PTOS 10-K Fiscal year ended March 31, 2010

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

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

For the Fiscal Year Ended March 31, 2010

[] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ______________

P2 SOLAR, INC.

(Exact name of registrant as specified in its charter)

Delaware	333-91190	98-0234680
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification Number)
UNIT 204, 13569 - 76 AVENUE SURREY, BRITISH COLUMBIA, CANADA, V3W 2W3
(Address of principal executive offices)
Registrant’s telephone number, including area code: (604) 592-0047

Securities registered under Section 12(b) of the Exchange Act:

None

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

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act [] Yes [X ] No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the [ ]Yes [X ] No

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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. [X] Yes [  ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Not Applicable.

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not  contained herein, and will not 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-K or any amendment to this Form 10-K. [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ]	Accelerated filer [ ]
Non-accelerated filer [ ]  (Do not check if a smaller reporting company)	Smaller reporting company [ X ]

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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [ ] Yes  [X ] No

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of the last business day of the registrant’s most recently completed second fiscal quarter. $12,546,615.

As of July 14, 2010, the Company had 32,997,589 shares issued and outstanding.

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PART I

ITEM 1.

BUSINESS

Organizational Development

P2 Solar, Inc., a Delaware corporation (hereinafter referred to as “we”, “us”, the “Company”, or the “Registrant”) has been in existence as a Company (including our predecessor British Columbia Corporation) since 1990.   As discussed more fully below, the Company’s current business operations are focused on the potential construction of a solar power plant located in Punjab, India, and the manufacturing, distribution and sales of solar panels.

The Company was initially organized under the laws of British Columbia, Canada, on November 21, 1990 as Spectrum Trading Inc. The Company’s initial business plan was to import leather products from India and sell them in Canada. However, the supplier in India did not materialize and the Company remained dormant until 1997.  In 1997, the Company began a chemical manufacturing business.  On May 14, 1999, pursuant to Section 388 of the Delaware General Corporation Law, the Company domesticated to Delaware and began a chemical manufacturing business; these operations were phased out in the end of 2008.  Subsequent to the Company’s domestication to Delaware, on June 3, 2004, the Company changed its name to Natco International, Inc. On March 11, 2009, the Company changed its name to P2 Solar, Inc.

Business of the Company

The Company’s current business operations are focused on: i) the potential construction of a solar power plant located in Punjab, India; and ii) the manufacturing, distribution and sales of solar panels, both of which are discussed below.

Power Plant Construction Business

On July 13, 2009, the Company entered into a Memorandum of Understanding (“MOU”) with the Punjab Energy Development Agency (“PEDA”) regarding the construction of a 25 mega watt power plant, which was to serve as the first phase of the larger 200 mega watt plant in Punjab, India.  No material definitive agreement had been signed regarding the construction of either power plant.  Pursuant to the terms of the MOU, the Company was only authorized to prepare and submit a pre-feasibility report for the proposed solar power project to PEDA; the MOU did not provide the Company with the authority to construct the solar power project.  Under the terms of the MOU, the Company was required to supply the pre-feasibility report to PEDA within 120 days of the execution of the MOU.  On November 5, 2009, the Company received an extension from PEDA until January 31, 2010 in which to submit its pre-feasibility report. On January 31, 2010, the Company submitted the pre-feasibility report to PEDA.  However, due to the New India Solar Mission implemented by the Indian Federal Government in an effort to enhance India’s use of solar technology, jurisdiction for the Company’s project was transferred to the Indian Federal Government.  Accordingly, the Indian Federal Government located in Delhi, India must now approve the Company’s pre-feasibility report.  Currently the Company is awaiting the issuance of new guidelines relating to the construction of the solar plant from the Indian Federal Government.  The guidelines will set out the procedure and terms under which the interested parties will be able to apply and receive approval to build solar power plants in India under the India Solar Mission. In the event that the Indian Federal Government determines that the Company’s solar power project is viable, the Company and the Indian Federal Government will enter into a separate agreement memorializing the terms for the construction of

1905 Wright Boulevard

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Fax: 847.524.1655

the power plant.  Once the new guidelines are released, the Company will apply for the maximum allowable under the guidelines.

In conjunction with the entry into the MOU, the Company paid a refundable interest free security deposit to PEDA of RS 62.5 Lakhs (approximately US $150,842) in the form of a bank guarantee / demand draft in favor of PEDA.  However, because the review of the project proposal was transferred to the Indian Federal Government’s jurisdiction, subsequent to the fiscal year ended March 31, 2010, PEDA returned the performance guarantee of RS 62.5 Lakhs (approximately US $150,842) to the Company.  The Company will have to pay the performance guarantee to the Indian Federal Government in the event the project is approved.

As noted above, no material definitive agreements have been entered into regarding the construction of the power plant in Punjab, India; the Company and its subsidiary have only entered into non-binding MOU and LOIs.  The MOU and the LOIs are both conditional and there is no guarantee that the Company will be able to meet the conditions of either the MOU or LOIs. The foregoing is an explanation of the preliminary steps that the Company has taken with regards to the potential entry into material definitive agreements and construction of the power plant in Punjab, India.

Solar Panel Business Operations

General Information

As disclosed on a Form 8-K filed with the Securities and Exchange Commission on November 26, 2008, on November 21, 2008, in furtherance of its business operations focused on the manufacture, distribution and sales of solar panels, the Company entered into an Intellectual Property License Agreement (the “License Agreement”) with Lassen Energy, Inc. “(Lassen”) a California corporation, DBK Corporation (“DBK Corp”), a Nevada corporation, and Darry Boyd (“Boyd”) (DBK Corp and Boyd are collectively referred to herein as (“DBK”)).   Pursuant to the License Agreement, Lassen and DBK agreed to provide the Company with several Licenses relating to the use of certain intellectual property necessary for the manufacturing, distribution and sale of the Lassen Solar Panel throughout the Nations of India and Canada, and the State of Hawaii.  The consideration to be paid by the Company to Lassen for the Licenses is a fee of US $1,000,000 together with a 2% royalty on gross revenues received by the Company from future sales of Lassen Solar Panels.  The current amount due and owing under the License Agreement is $770,000.  The Company is required to pay the remaining $770,000, ninety (90) days after the Company receives a report from Lassen indicating that the Lassen Solar Panel has received Intertek Certification and has a power output of a minimum of 1500 watts.

The Lassen Solar Panel is still in the developmental stage.  Once the Lassen Solar Panels receives Underwriters Laboratories, Inc. (“UL”) Certification indicating that the Lassen Solar Panel is ready for commercial distribution, the Company will begin the process of establishing assembly facilities for the Lassen Solar Panel in the Licensed Territories.  The Company anticipates that the facilities will be established and operational within approximately one (1) year of the receipt of UL Certification.

Products

The Lassen Solar Panels are currently in the development stage and are not yet ready for commercial distribution.  Lassen is in the process of obtaining UL Certification for the Lassen Solar Panel.  The Lassen Solar Panels contain components which make use of a patent pending application of a technology called Multiple Energy Levels or MEL, which configures photovoltaic cells (PV) as a series of transistors instead of as diodes. The technology takes wavelength frequency to move a bucket of electrons through the junctions, which greatly improves photovoltaic efficiency. The panels use this increased

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efficiency as a catalyst to generate, in current prototypes, 400 watts per panel, with construction of new panels currently underway that are designed to produce 2000 to 3000 watts per panel. A photovoltaic device (generally called a solar cell) consists of layers of semiconductor materials with different electronic properties. In a Lassen Solar Panel there are two parts. Part A, which we call “the cornerstone”, is a multi-junction, multi-layer device. Part B, which we call “the legacy”, has previously stored energy in it. Part A and B are tied together in a photosynthesis arrangement to release in excess of 2000 watts of energy.

Testing was conducted over a multiple day period by using one Lassen Solar Panel prototype measuring 62.5 x 32.5x3.5 inches. As part of the test, six (6)-half (1/2) horsepower Dayton motors and four (4)-500 watt Lithonia lights were attached to the panel. Measurements averaged 13 amps and 208 volts, which calculates to 2704 watts, with peaks over 3000 watts.

Photovoltaic solar power is a renewable energy. Compared to nonrenewable sources such as coal, gas, oil, and nuclear, the perceived advantages are: it's non-polluting, has no moving parts to break down, and does not require much maintenance. A very important characteristic of PV power generation is that it does not require a large-scale installation to operate as conventional power generation stations. Power generators can be installed in a distributed fashion, on each house or business or school, using area that is already developed, and allowing individual users to generate their own power, quietly and safely.  Rooftop power can be added as more homes or businesses are added to a community, thereby allowing power generation to keep in step with growing needs without having to overbuild generation capacity as is often the case with conventional large scale power systems.

