Converted by EDGARwiz

Reg Technologies Inc.

(A Development Stage Company)

Interim Consolidated Statements of Loss and Comprehensive Loss

(Unaudited – Prepared by Management)

(Expressed in Canadian Dollars)

For the three

For the nine

months

ended

January 31

2010

2009

2010

2009

Expenses

Amortization

820

1,026

2,935

3,016

Advertising and promotion

4,999

4,914

10,358

96,793

Consulting fees

9,563

5,538

13,965

25,126

Foreign exchange loss (gain)

38,836

(1,047)

40,556

(56,992)

Investor relations and shareholder communication

23,736

9,578

51,844

9,578

Management and director fees

13,050

21,800

39,150

44,700

Miscellaneous office expenses

16,606

9,151

44,051

43,516

Professional fees

13,743

10,557

80,347

131,198

Public relations

4,088

8,175

12,263

27,250

Research and development

19,737

29,849

98,200

99,037

Rent and utilities

11,233

8,631

27,562

24,554

Stock-based compensation

31,987

31,241

Transfer agent and filing fees

8,727

7,971

15,889

33,133

Travel and promotion

4,541

8,856

13,516

14,573

Wages and benefits

7,342

7,185

21,616

23,030

Mineral property maintenance costs

8,060

Loss before other items

185,081

140,244

512,299

557,813

Other (income) expenses

Gain on sale of investee's shares

(7,473)

(26,689)

(99,797)

Gain on issue by investee of its own shares

Unrealized loss (gain) on financial instrument

liability

(79,229)

(144,115)

Write down of accounts payable

(10,813)

Net and comprehensive loss for the period

105,852

121,958

341,495

447,203

Loss per share - basic and diluted

0.004

0.005

0.013

0.018

Weighted average number of common shares

outstanding - basic and diluted

25,768,959

25,164,000

25,732,271

24,726,000

The accompanying notes are an integral part of these consolidated financial statements.

Reg Technologies Inc.

(A Development Stage Company)

Interim Consolidated Statements of Cash Flows

(Unaudited – Prepared by Management)

(Expressed in Canadian Dollars)

For the Three Months

For the Nine Months

Ended January 31

2010

2009

2010

2009

Cash flows used in operating activities

Net loss for the period

(105,852)

(121,958)

(341,495)

(447,203)

Adjustments to reconcile loss to net cash

used by operating activities:

Amortization

820

1,026

2,935

3,016

Gain on sale of investee's shares

(7,473)

(26,689)

(99,797)

Stock-based compensation

31,987

31,241

Unrealized gain on financial instrument

liability

(79,229)

(144,115)

Changes in non-cash working capital items:

GST and interest receivable

9,001

1,057

2,693

475

Prepaid expenses

11,858

900

(1,315)

3,600

Accounts payable and accrued liabilities

47,294

(30,383)

176,131

15,550

(116,108)

(156,831)

(299,868)

(493,118)

Cash flows provided by investing activities

(Advances to) repayments from equity

accounted investee

(6,412)

(407,734)

7,007

(697,957)

Proceeds on sale of investee's shares and

warrants

7,473

26,689

99,797

Purchase of property and equipment

(740)

(6,412)

(400,261)

33,696

(598,900)

Cash flows provided by financing activities

Bank indebtedness

11,939

13,878

Advances from (to) related parties

(79)

174,891

140,856

219,361

Proceeds from share issuances, net of

143,331

509,283

issuance costs

Subscription receivable

(45,000)

Subscription received

12,000

389,586

12,000

384,158

122,191

564,477

265,065

1,112,802

Change in cash

(329)

7,385

(1,107)

20,784

Cash, beginning of period

329

13,657

1,107

258

Cash, end of period

21,042

Supplemental Disclosures

Interest paid

Income taxes paid

The accompanying notes are an integral part of these consolidated financial statements.

Reg Technologies Inc.

