FOR AGES GAR ANT & FR ` ERES INC. BALANCE SHEETS September 30, June 30, 2006 2006 2005 (restated) (restated) $$ $ CURRENT A ccounts receivable (Note 4) .......................... 3,534,382 4,011,428 3,869,914 A dvances to the parent company, non-interest bearing ........ 409,193 409,193 365,129 A dvances to a company under common control, non-interest bearing ........................................ 673,400 468,900 353,937 Income taxes receivable .............................. — — 33,670 Inventories ....................................... 3,007,416 3,037,324 2,464,868 P repaid expenses ................................... 101,609 27,085 32,011 7,726,000 7,953,930 7,119,529 LONG- TERM INVESTMENTS, portfolio, at cost (fair value, $39,379) ......................................... — — 38,226 CAPIT AL A SSETS (Note 5) ............................ 2,939,717 3,166,571 3,458,485 10,665,717 11,120,501 10,616,240 LIABILITIES CURRENT Bank overdraft .................................... 158,211 320,136 748,477 Bank loan (Note 6) ................................. — 2,750,000 2,750,000 A ccounts payable and accrued liabilities .................. 1,909,701 2,588,378 1,845,397 Income taxes payable ................................ 389,950 515,553 — A dvances from a private trust fund, non-interest bearing, October 2006 .................................... 3,476,611 — — Bonuses payable ................................... — — 1,150,000 Current portion of long-term debt (Note 7) ............... 50,456 240,448 247,874 5,984,929 6,414,515 6,741,748 LONG- TERM DEBT (Note 7) .......................... 27,468 894,942 1,125,193 FUTURE INCOME T A XES (Note 9) ..................... 245,856 256,902 175,352 6,258,253 7,566,359 8,042,293 SHAREHOLDERS’ EQUITY Share capital (Note 8) ................................. 1,253,100 253,100 253,100 R etained earnings .................................... 3,154,364 3,301,042 2,320,847 4,407,464 3,554,142 2,573,947 10,665,717 11,120,501 10,616,240 APPRO VED B Y THE BO ARD (Signed) M ICHEL M ATHIEU (Signed) J AMES C. J OHNSON Director Director F-47