Customers

Due to the fact that the Lassen Solar Panel is still in the developmental stage, we do not currently have any customers.  However, once we begin manufacturing, distributing and selling the Lassen Solar Panel in the Licensed Territories, our initial primary customer will consist of DBK Corp.  Pursuant to the terms of the License Agreement, the Company has the right, but not the obligation, to require DBK Corp. to purchase not less than 91% of the Lassen Solar Panels produced by the Company each quarter.  In addition to DBK Corp., we anticipate the additional customers will consist of private individuals, companies, as well as governmental entities in the Licenses Territories.

Suppliers and Raw Materials

Due to the fact that the Lassen Solar Panel is still in the developmental stage, we do not currently have any suppliers.  However, once we begin manufacturing the Lassen Solar Panel, pursuant to the terms of the License Agreement, DBK is required to supply us with all of the necessary raw materials related to the manufacture of the Lassen Solar Panel.  We have the right, but not the obligation, to purchase from Lassen and DBK all material necessary for the quality manufacture and assembly of the Lassen Solar Panel.  However, in the event that the Company chooses to acquire all or any portion of the Lassen Solar Panel from independent third party suppliers, we are required to notify Lassen and DBK of the identity of any such supplies and the specifications of the products to be provided.  Lassen and DBK have the right to reject any product proposed to be purchased by the Company in the extent it believes in the exercise of its reasonable discretion that such product does not satisfy minimum quality standards.

Marketing and Distribution

Marketing

The Lassen Solar Panel will be marketed to the Residential and Commercial markets in the Company’s Licensed Territories which include the Nations of India, and Canada, and the State of Hawaii.

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Distribution

Pursuant to the terms of the License Agreement, the Company, holds a performance based irrevocable exclusive license to sell and distribute the Lassen Solar Panels for any and all applications above 1 Mega Watt throughout the Licensed Territories, and to sell and distribute the Lassen Solar Panel for uses equal to or below 1Mega Watt to DBK or its dealer network.   Additionally, under the terms of the License Agreement, to the extent in any of the Licensed Territories that distribution, sales and service rights for uses of the Lassen Solar Panel equal to or below 1Mega Watt are available, the Company may at is sole discretion acquire any or all of such from DBK as per DBK’s established dealership agreement.   Once the Company has established manufacturing facilities in the Licensed Territories, the Lassen Solar Panels will be distributed in accordance with the terms of the License Agreement.

Competition and Related Factors

The Lassen Solar Panel’s technology enables it to produce relatively lower costs per KWh compared with the generally available technology. We believe that we can produce, on a commercial scale, solar panels that will make solar energy power generation cost competitive with traditional electric power sources. Lower cost, clean, renewable, and reliable energy has the potential to be a dominant source of electric power generation for many years.  Our chief competitor on the industrial side is Stirling Energy Systems, a systems integration and project management company that is developing equipment for utility-scale renewable energy power plants and distributed electric generating systems. Their systems require 3-4 times the land for the equivalent wattages, as compared with the Lassen Solar Panel’s technology. Their systems must be mounted in remote locations due to the height of their tower and reflective mirrors. On the residential and commercial side, our chief competitors are British Petroleum and Shell, both of which have substantially greater financial, manpower, and marketing resources than we do.  Our ability to compete with them will be based solely on the hope that the Lassen Solar Panels are significantly technologically superior to any solar panels they develop.

Intellectual Property

Pursuant to the License Agreement, Lassen and DBK granted the Company licenses relating to: i) the manufacture, assembly, and sale of Lassen Solar Panels throughout the Licensed Territories; ii)  utilization of the Lassen Solar Panels in any and all applications above one (1) Mega Watt throughout the Licensed Territories;  iii) the sale and distribution of the Lassen Solar Panels for any and all applications above one (1) Mega Watt throughout the Licensed Territories; iv) the sale and distribution of the Lassen Solar Panels for uses equal to or below one (1) Mega Watt to DBK Corp or its dealer network; and v)  the right to acquire distribution rights for the sale of Lassen Solar Panels under one (1) Mega Watt in the Licensed Territories.  Other than the Licenses, the Company does not own any intellectual property relating to the Lassen Solar Panel.

Government Regulation

Our manufacture and distribution of the Lassen Solar Panels in the Licensed Territories will be subject to oversight and regulation in accordance with national and local ordinances relating to building codes, safety, environmental protection, and related matters. We are responsible for knowing all applicable regulatory requirements and must manufacture products to comply with all such requirements. Any new government regulations or utility policies that relate to our solar power products may result in significant additional expenses to us and our customers and, as a result, could cause a significant reduction in demand for our solar power products.

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Employees

As of the date of this Form 10-K, we do not have any full or part-time employees.  All work relating to the Company is carried on by the Company’s management.

Reports to Security Holders

We are required to file reports with the SEC under section 13(a) of the Securities Act.  The reports will be filed electronically. You may read copies of any materials we file with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Room 1580, Washington, D.C. 20549.  You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.  The SEC also maintains an Internet site that will contain copies of the reports we file electronically.  The address for the SEC Internet site is http://www.sec.gov.

Subsequent Events

Sinova Agreement

Subsequent to the fiscal year ended March 31, 2010, on April 1, 2010, the Company entered into a one year Consulting Agreement (the “Consulting Agreement”) with Sinova Holdings, Ltd. (“Sinova”).  Pursuant to the terms of the Consulting Agreement, in the event the Company receives approval for the construction of the power plant, Sinova will assist the Company in identifying strategic investors, financial investors, and/or investment banks for the purpose of securing funds necessary for the construction of the power plant in Punjab, India through either equity or debt financing.  In return for the consulting services rendered by Sinova, the Company is required to issue Sinova a monthly retainer in the amount of 80,000 shares of restricted common stock.  Additionally, in the event Sinova is successful in assisting the Company in procuring the necessary funds for the power plant construction project, Sinova will be entitled to additional compensation.   A copy of the Consulting Agreement is attached hereto as Exhibit 10.16

CCG Agreement

Subsequent to the fiscal year ended March 31, 2010, on April 19, 2010, the Company entered into an Agreement (the “CCG Agreement”) with CCG, an investor relations firm located in New York. Pursuant to the terms of the CCG Agreement, CCG will assist the Company with investor relations services.  CCG is paid $11,000 per month for the services that CCG will render to the Company.  The CCG Agreement is for a period of twelve months.  A copy of the CCG Agreement is attached hereto as Exhibit 10.17.

Return of Performance Guarantee

As noted above, because of the India Solar Mission, the Company’s proposed power plant project must now be approved by the Indian Federal Government located in Delhi, India.  As a result, in May 2010 PEDA returned the performance guarantee in the amount of RS 62.5 Lakhs (approximately US $150,842) to the Company.

ITEM 1A.

RISK FACTORS

Not Applicable.

ITEM 1B. UNRESOLVED STAFF COMMENTS

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Not Applicable.

ITEM 2.

PROPERTIES.

Our principal office is located at Unit 204, 13569 – 76 Avenue, Surrey, British Columbia, Canada, V3W 2W3.  As of September 1, 2007 the Company has leased offices at #204, 13569 - 76 ^th Avenue, Surrey, BC, Canada.  Total space is 750 square feet for total rent of $900.00 per month.  The lease for the Company’s principal office lease will expire on August 31, 2012.

ITEM 3.

LEGAL PROCEEDINGS.

On December 12, 2007, the Company commenced legal proceedings in British  Columbia Supreme Court against Photo Violation Technologies Corp. ("PVT") and its president, Fred Mitschele (aka Fred Marlatt), claiming punitive, exemplary and consequential damages and other remedies arising from breach of contract and wrongful conduct on the part of Mitschele.  In the Action, the Company claimed PVT had breached the agreement among the Company, PVT and Mitschele entered into on or about March 16, 2007, which provided for the completion of a reverse merger between the Company and PVT.   The Company also claimed in Court documents that Mitschele engaged in a number of wrongful acts, including inducing breach of contract, attempting to divert prospective investors from Company to PVT, failing to provide financial statements and other necessary documents. In February 2008, the Company extended the law suit to include, the other two directors and one employee.  On July 22, 2009, the Company was awarded a judgment in its legal proceeding against PVT in the amount of $1,485,000, plus interest.  On March 24, 2010, the British Columbia Supreme Court, in response to a motion made by the Company, declared PVT bankrupt as of October 7, 2009.  As a result of the declaration of bankruptcy, the Company has had a trustee appointed to handle PVT’s bankruptcy proceedings.  Additionally, in November 2008, the Company launched another law suit against PVT for spreading misinformation about the Company through a number of websites; this legal proceeding is currently ongoing.