(A Development Stage Company)

Interim Consolidated Statements of Shareholders’ Equity

(Unaudited – Prepared by Management)

(Expressed in Canadian Dollars)

Other

Total

Common

Subscription Contributed

Comprehensive

Shareholders’

Shares

Received

Surplus

Warrants Income (Loss)

Deficit

Equity

Balance – April 30, 2007

23,942,759 11,356,689

–

849,839

–

639,758 (12,794,669)

51,617

Stock-based compensation

–

247,059

–

247,059

Deconsolidation adjustment

–

– (886,589)

–

(648,763)

– (1,535,352)

Deconsolidation of subsidiary

–

– 1,808,851

–

1,808,851

Foreign currency translation

–

5,672

–

9,005

–

14,677

adjustment

Net loss (Restated – Note 12)

–

(536,329)

Balance – April 30, 2008

23,942,759 11,356,689

– 2,024,832

–

– (13,330,998)

50,523

Shares issued for cash

1,771,168

444,275

–

– 167,540

–

611,815

Stock-based compensation

–

90,736

–

90,736

Net loss

–

(456,090)

Balance – April 30, 2009

25,713,927 11,800,964

– 2,115,568 167,540

– (13,787,088)

296,984

Shares issued for cash, net of share

–

issue costs

1,012,596

46,103

–

97,228

–

143,330

Subscription received

–

12,000

–

12,000

Net loss

–

(341,495)

Stock based compensation

–

31,987

–

31,987

Balance – January 31, 2010

26,726,523 11,847,067

12,000 2,147,555 264,768

– (14,128,583)

142,807

The accompanying notes are an integral part of these consolidated financial statements.

Reg Technologies Inc.

(A Development Stage Company)

Notes to Interim Consolidated Financial Statements

(Expressed in Canadian Dollars)

(Unaudited – Prepared by Management

For the nine months ended January 31, 2010 and 2009

Nature and Continuance of Operations

Reg Technologies Inc. (the “Company”) is a development stage company in the business of developing and

commercially exploiting a new designed axial vane type rotary engine known as the RadMax™ Engine

and other RandCamTM / RadMax™ applications, such as compressors and pumps (the “Technology”). The

worldwide marketing and intellectual rights, other than in the U.S., are held by the Company, which owns

4.5 million (directly or indirectly) shares of REGI U.S, Inc. (“REGI”) (a U.S. public company) representing

a 16% interest in REGI. REGI owns the U.S, marketing and intellectual rights. The Company and REGI

have a project cost sharing agreement whereby these companies each fund 50% of the development of the

Technology.

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 incurred recurring

operating losses as is normal in development stage companies. The Company has accumulated losses of

$14,128,583 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.

Management is aware that material uncertainties exist, related to current economic conditions, which could

adversely affect the Company’s ability to continue to finance its activities. The Company 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 adequate working capital to fund ongoing

operations for the next twelve months. The Company may also raise additional funds though the exercise of

warrants and stock options.

There is no certainty that the Company’s efforts to raise additional capital will be successful. These

financial statements do not include any adjustments relating to the recoverability and classification of

recorded asset amounts and classification of liabilities that might be necessary should the Company be

unable to continue in normal operations.

2. Basis of Accounting and Principles of Consolidation

These unaudited interim consolidated financial statements have been prepared in accordance with Canadian

generally accepted accounting principles (“GAAP”) for interim financial information using the same

accounting policies and methods of application as the audited consolidated financial statements of the

Company for the year ended April 30, 2009. These unaudited interim consolidated financial statements do not

include all the information and note disclosures required by GAAP for annual financial statements of the

Company and should be read in conjunction with the audited consolidated financial statements of the

Company as at April 30, 2009.

In the opinion of management, all adjustments considered necessary for fair presentation have been included

in these financial statements. Interim results are not necessarily indicative of the results expected for the fiscal

year.

Reg Technologies Inc.

(A Development Stage Company)

Notes to Interim Consolidated Financial Statements

(Expressed in Canadian Dollars)

(Unaudited – Prepared by Management

For the nine months ended January 31, 2010 and 2009

Basis of Accounting and Principles of Consolidation (Continued)

These financial statements include the accounts of the Company and its 51% owned subsidiary, Rand

Energy Group Inc. (“Rand”), which owns a 4% (2008 – 9%) interest in REGI. The Company also owns a

12% (2008 - 12%) interest in REGI. Prior to April 30, 2008, REGI was considered a controlled subsidiary

for consolidation purposes by way of control through an annually renewable voting trusts agreement, with

other affiliated companies. This trusts agreement gave the Company 50% control of the voting shares of

REGI. The agreement could be cancelled by the President of the 51% owned subsidiary with seven days’

written notice to the affiliated companies. Effective April 30, 2008, the voting trusts agreement was

cancelled and consequently the investment in REGI has been accounted for as an equity investment.

