##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the year
    ended September 30, 2009.oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission File Number 000-31355
  BEACON ENTERPRISE SOLUTIONS
    GROUP, INC.
 (Exact name of registrant as
    specified in its charter)
  Nevada

81-0438093(State or other jurisdiction
    of
    incorporation or organization)

(I.R.S. Employer
    Identification No.)1311 Herr Lane, Suite 205, Louisville, KY

40218(Address of principal executive
    offices)

(Zip Code)   Registrants
    telephone number, including area code(502) 657-3500
    Securities registered pursuant to Section 12(b) of the
    Act:
    None
    Securities registered pursuant to Section 12(g) of the
    Act:
 Common Stock, $.001 par value.
  o þ
  o þ
  þ o
  Regulation S-T o o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
  Large accelerated filer o

Accelerated filer o

Non-accelerated filero

Smaller reporting company þ(Do not check if a smaller reporting company)   Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE
  Documents

Form 10-K ReferenceNone

Not Applicable




---



##### 





FORM 10-K
    For the fiscal year ended September 30, 2009
    INDEX
   
 PagePART IItem 1


Business


3Item 1A


Risk Factors


7Item 2


Properties


13Item 3


Legal Proceedings


13Item 4


Submission of Matters to a Vote of Securities
    Holders


13PART IIItem 5


Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


13Item 7


Managements Discussion and Analysis of
    Financial Condition, Plans and Results of Operations


15Item 8


Financial Statements and Supplementary Data


22Item 9


Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


74Item 9A(T)


Controls and Procedures


74Item 9B


Other Information


75PART IIIItem 10


Directors, Executive Officers and Corporate
    Governance


76Item 11


Executive Compensation


78Item 12


Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


90Item 13


Certain Relationships and Related Transactions,
    and Director Independence


91Item 14


Principal Accounting Fees and Services


93PART IVItem 15


Exhibits, Financial Statement Schedules


93Signatures


97EX-4.14EX-10.33EX-21.1EX-31.1EX-31.2EX-32.1EX-32.2   2




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##### Table of Contents



PART I  Item 1.
    Business  Company
  General
      Share
    Exchange Transaction and Phase I Acquisitions
       3




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##### Table of Contents



Phase
    I Acquisitions
      Operations
  Services
    Management Services.
  Design, Engineering & Construction
    Services.
 4




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##### Table of Contents



Special Services.
    Customers
   5




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##### Table of Contents



Suppliers
  time-to-time
  Seasonality
    Customer
    Concentration
  and/or
  Competition
   6




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##### Table of Contents



Employees
    Available
    Information
  www.askbeacon.com Form 10-K, Form 10-Q, Form 8-K
  Code of
    Ethics
  Form 8-K. 502-657-3500
  1-800-SEC-0330. www.sec.gov
  Item 1A.
    Risk
    Factors  You should carefully consider the risks described below
    together with all of the other information included in this
    report before making an investment decision with regard to our
    securities. The statements contained in or incorporated into
    this report that are not historic facts are forward-looking
    statements that are subject to risks and uncertainties that
    could cause actual results to differ materially from those set
    forth in or implied by forward-looking statements. If any of the
    following risks actually occurs, our business, financial
    condition or results of operations could be harmed. In that
    case, the trading price of Beacon Common Stock could decline,
    and you may lose all or part of your investment.
  Risks
    Relating to the Business
  us we our Beacon
  Beacon
    has had a history of losses.
   7




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Beacons
    success depends upon making and integrating
    acquisitions.
    Beacon
    will require additional financing.
    Rapid
    technological change and obsolescence could adversely affect
    Beacons business.
    Beacons
    success depends upon agreements with third parties.
    Beacon
    has operations outside the United States.
    
    local political or economic instability;
    changes in governmental regulation;
    changes in import/export duties;
    trade restrictions;
    lack of experience in foreign markets;
    difficulties and costs of staffing and managing operations in
    certain foreign countries;
    work stoppages or other changes in labor conditions;
    difficulties in collecting accounts receivables on a timely
    basis or at all; and
    adverse tax consequences or overlapping tax structures. 8




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Beacon
    does not manufacture the equipment that it relies
    upon.
    Beacons
    business is subject to inherent risks including those arising
    from customer acceptance, lost customers, market competition,
    customer liability and increasing expenses.
  Customer Acceptance.
  Lost Customers.
  Competition.
  Liability.
  Expense. day-to-day
 9




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Beacon
    depends on its key employees.
    Beacon
    has no patent protection for its products and
    services.
    Economic
    conditions could materially adversely affect us.
  and/or
    Changes
    in regulations, the laws or court rulings could adversely affect
    Beacon.
    Beacons
    quarterly operating results may fluctuate significantly and will
    be difficult to predict.
    Past
    activities of Suncrest Global Energy Corp. and its affiliates
    may lead to future liability for Beacon.
   10




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Catastrophic
    events or geo-political conditions may disrupt our
    business.
    Risks
    Relating to Ownership of Beacon Common Stock
  No
    Assurances of a Public Market; Restrictions on Resale.
    Significant
    number of outstanding convertible notes, options and warrants
    could interfere with Beacons ability to raise
    capital.
    The price
    of Beacon Common Stock may fluctuate significantly.
    
    variations in operating results;
    announcements of technological innovations, new products or
    product enhancements, strategic alliances or significant
    agreements by Beacon or by competitors;
    recruitment or departure of key personnel;
    litigation, legislation, regulation or technological
    developments that adversely affect Beacons
    business; and
    market conditions in Beacons industry, the industries of
    their customers and the economy as a whole.   11




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OTC.BB
  The SEC
    may limit the number of shares of Beacon Common Stock that may
    be registered for resale at any one time.
    Beacon
    Common Stock may be subject to Penny Stock Rules, which could
    affect trading.
    Beacons
    operation as a public company subjects it to extensive corporate
    governance and disclosure regulations that will result in
    additional operating expenses.
   12




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If Beacon
    fails to maintain the adequacy of our internal control, our
    ability to provide accurate financial statements and comply with
    the requirements of the Sarbanes-Oxley Act of 2002 could be
    impaired, which could cause our stock price to decrease
    substantially.
    Item 1B.
    Unresolved
    Staff Comments.    Item 2.
    Properties    Item 3.
    Legal
    Proceedings    Item 4.
    Submission
    of Matters to a Vote of Security Holders   Part II  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases for Equity Securities  Market
    Information
   13




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##### Table of Contents



Quarter Ended

High

LowFiscal 2009December 31, 2008

$
1.52


$
0.55March 31, 2009

$
1.10


$
0.30June 30, 2009

$
1.65


$
0.69September 30, 2009

$
1.73


$
0.92Fiscal 2008December 31, 2007

$



$
March 31, 2008

$
1.90


$
1.04June 30, 2008

$
1.20


$
0.95September 30, 2008

$
1.50


$
0.51   Holders
    Dividends
    A-1
  Recent
    Sales of Unregistered Securities
  Form 10-Q Form 8-K
 14




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##### Table of Contents



Securities
    Authorized for Issuance Under Compensation Plans
    Equity
    Compensation Plan Information
  (a)


(b)


(c)Number of Securities to


Weighted-Average


Number of Securities Remainingbe Issued Upon Exercise


Exercise Price of


Available for Future Issuance Underof Outstanding Options,


Outstanding Options,


Equity Compensation Plans (ExcludingAs of September 30, 2009

Warrants and Rights


Warrants and Rights


Securities Reflected in Column (a))Plan CategoryEquity compensation plans approved by security holders


300,000


$
1.57



700,000   Issuer
    Purchases of Equity Securities
    Item 7.
    Managements
    Discussion and Analysis of Financial Condition, Plans and
    Results of Operations  Company
  Cautionary
    Statements  Forward Outlook and Risks
  Form 10-K,
  
    Our business may be materially adversely affected by the current
    economic environment. The recent disruptions in both domestic
    and global financial and credit markets have significantly
    impacted domestic and global economic activity and lead to an
    economic recession. As a result of these disruptions, our
    customers and markets have been adversely affected. If we
    experience reduced demand because of these disruptions in the
    macroeconomic environment, our business, results of operation
    and financial condition could be materially adversely affected.
    If we are unable to successfully anticipate changing economic
    and financial conditions, we may be unable to effectively plan
    for and respond to these changes and our business could be
    adversely affected; 15




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##### Table of Contents




    effects of competition in the markets in which we operate;
    liability and other claims asserted against us;
    ability to attract and retain qualified personnel;
    availability and terms of capital;
    loss of significant contracts or reduction in revenue associated
    with major customers;
    ability of customers to pay for services;
    business disruption due to natural disasters or terrorist acts;
    ability to successfully integrate the operations of acquired
    businesses and achieve expected synergies and operating
    efficiencies from the acquisitions, in each case within expected
    time-frames or at all;
    changes in, or failure to comply with, existing governmental
    regulations; and
    changes in estimates and judgments associated with critical
    accounting policies and estimates.  Form 10-K.
  Overview
      Phase
    I Acquisitions
     16




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##### Table of Contents



Acquisition
    Growth Strategy
  We are
    continuing to pursue mergers and acquisitions for a portion of
    our growth.
      
    Accretive to earnings in the first year.
    Strategic locations throughout the US and Europe where we have
    significant concentrations of demand for our service offerings.
    Highly trained technical staff that can meet our internal
    requirements and the requirements of our Global customers.    Organic
    Growth Strategy
    
    The first strategy is to expand the a la carte services offered
    to existing major national, multi-national and global clients
    who have not already signed an infrastructure managed services
    agreement. This has been initiated by the hiring of branch level
    account managers focused on the sale of individual
    infrastructure services and the global managed services
    offering. With reorganization of the professional services team
    structure, it permits Beacon to accommodate branch level
    services delivery to potential global clients.
    The second strategy is to continue to add regional branches to
    the existing branches in Columbus and Cincinnati, Ohio,
    Louisville, Kentucky and Raritan, NJ. The additional branches
    will be strategically located to provide regional coverage and
    depth of resources to support global client demand.
    The third strategy is to add regional and major account sales
    resources in each new branch. This will facilitate the
    introduction of Fortune 1000, Global 2000 and qualifying
    multi-national firms. We refer to these current and future
    clients as Fortune 10000.  Results
    of Operations
  For
    the years ended September 30, 2008 and 2009
   17




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##### Table of Contents



A-1 A-1
  Liquidity
    and Capital Resources
     18




---



##### Table of Contents



and/or
    Placement Agent Common Units Common Offering Warrant
               19




---



##### Table of Contents



Off-Balance
    Sheet Arrangements
    Contractual
    Obligations as of September 30, 2009:
    Payment Due by PeriodYear


Years


YearsContractual Obligations

Total


1


2-3


4-5


ThereafterDebt obligations

$
2,292,561


$
1,490,226


$
698,618


$
103,717Interest obligations(1)


162,109



95,875



64,525



1,709Operating lease obligations(2)


142,823



123,423



19,400$
2,597,493


$
1,709,524


$
782,543


$
105,426


$
     (1)
    
    Interest obligations assume Prime Rate of 3.25% at
    September 30, 2009. Interest rate obligations are presented
    through the maturity dates of each component of long-term debt.(2)
    
    Operating lease obligations represent payment obligations under
    non-cancelable lease agreements classified as operating leases
    and disclosed pursuant to Statement of Financial Accounting
    Standards No. 13 Accounting for Leases, as may
    be modified or supplemented. These amounts are not recorded as
    liabilities of the current balance sheet date. 20