ITEM 4.

(REMOVED AND RESERVED)

PART II

ITEM 5.

MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Market Information .

The Company’s shares trade on the OTCBB under the symbol “PTOS.”   The following table sets forth the high and low bid prices of our common stock (USD) for the last two fiscal years and subsequent interim period, as reported by the National Quotation Bureau and represents inter dealer quotations, without retail mark-up, mark-down or commission and may not be reflective of actual transactions:

	(U.S. $)
2008	HIGH	LOW
Quarter Ended March 31	$.064	$0.18
Quarter Ended June 30	$0.70	$0.23
Quarter Ended September 30	$0.85	$0.25

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Quarter Ended December 31	$0.58	$0.14
2009	HIGH	LOW
Quarter Ended March 31	$.81	$0.20
Quarter Ended June 30	$0.78	$0.25
Quarter Ended September 30	$0.75	$0.32
Quarter Ended December 31	$0.55	$0.30
2010	HIGH	LOW
Quarter Ended March 31	$0.43	$0.24

Holders .

As of March 31, 2010 there were 32,647,589 shares of common stock issued and outstanding and approximately 47 shareholders of record.

Dividends .

The Company has not declared or paid any cash dividends on its common stock during the fiscal years ended March 31, 2010 or 2009.  There are no restrictions on the common stock that limit the ability of us to pay dividends if declared by the Board of Directors and  the loan agreements and general security agreements covering the Company’s assets do not limit its ability to pay dividends.  The holders of common stock are entitled to receive dividends when and if declared by the Board of Directors, out of funds legally available therefore and to share pro-rata in any distribution to the stockholders. Generally, the Company is not able to pay dividends if after payment of the dividends, it would be unable to pay its liabilities as they become due or if the value of the Company’s assets, after payment of the liabilities, is less than the aggregate of the Company’s liabilities and stated capital of all classes

ITEM 6.

SELECTED FINANCIAL DATA.

Not Applicable.

ITEM 7.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION.

SPECIAL NOTE OF CAUTION REGARDING FORWARD-LOOKING STATEMENTS

CERTAIN STATEMENTS IN THIS REPORT, INCLUDING STATEMENTS IN THE FOLLOWING DISCUSSION, ARE WHAT ARE KNOWN AS "FORWARD LOOKING STATEMENTS", WHICH ARE BASICALLY STATEMENTS ABOUT THE FUTURE. FOR THAT REASON, THESE STATEMENTS INVOLVE RISK AND UNCERTAINTY SINCE NO ONE CAN ACCURATELY PREDICT THE FUTURE. WORDS SUCH AS "PLANS," "INTENDS," "WILL," "HOPES," "SEEKS," "ANTICIPATES," "EXPECTS "AND THE LIKE OFTEN IDENTIFY SUCH FORWARD LOOKING STATEMENTS, BUT ARE NOT THE ONLY INDICATION THAT A STATEMENT IS A FORWARD LOOKING STATEMENT. SUCH FORWARD LOOKING STATEMENTS INCLUDE STATEMENTS CONCERNING OUR PLANS AND OBJECTIVES WITH RESPECT TO THE PRESENT AND FUTURE OPERATIONS OF THE COMPANY, AND STATEMENTS WHICH EXPRESS OR IMPLY THAT SUCH PRESENT AND FUTURE OPERATIONS WILL OR MAY PRODUCE REVENUES, INCOME OR PROFITS. NUMEROUS FACTORS AND FUTURE EVENTS COULD CAUSE THE COMPANY TO CHANGE SUCH PLANS AND OBJECTIVES OR FAIL TO SUCCESSFULLY

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IMPLEMENT SUCH PLANS OR ACHIEVE SUCH OBJECTIVES, OR CAUSE SUCH PRESENT AND FUTURE OPERATIONS TO FAIL TO PRODUCE REVENUES, INCOME OR PROFITS. THEREFORE, THE READER IS ADVISED THAT THE FOLLOWING DISCUSSION SHOULD BE CONSIDERED IN LIGHT OF THE DISCUSSION OF RISKS AND OTHER FACTORS CONTAINED IN THIS REPORT ON FORM 10-K AND IN THE COMPANY'S OTHER FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION. NO STATEMENTS CONTAINED IN THE FOLLOWING DISCUSSION SHOULD BE CONSTRUED AS A GUARANTEE OR ASSURANCE OF FUTURE PERFORMANCE OR FUTURE RESULTS.

Background and Overview

P2 Solar, Inc. has been in existence as a Company (including our predecessor British Columbia Corporation) since 1990. The Company’s current business operations are focused on: i) the potential construction of a solar power plant located in Punjab, India; and ii) the manufacturing, distribution and sales of solar panels.

Power Plant Construction Business

As mentioned above, on July 13, 2009, the Company entered into a MOU with the PEDA regarding the construction of a 25 mega watt power plant, which was to serve as the first phase of the larger 200 mega watt plant in Punjab, India.  No material definitive agreement had been signed regarding the construction of either power plant.  Pursuant to the terms of the MOU, the Company was only authorized to prepare and submit a pre-feasibility report for the proposed solar power project to PEDA; the MOU did not provide the Company with the authority to construct the solar power project.  Under the terms of the MOU, the Company was required to supply the pre-feasibility report to PEDA within 120 days of the execution of the MOU.  On November 5, 2009, the Company received an extension from PEDA until January 31, 2010 in which to submit its pre-feasibility report. On January 31, 2010, the Company submitted the pre-feasibility report to PEDA.  However, due to the New India Solar Mission implemented by the Indian Federal Government in an effort to enhance India’s use of solar technology, jurisdiction for the Company’s project was transferred to the Indian Federal Government.  Accordingly, the Indian Federal Government located in Delhi, India must now approve the Company’s pre-feasibility report.  Currently the Company is awaiting the issuance of new guidelines relating to the construction of the solar plant from the Indian Federal Government.  The guidelines will set out the procedure and terms under which the interested parties will be able to apply and receive approval to build solar power plants in India under the India Solar Mission. In the event that the Indian Federal Government determines that the Company’s solar power project is viable, the Company and the Indian Federal Government will enter into a separate agreement memorializing the terms for the construction of the power plant.  Once the new guidelines are released, the Company will apply for the maximum allowable under the guidelines.

In conjunction with the entry into the MOU, the Company has paid a refundable interest free security deposit to PEDA of RS 62.5 Lakhs (approximately US $150,842) in the form of a bank guarantee / demand draft in favor of PEDA.  However, because the review of the project proposal was transferred to the Indian Federal Government’s jurisdiction, subsequent to the fiscal year ended March 31, 2010, PEDA returned the performance guarantee of RS 62.5 Lakhs (approximately US $150,842) to the Company.  The Company will have to pay the performance guarantee to the Indian Federal Government in the event the project is approved.

As noted above, no material definitive agreements have been entered into regarding the construction of the power plant in Punjab, India; the Company and its subsidiary have only entered into a non-binding MOU and LOIs.  The MOU and the LOIs are both conditional and there is no guarantee that the Company will be able to meet the conditions of either the MOU or LOIs. The foregoing is an

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explanation of the preliminary steps that the Company has taken with regards to the potential entry into material definitive agreements and construction of the power plant in Punjab, India

Solar Panel Business Operations

As disclosed on a Form 8-K filed with the Securities and Exchange Commission on November 26, 2008, on November 21, 2008, in furtherance of its business operations focused on the manufacture, distribution and sales of solar panels, the Company entered into the License Agreement with Lassen and DBK.   Pursuant to the License Agreement, Lassen and DBK agreed to provide the Company with several Licenses relating to the use of certain intellectual property necessary for the manufacturing, distribution and sale of the Lassen Solar Panel throughout the Nations of India and Canada, and the State of Hawaii.  The consideration to be paid by the Company to Lassen for the Licenses is a fee of US $1,000,000 together with a 2% royalty on gross revenues received by the Company from future sales of Lassen Solar Panels.  The current amount due an owing under the License Agreement is $770,000.  The Company is required to pay the remaining $770,000, ninety (90) days after the Company receives a report from Lassen indicating that the Lassen Solar Panel has received Intertek Certification and has a power output of a minimum of 1500 watts.