3. Recent Accounting Pronouncements Not Yet Adopted

International Financial Reporting Standards

In 2006, the Canadian Accounting Standards Board (“AcSB”) published a new strategic plan that will

significantly affect financial reporting requirements for Canadian companies. The AcSB strategic plan

outlines the convergence of Canadian GAAP with IFRS over an expected five year transitional period.

In February 2008 the AcSB announced that 2011 is the changeover date for publicly-listed companies to

use IFRS, replacing Canadian GAAP. This date is for interim and annual financial statements relating to

fiscal years beginning on or after January 1, 2011. The Company’s transition date of May 1, 2010 will

require the restatement for comparative purposes of amounts reported by the Company for the year ended

April 30, 2011. In July 2008 AcSB announced that early adoption will be allowed in 2009 subject to

seeking exemptive relief. The Company is currently assessing the financial reporting impact of the

transition to IFRS and the changeover date.

Other accounting pronouncements issued with future effective dates are either not applicable or are not

expected to be significant to the consolidated financial statements of the Company.

Management of Financial Risk

Interest rate and credit risk

The Company has minimal cash balances and no interest-bearing debt. The Company has no significant

concentrations of credit risk arising from operations. The Company's current policy is to invest any

significant excess cash in investment-grade short-term deposit certificates issued by reputable financial

institutions with which it keeps its bank accounts and management believes the risk of loss to be

remote. The Company periodically monitors the investments it makes and is satisfied with the credit

ratings of its banks.

Receivables consist of goods and services tax due from the Federal Government. Management believes

that the credit risk concentration with respect to receivables is remote.

Reg Technologies Inc.

(A Development Stage Company)

Notes to Interim Consolidated Financial Statements

(Expressed in Canadian Dollars)

(Unaudited – Prepared by Management

For the nine months ended January 31, 2010 and 2009

4. Management of Financial Risk (Continued)

Foreign exchange risk

The Company is primarily exposed to currency fluctuations relative to the Canadian dollar through

expenditures that are denominated in US dollars. Also, the Company is exposed to the impact of

currency fluctuations on its monetary assets and liabilities.

The operating results and the financial position of the Company are reported in Canadian dollars.

Fluctuations in exchange rates will, consequently, have an impact upon the reported operations of the

Company and may affect the value of the Company’s assets and liabilities.

The Company currently does not enter into financial instruments to manage foreign exchange risk.

The Company is exposed to foreign currency risk through the following financial assets and liabilities

that are denominated in United States dollars:

Related Party

Accounts

January 31, 2010

Bank Debt

Receivables

payable

4,925

13,919

11,827

At January 31, 2010 with other variables unchanged, a +/-10% change in exchange rates would

increase/decrease pre-tax loss by approximately +/- $702.

Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall

due. The Company manages liquidity risk through the management of its capital structure and financial

leverage as outlined in Note 11.

Shareholders’ Equity

Authorized

50,000,000 Common shares without par value

10,000,000 Preferred shares with a $1 par value, redeemable for common shares on the basis of 1

common share for 2 preferred shares

5,000,000 Class A non-voting shares without par value. Special rights and restrictions apply.

Treasury Shares

At January 31, 2010, Rand owns 217,422 (2009 – 217,422) shares of the Company valued at $43,485

that have been deducted from the total shares issued and outstanding. The value of these shares has

been deducted from share capital.

Reg Technologies Inc.

(A Development Stage Company)

Notes to Interim Consolidated Financial Statements

(Expressed in Canadian Dollars)

(Unaudited – Prepared by Management

For the nine months ended January 31, 2010 and 2009

5. Shareholders’ Equity (Continued)

Private placements

During the year ended April 30, 2009, the Company completed a private placement, whereby it issued

1,315,168 units at $0.40 per unit for proceeds of $526,067. Each unit consisted of one common share and

one non-transferable share purchase warrant, entitling the holder to acquire one additional common share

for a period of one year at $0.50 per share and at $0.60 per share in the second year. The fair value of the

warrants included in the units was estimated to be $0.115 per warrant using the Black-Scholes option

pricing model using the following assumptions: risk free interest rate of 3.10%, expected volatility of

107%, an expected life of 1 year and no expected dividends. Finders’ fees of $22,212 were paid in

connection with the private placement, which are included in share issuance costs.

