,658    |   |                         | $      | 5,291,547 |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |
|                                                                                                                                                                                    |   |                         |         |   |                         |   |   |   |

----

|                                                                                       |   | Three      Months |         | Nine      Months |   |
|--------------------------------------------------------------------------------------------|--------|-------------------|--------------|------------------|--------|
|                                                                                       |   | 2009              |         | 2008             |   | 2009 |   | 2008 |   |
| Net      Revenues                                                                          |   | $                 | 1,160,577    |             | $      | 1,065,172 |   | $ | 2,425,383 |   | $ | 1,891,157 |   |
|                                                                                       |   |              |         |             |   |   |   |   |   |   |   |   |   |
| Cost      of goods sold                                                                    |   |              | 563,148      |             |   | 492,837 |   |   | 1,384,184 |   |   | 1,276,508 |   |
|                                                                                       |   |              |         |             |   |   |   |   |   |   |   |   |   |
| Gross      Profit                                                                          |   |              | 597,429      |             |   | 572,335 |   |   | 1,041,199 |   |   | 614,649 |   |
|                                                                                       |   |              |         |             |   |   |   |   |   |   |   |   |   |
| Operating      Expenses                                                                    |   |              |         |             |   |   |   |   |   |   |   |   |   |
| Engineering,      research and development expenses                                        |   |              | 562,082      |             |   | 556,779 |   |   | 1,626,357 |   |   | 1,494,894 |   |
| Selling,      general and administrative expenses                                          |   |              | 1,828,847    |             |   | 2,040,489 |   |   | 5,560,397 |   |   | 5,819,237 |   |
| Stock      option compensation expense                                                     |   |              | 162,900      |             |   | 73,749 |   |   | 6,807,418 |   |   | 280,913 |   |
| Total      operating expenses                                                              |   |              | 2,553,829    |             |   | 2,671,017 |   |   | 13,994,172 |   |   | 5,785,942 |   |   |
|                                                                                       |   |              |         |             |   |   |   |   |   |   |   |   |   |   |
| Loss      from operations                                                                  |   |              | (1,956,400,) |             |   | (2,098,682) |   |   | (12,952,973) |   |   | (5,326,402) |   |   |
|                                                                                       |   |              |         |             |   |   |   |   |   |   |   |   |   |
| Other      income and (expense)                                                            |   |              |         |             |   |   |   |   |   |   |   |   |   |
| Interest      expense, net                                                                 |   |              | (217,032)    |             |   | (422,306) |   |   | (553,265) |   |   | (548,328) |   |
| Other      income (expense), net                                                           |   |              | -            |             |   | 229 |   |   | (21,850) |   |   | 144,003 |   |
| Total      other income (expense)                                                          |   |              | (217,032)    |             |   | (422,078) |   |   | (575,115) |   |   | (404,325) |   |
| Net      Loss                                                                              |   | $                 | (2,173,432)  |             | $      | (2,520,759) |   | $ | (13,528,088) |   | $ | (7,384,720) |   |
|                                                                                       |   |              |         |             |   |   |   |   |   |   |   |   |   |
| Total      basic and diluted loss per share                                                |   | $                 | (0.05)       |             | $      | (0.06) |   | $ | (0.29) |   | $ | (0.18) |   |
| Weighted      average shares used tocompute      basic and diluted income (loss) per share |   |              | 48,171,882   |             |   | 43,011,743 |   |   | 47,412,895 |   |   | 40,628,425 |   |