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##### Table of Contents



A-1 A-1 A-1
    Working
    Capital
   21




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##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data    PageReport of Independent Registered Public
    Accounting Firm


23Consolidated Balance Sheets as of
    September 30, 2008 and 2009


24Consolidated Statements of Operations for the
    years ended September 30, 2008 and 2009


25Consolidated Statement of Stockholders
    Equity for the years ended September 30, 2008 and 2009


26Consolidated Statements of Cash Flows for the
    years ended September 30, 2008 and 2009


28Notes to Consolidated Financial Statements


29  22




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##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM               23




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##### Table of Contents



Beacon
    Enterprise Solutions Group, Inc. and Subsidiaries



Consolidated
    Balance Sheets  September 30,


September 30,2008


2009ASSETSCurrent assets:Cash and cash equivalents

$
127,373


$
264,338Accounts receivable, net


1,505,162



3,980,715Inventory, net


597,794



604,622Prepaid expenses and other current assets


44,745



397,319Total current assets


2,275,074



5,246,994Property and equipment, net


310,703



394,571Goodwill


2,791,648



3,151,948Other intangible assets, net


3,802,717



3,903,124Other assets


176,249



117,111Total assets

$
9,356,391


$
12,813,748LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Short term credit obligations

$
200,000


$
550,000Convertible Note Payable






297,999Bridge notes (net of $0 and $33,123 aggregate discounts)






166,879Current portion of long-term debt


495,595



475,348Accounts payable


1,225,509



2,176,845Contingent consideration payable






145,189Income tax payable






97,581Accrued expenses


1,337,360



2,644,280Customer Deposits


95,767



160,368Total current liabilities


3,354,231



6,714,489Long-term debt, less current portion


1,316,477



802,335Bridge notes (net of $128,840 discount at September 30,
    2008)


571,160Deferred Tax Liability


45,472



103,484Total liabilities


5,287,340



7,620,308Stockholders equityStockholders equityPreferred Stock: $0.01 par value, 5,000,000 shares
    authorized, 5,200 and 3,984 shares outstanding in the
    following classes:Series A convertible preferred stock, $1,000 stated
    value, 4,500 authorized, 4,000 and 1,984 shares issued and
    outstanding, (liquidation preference $3,171,999)


4,000,000


$
1,984,074Series A-1
    convertible preferred stock, $1,000 stated value,
    1,000 shares authorized, 800 and 752 shares issued and
    outstanding, (liquidation preference $940,678)


800,000



752,347Series B convertible preferred stock, $1,000 stated
    value, 4,000 shares authorized, 400 and 700 shares
    issued and outstanding, (liquidation preference $914,818)


400,000



700,000Common stock, $0.001 par value 70,000,000 shares
    authorized, 12,093,021 and 24,655,990 shares issued and
    outstanding


12,093



24,656Additional paid in capital


8,027,602


$
17,977,046Accumulated deficit


(9,170,644
)


(16,254,545
)Accumulated other comprehensive income






9,862Total stockholders equity


4,069,051



5,193,440Total liabilities and stockholders equity


9,356,391



12,813,748    24




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##### Table of Contents



Beacon
    Enterprise Solutions Group, Inc. and Subsidiaries
  Consolidated
    Statements of Operations
  For the


For theYear Ended


Year EndedSeptember 30,


September 30,2008


2009Net sales

$
6,012,637


$
11,070,496Cost of goods sold


1,796,460



4,577,261Cost of services


1,500,390



2,915,803Gross profit


2,715,787



3,577,432Operating expenseSalaries and Wages


3,199,378



4,489,947Selling, General and Administrative


3,515,840



4,297,342Total operating expense


6,715,218



8,787,289Loss from operations


(3,999,431
)


(5,209,857
)Other (expenses) incomeInterest expense


(610,051
)


(905,125
)Interest income


7,416



725Total other (expenses)


(602,635
)


(904,400
)Net (loss) before income taxes


(4,602,066
)


(6,114,257
)Income taxes


45,472



155,593Net (loss)


(4,647,538
)


(6,269,850
)Series A,
    A-1 and B
    Preferred Stock:Contractual dividends


(220,354
)


(547,676
)Deemed dividends related to beneficial conversion feature


(4,169,372
)


(266,375
)Net (loss) available to common stockholders


(9,037,264
)


(7,083,901
)Net loss per share to common stockholders  basic and
    diluted

$
(0.95
)

$
(0.43
)Weighted average shares outstanding  basic and diluted


9,466,764



16,482,449Other Comprehensive income, net of taxNet Loss

$
(9,037,264
)

$
(7,083,901
)Foreign currency translations adjustment


*



9,862Comprehensive loss

$
(9,037,264
)

$
(7,074,039
)    25




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##### Table of Contents



Beacon
    Enterprise Solutions Group, Inc. and Subsidiaries
  Condensed
    Consolidated Statement of Stockholders Equity
 For
    the years ended September 30, 2008 and 2009
  Series A Convertible


Series A-1 Convertible


Series B ConvertiblePreferred Stock


Preferred Stock


Preferred Stock


Common Stock








Accumulated$1,000





$1,000





$1,000





$0.001


Additional





OtherStated





Stated





Stated





Par


Paid-In


Accumulated


ComprehensiveShares


Value


Shares


Value


Shares


Value


Shares


Value


Capital


Deficit


Income


TotalBalance at October 1, 2007


























5,187,650


$
5,188


$
(812
)

$
(133,380
)





$
(129,004
)Common stock granted to employee for services


























782,250



782



(782
)










Vested portion of common stock granted to employee for services


































266,693











266,693Shares of Suncrest outstanding at time of share exchange


























1,273,121



1,273



(1,273
)










Common stock issued as purchase consideration in business
    combinations


























3,225,000



3,225



2,738,025











2,741,250Series A Preferred Stock issued in private placement


4,000.0



4,000,000







































4,000,000Series A-1
    Preferred Stock issued in private placement










800.0



800,000































800,000Series B Preferred Stock issued in private placement


















400



400,000























400,000Common Stock issued in private placement


























1,625,000



1,625



1,298,375











1,300,000Private placement offering costs


































(1,188,324
)










(1,188,324
)Beneficial conversion feature  deemed preferred stock
    dividend


































4,169,372



(4,169,372
)






Bridge note warrants


































72,000











72,000Beneficial conversion feature  bridge notes


































128,000











128,000Vested contingent bridge warrants


































77,980











77,980Warrants issued for equity financing agreement


































235,699











235,699Compensatory warrants


































219,000











219,000Interest on Put Options


































Series A Preferred Stock contractual dividends






































(194,904
)






(194,904
)Series A-1
    Preferred Stock contractual dividends






































(25,450
)






(25,450
)Issuance of Stock Options


































13,649











13,649Net loss






































(4,647,538
)






(4,647,538
)Balance at September 30, 2008


4,000


$
4,000,000



800


$
800,000



400


$
400,000



12,093,021


$
12,093


$
8,027,602


$
(9,170,644
)

$



$
4,069,051Vested portion of share based payments to employee for services


































558,235











558,235Coversion of debt to Preferred shares


















300



300,000























300,000Coversion of debt to common shares


























833,334



833



499,167











500,000Conversion of Preferred shares to common


(2,635
)


(2,635,049
)


(159
)


(158,598
)










3,724,854



3,726



2,789,921











Common Stock issued in private placement


























6,853,497



6,853



5,478,396











5,485,249Private placement offering costs


































(1,138,574
)










(1,138,574
)Warrants exercised for common shares


























196,145



196



(196
)










(0
)Shares issued for Symbio  Tec acquistion


























400,000



400



436,455











436,855 26




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##### Table of Contents



Beacon
    Enterprise Solutions Group, Inc. and Subsidiaries
  Condensed
    Consolidated Statement of Stockholders Equity 
    (Continued)
 For the
    years ended September 30, 2008 and 2009
  Series A Convertible


Series A-1 Convertible


Series B ConvertiblePreferred Stock


Preferred Stock


Preferred Stock


Common Stock








Accumulated$1,000





$1,000





$1,000





$0.001


Additional





OtherStated





Stated





Stated





Par


Paid-In


Accumulated


ComprehensiveShares


Value


Shares


Value


Shares


Value


Shares


Value


Capital


Deficit


Income


TotalFair value of contingent shares related to Symbio-Tec acquistion


































476,000











476,000Shares committed to Anti-dilution adjustment


























285,139



285



(285
)










0Common Stock issued for investor relations agreements


























270,000



270



163,830











164,100Beneficial conversion feature  deemed preferred stock
    dividend


































200,676



(200,676
)






Discount on Convertible Notes Payable


































74,334











74,334Vested contingent bridge warrants


































56,840











56,840Warrants issued for equity financing agreement


































288,946











288,946Series A Preferred Stock contractual dividends






































(429,834
)






(429,834
)Series A Preferred Stock contractual dividends paid in kind


619



619,123







































619,123Series A-1
    Preferred Stock contractual dividends






































(85,689
)






(85,689
)Series A-1
    Preferred Stock contractual dividends paid in kind










111



110,945































110,945Series B Preferred Stock contractual dividends






































(32,153
)






(32,153
)Beneficial conversion feature  deemed Investor
    Warrant dividend


































65,699



(65,699
)






Net loss






































(6,269,850
)






(6,269,850
)Net change in accumulated other comprehensive income










































9,862



9,862Total comprehensive incomeBalance at September 30, 2009


1,984


$
1,984,074



752


$
752,347



700


$
700,000



24,655,990


$
24,656


$
17,977,046


$
(16,254,545
)

$
9,862


$
5,193,440    27




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##### Table of Contents



Beacon
    Enterprise Solutions Group, Inc. and Subsidiaries



Consolidated
    Statements of Cash Flows  For the


For theYear Ended


Year EndedSeptember 30,


September 30,2008


2009(Unaudited)CASH FLOWS FROM OPERATING ACTIVITIESNet loss

$
(4,647,538
)

$
(6,269,850
)Adjustments to reconcile net loss to net cash used in operating
    activities:Change in reserve for obsolete inventory


35,058



125,441Change in reserve for doubtful accounts


50,000



107,771Depreciation and Amortization


571,467



613,080Non-cash interest


384,839



590,837Share based payments


499,342



722,336Deferred income tax liability


45,472



58,012Changes in operating assets and liabilities:Accounts receivable


(866,161
)


(2,444,628
)Inventory


(174,861
)


(132,269
)Prepaid expenses and other current assets


32,691



(325,092
)Other assets


131,227



59,137Accounts payable


403,365



903,973Income taxes payable






97,581Customer deposits


(241,866
)


64,601Accrued expenses


935,132



1,501,244NET CASH USED IN OPERATING ACTIVITIES


(2,841,833
)


(4,327,826
)CASH FLOWS FROM INVESTING ACTIVITIESCapital expenditures


(154,070
)


(220,438
)Acquisition of businesses, net of acquired cash


(2,223,535
)


46,202NET CASH USED IN INVESTING ACTIVITIES


(2,377,605
)


(174,236
)CASH FLOWS FROM FINANCING ACTIVITIESProceeds from issuances of convertible notes