During the year ended April 30, 2009, the Company completed a private placement, whereby it issued

456,000 units at $0.25 per unit for proceeds of $114,000. Each unit consisted of one common share and

one-half non-transferable share purchase warrant. Two one-half warrants entitle the holder to purchase one

additional share of common stock at a price of $0.35 per share for one year. The fair value of the warrants

included in the units was estimated to be $0.07 using the Black-Scholes option pricing model using the

following assumptions: risk free interest rate of 1.10%, expected volatility of 115%, an expected life of 1

year and no expected dividends. Finders’ fees of $6,040 were paid in connection with the private

placement, which are included in share issuance costs.

During the nine months ended January 31, 2010, the Company completed a private placement, whereby it

issued 1,012,596 units at $0.15 per unit for proceeds of $151,889, of which $45,000 was received on

February 3, 2010 from the shareholder’s RRSP trust account. Each private placement unit consisted of one

common share and share purchase warrant. Each warrant entitles the holder to purchase one additional

share of common stock at a price of $0.20 per share for one year. The fair value of the warrants included in

the units was estimated to be $0.10 using the Black-Scholes option pricing model using the following

assumptions: risk free interest rate of 1.17%, expected volatility of 153%, an expected life of 1 year and no

expected dividends. Finders’ fees of $7,050 were paid in connection with the private placement, which are

included in share issuance costs.

During the nine months ended January 31, 2010, the Company received $12,000 for subscriptions for shares

issued in March, 2010.

Stock Options

The Company has implemented a stock option plan (the “Plan”) to be administered by the Board of

Directors. Pursuant to the Plan, the Board of Directors has discretion to grant options for up to a maximum

of 10% of the issued and outstanding common shares of the Company at the date the options are granted.

The option price under each option shall be not less than the discounted market price on the grant date. The

expiry date of an option shall be set by the Board of Directors at the time the option is awarded, and shall

not be more than five years after the grant date.

Reg Technologies Inc.

(A Development Stage Company)

Notes to Interim Consolidated Financial Statements

(Expressed in Canadian Dollars)

(Unaudited – Prepared by Management

For the nine months ended January 31, 2010 and 2009

Shareholders’ Equity (Continued)

Stock Options (Continued)

These options have the following vesting schedule:

Up to 25% of the option may be exercised at any time during the term of the option; such initial

exercise is referred to as the “First Exercise”.

ii)

The second 25% of the option may be exercised at any time after 90 days from the date of First

Exercise; such second exercise is referred to as the “Second Exercise”.

iii)

The third 25% of the option may be exercised at any time after 90 days from the date of Second

Exercise; such third exercise is referred to as the “Third Exercise”.

iv)

The fourth and final 25% of the option may be exercised at any time after 90 days from the date

of the Third Exercise.

The options expire 60 months from the date of grant.

Options granted to consultants engaged in investor relations activities will vest in stages over a minimum of

12 months with no more than 25% of the options vesting in any three-month period.

During the nine months ended January 31, 2010, the Company recorded stock-based compensation of

$31,987 (2009 - $31,240) as a general and administrative expense and addition to contributed surplus.

During the year ended April 31, 2009, the Company granted 375,000 stock options from the Plan to two

directors and a consultant exercisable at $0.21 per share, up to April 22, 2014. The fair value of options

was estimated using the Black-Scholes option pricing model using the following weighted average

assumptions: risk free interest rate of 3.19%, expected volatility of 106%, an expected option life of 1 - 5

years and no expected dividends. The weighted average fair value of options granted was $0.18 per option.

During the year ended April 31, 2009, the Company granted 400,000 stock options from the Plan to

employees, directors and consultants exercisable at $0.40 per share, up to August 1, 2013. The fair value of

options was estimated using the Black-Scholes option pricing model using the following weighted average

assumptions: risk free interest rate of 1.69%, expected volatility of 134%, an expected option life of 1 - 5

years and no expected dividends. The weighted average fair value of options granted was $0.31 per option.

Reg Technologies Inc.

(A Development Stage Company)

Notes to Interim Consolidated Financial Statements

(Expressed in Canadian Dollars)

(Unaudited – Prepared by Management

For the nine months ended January 31, 2010 and 2009

Shareholders’ Equity (Continued)

Stock Options (Continued)

A summary of the Company’s stock options is as follows:

Weighted

average

Number of

exercise

options

price

Outstanding at April 30, 2008

1,125,000

0.27

Granted

775,000

0.31

Expired

(375,000)

0.22

Outstanding at April 30, 2009 and January 31, 2010

1,525,000

0.30

As at January 31, 2010, the following stock options are outstanding:

Expiry Date

Exercise

Number

Remaining

price

of options

contractual life

(years)

October 20, 2010

0.30

750,000

0.72

August 1, 2013

0.40

400,000

3.50

April 22, 2014

0.21

375,000

4.23

Options Outstanding

1,525,000

Options Exercisable

381,250

Reg Technologies Inc.