The Lassen Solar Panel is still in the developmental stage.  Once the Lassen Solar Panels receives UL Certification indicating that the Lassen Solar Panel is ready for commercial distribution, the Company will begin the process of establishing assembly facilities for the Lassen Solar Panel in the Licensed Territories.  The Company anticipates that the facilities will be established and operational within approximately one (1) year of the receipt of UL Certification.

Plan of Operation

During the fiscal year ending March 31, 2011, and the subsequent twelve months, the Company anticipates that it will continue to pursue the development of the solar power plant in Punjab, India.  Additionally, in the event that the Lassen Solar Panel is ready for commercial applications when the Company begins construction on the power plant, and the Company is able to meet the financial requirements of the License Agreement, the Company anticipates utilizing the Lassen Solar Panel in the project.  However, if the Lassen Solar Panel is not yet ready for commercial applications, the Company will utilize currently available commercial solar panels for the construction of the project.

Results of Operation

As of March 31, 2010, the Company remained in the development stage and had not generated any revenue from operations.  As a result, no meaningful comparison is possible regarding results of operation for the fiscal year ended March 31, 2010 as compared to the fiscal year ended March 31, 2009.

Liquidity and Capital Resources

The following discussion and analysis provides information that we believe is relevant to an assessment and understanding of our financial condition for the twelve months ended March 31, 2010. The following summary should be read in conjunction with the financial statements and accompanying notes to them included elsewhere in this report.  Our financial statements are stated in US Dollars and are prepared in accordance with generally accepted accounting principals of the United States (“GAAP”).

During the fiscal year ended March 31, 2010, the Company did not have any sales or generate any revenues.  As of March 31, 2010, the Company’s audited balance sheet reflects total assets of $2,976,731 which primarily consist of: i) a Loan to Photo Violations Technology Inc. in the principal

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amount of $1,485,000; ii) the License Agreement with Lassen valued at $1,000,000; iii) an interest receivable on the loan to Photo Violations Technology Inc. in the amount of $226,872; and iv) a Performance Bond with the Punjab Government in the amount of $150,842.  As of March 31, 2010, the Company’s audited balance sheet reflects total liabilities of $2,365,099.  The Company has cash on hand of $12,142 and a deficit accumulated during the development stage of $3,038,538.

The Company does not have sufficient assets or capital resources to pay its on-going expenses.  Additionally, the Company does not currently have the $770,000 to cover the final payment that will need to be paid pursuant to the terms of the License Agreement, or the funds necessary to proceed with the development of the power plant in Punjab. To date, the Company has primarily financed its operations through equity investment from investors, shareholder loans, and credit facilities from Canadian chartered banks and increases in payables and share subscriptions. Most of the financing has been debt financing from related and un-related parties.  Currently, our estimated fixed costs at this time are approximately $5400 per month; that figure includes $900 for lease payments, $500 for utilities, $3,000 for loan interest and principle payments, and $1,000 for miscellaneous expenses. We will have to raise approximately $5400 per month to cover operating expenses, and an additional $770,000 to cover the payment under the License Agreement, and, if the Indian Federal Government approves the Company’s feasibility report, approximately $112,000,000 to cover expenses associated with the development of the power plant in Punjab, India.

The Company anticipates that it will attempt to raise approximately 2 to 3 million dollars through the sale of the Company’s securities to cover the Company’s operating expenses and to make the $770,000 payment pursuant to the License Agreement.  Furthermore, if the Indian Federal Government approves the Company’s feasibility report, and authorizes the construction of the 25 mega watt power plant in Punjab India, the Company anticipates that it will pursue a combination of debt and equity financing in an effort to raise the necessary funds to cover the estimated $112,000,000 in expenses associated with the development of the power plant.  We have had preliminary discussions with a number of groups regarding both a smaller and larger financing; we are hopeful that we will be able to obtain financing.  However, there is no guarantee that we will be successful in raising any additional capital.  If we are unable to finance the Company by debt or equity financing, or a combination of the two, we will have to look for other sources of funding to meet our requirements.  That source has not been identified as yet.   As noted above, subsequent to the fiscal year ended March 31, 2010, on April 1, 2010, the Company entered into a one year Consulting Agreement with Sinova Holdings, Ltd.  Pursuant to the terms of the Consulting Agreement, in the event the Company’s power plant project is approved by the Indian Federal Government, Sinova will assist the Company in identifying strategic investors, financial investors, and/or investment banks for the purpose of securing funds necessary for the construction of the power plant in Punjab, India through either equity or debt financing.  In return for the consulting services rendered by Sinova, the Company is required to issue Sinova a monthly retainer in the amount of 80,000 shares of restricted common stock.  Additionally, in the event Sinova is successful in assisting the Company in procuring the necessary funds for the power plant construction project, Sinova will be entitled to additional compensation.

In an effort to enhance its short term liquidity, subsequent to the fiscal year ended March 31, 2010, in April 2010, the Company conducted a Private Placement Offering, pursuant to which the Company raised $105,000 through the sale of 350,000 Units at a purchase price of $.30 per Unit. Each Unit consisted of one share of common stock and one Warrant.  One Warrant entitles the holder thereof to purchase one share of common stock at a price of $0.42 per share at any time up until 36 months following the purchase of the Unites.  For the above share issuances, the shares were not registered under the Securities Act in reliance upon the exemptions from registration contained in Section 4(2) and Regulation D of the Securities Act of 1933 (the “1933 Act”), the securities laws of certain states, and Regulation S under the 1933 Act. No underwriters were used, nor were any brokerage commissions paid in connection with the above share

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issuances.  Additionally, in an effort to enhance liquidity, the Company is currently pursuing PVT for the money it owes the Company ($1,485,000) plus interest and damages.

Our financial statements have been prepared on the going concern basis under which an entity is considered to be able to realize its assets and satisfy its liabilities in the ordinary course of business. Operations to date have been primarily financed by long-term debt and equity transactions as well as increases in payables and related party loans. Our future operations are dependent upon the identification and successful completion of additional long-term or permanent equity financing, the continued support of creditors and shareholders, and, ultimately, the achievement of profitable operations. There can be no assurance that we will be successful. If we are not, we will be required to reduce operations or liquidate assets. We will continue to evaluate our projected expenditures relative to our available cash and to seek additional means of financing in order to satisfy working capital and other cash requirements.

Off Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements.

ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not Applicable.

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

The financial statements of the Company required by Article 8 of Regulation S-X are attached to this report.

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P2 SOLAR, INC.

AUDITED FINANCIAL STATEMENTS

FOR THE FISCAL YEAR ENDED MARCH 31, 2010 and 2009

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and
Stockholders of P2 Solar, Inc.

We have audited the accompanying balance sheets of P2 Solar, Inc. (the “Company”) as of March 31, 2010 and 2009 and related statements of operations, stockholders’ deficit, and cash flows for the years then ended March 31, 2010 and 2009, and for the period since inception to March 31, 2010. 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 audit.

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. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, 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 P2 Solar, Inc. as of March 31, 2010 and 2009 and the results of its operations and its cash flows for years ended March 31, 2010 and 2009, and for the period since inception to March 31, 2010, in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. The Company has suffered recurring losses and has yet to generate an internal cash flow that raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ Lake & Associates, CPA’s LLC

Lake & Associates, CPA’s LLC

Schaumburg, Illinois

July 14, 2010

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16

17

P2 Solar Inc.

(Development Stage Company

Statement of Operations

Expressed in U.S. Dollars

For the years ended March 31, 2010 and 2009 and the period inception

to March 31, 2010

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19

20

21

22

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P2 Solar, Inc.

Development Stage Company

Notes to Financial Statements

March 31, 2010 and 2009

Expressed in US Dollars

1.    Nature of Operations and Going Concern

The Company was incorporated as Spectrum Trading Inc. under the laws of the Province of British Columbia, Canada, on November 21, 1990. On May 14, 1999, the Company was discontinued in British Columbia and was reincorporated as Spectrum International Inc. in the State of Delaware, U.S.A.  Effective September 3, 2004, the Company changed its name from Spectrum International Inc. to Natco International Inc. On March 11, 2009, the Company changed its name from the Natco International Inc. to P2 Solar, Inc.