500,000Proceeds from issuances of bridge notes and other short term
    notes


422,000



700,000Proceeds from sale of preferred stock, net of offering costs


4,276,460



Proceeds from sale of common stock, net of offering costs


1,035,216



4,346,672Proceeds from lines of credit


400,000



343,000Proceeds from note payable


600,000



Payment of note offering costs






(75,000
)Repayment of line of credit


(450,000
)


(393,000
)Repayment of convertible notes






(202,001
)Payments of notes payable


(985,514
)


(534,389
)Payments of capital lease obligations


(13,562
)


(11,928
)NET CASH PROVIDED BY FINANCING ACTIVITIES


5,284,600



4,673,354NET INCREASE IN CASH AND CASH EQUIVALENTS


65,162



171,292CASH AND CASH EQUIVALENTS  BEGINNING OF YEAR


62,211



127,373Effect of exchange rates on chase and cash equivalents






(34,327
)CASH AND CASH EQUIVALENTS  END OF YEAR

$
127,373


$
264,338Cash paid for:Interest


115,587


$
104,715Income taxes





$
105,266Acquisition of businessesAccounts receivable


689,001


$
133,516Inventory


618,601



Prepaid expenses and other current assets


55,283



26,567Property and equipment


226,743



15,000Goodwill


2,791,649



360,300Customer relationships


3,874,074



349,100Non-compete agreements


430,000



212,300Security deposits


27,591



Line of credit


(250,000
)


Accounts payable and accrued expenses


(932,276
)


(84,941
)Customer deposits


(292,692
)


Long-term debt assumed


(354,199
)


Capital lease obligations


(25,490
)


Other acquisition liabilities


(50,000
)


(145,189
)Less: share based purchase consideration


(2,741,250
)


(912,855
)Less: acquisition notes issued to sellers of acquired businesses


(1,843,500
)


Cash used in acquisition of businesses (net of $148,283 and
    $46,202 of cash acquired)


2,223,535


$
(46,202
)    28




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL STATEMENTS
 (amounts
    in thousands, except share and per share data)
  NOTE 1 
    ORGANIZATION
    AND DESCRIPTION OF BUSINESS  Organization
          Share
    Exchange Transaction
     29




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    NOTE 2 
    LIQUIDITY
    AND FINANCIAL CONDITION    and/or
             30




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
                NOTE 3 
    SUMMARY
    OF SIGNIFICANT ACCOUNTING POLICIES  Principles
    of Consolidation
   31




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Use
    of Estimates
  and/or
  Revenue
    and Cost Recognition
    Time and Materials Contracts 
  Professional Services Revenue 
 32




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Foreign
    Currency Reporting
    Customer
    Concentration
    Advertising
    Expense
    Cash
    and Cash Equivalents
    Accounts
    Receivable
     33




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Inventory
  (first-in,
  Property
    and Equipment
    Concentration
    of Credit Risk
    Goodwill
    and Intangible Assets
     34




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  and/or
      Preferred
    Stock
   35




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Convertible
    Instruments
        and/or
    Common
    Stock Purchase Warrants and Other Derivative Financial
    Instruments
     36




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  A-1
  Share-Based
    Payments
    Income
    Taxes
       37




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Net
    Loss Per Share
      TotalStock


Common


CommonOptions and


Stock


StockWarrants


Equivalents


EquivalentsSeries A Convertible Preferred Stock


2,666,666



2,645,437



5,312,103Series A-1
    Convertible Preferred Stock


533,333



1,003,129



1,536,462Series B Convertible Preferred Stock


350,000



875,000



1,225,000Common Stock Offering Warrants


4,237,214







4,237,214Placement Agent Warrants


2,519,156







2,519,156Affiliate Warrants


55,583







55,583Bridge Financings


1,236,000



333,333



1,569,333Convertible Notes Payable


50,000



397,332



447,332Compensatory Warrants


300,000







300,000Equity Financing Arrangements


766,662







766,662Employee Stock Options


3,200,900







3,200,90015,915,514



5,254,231



21,169,745     Fair
    Value of Financial Instruments
    Recently Adopted Accounting Pronouncements
   38




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
             39




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        NOTE 4 
    BUSINESS
    COMBINATIONS  Advance
    Data Systems, Inc.
         40




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Bell-Haun
    Systems Inc.
         41




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          CETCON,
    Inc.
         42




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Strategic
    Communications, LLC
         43




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        th
   44




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Business
    Combination Accounting  Phase 1
    Acquisitions
    Bell-Haun





Strategic


TotalADSnetcurve


Systems


CETCON


Communications


ConsiderationCash paid

$
666,079


$
155,048


$
700,000


$
220,500


$
1,741,627Direct acquisition costs


172,345



95,052



235,518



127,276



630,191Net of cash acquired


(5,876
)






(142,407
)






(148,283
)Cash used in acquisitions

$
832,548


$
250,100


$
793,111


$
347,776


$
2,223,535Notes payable


220,000



119,000



600,000



904,500



1,843,500Common stock issued


595,000



425,000



765,000



956,250



2,741,250$
1,647,548


$
794,100


$
2,158,111


$
2,208,526


$
6,808,285      45




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Purchase
    Price Allocation  Phase 1
    Acquisitions
    Bell-Haun





Strategic


TotalADSnetcurve


Systems


CETCON


Communications


ConsiderationAccounts receivable

$
151,208


$
71,335


$
466,458


$



$
689,001Inventory






168,065







450,536



618,601Prepaid expenses and other current assets


13,430



34,522



5,516



1,815



55,283Property and equipment


47,500



19,243



20,000



140,000



226,743Goodwill


524,396



451,252



994,007



821,994



2,791,649Customer relationships


862,027



843,760



927,887



1,240,400



3,874,074Covenants not to compete


100,000



30,000



200,000



100,000



430,000Security deposits


21,541











6,050



27,591Line of credit obligation






(250,000
)










(250,000
)Accounts payable and accrued liabilities


(40,103
)


(319,911
)


(55,278
)


(516,984
)


(932,276
)Customer deposits


(32,451
)


(44,914
)


(205,532
)


(9,795
)


(292,692
)Capital lease obligations














(25,490
)


(25,490
)Long-term debt






(159,252
)


(194,947
)






(354,199
)Other acquisition liability






(50,000
)










(50,000
)$
1,647,548


$
794,100


$
2,158,111


$
2,208,526


$
6,808,285Net tangible asset acquired (liabilities assumed)

$
161,125


$
(530,912
)

$
36,217


$
46,132


$
(287,438
)    46




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Symbiotec
    Solutions AG
      AmountShares issued at acquistion

$
436,855Contingent shares pursuant to earnout


476,000Profit sharing earnout


145,189$
1,058,044Less cash acquired


(46,202
)Total purchase price consideration, net of cash received

$
1,011,842     AmountAccounts receivable

$
133,516Prepaid expenses and other current assets


26,567Property and equipment


15,000Goodwill


360,300Customer relationships


349,100Covenants not to compete


212,300Accounts payable and accrued liabilities


(84,941
)$
1,011,842Net tangible asset acquired

$
136,344    47




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Pro-Forma
    Financial Information
        For the

For theYear Ended

Year EndedSeptember 30,

September 30,2008

2009(Unaudited)

(Unaudited)Net sales

$
8,390,073


$
11,231,496Loss from operations


(4,713,761
)


(5,154,657
)Net loss available to common stockholders  (including
    the effects of contractual and deemd dividends)


(10,673,847
)


(7,045,261
)Net loss per share  basic and diluted

$
(0.98
)

$
(0.42
)Pro-forma weighted average shares outstanding


10,865,250



16,882,449     NOTE 5 
    ACCOUNTS
    RECEIVABLE    September 30,


September 30,2008


2009Accounts receivable

$
1,555,162


$
4,138,486Less: Allowance for doubtful accounts


(50,000
)


(157,771
)Accounts receivable, net

$
1,505,162


$
3,980,715   Additions and charges to the allowance for doubtful accounts
    consists of the following:
  September 30,


September 30,2008


2009Opening balance

$



$
(50,000
)Add: Additions to reserve

$
(50,000
)

$
(151,888
)Less: charges






44,117Ending balance

$
(50,000
)

$
(157,771
)  48




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   NOTE 6 
    INVENTORY,
    NET    September 30,


September 30,2008


2009Inventory

$
632,852


$
765,121Less: reserve for obsolete inventory


(35,058
)


(160,499
)Inventory

$
597,794


$
604,622     As of


As ofSeptember 30,


September 30,2008


2009Opening balance

$



$
(35,058
)Add: additions to reserve


(35,058
)


(144,659
)Less: charges






19,218Ending balance

$
(35,058
)

$
(160,499
)   and/or
  NOTE 7 
    PROPERTY
    AND EQUIPMENT, NET    September 30,


September 30,2008


2009Equipment

$
213,315


$
290,386Vehicles


80,934



80,934Furniture and Fixtures


45,000



118,358Software


27,225



110,992Leasehold Improvements


14,339



16,852$
380,813


$
617,522Less: Accumulated Depreciation


(70,110
)


(222,951
)Net Book Vaule Fixed Assets

$
310,703


$
394,571    49




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   NOTE 8 
    INTANGIBLE
    ASSETS, NET   Bell-Haun





Strategic





TotalADSnetcurve


Systems


CETCON


Communications


Symbio Tec


ConsiderationGoodwill

$
524,396


$
451,252


$
994,007


$
821,993


$
360,300


$
3,151,948Customer relationships


862,027



843,760



927,887



1,240,400



349,100



4,223,174Contracts not to compete


100,000



30,000



200,000



100,000



212,300



642,300962,027



873,760



1,127,887



1,340,400



561,400



4,865,474Less: Accumulated amortization


(213,584
)


(193,308
)


(271,727
)


(283,731
)






(962,350
)Intangibles, net


748,443



680,452



856,160



1,056,669



561,400



3,903,124         Fiscal YearEndedSeptember 30,2010

$
462,2462011


462,2462012


462,2462013


462,2462014


462,246Thereafter


1,591,894$
3,903,124   NOTE 9 
    ACCRUED
    EXPENSES    September 30,


September 30,2008


2009Goods received not invoiced

$
121,517


$
1,092,042Compensation related


371,511



559,782Severance and related


133,161



156,248Interest


76,852



122,660Sales taxes payable


80,147



66,798Warranty reserve


58,178



65,072Preferred stock dividends


220,354



37,962Other


275,640



543,716$
1,337,360


$
2,644,280  50




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   NOTE 10 
    NOTES PAYABLE
    AND LONG TERM DEBT    September 30,


September 30,2008


2009Lines of Credit and Short-Term Notes

$
200,000


$
550,000Convertible Notes Payable

$



$
297,999Bridge Note

$
571,160



166,879Integra Bank


548,541



439,367Acquistion notes (payable to the sellers of the acquired
    businesses)ADSnetcurve


156,617



80,922Bell-Haun


119,000



43,985CETCON


515,627



416,404Strategic Secured Note


472,287



297,0051,812,072



1,277,683Less: current portion


(495,595
)


(475,348
)Non-current portion

$
1,316,477


$
802,335   Lines
    of Credit
         51




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Convertible
    Notes Payable
       52




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Bridge
    Financing Transactions
        out-of-the-money,
   53




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Expected





Fair Value








Risk-Free


Value


Charge toQuantity


Life


Strike


of Common


Volatility


Dividend


Interese


per


InterestVesting Date

Vested


(Days)