----

|                                                                               |   | 2009   |        |   | 2008   |   |
|------------------------------------------------------------------------------------|--------|--------|-------------|--------|--------|--------|
| Cash      flow from operating activities:                                          |   |   |        |   |   |   |
| Net      Loss                                                                      |   | $      | (13,528,088 | )      |   | $      | (7,384,720 | ) |
| Adjustments      to reconcile Net loss to net cash used in operating    activities |   |   |        |   |   |   |   |   |
| Depreciation      Expense                                                          |   |   | 92,452      |   |   |   | 36,319 |   |
| Issuance      of stock as per employment agreement                                 |   |   | -           |   |   |   | 100,000 |   |
| Amortization      of debt discount                                                 |   |   | 220,289     |   |   |   | - |   |
| Beneficial      conversion feature expense                                         |   |   | -           |   |   |   | 368,900 |   |
| Loss      on settlement of debt                                                    |   |   | 22,750      |   |   |   | - |   |
| Stock      options and warrants expense                                            |   |   | 6,807,417   |   |   |   | 280,913 |   |
| (Increase)      decrease in:Accounts      receivable                               |   |   | (289,293    | )      |   |   | 304,312 |   |
| Inventory                                                                          |   |   | 343,820     |   |   |   | 269,665 |   |
| Other      current assets and deposit                                              |   |   | (107,753    | )      |   |   | 9,571 |   |
| Increase      (decrease) in:                                                       |   |   |        |   |   |   |   |   |
| Accounts      payable, customer deposits and accrued expenses                      |   |   | 1,291,101   |   |   |   | 741,997 |   |
|                                                                               |   |   |        |   |   |   |   |   |
| Net      cash used in operations                                                   |   |   | (5,147,305) |   |   |   | (5,273,043 | ) |
|                                                                               |   |   |        |   |   |   |   |   |
| Investing      activities:                                                         |   |   |        |   |   |   |   |   |
| Acquisition      of plant and equipment                                            |   |   | (318,151    | )      |   |   | (119,211 | ) |
|                                                                               |   |   |        |   |   |   |   |   |
| Net      cash used in investing activities                                         |   |   | (318,151    | )      |   |   | (119,211 | ) |   |   |
|                                                                               |   |   |        |   |   |   |   |   |   |   |
| Financing      activities:                                                         |   |   |        |   |   |   |   |   |
| Issuance      of common stock                                                      |   |   | 1,667,496   |   |   |   | 1,877,077 |   |
| Proceeds      from notes payable, net                                              |   |   | 3,407,500   |   |   |   | 1,063,863 |   |
| Collections      on (increase in) subscriptions receivable                         |   |   | -           |   |   |   | 245,750 |   |
| Exercise      of warrants                                                          |   |   | 94,428      |   |   |   | 2,205,277 |   |
|                                                                               |   |   |        |   |   |   |   |   |
| Net      cash provided by financing activities:                                    |   |   | 5,169,424   |   |   |   | 5,391,966 |   |
|                                                                               |   |   |        |   |   |   |   |   |
| Net      decrease in cash & cash equivalents                                   |   |   | (296,032    | )      |   |   | (287) |   |
|                                                                               |   |   |        |   |   |   |   |   |
| Cash      and cash equivalents at beginning of period                              |   |   | 317,256     |   |   |   | 37,532 |   |
|                                                                               |   |   |        |   |   |   |   |   |
| Cash      and cash equivalents at end of period                                    |   | $      | 21,224      |   |   | $      | 37,245 |   |
|                                                                               |   |   |        |   |   |   |   |   |
| Supplemental      disclosures of cash flow information                             |   |   |        |   |   |   |   |   |
| Cash      paid during the period for:                                              |   |   |        |   |   |   |   |   |
| Interest                                                                           |   | $      | 26,088      |   |   | $      | 120,601 |   |
| Income      taxes                                                                  |   | $      | -           |   |   | $      | - |   |

----

| Buildings                    | 40      years      |
|------------------------------|--------------------|
| Machinery      and equipment | 5      to 10 years |
| Furniture      and fixtures  | 7      years       |

----

|                                             |   | November      30, 2009 |       |   | February      28, 2009 |   |
|--------------------------------------------------|--------|------------------------|------------|--------|------------------------|--------|
|                                             |   |                   |       |   |                   |   |
| Raw      materials                               |   | $                      | 2,835,998  |   |                   | $      | 2,642,833 |   |
| Finished      goods                              |   |                   | 3,538,925  |   |                   |   | 3,829,139 |   |
| Reserved      for potential product obsolescence |   |                   | (2,390,088 | )      |                   |   | (2,271,535 | ) |
|                                             |   |                   |       |   |                   |   |   |   |
|                                             |   |                   | 3,984,835  |   |                   |   | 4,200,437 |   |
| Non-current      portion                         |   |                   | (2,330,376 | )      |                   |   | (2,545,978 | ) |
| Discount      on long term inventory             |   |                   | (154,459   | )      |                   |   | (154,459 | ) |
|                                             |   |                   |       |   |                   |   |   |   |
| Current      portion                             |   | $                      | 1,500,000  |   |                   | $      | 1,500,000 |   |
|                                             |   |                   |       |   |                   |   |   |   |