The company had two products, jewelry cleaner and a tire sealant. During the fiscal year ended March 31 2007, the Company discontinued its production of both lines. The company had signed a binding letter of agreement with Photo Violation Technologies Corp. (PVT), which would have lead PVT to take over the Company in a reverse merger. However, this agreement was cancelled in December 2007.  The company signed another letter of agreement in February 2008 with Lassen Energy, Inc to do a share exchange merger. On November 28, 2008, the Company cancelled the merger agreement with Lassen and instead signed a Licensing agreement with Lassen that gives the company rights to their products in India, Canada, and Hawaii.

These financial statements have been prepared on the basis of accounting principles applicable to a going concern which assumes that the company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of operations. The Company has incurred significant operating losses over the past three years and has a substantial stockholders' deficiency and a working capital deficiency. The company's continued existence is dependent upon its ability to raise additional capital and to achieve profitable operations through the Licensing agreement with Lassen Energy, Inc. and financing and building of power plant in India and elsewhere.

If the going concern assumption were not appropriate for these financial statements, then adjustments would be necessary in the carrying values of assets and liabilities, the reported revenues and expenses and the balance sheet classifications used.

2.    Summary of Significant Accounting Policies

a)   Fiscal Period

The Company's fiscal year ends on March 31.

b)    Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, term deposits and short term highly liquid investments with a term to maturity of less than one year from inception which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of changes in value.

c)    Use of Estimates

In conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that could affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the year. Actual results could

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vary materially from those reported.

d)    Foreign Currency Transactions

The Company's functional currency is the Canadian dollar and the reporting currency is the U.S. dollar.  Assets and liabilities are translated from the functional to the reporting currency at the exchange rate in effect at the balance sheet date and equity at the historical exchange rates. Revenue and expenses are translated at rates in effect at the time of the transactions. Resulting translation gains and losses are accumulated in a separate component of stockholders' equity - other comprehensive income (loss).  Realized foreign currency transaction gains and losses are credited or charged directly to operations.

e)    Property, Plant and Equipment

Property, plant and equipment are recorded at cost.  Depreciation is provided annually on the diminishing balance method to write-off the assets over their estimated useful lives as follows:

Computer and office equipment - 5 years

Manufacturing equipment - 10 years

f)  Income Taxes

Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.  A valuation allowance is provided for significant deferred tax assets when it is more likely than not that such asset will not be recovered.

g) Fair value of Financial Instruments

The company's financial instruments consist of accounts receivable, bank indebtedness, accounts payable and amounts due to related parties.  Unless otherwise noted, it is management's opinion that this Company is not exposed to significant interest or credit risks arising from these financial instruments. The fair values of these financial instruments approximate their carrying values unless otherwise noted.

h) Stock-Based Compensation

Effective January 1, 2006, the Company adopted the provisions of Accounting Standards Codification (ASC) Topic 718 “Stock Compensation” , which establishes accounting for equity instruments exchanged for employee services. Under the provisions of ASC 718, stock-based compensation cost is measured at the grant date, based on the calculated fair value of the award, and is recognized as an expense over the employees' requisite service period (generally the vesting period of the equity grant). Before January 1, 2006, the Company accounted for stock-based compensation to employees in accordance with Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees," and complied with the disclosure requirements of SFAS No. 123, "Accounting for Stock-Based Compensation".  The Company adopted SFAS 123(R) using the modified prospective method, which requires the Company to record compensation expense over the vesting period for all awards granted after the date of adoption, and for the unvested portion of previously granted awards that remain outstanding at the date of adoption.  Accordingly, financial statements for the periods prior to January 1, 2006 have not been restated to reflect the fair value method of expensing share-based compensation. Adoption of ASC 718  does not change the way the Company accounts for share-based payments to non-employees, with guidance provided by SFAS 123 (as originally issued) and Emerging Issues Task Force Issue No. 96-18, "Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in conjunction with Selling, Goods or Services".

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i) Revenue Recognition

Revenues are recognized when all of the following criteria have been met: persuasive evidence for an arrangement exists; delivery has occurred; the fee is fixed or determinable; and collection is reasonably assured.

j) Advertising Policy

The Company expenses the cost of advertising when incurred.

k) Research and Development

Research and development is expensed as incurred.

l) Shipping and Handling

The company includes the cost of shipping and handling as a component of cost of sales in accordance with ASC Topic 605,"Accounting for Shipping and Handling Fees and Costs."

m) Long-Lived Assets

The company monitors the recoverability of long-lived assets, including property, plant and equipment and product rights, based on estimates using factors such as current market value, future asset utilization, business climate and future undiscounted cash flows expected to result from the use of the related assets. The company policy is to record any impairment loss in the period when it is determined that the carrying amount of the asset may not be recoverable equal to the excess of the asset's carrying value over its fair value.

n) Loss Per Share

The company computes net loss per common share using ASC Topic 260  "Earnings Per Share" guidance.  Basic loss per common share is computed based on the weighted average number of shares outstanding for the period. Diluted loss per share is computed by dividing net loss by the weighted average shares outstanding assuming all dilutive potential common shares were issued. There were no dilutive potential common shares at March 31, 2010 and 2009.  Because the company has incurred net losses and has no potentially dilutive common shares, basic and diluted loss per share, is the same.  Additionally, for the purposes of calculating diluted loss per share, there were no adjustments to net loss.

0) Obligations Under Capital Leases

Leases are classified as either capital or operating.  Leases that transfer substantially all of the benefits and risks of ownership of property to the company are accounted for as capital leases.  At the time a capital lease is entered into, an asset is recorded with its related long-term financing. Payments under operating leases are expensed as incurred.

p) Segmented Reporting

ASC Topic 280 "Segment Reporting", changed the way public companies report information about segments of their business in their quarterly reports issued to stockholders. It also requires entity-wide disclosures about the products and services an entity provides, the material countries in which it holds assets and reports revenues and its major customers.  The company's sales are generated in one geographical area, Canada. All revenues consist of interest earned on investment.

q) Comprehensive Income

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ASC Topic 220 , "Comprehensive Income", establishes standards for reporting and display of comprehensive income and its components in a full set of general-purpose financial statements.

r) Derivative Financial Instruments

The company was not a party to any derivative financial instruments during any of the reported fiscal periods.

s) Recent Accounting Pronouncements

In June 2009, the FASB issued SFAS No. 168, “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles” (“SFAS 168”).  SFAS 168, which was primarily codified into ASC Topic 105, will become the source of authoritative U.S. generally accepted accounting principles recognized by the FASB to be applied by nongovernmental entities.  On the effective date,  will supersede all then-existing non-SEC accounting and reporting standards.  All other non-grandfathered non-SEC accounting literature not included in the codification will become non-authoritative.  ASC Topic 105  is effective for financial statements issued for interim and annual periods ending after September 15, 2009.  The Company is currently evaluating the requirements of SFAS 168, but it is not expected to have a material impact on the Company’s financial statements.

In December 2008, the FASB provided for a deferral of the effective date of ASC 740  “Income Taxes”  for certain non-public enterprises to annual financial statements for fiscal years beginning after December 15, 2008.  The Company has elected this deferral and accordingly will be required to adopt FIN 48 in its 2009 annual financial statements.  Prior to adoption of ASC 740, the Company will continue to evaluate its uncertain tax positions and related income tax contingencies under Statement No. 5, Accounting for Contingencies. SFAS No. 5 requires the Company to accrue for losses it believes are probable and can be reasonably estimated.  Management has not yet determined if the adoption of FIN 48 will have a material effect on the Company’s financial statements.

3. Solar Panel License and Share Exchange

On November 28, 2008, the Company cancelled the April 18, 2008 agreement and signed a new Licensing agreement with Lassen.  This agreement gives the Company the rights to Manufacture and setup power plants in the countries of India, Canada, and State of Hawaii. The consideration to be paid by the Company to Lassen for the Licenses is an initial fee of US $1,000,000 (the “License Fee”) together with a 2% royalty on gross revenues received by the Company from future sales of Lassen Solar Panels. The license does not have defined term and will not be amortized until it is used to the benefit of the Company.

Simultaneously with execution of the License Agreement, the Company also executed a Share Transfer Agreement with Lassen pursuant to which it agreed to issue Lassen a total of 8,915,871 shares of its common stock, representing approximately 25% of the Company’s issued and outstanding common stock, in exchange for the issuance by Lassen to the Company of approximately 25,252,500 shares of common stock of Lassen, representing approximately 25% of the issued and outstanding common stock of Lassen.  The shares had been valued at par value ($0.001) for reporting purposes.