Price


Stock


Rate


Yield


Rate


Warrant


Expense2/15/2008


10,000



1,825


$
1.00


$
1.35



66.34
%


0
%


2.76
%

$
0.86


$
8,600.003/15/2008


10,000



1,796


$
1.00


$
1.04



66.34
%


0
%


2.37
%

$
0.60


$
6,000.004/15/2008


10,000



1,765


$
1.00


$
1.15



66.34
%


0
%


2.68
%

$
0.69


$
6,900.005/15/2008


10,000



1,735


$
1.00


$
0.95



66.34
%


0
%


3.10
%

$
0.53


$
5,300.006/15/2008


10,000



1,704


$
1.00


$
1.01



66.34
%


0
%


3.73
%

$
0.58


$
5,800.007/15/2008


10,000



1,674


$
1.00


$
1.25



66.34
%


0
%


3.12
%

$
0.76


$
7,600.008/15/2008


10,000



1,643


$
1.00


$
1.50



66.34
%


0
%


3.11
%

$
0.97


$
9,700.009/15/2008


10,000



1,612


$
1.00


$
1.05



66.34
%


0
%


2.59
%

$
0.58


$
5,800.00For the year ended September 30, 2008

































$
55,700.0010/15/2008


10,000



1,582


$
1.00


$
1.20



66.34
%


0
%


2.90
%

$
0.70


$
7,000.0011/15/2008


10,000



1,551


$
1.00


$
0.85



66.34
%


0
%


2.33
%

$
0.42


$
4,200.0011/20/2008


140,000



1,546


$
1.00


$
0.55



66.34
%


0
%


1.94
%

$
0.21


$
29,400.00For the year ended September 30, 2009

































$
40,600.00        54




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
             55




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Expected





Fair Value








Risk-Free


Value


Charge toQuantity


Life


Strike


of Common


Volatility


Dividend


Interese


per


InterestVesting Date

Vested


(Days)


Price


Stock


Rate


Yield


Rate


Warrant


Expense2/15/2008


4,000



1,825


$
1.00


$
1.35



66.34
%


0
%


2.76
%

$
0.86


$
3,440.003/15/2008


4,000



1,796


$
1.00


$
1.04



66.34
%


0
%


2.37
%

$
0.60


$
2,400.004/15/2008


4,000



1,765


$
1.00


$
1.15



66.34
%


0
%


2.68
%

$
0.69


$
2,760.005/15/2008


4,000



1,735


$
1.00


$
0.95



66.34
%


0
%


3.10
%

$
0.53


$
2,120.006/15/2008


4,000



1,704


$
1.00


$
1.01



66.34
%


0
%


3.73
%

$
0.58


$
2,320.007/15/2008


4,000



1,674


$
1.00


$
1.25



66.34
%


0
%


3.12
%

$
0.76


$
3,040.008/15/2008


4,000



1,643


$
1.00


$
1.50



66.34
%


0
%


3.11
%

$
0.97


$
3,880.009/15/2008


4,000



1,612


$
1.00


$
1.05



66.34
%


0
%


2.59
%

$
0.58


$
2,320.00For the year ended September 30, 2008

































$
22,280.0010/15/2008


4,000



1,582


$
1.00


$
1.20



66.34
%


0
%


2.90
%

$
0.70


$
2,800.0011/15/2008


4,000



1,551


$
1.00


$
0.85



66.34
%


0
%


2.33
%

$
0.42


$
1,680.0011/20/2008


56,000



1,546


$
1.00


$
0.55



66.34
%


0
%


1.94
%

$
0.21


$
11,760.00For the year ended September 30, 2009

































$
16,240.00     Integra
    Bank
    Acquisition
    Notes
   56




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Fiscal YearEndedSeptember 30,2010

$
475,3482011


377,3582012


321,2602013


103,717$
1,277,683     NOTE 12 
    RELATED
    PARTY TRANSACTIONS        Series A-1
  Expected



Fair Value





Risk-Free

Value

Charge toQuantity

Life

Strike

of Common

Volatility

Dividend

Interese

per

InterestDate Earned

Earned

(Days)

Price

Stock

Rate

Yield

Rate

Warrant

Expense1/28/2008


20,000



1,825


$
1.00


$
1.90



66.34
%


0
%


2.80
%

$
1.34


$
26,8002/28/2008


20,000



1,825


$
1.00


$
1.50



66.34
%


0
%


2.73
%

$
0.99


$
19,8003/7/2008


10,000



1,825


$
1.00


$
1.75



66.34
%


0
%


2.45
%

$
1.21


$
12,100  57




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Expected





Fair Value








Risk-Free


Value


Charge toQuantity


Life


Strike


of Common


Volatility


Dividend


Interese


per


InterestDate Earned

Earned


(Days)


Price


Stock


Rate


Yield


Rate


Warrant


Expense6/15/2008


33,333



1,825


$
1.00


$
1.01



66.34
%


0
%


3.73
%

$
0.58


$
19,3337/15/2008


33,333



1,825


$
1.00


$
1.25



66.34
%


0
%


3.12
%

$
0.78


$
26,0008/15/2008


33,333



1,825


$
1.00


$
1.50



66.34
%


0
%


3.41
%

$
1.00


$
33,3338/19/2008


100,000



1,825


$
1.00


$
1.25



66.34
%


0
%


3.07
%

$
0.78


$
78,0009/15/2008


33,333



1,825


$
1.00


$
1.05



66.34
%


0
%


2.59
%

$
3.61


$
20,333For year ended September 30, 2008

























$
176,99910/15/2008


33,333



1,825


$
1.00


$
1.20



66.34
%


0
%


2.90
%

$
0.74


$
24,66611/15/2008


33,333



1,825


$
1.00


$
0.85



66.34
%


0
%


2.33
%

$
0.45


$
15,00012/15/2008


33,333



1,825


$
1.00


$
1.52



66.34
%


0
%


1.50
%

$
0.99


$
33,00012/31/2008


16,667



1,825


$
1.00


$
1.01



66.34
%


0
%


1.55
%

$
0.57


$
9,5001/9/2009


100,000



1,825


$
1.00


$
0.80



66.34
%


0
%


1.51
%

$
0.41


$
41,0002/9/2009


33,333



1,825


$
1.00


$
0.80



66.34
%


0
%


1.99
%

$
0.41


$
13,6673/9/2009


33,333



1,825


$
1.00


$
0.54



66.34
%


0
%


1.90
%

$
0.23


$
7,6674/9/2009


33,333



1,825


$
1.00


$
0.75



66.34
%


0
%


1.90
%

$
0.37


$
12,3335/9/2009


33,333



1,825


$
1.00


$
1.19



66.34
%


0
%


2.09
%

$
0.72


$
23,9706/9/2009


33,333



1,825


$
1.00


$
1.35



66.34
%


0
%


2.73
%

$
0.86


$
28,6667/9/2009


33,333



1,825


$
1.00


$
1.61



66.34
%


0
%


2.31
%

$
1.08


$
35,9838/9/2009


33,333



1,825


$
1.00


$
1.20



66.34
%


0
%


2.75
%

$
0.74


$
24,5339/9/2009


33,333



1,825


$
1.00


$
1.00



66.34
%


0
%


2.38
%

$
0.57


$
18,960For year ended September 30, 2009

























$
288,945      58




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
              NOTE 13 
    COMMITMENTS
    AND CONTINGENCIES  Employment
    Agreements
   59




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Operating
    Leases
    Fiscal YearEndingSeptember 30, 20092010

$
123,4232011


19,400$
142,823   Engagement
    of Investor Relations Firm
        Engagement
    for Advisory Services
   60




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   NOTE 14 
    STOCKHOLDERS
    EQUITY  Authorized
    Capital
  Series A-1
  Series A-1 Series A-1 Series A-1) Series A-1 Series A-1
  A-1 A-1, Series A-1 A-1
  A-1 Series A-1,
  Series A-1 Series A-1
  Series A-1
  Private
    Placement of Convertible Preferred Stock
  Series A
    Preferred Stock Placement
   61




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    paid-in-kind
      Fair Value ofQuantity of


Estimated


Estimated


Undelying


Risk-Free


ExpectedDate

Warrants


Fair Value


Fair Value of


Common


Interest


Dividend


Life


CurrentIssued

Issued


per Warrant


Warrants


Stock


Rate


Yield


(Years)


Volatility12/20/2007


1,622,600


$
0.46


$
746,396


$
0.85



3.45
%


0
%


5



66.34
%1/15/2008


480,333


$
0.78


$
374,660


$
1.25



3.00
%


0
%


5



66.34
%2/12/2008


563,733


$
0.78


$
439,712


$
1.25



2.71
%


0
%


5



66.34
%     Fair Value of





Intrinsic


CommonCommon





Value of


SharesDate of Issue/

Stock on


Effective


Beneficial


IssuableCommitment

Commitment


Conversion


Conversion


upon


DeemedDate

Date


Price


Feature


Conversion


Dividend12/20/2007

$
0.85


$
0.57


$
0.28



3,245,200


$
903,8781/15/2008

$
1.25


$
0.49


$
0.76



960,667


$
726,8202/12/2008

$
1.25


$
0.49


$
0.76



1,127,466


$
853,017    62




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  and/or
    Series A-1
    Preferred Stock Placement
  Series A-1 Series A-1 Series A-1 Series A-1
  Series A-1 Series A-1, paid-in-kind
  Series A-1 Series A-1 Series A-1
  Fair Value ofQuantity of


Estimated


Estimated


Undelying


Risk-Free


ExpectedDate

Warrants


Fair Value


Fair Value of


Common


Interest


Dividend


Life


CurrentIssued

Issued


per Warrant


Warrants


Stock


Rate


Yield


(Years)


Volatility3/7/2008


515,200


$
1.20


$
618,240


$
1.75



2.45
%


0
%


5



66.34
%3/11/2008


18,133


$
0.99


$
17,952


$
1.50



2.61
%


0
%


5



66.34
%  63




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Fair Value of





Intrinsic


CommonCommon





Value of


SharesDate of Issue/

Stock on


Effective


Beneficial


IssuableCommitment

Commitment


Conversion


Conversion


upon


DeemedDate

Date


Price


Feature


Conversion


Dividend3/7/2008

$
1.75


$
0.42


$
1.33



1,030,400


$
1,373,8673/11/2008

$
1.50


$
0.45


$
1.05



36,267


$
38,015   Series A-1
  Series A-1 and/or Series A-1
  Series A-1
  Series B
    Preferred Stock Placement
      Series A-1
 64




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Fair Value ofQuantity of


Estimated


Estimated


Undelying


Risk-Free


ExpectedDate

Warrants


Fair Value


Fair Value of


Common


Interest


Dividend


Life


CurrentIssued

Issued


per Warrant


Warrants


Stock


Rate


Yield


(Years)


Volatility7/10/2008


200,000


$
0.55


$
110,000


$
1.01



3.10
%


0
%


5



66.34
%     Fair Value of





Intrinsic


CommonCommon





Value of


SharesDate of Issue/

Stock on


Effective


Beneficial


IssuableCommitment

Commitment


Conversion


Conversion


upon


DeemedDate

Date


Price


Feature


Conversion


Dividend7/10/2008

$
1.01


$
0.71


$
0.30



444,444


$
135,163       and/or
    Preferred
    Stock Dividends
  A-1,
 65




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  pay-in-kind
  DeemedFair Value of