(A Development Stage Company)

Notes to Interim Consolidated Financial Statements

(Expressed in Canadian Dollars)

(Unaudited – Prepared by Management

For the nine months ended January 31, 2010 and 2009

Shareholders’ Equity (Continued)

Share Purchase Warrants

A summary of the Company’s share purchase warrants is as follows:

Weighted

average

Number of

exercise

warrants

price

Outstanding at April 30, 2008

Issued

1,543,168

0.56

Outstanding at April 30, 2009 and January 31, 2010

1,543,168

0.56

As at January 31, 2010, the following share purchase warrants were outstanding:

Expiry Date

Exercise

Number

price

of warrants

July 31, 2010

0.60

1,315,168

April 1, 2010

0.35

228,000

Warrants Outstanding

1,543,168

Equipment

Accumulated

January 31, 2010

Cost

Amortization

Net Book Value

Computer hardware

7,372

6,656

716

Office furniture and equipment

8,849

5,603

3,246

Total

16,221

12,259

3,962

Accumulated

April 30, 2009

Cost

Amortization

Net Book Value

Computer hardware

7,372

5,049

2,323

Office furniture and equipment

8,849

4,275

4,574

Total

16,221

9,324

6,897

Reg Technologies Inc.

(A Development Stage Company)

Notes to Interim Consolidated Financial Statements

(Expressed in Canadian Dollars)

(Unaudited – Prepared by Management

For the nine months ended January 31, 2010 and 2009

7. Equity Accounted Investee

The Company’s investment in REGI has been reduced to $nil as the Company’s share of past losses

exceeded the carrying value of the investment in REGI.

At January 31, 2010, the Company is owed an aggregate of $529,431 (April 30, 2009 - $536,428) by REGI.

The amounts owed are unsecured, non-interest bearing and due on demand.

During the nine months ended January 31, 2010, the Company recognized a gain of $26,689 (2009 -

$99,797) relating to the sale of 84,500 of its shares of REGI.

Related Party Transactions

At January 31, 2010, the Company is owed an aggregate of $26,820 (April 30, 2009 - $19,537) by related

parties. The amounts owed are unsecured, non-interest bearing and due on demand. These parties are

companies that the President of the Company controls or significantly influences.

During the nine months ended January 31, 2010, rent of $11,379 (2009 - $10,890) was paid to a company

having common officers and directors.

During the nine months ended January 31, 2010, management fees of $22,500 (2009 - $22,500) were paid

to a company having common officers and directors.

During the nine months ended January 31, 2010, research and development costs of $32,366 (2009 - $Nil)

were paid to a company having common officers and directors.

During the nine months ended January 31, 2010, administrative and management fees, included in

miscellaneous office expenses, of $20,250 (2009 - $21,048) and directors’ fees of $9,000 (2009 - $6,500)

were paid to officers, directors and companies controlled by officers and directors for services rendered.

These related party transactions are carried out in the normal course of operations and are measured at the

exchange amount of consideration established and agreed to by all the related parties. Amounts due from

related parties are unsecured, non-interest bearing and due on demand.

Reg Technologies Inc.

(A Development Stage Company)

Notes to Interim Consolidated Financial Statements

(Expressed in Canadian Dollars)

(Unaudited – Prepared by Management

For the nine months ended January 31, 2010 and 2009

Commitments

a) In connection with the acquisition of Rand, the Company has the following royalty obligations:

A participating royalty is to be paid based on 5% of all net profits from sales, licenses, royalties

or income derived from the Rand Cam Technology patented technology, to a maximum amount

of $10,000,000. The participating royalty is to be paid in minimum annual instalments of

$50,000 per year beginning on the date the first revenues are derived from the license or sale of

the patented technology.

ii)

Pursuant to a letter of understanding dated December 13, 1993, between the Company and REGI

(collectively called the grantors) and West Virginia University Research Corporation

(“WVURC”), the grantors have agreed that WVURC shall own 5% of the Rand Cam patented

technology and will receive 5% of all net profits from sales, licenses, royalties or income derived

from the patented technology.

iii)

A 1% net profit royalty will be payable to a director on all U.S. – based sales.

b) The Company is committed to fund 50% of the further development of the RadMax™ Engine

Technology.

c) The Company’s current agreement to lease office premise expired on June 30, 2009. On June 11, 2009,

the Company entered into a new lease agreement for one additional year for a total of $13,185.

