NOTE 7

LOSS PER SHARE

Basic loss per share is computed by dividing net loss by the weighted average number of common shares outstanding for the periods. Diluted loss per share reflects, in addition to the weighted average number of common shares, the potential dilution of stock options and warrants outstanding, exercised and/or converted into common stock, unless the effect of such equivalent shares was anti-dilutive.

For the three months ended September 30, 2011 and 2010, the effect of stock options and other potentially dilutive shares was excluded from the calculation of diluted loss per common share, as their inclusion would have been anti-dilutive. Therefore, diluted loss per share is equal to basic loss per share. Such securities, shown below, presented on a common share equivalent basis and outstanding as at September 30, 2011 and 2010 have been excluded from the three month diluted loss per share computations:

	September 30, 2011		September 30, 2010
Warrants		2,690,985		2,810,000
Convertible Preferred stock		6,414,488		2,380,326
Due to Related Party		3,747,590		3,747,590
Options		425,000		425,000