DividendDate of


Contractual


Conversion


Common


Closing


Fair Value


Contractual


Related toPreferred

Date of


Election


Preferred


Price per


Shares


Price on


of Underlying


Preferred


BeneficialStock

Contractual


(Commitment


Stock


Common


Underlying


Date of


Common


Stock


ConversionSeries

Dividend


Date)


Dividend


Share


Dividend


Election


Stock


Dividend


FeatureA


1/1/2008



3/26/2008


$
7,335


$
0.75



9,780


$
1.20


$
11,736


$
7,335


$
4,401A


4/1/2008



3/26/2008


$
87,569


$
0.75



116,759


$
1.20


$
140,111


$
87,569


$
52,542A


7/1/2008



10/7/2008


$
100,000


$
0.75



133,333


$
1.24


$
165,333


$
100,000


$
65,333A-1


4/1/2008



3/26/2008


$
5,450


$
0.75



7,267


$
1.20


$
8,720


$
5,450


$
3,270A-1


7/1/2008



10/7/2008


$
20,000


$
0.75



26,667


$
1.24


$
33,067


$
20,000


$
13,067Total For year end September 30, 2008

$
220,354







293,806






$
358,967






$
138,613A


10/1/2008



10/7/2008


$
100,000


$
0.75



133,333


$
1.24


$
165,333


$
100,000


$
65,332A


1/1/2009



1/9/2009


$
100,000


$
0.75



133,333


$
0.80


$
106,666


$
100,000


$
6,666A


4/1/2009



2/17/2009


$
126,213


$
0.75



168,284


$
0.55


$
92,556


$
126,213


$
A


7/1/2009



6/5/2009


$
103,618


$
0.75



138,157


$
1.37


$
189,275


$
103,618


$
85,657A-1


10/1/2008



10/7/2008


$
20,000


$
0.75



26,667


$
1.24


$
33,067


$
20,000


$
13,067A-1


1/1/2009



1/9/2009


$
20,000


$
0.75



26,667


$
0.80


$
21,334


$
20,000


$
1,334A-1


4/1/2009



2/17/2009


$
23,549


$
0.75



31,399


$
0.55


$
17,269


$
23,549


$
A-1


7/1/2009



6/5/2009


$
22,142


$
0.75



29,523


$
1.37


$
40,447


$
22,142


$
18,305B


10/1/2008



10/7/2008


$
5,152


$
0.80



6,440


$
1.24


$
7,986


$
5,152


$
2,834B


1/1/2009



1/9/2009


$
6,000


$
0.80



7,500


$
0.80


$
6,000


$
6,000


$
B


4/1/2009



2/17/2009


$
10,502


$
0.80



13,128


$
0.55


$
7,220


$
10,502


$
B


7/1/2009



6/5/2009


$
10,500


$
0.80



13,125


$
1.37


$
17,981


$
10,500


$
7,481Total For year end September 30, 2009

$
547,676







727,556






$
705,134






$
200,676   Registration
    Rights
  Series A-1 Series A-1
 66




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Issuances
    of Common Stock in Business Combinations
      Restricted
    Stock Grant
    Compensatory
    Warrants Issuance
    Expected














Risk-Free


Value


Charge toGrant

Quantity


Life


Strike


Underlying





Dividend


Interese


per


InterestDate

Granted


(Days)


Price


Price


Volatility


Yield


Rate


Warrant


Expense3/26/2008


300,000



1,825


$
1.00


$
1.20



66.34
%


0
%


2.55
%

$
0.73


$
219,000   Sales
    of Common Stock and Warrants
  Placement Agent Common
    Units Common Offering
    Warrant Common Offering
 67




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
               68




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      NOTE 15 
    INCOME
    TAXES    2008


2009Federal:CurrentDeferred


1,451,792



2,216,449Total federal


1,451,792



2,216,449State:CurrentDeferred


166,530



254,240Total state


166,530



254,240Foreign:Current






(97,581
)Deferred



(97,581
)1,618,322



2,373,108Change in valuation allowance


(1,663,794
)


(2,528,701
)Total provision

$
(45,472
)

$
(155,593
)     For the Twlelve


For the TwlelveMonths Ended


Months EndedSeptember 30,


September 30,2008


2009Tax benefit at statutory rate


34.0
%


34.0
%State income taxes, net of federal benefit


3.9



3.9Foreign income taxes






1.6Non-deductible expenses


(2.8
)


(.6
)Increase in valuation allowance


(36.1
)


(41.4
)Effective income tax rate


(1.0
)


(2.5
)  69




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    As of


As ofSeptember 30,


September 30,2008


2009Deferred tax assetsCapitalized start up and organization costs

$
46,257


$
42,953Depreciation and amortization


81,265



135,039Accrued expenses


36,557



79,875Bad debt reserve


18,950



59,125Inventory obsolescence reserve


13,287



67,758Share based payments


189,624



400,891Net operating loss carryforwards


1,872,812



4,001,813Total deferred tax assets


2,258,752



4,787,454Less valuation allowance


(2,258,752
)


(4,787,454
)Net deferred tax assets






Deferred tax liabilitiesTax deductible goodwill


(45,472
)


(103,484
)Total deferred tax liabilities

$
(45,472
)

$
(103,484
)      70




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   NOTE 16 
    EMPLOYEE
    BENEFITS PLANS  Stock
    Options and Other Equity Compensation Plans
      Expected











Risk-Free


Value


Share BasedDate

Quantity


Life


Strike





Dividend


Interese


per


CompensationEarned

Issued


(Days)


Price


Volatility


Yield


Rate


Option


Expense3/26/2008


90,000



2,373


$
1.20



66.34
%


0
%


2.55
%

$
0.72


$
64,9805/8/2008


30,900



2,373


$
1.00



66.34
%


0
%


2.99
%

$
0.64


$
19,77610/7/2008


25,000



2,373


$
1.24



66.34
%


0
%


2.45
%

$
0.79


$
19,7501/9/2009


285,000



2,373


$
0.80



66.34
%


0
%


1.99
%

$
0.50


$
142,5005/8/2009


2,500,000



2,373


$
1.19



66.34
%


0
%


2.09
%

$
0.75


$
1,875,0006/5/2009


50,000



2,373


$
1.37



66.34
%


0
%


2.85
%

$
0.87


$
43,5007/9/2009


250,000



2,373


$
1.61



66.34
%


0
%


2.33
%

$
1.02


$
254,400        71




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    WeightedAverageWeighted





RemainingNumber


Average


Intrinsic


Contractualof Options


Exercise Price


Value


TermOptions Outstanding at October 1, 2007





$
Granted


120,900


$
1.15Forfeited


(30,000
)

$
1.20Options Outstanding at September 30, 2008


90,900


$
1.13Granted


3,110,000


$
1.19Forfeited


Options Outstanding at September 30, 2009


3,200,900


$
1.19



0.10



9.56Exercisable, September 30, 2009


105,300


$
1.13



0.39



8.53     Beacon
    Solutions 401(k) Plan
      Segment
    Reporting
       72




---



##### Table of Contents



BEACON
    ENTERPRISE SOLUTIIONS GROUP, INC.
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     United States


Europe


TotalRevenue

$
10,112,912


$
957,584


$
11,070,496(Loss) income from operations


(5,704,605
)


494,748



(5,209,857
)Interest expense


(905,125
)






(905,125
)Interest income


686



39



725Depreciation and amortization


(613,171
)


(950
)


(614,121
)Assets


10,874,908



1,938,840



12,813,748Goodwill


2,791,648



360,300



3,151,948Intangible assets


3,341,724



561,400



3,903,124     NOTE 17 
    SUBSEQUENT
    EVENTS  Sale
    of Common Stock and Warrants
      Contractual
    Dividends
  A-1
  Grant
    of Stock Options
    10-K.
 73




---



##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A(T).
    Controls
    and Procedures  Rules 13a-15 15d-15.
  Managements
    Report on Internal Control over Financial Reporting
             74




---



##### Table of Contents



Disclosure
    Controls and Internal Controls
      Form 10-K.
  Form 10-K
  Changes
    in Internal Control Over Financial Reporting
    Item 9B.
    Other
    Information   75




---



##### Table of Contents



Item 10.
    Directors,
    Executive Officers, and Corporate Governance  Directors
    of Beacon Enterprise Solutions Group, Inc.
    Name

Age

TitleBruce Widener


48


Director, Chairman, Chief Executive OfficerJ. Sherman Henderson III


66


DirectorJohn D. Rhodes III


55


DirectorRichard C. Mills


53


PresidentRobert Mohr


43


Chief Accounting Officer, Secretary, TreasurerGerald Bowman


51


Senior Vice President of Global Services   Bruce Widener, Director, Chairman and Chief Executive
    Officer.
  J. Sherman Sherm Henderson III,
    Director.
  John D. Rhodes, III, M.D.,
    Director.
  Richard C. Mills, President.
  Robert R. Mohr, CPA, Chief Accounting
    Officer. start-ups,
  Gerald Bowman, Senior Vice President of Global
    Services.
 76




---



##### Table of Contents



Audit
    Committee
    Section 16(a)
    Beneficial Ownership Reporting Compliance
    Form 8-K Form 10-Q,
  Code of
    Ethics
   77




---



##### Table of Contents



Item 11.
    Executive
    Compensation  COMPENSATION
    DISCUSSION AND ANALYSIS
    
    Bruce Widener, Chairman, Chief Executive Officer and Director
    Richard C. Mills, President
    Robert Mohr, Chief Financial Officer, Treasurer and Secretary    Overview
    of Compensation Philosophy
    Overview
    of Compensation Objectives
  Performance.
    
    Base salary, which provides fixed compensation based on
    competitive market practice and in accordance with the terms of
    the executives employment agreement.
    Bonus, which is discretionary and payable in cash or equity
    incentives based on an assessment of each executives
    performance against pre-determined quantitative and qualitative
    measures within the context of our overall performance.
    Equity incentive compensation in the form of stock options
    and/or
    restricted stock subject to vesting schedules that require
    continued service with us.
    Our matching contributions to our named executive officers who
    participate in our 401(k) plan.
    Other benefits.   78




---



##### Table of Contents



Alignment.
    Retention.
    Implementing
    Our Objectives
  Determining
    Appropriate Pay Levels.
      