|                                                |   | November      30, 2009 |      |   | February      28, 2009 |   |
|-----------------------------------------------------|--------|------------------------|-----------|--------|------------------------|--------|
|                                                |   |                   |      |   |                   |   |
| Machinery      and equipment                        |   | $                      | 1,060,519 |   |                   | $      | 1,054,422 |   |
| Furniture      and fixtures                         |   |                   | 1,468,603 |   |                   |   | 1,438,312 |   |
| Leasehold      Improvements                         |   |                   | 481,887   |   |                   |   | 200,124 |   |
|                                                |   |                   |      |   |                   |   |   |   |
|                                                |   |                   | 3,011,009 |   |                   |   | 2,692,858 |   |
| Less      accumulated depreciation and amortization |   |                   | 2,431,866 |   |                   |   | 2,339,414 |   |
|                                                |   |                   |      |   |                   |   |   |   |
| Property,      plant and equipment, net             |   | $                      | 579,143   |   |                   | $      | 353,444 |   |
|                                                |   |                   |      |   |                   |   |   |   |

|                                      |   | November      30, 2009 |      |   | February      28, 2009 |   |
|-------------------------------------------|--------|------------------------|-----------|--------|------------------------|--------|
|                                      |   |                   |      |   |                   |   |
| Accrued      payroll and related expenses |   | $                      | 1,609,726 |   |                   | $      | 904,849 |   |
| Other                                     |   |                   | 409,182   |   |                   |   | 133,068 |   |
|                                      |   |                   |      |   |                   |   |   |   |
| Total                                     |   | $                      | 2,018,908 |   |                   | $      | 1,037,917 |   |
|                                      |   |                   |      |   |                   |   |   |   |

|                                     |   | November      30, 2009 |      |   | February      28, 2009 |   |
|------------------------------------------|--------|------------------------|-----------|--------|------------------------|--------|
|                                     |   |                   |      |   |                   |   |
| Demand      notes payable  (a) |   | $                      | 140,000   |   |                   | $      | 225,000 |   |
| Convertible      notes payable (b)       |   |                   | 1,257,500 |   |                   |   | 500,000 |   |
|                                     |   |                   | 1,397,500 |   |                   |   | 725,000 |   |
|                                     |   |                   |      |   |                   |   |   |   |
| Less:      Current portion               |   |                   | 897,500   |   |                   |   | 225,000 |   |
|                                     |   |                   |      |   |                   |   |   |   |
| Long-term      portion                   |   | $                      | 500,000   |   |                   | $      | 500,000 |   |
|                                     |   |                   |      |   |                   |   |   |   |

|   | (a) | Consists      of one demand note payable, with interest at an annual rate of 10%, on      which $5,857 in interest was accrued during the nine months ended November      30, 2009, and one demand note with an original balance of $140,000 and a      remaining balance of $90,000 with a flat interest fee of $10,000, which      has already been paid. During the nine month period ended November 30,      2009, the Company settled $35,000 of the notes in 58,333 shares of the      common stock of the Company. The Company recorded a loss on settlement      of  debt of $22,750 on the partial  settlement. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | Consists      of a convertible note payable totaling $500,000, bearing interest at a      rate of 7%, due in 2013. The note is convertible into our common stock at      a price of $3.00 per share. The Company paid interest of $26,088 on the      note during the nine months ended November 30, 2009. In April 2009, the      Company arranged a debt financing aggregating $192,500 from unrelated      parties in exchange for the issuance of 120 day 10% secured convertible      promissory notes and 30,800 warrants at an exercise price of $1.25 for the      first year. The performance of the notes is secured by all the inventory      of the Company specifically pertaining to the WePower purchase order      including all the proceeds arising from the sale or lease of all or any      part thereof. The notes are convertible into our common stock at a price      of $0.75 per share. The Company accrued interest of $11,732 on the notes      during the nine months ended November 30, 2009. Also consists of six      convertible notes entered into during the second quarter of fiscal 2010      totaling $565,000. The notes carry an interest rate of 10%, are for a term      of 180 days, and are convertible into common stock of the company at $0.75      per share. The company accrued interest of $26,211 on the notes during the      nine months ended November 30,2009. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Year      Ending February 28, |   |   |      |
|-------------------------------|--------|--------|-----------|
| 2010                          |   | $      | 897,500   |   |
| 2011                          |   |   | -         |   |
| 2012                          |   |   | -         |   |
| 2013                          |   |   | 500,000   |   |
|  Total                   |   | $      | 1,397,500 |   |