10. Financial Instrument Liability

During the year ended April 30, 2009, Rand sold 1,304,933 units (2008 – 80,000 units) consisting of one

common share of REGI and one share purchase warrant entitling the holder to purchase one additional

share of REGI at a specified exercise price. The details of the share purchase warrants are as follows:

Closing date of sale

# of warrants

Exercise price

Expiry date

March 27, 2008

80,000

1.50

March 27, 2013

May 6, 2008

40,000

1.50

May 6, 2013

March 12, 2009

1,264,933

0.35

March 12, 2010

The warrants are a derivative, and the proceeds on the sale of the units were bifurcated between the fair

value of the common shares and the share purchase warrants. The proceeds allocated to the warrants were

$125,632 (2008 - $30,798). The fair value of the warrants at the closing date was determined using the

Black-Scholes option pricing model.

Reg Technologies Inc.

(A Development Stage Company)

Notes to Interim Consolidated Financial Statements

(Expressed in Canadian Dollars)

(Unaudited – Prepared by Management

For the nine months ended January 31, 2010 and 2009

10. Financial Instrument Liability (Continued)

During the nine month period ended January 31, 2010, the Company received share subscriptions in the

amount of $144,418 whereby the Company will sell 418,000 units consisting of one common share of

REGI and one share purchase warrant entitling the holder to purchase one additional share of REGI at a

specified exercise price. As at January 31, 2010, these subscriptions are included in accounts payable.

The fair value of the warrants as follows:

Fair value at

Expiry date

January 31, 2010

April 30, 2009

March 27, 2013

10,071

11,474

May 6, 2013

5,166

5,873

March 12, 2010

7,648

149,653

Total

22,885

167,000

Black-Scholes Option-Pricing Model Assumptions

The fair value of each warrant issued was calculated using the Black-Scholes option-pricing model with

the following assumptions:

January 31, 2010

April 30, 2009

Expected dividend yield

0.00%

Expected stock price volatility

110% - 146%

108% - 118%

Risk-free interest rate

0.02% - 1.38%

0.43% - 0.64%

Expected life of warrants (years)

0.11 – 3.15

0.87 – 4.01

Subsequent to January 31, 2010, 1,264,933 warrants expired on March 12, 2010, of which 894,333 were

extended for one year, expiring on March 12, 2011.

Reg Technologies Inc.

(A Development Stage Company)

Notes to Interim Consolidated Financial Statements

(Expressed in Canadian Dollars)

(Unaudited – Prepared by Management

For the nine months ended January 31, 2010 and 2009

11. Capital Management

The Company’s objectives when managing capital are to safeguard the Company’s ability to continue

as a going concern in order to pursue the development of its technologies and to maintain a flexible

capital structure for its projects for the benefit of its stakeholders. As the Company is in the

development stage, its principal source of funds is from the issuance of common shares.

In the management of capital, the Company includes the share capital as well as cash, receivables,

related party receivables and advances to equity accounted investee.

The Company manages the capital structure and makes adjustments to it in light of changes in

economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the

capital structure, the Company may attempt to issue new shares, acquire or dispose of assets or adjust

the amount of cash and short-term investments.

The Company expects its capital resources, which include a share offering and the sale of investee

shares and warrants, will be sufficient to carry its research and development plans and operations

through its current operating period.

The Company is not subject to externally imposed capital requirements and there were changes in its

approach to capital management during the nine months ended January 31, 2010.

12. Subsequent Events

On March 24, 2010 the Company the Company completed a private placement, whereby it issued

1,643,333 units at $0.15 per unit for gross proceeds of $246,500. Each unit consisted of one common

share and share purchase warrant. Each warrant entitles the holder to purchase one additional share of

common stock at a price of $0.20 per share for one year. Finder’s fees of $12,068 were paid in

connection with the private placement.

During the years ended 2008 and 2009 Rand sold 1,304,933 warrants entitling the holder to purchase

shares of REGI from Rand. On March 12, 2010, 1,264,933 of these warrants expired, of which 894,333

warrants were extended for one additional year, expiring March 12, 2011.