    Key financial measurements such as revenue, operating profit and
    cash flow from operating activities.
    Strategic objectives such as acquisitions, dispositions or joint
    ventures.
    Promoting commercial excellence by launching new or continuously
    improving services, and attracting and retaining customers.
    Achieving specific operational goals for us including improved
    productivity, simplification and risk management.
    Achieving excellence in their organizational structure and among
    their employees.    Allocation
    of Compensation
   79




---



##### Table of Contents



Timing
    of Compensation
    Minimum
    Stock Ownership Requirements
    Role
    of Compensation Committee.
    Role
    of Executive Officers in Determining Compensation
    Role
    of Compensation Consultant.
    Equity
    Grant Practices.
   80




---



##### Table of Contents



Annual
    Compensation Objectives
  Base
    Salary.
      Bonus.
          Equity
    Awards
   81




---



##### Table of Contents



401(k)
    Plan
      Matching


MatchingContributions


Contributionsfor the Twelve


for the TwelveNamed

Months Ended


Months EndedExecutive

September 30,


September 30,Officer

2008


2009Bruce Widener

$
4,274


$
773Richard C. Mills

$
3,433


$
577Kenneth Kerr

$
3,433


$
Robert Mohr

$
3,607


$
606   Other
    Compensation.
    Compensation for Named Executive Officers in Fiscal 2008 and
    2009 Strength of company performance. Form 10-K.
 82




---



##### Table of Contents



CEO Compensation.
  Financial
    Objectives
    Strategic
    and Operational Goals
  Execute Phase I Acquisitions

Mr. Widener successfully executed the Phase I Acquisition
    plan and reverse merger to create Beacon as a public company.Integrate Phase I Acquisitions

We successfully integrated the four companies into a single
    business providing the comprehensive services contemplated under
    the original plan.Retain Excellent Team

Mr. Widener continued to attract and retain a strong
    management expertise at all levels of the organization.Launched Foreign Operations

Mr. Widener successfully launched foreign operations
    through the acquisition of Symbiotec Solution AG.     Other Named Executive Officers
    Compensation.
  COMPENSATION
    COMMITTEE REPORT
  Regulation S-K. Form 10-K.
      83




---



##### Table of Contents



ADDITIONAL
    INFORMATION REGARDING EXECUTIVE COMPENSATION
    Summary
    Compensation Table
  ChangeinPensionValueandNonquali-Non-

fiedEquity

Deferred

AllIncentive

Compen-

OtherStock

Option

Plan

sation

Compen-Bonus ($)

Awards ($)

Awards ($)

Compen-

Earnings

sation

TotalName and Principal

Year

Salary ($)

(1)

(2)

(3)

sation ($)

($)

($)

($)Position (A)

(B)

(C)

(D)

(E)

(F)

(G)

(H)

(I)

(J)Bruce Widener


2009



203,035
(4)










104,795
(5)










12,893
(6)


215,928Chairman, Chief Executive


2008



190,378
(7)






















11,912
(8)


307,085Richard C. Mills


2009



156,086
(9)






90,202
(10)


104,795
(11)










12,696
(12)


363,779President


2008



110,494
(13)






266,694
(14)














10,578
(15)


387,766Kenneth Kerr


2009



150,000
(16)






















112,120
(17)


262,119Chief Operating Officer


2008



109,615
(18)






















10,306
(19)


119,921Robert Mohr


2009



150,000
(20)










63,699
(21)










4,382
(22)


218,081Chief Accounting Officer,


2008



126,923
(23)


5,000
(24)






7,358
(25)










2,743
(26)


142,024Treasurer and SecretaryGerald Bowman


2009



5,769
(27)


























5,769Senior Vice President of Global Services     (1)
    
    For purposes of this Summary Compensation Table, the cash
    incentive awards to the named executive officers, which are
    discussed in further detail under the heading Compensation
    Discussion and Analysis  Compensation for Named
    Executive Officers for Fiscal Year 2009, have been
    characterized as Non-Equity Incentive Plan
    Compensation under column (G).(2)
    
    The amounts in Column (E) represent the proportionate
    amount of the total fair value of restricted stock recognized by
    us as an expense in fiscal years 2008 and 2009 for financial
    accounting purposes, disregarding for this purpose the estimate
    of forfeitures related to service-based vesting conditions. The
    fair values of these awards and the amounts expensed in fiscal
    year 2009 were determined in accordance with ASC 718. The awards
    for which expense is shown in column (E) include awards
    described in the Grants of Plan-Based Awards table included
    elsewhere in this section. The assumptions used in determining
    the grant date fair values of these awards are set forth in
    Note 16 to our consolidated financial statements included
    elsewhere in this annual report on
    Form 10-K.(3)
    
    The amounts in column (F) represent the proportionate
    amount of the total fair value of stock options recognized by us
    as an expense in fiscal years 2008 and 2009 for financial
    accounting purposes, disregarding for this purpose the estimate
    of forfeitures related to service-based vesting conditions. The
    fair value of these awards and the amounts expensed in fiscal
    years 2008 and 2009 were determined in accordance with ASC 718.
    The awards for which expense is shown in column (F) include
    the awards described in the Grants of Plan-Based Awards table
    included elsewhere in this section. The assumptions used in
    determining the grant date fair values of these awards are set
    forth in Note 16 to our consolidated financial statements
    included elsewhere in this annual report on
    Form 10-K.(4)
    
    Amount includes $240,000 annual salary under the terms of
    Mr. Wideners employment agreement and amounts agreed
    upon with Founders prior to execution of the employment
    agreement.(5)
    
    Amount relates to unrestricted stock grant which is discussed in
    further detail in Note 16 to our consolidated financials
    statements included elsewhere in this annual report on
    Form 10-K.(6)
    
    Amount paid for 401k match, medical, dental and vision insurance. 84




---



##### Table of Contents



(7)
    
    Amount includes $180,000 annual salary under the terms of
    Mr. Wideners employment agreement and amounts agreed
    upon with Founders prior to execution of the employment
    agreement.(8)
    
    Amount paid for medical, dental and vision insurance.(9)
    
    Amount includes $150,000 annual salary under the terms of
    Mr. Mills employment agreement and amounts agreed
    upon with Founders prior to execution of the employment
    agreement.(10)
    
    Amount relates to restricted stock grant which is discussed in
    further detail in Note 16 to our consolidated financial
    statements included elsewhere in this annual report on
    Form 10-K.(11)
    
    Amount relates to unrestricted stock grant which is discussed in
    further detail in Note 16 to our consolidated financials
    statements included elsewhere in this annual report on
    Form 10-K.(12)
    
    Amount paid for 401k, match, medical, dental and vision
    insurance.(13)
    
    Amount includes $150,000 annual salary under the terms of
    Mr. Mills employment agreement for partial year since
    execution of the employment agreement..(14)
    
    Amount relates to restricted stock grant which is discussed in
    further detail in Note 16 to our consolidated financial
    statements included elsewhere in this annual report on
    Form 10-K.(15)
    
    Amount paid for medical, dental and vision insurance.(16)
    
    Amount includes $150,000 annual salary under the terms of
    Mr. Kerrs employment agreement and amounts agreed
    upon with Founders prior to execution of the employment
    agreement.(17)
    
    Amount paid for medical, dental and vision insurance.(18)
    
    Amount includes $150,000 annual salary under the terms of
    Mr. Kerrs employment agreement for partial year since
    execution of the employment agreement.(19)
    
    Amount paid for medical, dental and vision insurance .(20)
    
    Amount includes $150,000 annual salary under the terms of
    Mr. Mohrs employment agreement and amounts agreed
    upon with Founders prior to execution of the employment
    agreement.(21)
    
    Amount relates to unrestricted stock grant which is discussed in
    further detail in Note 16 to our consolidated financials
    statements included elsewhere in this annual report on
    Form 10-K.(22)
    
    Amount paid for 401k match, medical, dental and vision insurance(23)
    
    Amount includes $150,000 annual salary under the terms of
    Mr. Mohrs employment agreement for partial year since
    execution of the employment agreement.(24)
    
    Amount represents a bonus for timely filing of documents with
    the Securities Exchange Commission.(25)
    
    Amount represents non-cash compensation expense recognized for
    financial accounting purposes determined in accordance with ASC
    718.(26)
    
    Amount paid for medical, dental and vision insurance.    Employment
    Agreements
     85




---



##### Table of Contents



Grants of
    Awards
  Grants of
    Awards
  All Other



GrantAll

Option



DateOther

Awards:

Exercise

FairStock

Number of

or Base

Value ofEstimated Future Payouts







Awards:

Securities

Price of

StockUnder Non-Equity Incentive

Estimated Future Payouts Under Equity Incentive

Number

Under-

Option

andPlan Awards

Plan Awards

of Shares

lying

Awards

OptionGrant

Threshold

Target

Maximum

Threshold

Target

Maximum

of Stock

Options

($/Sh)

Awards ($)Name

Date

($)

($)

($)

(#)

(#)

(#)

or Units (#)

(1)

(2)

(3)(A)

(B)

(C)

(D)

(E)

(F)

(G)

(H)

(I)

(J)

(K)

(L)Bruce Widener


5/8/2009































1,000,000


$
1.19



750,000Richard C. Mills


12/20/2007



























782,250
(4)










663,863Richard C. Mills


5/8/2009































1,000,000


$
1.19



750,000Robert Mohr


3/26/2008































60,000


$
1.20



43,200Robert Mohr


1/9/2009































75,000


$
0.80



37,500Robert Mohr


5/8/2009































250,000


$
1.19



187,500        86




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##### Table of Contents



Outstanding
    Equity Awards at Fiscal Year-End
    Outstanding
    Equity Awards at Fiscal Year-End
  Option Awards

Stock AwardsEquityIncentiveEquity

PlanIncentive

Awards:Equity









Plan

Market orIncentive









Awards:

PayoutPlan









Number of

Value ofAwards:







Market

Unearned

UnearnedNumber of





Number

Value of

Shares,

Shares,Number of

Number of

Unearned





of Shares

Shares or

Units or

Units orSecurities

Securities

Securities





or Units

Units of

Other

OtherUnderlying

Underlying

Underlying





of Stock

Stock

Rights

RightsUnexercised

Unexercised

Unexercised





That Have

That Have

That Have

That HaveOptions

Options

Options

Option

Option

Not

Not

Not

Not(#)

(#)

(#)

Exercise

Expiration

Vested

Vested

Vested

VestedName

Exercisable

Unexercisable

Unexercisable

Price

Date

(#)

($)

(#)

($)(A)

(B)

(C)

(D)

(E)

(F)

(G)

(H)

(I)

(J)Bruce Widener






1,000,000






$
1.19



5/8/2019







Richard C. Mills






















421,500



442,575Richard C. Mills






1,000,000






$
1.19



5/8/2019Robert Mohr


20,000



40,000






$
1.20



3/26/2018Robert Mohr


75,000










$
0.80



1/9/2019Robert Mohr






250,000






$
1.19



5/8/2019   Options
    Exercises and Stock Vested
    Option
    Exercises and Stock Vested
  Option Awards

Stock AwardsNumber



Numberof Shares

Value

of Shares

ValueAcquired

Realized

Acquired

Realizedon

on

on

onExercise

Exercise

Vesting

VestingName

(#)

($)

(#)

($)(A)

(B)

(C)

(D)

(E)Richard C. Mills










150,000


$
127,500210,750


$
252,900  87




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##### Table of Contents



Potential
    Payments Upon Termination or Change in Control
    Bruce
    Widener
  Terminationby Company

Terminationwithout Cause

Following oror Executive

Prior to awith Good

Change inRetirement

Death

Disability

Reason

ControlBenefit

($)

($)

($)

($)

($)Cash Severance





$
240,000
(1)

$
240,000
(1)

$
720,000
(1)



(2)Acceleration of Restricted Stock



















(2)Acceleration of Stock Options



















(2)Health & Welfare Benefits



(3)



(3)


3,121
(3)


3,121
(3)



(2)     (1)
    
    Excluding accrued, but unpaid, base salary, annual bonus,
    accrued vacation, 401(k) payments and unreimbursed business
    expenses.(2)
    
    Executive is not entitled to any specific payments upon a change
    in control, other than such payment that Executive would
    otherwise be entitled to if termination upon a change in control
    is by reason of death or disability or by the Company without
    Cause or the Executive for Good Reason, as provided in the
    related columns.(3)
    
    Executive is entitled to continued participation in our group
    health plan, assuming he makes a timely election of continuation
    coverage under COBRA, at the Companys expense.  Richard
    Mills
  Terminationby Company

Terminationwithout Cause

Following oror Executive

Prior to awith Good

Change inRetirement

Death

Disability

Reason

ControlBenefit

($)