As disclosed on a Form 8-K filed with the Securities and Exchange Commission on May 13, 2009, on May 7, 2009, the Company and Lassen entered into an Agreement pursuant to which the parties agreed to terminate the Share Transfer Agreement and return the shares that were transferred under the Share Transfer Agreement. Upon return of the share certificate from Lassen representing such shares, it was cancelled on Dec 31, 2009, and the 8,915,871 shares represented thereby were returned to the status of authorized but unissued shares of common stock. Additionally, once the Company received the share certificate from Lassen, the Company returned the share certificate representing 25,252,500 shares of Lassen common stock to Lassen.    A copy of the Agreement terminating the Share Transfer Agreement

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was attached as Exhibit 10.15 to the Form 8-K filed by the Company on May 12, 2009 and is hereby incorporated by reference.

4.   Loan to Photo Violation Technologies Inc

P2 Solar (“P2”) lent Photo Violation Technologies Corp., (“PVT”) $1,485,000.00 USD (the “Loan”). The Loan is the subject of a Loan Agreement and a Promissory Note. PVT has failed to pay any principal or interest on the Loan. P2 has sued PVT for $1,485,000.00 USD. P2 has also sued the Directors of PVT. P2’s action against the PVT Directors had been stayed pending posting of security for costs. $100,000 security for cost was paid on December 9, 2009.  P2’s action against PVT and Directors is continuing. Despite the fact that P2 lent PVT $1,485,000.00, PVT is disputed that it owed P2 the $1,485,000.00 it was lent by P2. PVT has filed a Counterclaim, purporting to have claims against P2 and others. PVT made no purported claims against P2 until after P2 sued PVT and PVT's Directors.  P2 was awarded a summary judgment of $1,485,000.00 plus interest by the courts on July 22, 2009.  The company is vigorously attempting to collect on the judgment.  In response to P2 motion the court put PVT into Bankruptcy on March 24, 2010.  P2 also commenced a second action against PVT for defamation after PVT published what was alleged to be a verbatim ruling from the Court, when, in fact, the ruling had been altered by PVT.  The Company believes that this debt is collectable and will be collected.

5.    Bank Indebtedness

Details are as follows:

6.    Related Party Transactions

Other than as disclosed elsewhere in these financial statements, the following amounts have been recorded as transactions with related parties:

a) Amounts due to related parties are as follows:

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b) Interest expense on amounts due to directors and an officer was $31,101 (2009 - $22,059).

c) Salaries and benefits include $68,653 (2009 - $59,637) paid to a director and officer of the Company.

d) As at March 31, 2010, a director and officer of the Company held approximately 20.84% of the issued and outstanding shares of the Company.

7.    Capital Stock

a) Authorized Stock

The company has authorized 500,000,000 common shares with a par value of $0.001 per share. Each common share shall entitle the holder to one vote, in person or proxy on any matter on which action of the stockholder of the corporation is sought. The company has authorized 5,000,000 shares of preferred stock with a par value of $0.001 per share. The holders of preferred stock have no rights except as determined by the Board of Directors of the company and/or provided by Delaware General Corporate Law.

b) Share Issuances

During the current period, the company issued total of 5,131,643 common shares from the treasury.  4,297,189 shares were issued to six different companies for debt conversion.  . Further 384,454 shares were issued to individuals and companies that participated in the $115,336 private placement done in June of 2009.  The Company also issued 450,000 shares to two individuals for consulting work. 8,915,871 shares issued to Lassen Energy, Inc in the last period as per the licensing and share exchange agreement signed in November 2008.  These shares were cancelled on December 31 2009 as per agreement signed in May 2009.

c) Share Subscriptions

At March 31, 2010 there was $24,000 worth outstanding Share Subscriptions.  Further share subscriptions of $81,000 were received subsequent to year-end

d) Warrants

In conjunction with the Private placement, 384,454 warrants were issued to individuals and companies that participated in the private placement done in June 2009.  Share subscriptions discussed above also have Warrants attached to them that have not been issued.

e)    Stock Options

There were 200,000 options issued to a company consultant for services.  As to the total number of Shares with respect to which the Option is granted, the Option shall be exercisable as follows:  (i) 50% of the Option (100,000 Shares) in the aggregate may be exercised on or after November 21, 2009 at an Exercise Price of $0.20 per Share; and (ii) 50% of the Option (100,000 Shares) in the aggregate may be

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exercised on or after November 1, 2010 at an Exercise Price  in an amount per Share that is 25% less than the ten day moving average of the Company’s Common Stock immediately prior to November 1, 2010.

The Company has committed to issue to the Chief Executive Officer 67,000 share purchase options every April.  These options will be exercisable at $0.10 per share and will expire five years after the date of grant.  Further bonus options are available to the Chief Executive Officer.  These bonus options entitle the Chief Executive Officer to purchase shares at 20% below the market price up to a value determined by 5% of the amount of annual profits from sales in excess of $2,500,000 up to $3,999,999 and 8% of the amount of annual profits from sales in excess of $4,000,000.  To date, sales have not exceeded $2,500,000 and thus no bonus options have been issued.

Until December 31, 2005, the Company accounted for its stock option plan in accordance with the provisions of APB Opinion No. 25, Accounting for Stock Issued to Employees.  Effective January 1, 2006, the Company is accounting for stock based compensation using SFAS 23(R) Share Based Payment.  Had compensation cost for the stock option plan been determined for the entire fiscal year based on the fair value at the grant date consistent with the method of SFAS No. 123, Accounting for Stock-Based Compensation, the total pro forma value of stock options expense granted to directors and officers for the year ended March 31, 2009 would be $Nil (2008 - $Nil) Because no options are outstanding at this time.

Under the black-scholes pricing model to calculate the fair value of the warrants as of the issuance date and charge it as warrants expense for $ 322,759, option expense $38,667 in nine month ended March 31, 2010 and $0 in twelve month ended March 31, 2009. The fair value of each option granted is estimated at the respective grant date using the Black-Scholes Option Module. The following assumptions were made in estimating fair value:

		Warrants & options
Expected volatility		1.59
Expected life		2.02-9.89
Risk-free interest rate		0.31~0.37%
Dividend yield		-

The following table summarizes stock options and warrants outstanding as of March 31, 2010, as well as activity during the twelve months then ended:

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		Warrants		Options
Balance, March 31, 2009		718,332		0
Issued		384,454		200,000
Exercised & expired		0		0
Balance, March 31, 2010		1,102,786		200,000

The following table provides certain information with respect to the above referenced warrants and options outstanding at March 31, 2010:

f)

Debt Conversion

From March 31, 2008 through September 21, 2009, the Company borrowed a total of $379,719.26 from certain holders (collectively referred to herein as the “Holders”) pursuant to the terms of Convertible Promissory Notes (collectively referred to herein as the “Notes”).  Pursuant to the terms of the Notes, the Holders were provided with the option of converting the outstanding balance of the Notes into shares of the Company’s Common Stock at a conversion price of $.10 per share.  On November 19 ^th and November 20 ^th , 2009, the Holders elected to exercise their conversion rights under the Notes.  In accordance with the terms of the Notes, on February 2, 2010, the Company caused the Company’s transfer agent to issue the Holders a total of 3,797,189 shares of the Company’s common stock.

8.    Income Taxes

The Company has accumulated net operating losses for federal income tax purposes of approximately $946,000, which may be carried forward and used to reduce taxable income of future years.  These losses expire as follows:

2020		$	180,000
2021			117,000
2022			135,000
2023			141,000
2024			97,000
2025			109,000
2026			138,000
2027			29,000
		$	946,000

The potential future tax benefits of these losses have not been recognized in these financial statements due to uncertainty of their realization.  When the future utilization of some portion of the carry forwards

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is determined not to be "more likely than not," a valuation allowance is provided to reduce the recorded tax benefits from such assets.

9.   Commitments

As of September 1, 2007 the company has leased offices at #204, 13569 - 76 ^th Avenue, Surrey, BC, Canada.  Total space is 750 square feet for total rent of $900.00 per month.  This lease will expire on August 31, 2012.

10.  Reverse Merger Agreement(s)

On Feb 19, 2008, the Company signed a binding Letter of agreement with Lassen Energy, Inc (LEI), a US company that manufactures Solar Panels.

On April 18, 2008, the Company signed a definitive binding agreement with Lassen Energy, Inc to do a reverse merger.

On November 28, 2008, the Company cancelled the reverse merger agreement with Lassen Energy and signed share exchange and licensing agreement with Lassen Energy, Inc. See note 5 for more details.