|                                |   | 2006      Plan                       |
|-------------------------------------|--------|--------------------------------------|
|                                |   | Weighted-Average      Exercise Price |   | Aggregate      Intrinsic Value |   | Number      of Options |
| Outstanding,      February 28, 2009 |   | $2.00-3.00                           |   | $0.00 |   | 1,913,000 |
| Issued                              |   | $1.50                                |   | $0.00 |   | 6,915,500 |
| Cancelled                           |   | $2.00-3.00                           |   |   |   | (1,913,000) |
|                                |   |                                 |   |   |   |   |
| Outstanding,      November 30, 2009 |   | $1.50                                |   | $0.00 |   | 6,915,500 |

| Options      Outstanding    |   | Exercisable      Options |      |
|-----------------------------|--------|--------------------------|-----------|
| Range      of ExercisePrice |   | Number                   |      | Weighted      Average Remaining Life |   | Weighted      Average Exercise Price |   | Weighted      Average Remaining Life |   | Number |   | Weighted      Average Exercise Price |   |
|        $1.50           |   |                     | 6,915,500 |   |   | 4.50      years |   | $ | 1.50 |   |   | 4.50      years |   |   | 6,110,615 |   | $ | 1.50 |   |

|                                | Number      of Shares | Exercise      Prices |
|-------------------------------------|-----------------------|----------------------|
| Outstanding,      February 28, 2009 | 3,452,511             | $2.00-4.00           |
| Issued                              | 3,185,996             | $1.25-1.50           |
| Exercised                           | (94,428)              | $1.00                |
| Outstanding,      November 30, 2009 | 6,544,079             | $1.25-4.00           |

| Range      of Exercise Prices |   | Stock      Warrants Outstanding |   | Stock      Warrants Exercisable |   | Weighted-Average      Remaining Contractual Life |   | Weighted-Average      Exercise Price of Warrants Outstanding |   | Weighted-Average      Exercise Price of Warrants Exercisable |   |  Intrinsic      Value |
|-------------------------------|--------|---------------------------------|--------|---------------------------------|--------|--------------------------------------------------|--------|--------------------------------------------------------------|--------|--------------------------------------------------------------|--------|----------------------------|
| $1.25                         |   | 1,285,996                       |   | 1,285,996                       |   | 56      months                                   |   | $1.25                                                        |   | $1.25                                                        |   | $0.00                      |
| $1.50                         |   | 1,900,000                       |   | 1,900,000                       |   | 55      months                                   |   | $1.50                                                        |   | $1.50                                                        |   | $0.00                      |
| $2.00-$3.00                   |   | 1,934,991                       |   | 1,782,908                       |   | 15      months                                   |   | $2.44                                                        |   | $2.49                                                        |   | $0.00                      |
| $3.50                         |   | 805,589                         |   | 805,589                         |   | 25months                                         |   | $3.50                                                        |   | $3.50                                                        |   | $0.00                      |
| $4.00                         |   | 617,503                         |   | 617,503                         |   | 14      months                                   |   | $4.00                                                        |   | $4.00                                                        |   | $0.00                      |
|                          |   | 6,544,079                       |   | 6,391,996                       |   |                                             |   |                                                         |   |                                                         |   |                       |

|               |   | 2009   |      |   | 2008   |   |
|--------------------|--------|--------|-----------|--------|--------|--------|
|               |   |   |      |   |   |   |
| United      States |   | $      | 1,737,148 |   |   | $      | 1,201,522 |   |
| Canada             |   |   | 231,849   |   |   |   | 253,930 |   |
| Asia               |   |   | 439,495   |   |   |   | 429,566 |   |
| Europe             |   |   | 16,891    |   |   |   | 6,139 |   |
|               |   |   |      |   |   |   |   |   |
| Total              |   | $      | 2,425,383 |   |   | $      | 1,891,157 |   |
|               |   |   |      |   |   |   |   |   |

| 11)   | Subsequent      Events |
|-----------------|------------------------|

| · | Our      ability to generate positive cash flow from  operations; |
|--------|-------------------------------------------------------------------|

| · | Our      ability to obtain additional financing to fund our    operations; |
|--------|----------------------------------------------------------------------------|

| · | Our      business development and  operating development;    and |
|--------|----------------------------------------------------------------------------|

| · | Our      expectations of growth in demand for our  products. |
|--------|--------------------------------------------------------------|

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