($)

($)

($)

($)Cash Severance





$
37,500
(1)

$
37,500
(1)

$
150,000
(1)

$

(2)Acceleration of Restricted Stock














445,124
(3)

$

(2)Acceleration of Stock Options

















$

(2)Health & Welfare Benefits



(4)



(4)


3,001
(4)


3,001
(4)

$

(2)     (1)
    
    Excluding accrued, but unpaid, base salary, annual bonus,
    accrued vacation, 401(k) payments and unreimbursed business
    expenses.(2)
    
    Executive is not entitled to any specific payments upon a change
    in control, other than such payment that Executive would
    otherwise be entitled to if termination upon a change in control
    is by reason of death or 88




---



##### Table of Contents



disability or by the Company without Cause or the Executive for
    Good Reason, as provided in the related columns.(3)
    
    Upon termination by the Company for Cause or the Executive for
    Good Reason, restricted stock vests as described in Note 14
    to the consolidated financial statements.(4)
    
    Executive is entitled to continued participation in our group
    health plan, assuming he makes a timely election of continuation
    coverage under COBRA, at the Companys expense.  Robert
    Mohr
  Terminationby Company

Terminationwithout Cause

Following oror Executive

Prior to awith Good

Change inRetirement

Death

Disability

Reason

ControlBenefit

($)

($)

($)

($)

($)Cash Severance





$
37,500
(1)

$
37,500
(1)

$
150,000
(1)



(2)Acceleration of Restricted Stock



















(2)Acceleration of Stock Options



















(2)Health & Welfare Benefits



(3)



(3)


977
(3)


977
(3)



(2)     (1)
    
    Excluding accrued, but unpaid, base salary, annual bonus,
    accrued vacation, 401(k) payments and unreimbursed business
    expenses.(2)
    
    Executive is not entitled to any specific payments upon a change
    in control, other than such payment that Executive would
    otherwise be entitled to if termination upon a change in control
    is by reason of death or disability or by the Company without
    Cause or the Executive for Good Reason, as provided in the
    related columns.(3)
    
    Executive is entitled to continued participation in our group
    health plan, assuming he makes a timely election of continuation
    coverage under COBRA, at the Companys expense.  Gerald
    Bowman
  Terminationby Company

Terminationwithout Cause

Following oror Executive

Prior to awith Good

Change inRetirement

Death

Disability

Reason

ControlBenefit

($)

($)

($)

($)

($)Cash Severance





$
37,500
(1)

$
37,500
(1)

$
150,000
(1)



(2)Acceleration of Restricted Stock



















(2)Acceleration of Stock Options



















(2)Health & Welfare Benefits



(3)



(3)


977
(3)


977
(3)



(2)     (1)
    
    Excluding accrued, but unpaid, base salary, annual bonus,
    accrued vacation, 401(k) payments and unreimbursed business
    expenses.(2)
    
    Executive is not entitled to any specific payments upon a change
    in control, other than such payment that Executive would
    otherwise be entitled to if termination upon a change in control
    is by reason of death or disability or by the Company without
    Cause or the Executive for Good Reason, as provided in the
    related columns.(3)
    
    Executive is entitled to continued participation in our group
    health plan, assuming he makes a timely election of continuation
    coverage under COBRA, at the Companys expense. 89




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##### Table of Contents



DIRECTOR
    COMPENSATION
  Compensation for Non-Management Directors.
    Director
    Compensation
  Change inPensionValue andFees





Non-

Non-Earned





Equity

Qualifiedor

Stock



Incentive

Deferred

AllPaid in

Awards

Options

Plan

Compensation

OtherCash

($)

Awards

Compensation

Earnings

Compensation

TotalName and Principal Position

($)

(1)

($)

($)

($)

($)

($)(A)

(B)

(C)

(D)

(E)

(F)

(G)

(H)



















   Item 12.
    Security
    Ownership of Certain Beneficial Owners and
    Management  and/or
  BeneficialName

Ownership

% of ClassBruce Widener


2,580,000



5.8
%J. Sherman Henderson III(1)


1,150,000



2.6
%John D. Rhodes III(2)


2,965,766



4.2
%Richard C. Mills(3)


1,577,250



3.6
%Robert R. Mohr


95,000



0.0
%Directors and Named Executives Officers (as a group)


8,368,016



16.2
%       (1)
    
    Includes 30,000 shares held by LANJK, LLC (a limited
    liability company wholly owned by Mr. Henderson).(2)
    
    Includes the 166,666 shares into which the Exchange Bridge
    Note held by Dr. Rhodes is convertible, 173,000 shares
    for which the Exchanged Bridge Warrants held by Dr. Rhodes
    are exercisable within 60 days of the date hereof, 300,000
    warrants to purchase shares in exchange for his representation
    on the Board of Directors, 805,271 shares into which the
    Series B Preferred Stock is convertible, 350,000 Warrants
    issued pursuant to the Series B Preferred Stock purchase,
    783,328 warrants issued in exchange for an equity financing
    arrangement, and warrants to purchase 87,500 shares of
    common stock pursuant to a debt financing arrangement. 90




---



##### Table of Contents



(3)
    
    632,250 of the shares of Beacon Common Stock are subject to a
    three-year vesting provision, where such shares vest in three
    equal installments on December 20, 2008, 2009 and 2010. In
    addition, Mr. Mills and his wife are the beneficial owners
    of 795,000 shares of Beacon Common Stock.  Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence        Series A-1
  Expected



Fair Value





Risk-Free

Value

Charge toQuantity

Life

Strike

of Common

Volatility

Dividend

Interese

per

InterestDate Earned

Earned

(Days)

Price

Stock

Rate

Yield

Rate

Warrant

Expense1/28/2008


20,000



1,825


$
1.00


$
1.90



66.34
%


0
%


2.80
%

$
1.34


$
26,8002/28/2008


20,000



1,825


$
1.00


$
1.50



66.34
%


0
%


2.73
%

$
0.99


$
19,8003/7/2008


10,000



1,825


$
1.00


$
1.75



66.34
%


0
%


2.45
%

$
1.21


$
12,100    91




---



##### Table of Contents



Expected





Fair Value








Risk-Free


Value


Charge toQuantity


Life


Strike


of Common


Volatility


Dividend


Interese


per


InterestDate Earned

Earned


(Days)


Price


Stock


Rate


Yield


Rate


Warrant


Expense6/15/2008


33,333



1,825


$
1.00


$
1.01



66.34
%


0
%


3.73
%

$
0.58


$
19,3337/15/2008


33,333



1,825


$
1.00


$
1.25



66.34
%


0
%


3.12
%

$
0.78


$
26,0008/15/2008


33,333



1,825


$
1.00


$
1.50



66.34
%


0
%


3.41
%

$
1.00


$
33,3338/19/2008


100,000



1,825


$
1.00


$
1.25



66.34
%


0
%


3.07
%

$
0.78


$
78,0009/15/2008


33,333



1,825


$
1.00


$
1.05



66.34
%


0
%


2.59
%

$
3.61


$
20,333For year ended September 30, 2008

























$
176,99910/15/2008


33,333



1,825


$
1.00


$
1.20



66.34
%


0
%


2.90
%

$
0.74


$
24,66611/15/2008


33,333



1,825


$
1.00


$
0.85



66.34
%


0
%


2.33
%

$
0.45


$
15,00012/15/2008


33,333



1,825


$
1.00


$
1.52



66.34
%


0
%


1.50
%

$
0.99


$
33,00012/31/2008


16,667



1,825


$
1.00


$
1.01



66.34
%


0
%


1.55
%

$
0.57


$
9,5001/9/2009


100,000



1,825


$
1.00


$
0.80



66.34
%


0
%


1.51
%

$
0.41


$
41,0002/9/2009


33,333



1,825


$
1.00


$
0.80



66.34
%


0
%


1.99
%

$
0.41


$
13,6673/9/2009


33,333



1,825


$
1.00


$
0.54



66.34
%


0
%


1.90
%

$
0.23


$
7,6674/9/2009


33,333



1,825


$
1.00


$
0.75



66.34
%


0
%


1.90
%

$
0.37


$
12,3335/9/2009


33,333



1,825


$
1.00


$
1.19



66.34
%


0
%


2.09
%

$
0.72


$
23,9706/9/2009


33,333



1,825


$
1.00


$
1.35



66.34
%


0
%


2.73
%

$
0.86


$
28,6667/9/2009


33,333



1,825


$
1.00


$
1.61



66.34
%


0
%


2.31
%

$
1.08


$
35,9838/9/2009


33,333



1,825


$
1.00


$
1.20



66.34
%


0
%


2.75
%

$
0.74


$
24,5339/9/2009


33,333



1,825


$
1.00


$
1.00



66.34
%


0
%


2.38
%

$
0.57


$
18,960For year ended September 30, 2009

























$
288,945          92




---



##### Table of Contents



Item 14.
    Principal
    Accountant Fees and Services    Fees
    For the Year


For the YearEnded


EndedSeptember 30,


September 30,2008


2009Audit fees

$
146,700


$
203,085Audit related fees






Tax fees






Other fees






$
146,700


$
203,085     Item 15.
    Exhibits,
    Financial Statement Schedules  3
.1

Amended and Restated Articles of Incorporation of the Company
    (incorporated by reference to Exhibit 3.1 to the
    Companys Annual Report on
    Form 10-K
    dated January 13, 2009).3
.2

Certificate of Designation of the Series B Preferred Stock
    (incorporated by reference to Exhibit 3.1 to the
    Companys Quarterly Report on
    Form 10-Q
    dated August 19, 2008). 93




---



##### Table of Contents



3
.3

Restated Bylaws (Incorporated by reference to Exhibit 3.2
    to
    Form 10-KSB
    dated October 16, 2003).4
.1

Form of warrant to purchase common stock granted in connection
    with August 19, 2008 financing arrangement between the
    Company and one of its directors (incorporated by reference to
    Exhibit 4.1 to the Companys Annual Report on
    Form 10-K
    dated January 13, 2009).4
.2

Registration Rights Agreement dated November 12, 2008 by
    and between the Company and the placement agent for the November
    2008 offering of Common Stock (incorporated by reference to
    Exhibit 4.2 to the Companys Annual Report on
    Form 10-K
    dated January 13, 2009).4
.3

Form of warrant to purchase common stock granted in connection
    with November 2008 offering of Common Stock (incorporated by
    reference to Exhibit 4.3 to the Companys Annual
    Report on
    Form 10-K
    dated January 13, 2009).4
.4

Form of convertible promissory notes and warrants granted in
    connection with the 2007 convertible debt financing
    (incorporated by reference to Exhibit 10.1 to the
    Companys Current Report on
    Form 8-K
    dated December 28, 2007).4
.5

Form of warrant to purchase common stock granted in connection
    with the offering of Series A and
    Series A-1
    Preferred Stock, as amended and recirculated July 30, 2008
    (incorporated by reference to Exhibit 4.5 to the
    Companys Annual Report on
    Form 10-K
    dated January 13, 2009).4
.6

Form of warrant to purchase common stock granted to the
    placement agent retained in connection with the offering of
    Series A and
    Series A-1
    Preferred Stock (incorporated by reference to Exhibit 10.3
    to the Companys Current Report on
    Form 8-K
    dated December 28, 2007).4
.7