11. Other Significant events

On January 13, 2009, the Company signed a Compensation Agreement with Capital Group Communications (“CGC”) of Sausalito, California, pursuant to which the Company agreed to compensate CGC for past consulting services rendered by CGC and for introduction to and assistance with the negotiations with Lassen Energy with the issuance of 500,000 shares of restricted common stock.  The 500,000 shares of common stock were recorded at $0.34 per share (market price at the agreement date) in total amount of $170,000 and issued on May 12, 2009.

On March 12, 2009, signed a Consulting Agreement with CGC, pursuant to which CGC agreed to provide consulting services to the Company for an initial one year period.  Pursuant to the terms of the Consulting Agreement, the Company agreed to compensate CCG with an initial issuance of a total of 500,000 shares of restricted common stock.  Under the terms of the Consulting Agreement, the Company has the option to extend the agreement for an additional 12 month period by issuing another 500,000 shares of restricted common stock to CCG. The initial 500,000 shares of common stock were recorded at $0.46 per share (market price at the agreement date) in total amount of $230,000 and issued on May 12, 2009.  The company did not extend the agreement with CGC, therefore, the remaining 500,000 shares were not issued.

On April 20, 2009, the Company paid additional $30,000 towards the remaining License fee of $800,000.  As a result, the current balance of the License Fee is $770,000

On May 7, 2009, the Company, Lassen and DBK entered into an Agreement removing the Licenses from suspension and providing the Company with an extension in which to make the remaining payment of the $770,000 due and owing under the License Agreement.  Pursuant to the Agreement, the Company is now required to pay the remaining $770,000, ninety (90) days after the Company receives a report from Lassen indicating that the Lassen Solar Panel has received Intertek Certification and has a power output of a minimum of 1500 watts.

On May 7, 2009, the Company and Lassen entered into an Agreement pursuant to which the parties agreed to terminate the Share Transfer Agreement and return the shares that were transferred under the Share Transfer Agreement.  The Company is in the process of returning the 25,252,500 shares of Lassen common stock.  The Company has advised its transfer agent that the 8,915,871 shares issued to Lassen will be cancelled.  Upon return of the share certificate from Lassen representing such shares, it will be cancelled, and the 8,915,871 shares represented thereby will be returned to the status of authorized but unissued shares of common stock.

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In June, 2009, the company has signed two share subscription agreements with third parties. Pursuant to these agreements, the subscribers agree to purchase total 384,454 Units at $0.30 per Unit in total amount of $115,336. Each Unit consists of one share of common stock and one Warrant. One Warrant entitles the holder thereof to purchase one share of common stock at $0.42 per share at anytime during the period of 36 months from the date of closing.

On July 13, 2009, the Company has signed a Memorandum of Understanding (MOU) with Punjab Energy Development Agency (PEDA). Pursuant to the terms of the MOU, the company is authorized to prepare and submit a pre-feasibility report for the proposed development and construction of a 25 Megawatt Solar Power Station within the Indian State of Punjab.

On July 13, 2009, the Company signed a Letter of Intent (LOI) with LDK Solar Europe Holding SA. (LDK).  Pursuant to the terms of the LOI, the parties were exploring a possible business relationship pursuant to which LDK would assist the Company with the production and manufacture of solar panels and manufacture and assembly of the above described 25 mega watt power plant in Punjab, India. The term of the LOI has expired; the parties did not reach any definitive agreement and elected not to pursue a business relationship.

On September 24, 2009, the British Columbia Supreme Court has awarded judgment in favour of P2 Solar, Inc. against Photo Violation Technologies Corp. ("PVT") in the amount of $1,485,000.00 CAD plus interest.

On January 22, the Company has signed a Letter of Intent (LOI) with Osolar, Inc., a Korean corporation(“Osolar”), regarding a potential business arrangement pursuant to which Osolar will assist P2 Solar with planning, construction and operation of a 25 mega watt power plant  in Punjab, India.  We are in the process of negotiating a definitive agreement.

On January, 31, 2010, the company filed a Pre-Feasibility Report with PEDA.  Due to implementation of new India Solar Mission, this project has to be approved by the federal government in Delhi.  The company is now working with the appropriate federal government agency to get the approval.

On March 24, 2010, the British Columbia Supreme Court, in response to P2 Motion, declared PVT bankrupt as of October, 7, 2009.  Since then the company was able to appoint a trustee to handle PVT’s bankruptcy proceedings.

12. Subsequent Events

On April 19, 2010, the company signed an agreement with CCG, an IR firm with Head office in New York, to provide IR services.  The agreement is for 12 months and compensation consists of $11,000 per month plus out of pocket expenses.

In April 2010, the company received total of $81,000 worth of share subscriptions for units consisting of one common share at $0.30 plus one warrant with exercise price of $0.42.

On April 1, 2010, the company signed an agreement with Sinova Capital, an investment Banker, based in the British Virgin Islands to raise the required money for the construction of Solar Power Plant in India.

There are 100,000 shares authorized for services performed in March 2010 that had not been issued as of the date of this report

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ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

As disclosed on Forms 8-K and 8-K/A filed with the SEC on August 5, 2009 and September 2, 2009, respectively, we changed accountants.  We have had no disagreements with our accountants required to be disclosed pursuant to Item 304 of Regulation S-K.

ITEM 9A(T). CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

The Securities and Exchange Commission defines the term “disclosure controls and procedures” to mean a company's controls and other procedures of an issuer that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods 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 by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.  The Company maintains such a system of controls and procedures in an effort to ensure that all information which it is required to disclose in the reports it files under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified under the SEC's rules and forms and that information required to be disclosed is accumulated and communicated to principal executive and principal financial officers to allow timely decisions regarding disclosure.

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures.  Based on this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are designed to provide reasonable assurance of achieving the objectives of timely alerting them to material information required to be included in our periodic SEC reports and of ensuring that such information is recorded, processed, summarized and reported with the time periods specified.  Our chief executive officer and chief financial officer also concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report to provide reasonable assurance of the achievement of these objectives.

Internal Control Over Financial Reporting

The management of the Company is responsible for the preparation of the financial statements and related financial information appearing in this Annual Report on Form 10-K. The financial statements and notes have been prepared in conformity with accounting principles generally accepted in the United States of America. The management of the Company also is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. A company's internal control over financial reporting is defined as a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that

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receipts and expenditures of the issuer are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.

Management, including the Chief Executive Officer and Chief Financial Officer, does not expect that the Company's disclosure controls and internal controls will prevent all error and all fraud. Because of its inherent limitations, a system of internal control over financial reporting can provide only reasonable, not absolute, assurance that the objectives of the control system are met and may not prevent or detect misstatements. Further, over time control may become inadequate because of changes in conditions or the degree of compliance with the policies or procedures may deteriorate.

With the participation of the Chief Executive Officer and Chief Financial Officer, our management evaluated the effectiveness of the Company's internal control over financial reporting as of March 31, 2010 based upon the framework in Internal Control –Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on that evaluation, our management has concluded that, as of March 31, 2010, the Company's internal control over financial reporting was effective.

This annual report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management's report in this Annual Report on Form 10-K.

There was no change in the Company's internal control over financial reporting during the last fiscal quarter, that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

ITEM 9B.     OTHER INFORMATION.

None.

PART III

ITEM 10.

DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE.

Directors and Executive Officers

The following table sets forth, as of March 31, 2010, the names and ages of the directors and executive officers of the Registrant, the principal positions with the Registrant held by such persons. The executive officers are elected annually by the Board of Directors. The directors serve one year terms or until their successors are elected.

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Biographical Information

Raj-Mohinder S. Gurm . Mr. Gurm is the President, Chief Financial Officer, and a Director of the Company.  From 1985 to 1987 Mr. Gurm was a partner in B.R. International Marketing Company of Vancouver, BC a company, which provided North American representation to manufacturers from Asia. From 1987 to 1989 he was a manager of Metro Parking Ltd. of Vancouver, BC and was responsible for overseeing 70 employees and 20 parking lots. From 1989 to 1995 he was involved in importing products from Asia and selling them by the container loads to large retail chain stores. In 1995 Mr. Gurm was founder and president of Xanatel Communications Inc. a company involved in the wireless communications industry and which was sold to a public company listed on The Alberta Stock Exchange. Mr. Gurm has been a President and CEO of Spectrum International Inc. from 1990 to present. From Jan. 2000 to Nov. 9th, 2001 he was also President/CEO of Canoil Exploration Corporation, a publicly traded company that recently completed the acquisition of a Medical Equipment company. Mr. Gurm attended the University of British Columbia and earned a Bachelor of Sciences Degree in Biology in 1983. Born in 1960 in India, Mr. Gurm is a citizen and resident of Canada.

Hans Edblad .  Hans Edblad is 44 years old. In addition to serving as a director of the Company, Mr. Edblad also works as the Vice President of Business Development for the Company.  From 2006 to 2009 Mr. Edblad served as a consultant to the Company.  In addition to his work with the Company, Mr. Edblad is also the President of Chag Investments Ltd., a position he has held since 1997.  Chag Investments specializes in assisting businesses with business development and investment strategies.  Additionally, from 2002 to present Mr. Edblad has served as a consultant with APR Consulting Group specializing in technical market consulting to various individuals and companies.

Stephen Sleigh .  Stephen Sleigh is 56 years old currently serves as a director of the Company.  Since 2001, Mr. Sleigh has been a Certified General Accountant.  In addition to serving as a director of the Company, Mr. Sleigh has worked as the Controller for Zodiac Hurricane Technologies, Inc., (“Zodiac”) a French owned boat builder since 2001.  As the Controller, Mr. Sleigh handles all maters of accounting for Zodiac, including accounts payable, accounts receivable, and monitoring the company’s capital assets, as well as assisting with the development and maintenance of the company’s budgets.  Mr. Sleigh has a BSc., MSc., and a PhD in Chemistry from the University of Manchester, UK.

Family Relationships

There are no family relationships between any of the current directors or officers of the Company.

Involvement in Certain Legal Proceedings

None of our officers, directors, promoters or control persons has been involved in the past five (5) years in any of the following:

(1)

Any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

(2)

Any conviction in a criminal proceedings or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

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(3)

Being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, or any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or

(4)

Being found by a court of competent jurisdiction (in a civil action), the SEC or the U.S. Commodity Futures Trading Commission to have violated a federal or state securities laws or commodities law, and the judgment has not been reversed, suspended, or vacated.

Directorships

None of the Company’s executive officers or directors is a director of any company with a class of equity securities registered pursuant to Section 12 of the Securities exchange Act of 1934 (the “Exchange Act”) or subject to the requirements of the Exchange Act or any company registered as an investment company under the Investment Company Act of 1940.

Code of Ethics

The Company has not yet adopted a code of ethics.  The Company intends to adopt a code of ethics in the near future.

ITEM 11.

EXECUTIVE COMPENSATION .

Executive Compensation

The following table sets forth, for the years indicated, all compensation paid, distributed or accrued for services, including salary and bonus amounts, rendered in all capacities by the Company’s chief executive officer , chief financial officer and all other executive officers ; the information contained below represents compensation paid to the Company’s officers for their work related to the Company.

(1) ) Salary accrued from April 1, 2005 to March 31, 2008 includes vacation pay.

(2) These stock purchase options were issued pursuant to Mr. Gurm's employment contract dated April, 30 1999. These options vested immediately, and could be exercised at $0.10 per share within 5 years from the date of grant.  These options were subsequently cancelled and no additional options have been issued.

Employment Agreements

On December 12, 1999, the Company entered into an employment agreement with Raj-Mohinder Gurm.  Pursuant to the terms of the employment agreement, Mr. Gurm is entitled to annual compensation of $72,000 at a rate of $6,000 per month.    A copy of the employment agreement was filed as Exhibit 10.4 to the Company’s Registration Statement on Form SB-2 filed with the Securities and Exchange Commission on Jun 26, 2002, and is hereby incorporated by reference.

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Option Grants in Last Fiscal Year

There were 200,000 options granted to Jon Brainard for the work he did for the company.

Equity Compensation Plan Information

The Company currently does not have any equity compensation plans .

Director Compensation

The following table provides summary information concerning compensation awarded to, earned by, or paid to any of our directors for all services rendered to the Company in all capacities for the fiscal year ended March 31, 2010:

(1)

This figure includes compensation paid to Raj-Mohinder Gurm for work performed as an officer of the Company.

ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth, as of March 31, 2010, certain information with respect to the common stock beneficially owned by (i) each director and executive officer of the Company; (ii) each person who owns beneficially more than 5% of the common stock; and (iii) all directors and executive officers as a group:

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(1) Director or Officer of Company

(2)Percentages are calculated based on 32,647,589 shares outstanding as of March 31, 2010.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Certain Relationships and Related Transactions

There were no material transactions, or series of similar transactions, during our Company’s last fiscal year, or any currently proposed transactions, or series of similar transactions, to which our Company was or is to be a party, in which the amount involved exceeded the lesser of $120,000 or one percent of the average of the small business issuer’s total assets at year-end for the last three completed fiscal years and in which any director, executive officer or any security holder who is known to us to own of record or beneficially more than five percent of any class of our common stock, or any member of the immediate family of any of the foregoing persons, had an interest.

Director Independence

The NASDAQ Stock Market has instituted director independence guidelines that have been adopted by the Securities & Exchange Commission.  These guidelines provide that a director is deemed “independent” only if the board of directors affirmatively determines that the director has no relationship with the company which, in the board’s opinion, would interfere with the director’s exercise of independent judgment in carrying out his or her responsibilities.  Significant stock ownership will not, by itself, preclude a board finding of independence.

For NASDAQ Stock Market listed companies, the director independence rules list six types of disqualifying relationships that preclude an independence filing.  The Company’s board of directors may not find independent a director who:

1.

is an employee of the company or any parent or subsidiary of the company;

2.

accepts, or who has a family member who accepts, more than $60,000 per year in payments from the company or any parent or subsidiary of the company other than (a) payments from board or committee services; (b) payments arising solely from investments in the company’s securities; (c) compensation paid to a family member who is a non-executive employee of the company’ (d) benefits under a tax qualified retirement plan or non-discretionary compensation; or (e) loans to directors and executive officers permitted under Section 13(k) of the Exchange Act;

3.

is a family member of an individual who is employed as an executive officer by the company or any parent or subsidiary of the company;

4.

is, or has a family member who is, a partner in, or a controlling shareholder or an executive officer of, any organization to which the company made, or from which the company received, payments for property or services that exceed 5% of the recipient’s consolidated gross revenues for that year, or $200,000, whichever is more, other than (a) payments arising solely from investments in the company’s

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securities or (b) payments under non-discretionary charitable contribution matching programs;

5.

is employed, or who has a family member who is employed, as an executive officer of another company whose compensation committee includes any executive officer of the listed company; or

6.

is, or has a family member who is, a current partner of the company’s outside auditor, or was a partner or employee of the company’s outside auditor who worked on the company’s audit.

Based upon the foregoing criteria, our Board of Directors has determined that Raj-Mohinder S. Gurm is not an independent director under these rules as he is also employed by the Company as its Chief Executive Officer and President, respectively.

ITEM 14.

PRINCIPAL ACCOUNTING FEES AND SERVICES

Audit Fees

(1)

The aggregate fees billed by Lake & Associates, CPA’s LLC for audit of the Company's annual financial statements were $21,000 for the fiscal year ended March 31, 2010, and $15,000 for the fiscal year ended March 31, 2009.

Audit Related Fees

(2)

Lake & Associates, CPA’s LLC did not bill the Company any amounts for assurance and related services that were related to its audit or review of the Company’s financial statements during the fiscal years ended 2010 and 2009.

Tax Fees

(3)

The aggregate fees billed by Lake & Associates, CPA’s LLC for tax compliance, advice and planning were $0.00 for the fiscal year ended March 31, 2010 and 2009.

All Other Fees

(4)

Lake & Associates, CPA’s LLC did not bill the Company for any products and services other than the foregoing during the fiscal years ended 2010 and 2009.

Audit Committee = s Pre-approval Policies and Procedures

(5)

P2 Solar, Inc. does not have an audit committee per se. The current board of directors functions as the audit committee.

ITEM 15.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

(a)

Exhibits.

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* Filed Herewith

SIGNATURES

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

By: /s/ Raj-Mohinder S. Gurm

Raj-Mohinder S. Gurm, Chief Executive Officer

Date:  July 14, 2010

In accordance with Section 13 or 15(d) of the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated:

By: /s/

Raj-Mohinder S. Gurm

Raj-Mohinder S. Gurm, Chief Executive Officer, Chief Financial Officer, Principal Accounting Officer, Director

Date:  July 14, 2010

By:  /s/ Hans Edblad

Hans Edblad, Director

Date:  July 14, 2010

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