Form of warrant to purchase common stock granted to affiliates
    of placement agent retained in connection with the offering of
    Series A and
    Series A-1
    Preferred Stock (incorporated by reference to Exhibit 10.4
    to the Companys Current Report on
    Form 8-K
    dated December 28, 2007).4
.8

Form of warrant to purchase common stock granted in connection
    with the offering of Series B Preferred Stock (incorporated
    by reference to Exhibit 4.1 to the Companys Quarterly
    Report on
    Form 10-Q
    dated August 19, 2008).4
.9

Form of warrant to purchase common stock granted in connection
    with the July 2008 offering of Common Stock (incorporated by
    reference to Exhibit 4.2 to the Companys Quarterly
    Report on
    Form 10-Q
    dated August 19, 2008).4
.10

Form of warrant to purchase common stock issued to J. Sherman
    Henderson and Robert A. Clarkson on July 10, 2008
    (incorporated by reference to Exhibit 4.3 to the
    Companys Quarterly Report on
    Form 10-Q
    dated August 19, 2008).4
.11

Form of the Convertible Promissory Notes, dated January 22,
    2009, made and issued by the Company to various investors, in
    the aggregate principal amount of $500,000 (incorporated by
    reference to Exhibit 4.1 to the Companys Quarterly
    Report on
    Form 10-Q
    dated February 23, 2009).4
.12

Form of the Warrants, dated January 22, 2009, made and
    issued by the Company to various investors (incorporated by
    reference to Exhibit 4.2 to the Companys Quarterly
    Report on
    Form 10-Q
    dated February 23, 2009).4
.13

Form of warrant to purchase common stock granted to the
    investors in connection with the June 2009 offering of
    Common Stock (incorporated by reference to Exhibit 4.1 to
    the Companys Quarterly Report on
    Form 10-Q
    dated August 12, 2009).4
.14*

Form of warrant to purchase common stock granted to the
    investors in connection with the September 2009 Private
    Placement.10
.1

Placement Agency Agreement dated July 25, 2008 by and
    between the Company and the Placement Agent (incorporated by
    reference to Exhibit 10.1 to the Companys Annual
    Report on
    Form 10-K
    dated January 13, 2009).10
.2

Letter Agreement dated July 25, 2008 by and between the
    Company and the Placement Agent (incorporated by reference to
    Exhibit 10.2 to the Companys Annual Report on
    Form 10-K
    dated January 13, 2009).10
.3

Letter agreement dated August 19, 2008 by and between the
    Company and one of its directors (incorporated by reference to
    Exhibit 10.3 to the Companys Annual Report on
    Form 10-K
    dated January 13, 2009). 94




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10
.4

Loan Agreement dated September 4, 2008 by and between the
    Company and First Savings Bank (incorporated by reference to
    Exhibit 10.4 to the Companys Annual Report on
    Form 10-K
    dated January 13, 2009).10
.5

Letter Agreement dated January 9, 2009, by and between the
    Company and John Rhodes, relating to an equity financing
    agreement (incorporated by reference to Exhibit 10.1 to the
    Companys Quarterly Report on
    Form 10-Q
    dated February 23, 2009).10
.6

Form of the Note Purchase Agreement, dated January 22,
    2009, by and between the Company and various investors
    (incorporated by reference to Exhibit 10.2 to the
    Companys Quarterly Report on
    Form 10-Q
    dated February 23, 2009).10
.7

Work Order dated December 19, 2008, by and between the
    Company and Johnson & Johnson Services, Inc.
    (incorporated by reference to Exhibit 10.3 to the
    Companys Quarterly Report on
    Form 10-Q
    dated February 23, 2009).10
.8

Promissory Note, dated January 7, 2009, made and issued by
    the Company to John Rhodes (incorporated by reference to
    Exhibit 10.4 to the Companys Quarterly Report on
    Form 10-Q
    dated February 23, 2009).10
.9

Beacon Solutions 2008 Long Term Incentive Plan (incorporated by
    reference to Exhibit 10.1 to the Companys Quarterly
    Report on
    Form 10-Q
    dated May 13, 2009.)10
.10

Letter Agreement dated August 10, 2009 by and between the
    Company and John Rhodes (incorporated by reference to
    Exhibit 10.5 to the Companys Quarterly Report on
    Form 10-Q
    dated August 12, 2009).10
.11

Promissory Note dated August 10, 2009 made and issued by
    the Company to John Rhodes Family Limited Partnership
    (incorporated by reference to Exhibit 10.6 to the
    Companys Quarterly Report on
    Form 10-Q
    dated August 12, 2009).10
.12

Selling Agency Agreement dated June 12, 2009 by and between
    the Company and the selling agent named therein (incorporated by
    reference to Exhibit 10.1 to the Companys Quarterly
    Report on
    Form 10-Q
    dated August 12, 2009)10
.13

Secured Promissory Note, dated December 20, 2007, issued by
    Beacon to ADSnetcurve (incorporated by reference to
    Exhibit 10.6 to the Companys Current Report on
    Form 8-K
    dated December 28, 2007).10
.14

Asset Purchase Agreement, dated October 15, 2007, by and
    between Beacon and CETCON, Incorporated
    (CETCON)(incorporated by reference to
    Exhibit 10.7 to the Companys Current Report on
    Form 8-K
    dated December 28, 2007).10
.15

Secured Promissory Note, dated December 20, 2007, issued by
    Beacon to CETCON (incorporated by reference to Exhibit 10.8
    to the Companys Current Report on
    Form 8-K
    dated December 28, 2007).10
.16

Asset Purchase Agreement, dated October 15, 2007, by and
    between Beacon and Strategic Communications, LLC (incorporated
    by reference Exhibit 10.9 to the Companys Current
    Report on
    Form 8-K
    dated December 28, 2007).10
.17

Promissory Note, dated December 20, 2007, issued by Beacon
    to Strategic (incorporated by reference to Exhibit 10.10 to
    the Companys Current Report on
    Form 8-K
    dated December 28, 2007).10
.18

Asset Purchase Agreement, dated October 15, 2007, by and
    between Beacon and RFK Communications, LLC
    (RFK) (incorporated by reference to
    Exhibit 10.11 to the Companys Current Report on
    Form 8-K
    dated December 28, 2007).10
.19

Secured Promissory Note, dated December 20, 2007, issued by
    Beacon to RFK (incorporated by reference to Exhibit 10.12
    to the Companys Current Report on
    Form 8-K
    dated December 28, 2007).10
.20

Agreement and Plan of Merger, dated October 15, 2007, by
    and among Beacon, BH Acquisition Sub, Inc., Bell Haun Systems,
    Inc. (BHS) and BHS shareholders (incorporated by
    reference to Exhibit 10.13 to the Companys Current
    Report on
    Form 8-K
    dated December 28, 2007).10
.21

Promissory Note, dated December 20, 2007, issued by Beacon
    to the BHS shareholders (incorporated by reference to
    Exhibit 10.14 to the Companys Current Report on
    Form 8-K
    dated December 28, 2007). 95




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##### Table of Contents



10
.22

Promissory Notes, dated December 20, 2007, issued by Beacon
    to Thomas O. Bell and Michael T. Haun (incorporated by reference
    to Exhibit 10.15 to the Companys Current Report on
    Form 8-K
    dated December 28, 2007).10
.23

Registration Rights Agreement, dated December 20, 2007,
    between Beacon, the placement agent for the Preferred Stock
    offerings and certain investors (incorporated by reference to
    Exhibit 10.16 to the Companys Current Report on
    Form 8-K
    dated December 28, 2007).10
.24**

Employment Agreement , dated December 2007, between the Company
    and Bruce Widener (incorporated by reference to
    Exhibit 99.8 to the Companys Quarterly Report on
    Form 10-Q
    dated February 19, 2008).10
.25**

Employment Agreement, dated December 2007, between the Company
    and Richard C. Mills (incorporated by reference to
    Exhibit 99.6 to the Companys Quarterly Report on
    Form 10-Q
    dated February 19, 2008).10
.26**

Employment Agreement, dated December 2007, between the Company
    and Robert R. Mohr (incorporated by reference to
    Exhibit 99.5 to the Companys Quarterly Report on
    Form 10-Q
    dated February 19, 2008).10
.27**

Employment Agreement dated May 12, 2009 by and between the
    Company and Bruce Widener (incorporated by reference to
    Exhibit 10.2 to the Companys Quarterly Report on
    Form 10-Q
    dated August 12, 2009).10
.28**

Employment Agreement dated May 22, 2009 by and between the
    Company and Richard C. Mills (incorporated by reference to
    Exhibit 10.3 to the Companys Quarterly Report on
    Form 10-Q
    dated August 12, 2009).10
.29**

Employment Agreement dated May 22, 2009 by and between the
    Company and Robert Mohr (incorporated by reference to
    Exhibit 10.4 to the Companys Quarterly Report on
    Form 10-Q
    dated August 12, 2009).10
.30

Documents related to the Integra Bank Credit Facility
    (incorporated by reference to Exhibit 10.1 to the
    Companys Quarterly Report on
    Form 10-QSB
    dated May 15, 2008).10
.31

Registration Rights Agreement dated July 25, 2008 by and
    between the Company and the placement agent retained in the July
    2008 offering of Common Stock (incorporated by reference to
    Exhibit 10.1 to the Companys Quarterly Report on
    Form 10-Q
    dated August 19, 2008).10
.33*

Placement Agency Agreement dated September 28, 2009 by and
    between the Company and the Placement Agent.14
.1

Code of Ethics (incorporated by reference to Exhibit 14.1
    to the Companys Annual Report on
    Form 10-K
    dated January 13, 2009).21
.1

Subsidiaries of the Registrant (incorporated by reference to
    Exhibit 21 to the Companys Annual Report on
    Form 10-K
    dated January 13, 2009).31
.1*

Certification of Principal Executive Officer, pursuant to
    Rules 13a-14(a)
    of the Sarbanes-Oxley Act of 2002.31
.2*

Certification of Principal Executive Officer, pursuant to
    Rules 13a-14(a)
    of the Sarbanes-Oxley Act of 2002.32
.1*

Certification of Principal Executive Officer, pursuant to 18
    U.S.C Section 1350, as adopted pursuant to Section 906
    of the Sarbanes-Oxley Act of 2002.*32
.2*

Certification of Principal Executive Officer, pursuant to 18
    U.S.C Section 1350, as adopted pursuant to Section 906
    of the Sarbanes-Oxley Act of 2002.*     *
    
    Denotes filed herein.**
    
    Denotes compensatory plan or management contract. 96




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##### Table of Contents



SIGNATURES



Pursuant to the requirements of Section 13 or 15(d) of the
    Securities Exchange Act of 1934, the registrant has duly caused
    this report to be signed on its behalf by the undersigned,
    thereunto duly authorized on December 29, 2009.



BEACON ENTERPRISE SOLUTIONS GROUP, INC. By:
    /s/  Bruce
    Widener          Signature

Title

Date/s/  Bruce
    WidenerBruce
    Widener

Chief Executive Officer and
    Chairman of the Board
    (Principal Executive Officer)

December 29, 2009/s/  J.
    Sherman Henderson IIIJ.
    Sherman Henderson III

Director

December 29, 2009/s/  Dr. John
    D. Rhodes IIIDr. John
    D. Rhodes III

Director

December 29, 2009/s/  Robert
    MohrRobert
    Mohr

Chief Accounting Officer
    (Principal Financial Officer)

December 29, 2009  97