UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-K

(Mark One)

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

OF 1934

For the fiscal year ended December 31, 2012



[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE

ACT OF 1934



For the transition period from_________ to____________



Commission file number: 000-5225



SOLAR ACQUISITION CORP.

(Name of small business issuer in its charter)



Florida

20-5080271

(State or other jurisdiction of incorporation

(I.R.S. Employer Identification

or organization)

No.)



215 Dino Drive Ann Arbor MI 48103

(Address of principal executive offices) (Zip Code)



Issuer's telephone number: (734) 320-7628



Securities registered under Section 12(b) of the Exchange Act: NONE



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



COMMON STOCK, $0.001 PAR VALUE

(Title of class)



Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]



Check if no disclosure of delinquent filers in response to Item 405 of Regulation S-B is contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]



State issuer's revenues for its most recent fiscal year: $ 0









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State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked price of such common equity, as of a specified date within the past 60 days: $1,125,175as of March 30, 2013.



State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:22,503,501 as of March 30, 2013.



Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]



PART I



ITEM 1. DESCRIPTION OF BUSINESS.



CAUTIONARY STATEMENT FOR PURPOSES OF "SAFE HARBOR PROVISIONS" OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.



Certain statements contained in this Annual Report on Securities and Exchange Commission ("SEC") Form 10-KSB ("Form 10-K") constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different than any expressed or implied by these forward-looking statements. These statements may be contained in our filings with the Securities and Exchange Commission, press releases, and written or oral presentations made by our representatives to analysts, rating agencies, stockholders, news organizations and others. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "intend", "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," "continue," or the negative of these terms or other comparable terminology. Although we believe that the expectations in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.



OUR BUSINESS



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|(a) | Business Development







Solar Acquisition Corp. (we, us, our, the Company or the Registrant) was incorporated in the State of Nevada on June 3, 2006. Since inception through June 2008, the Company has been engaged in organizational efforts and obtaining initial financing. The Company was formed as a vehicle to pursue a business combination and has made no efforts to identify a possible business combination.  In June 2008, we entered into a letter of intent with Solay Teyin/ Hyundai Heavy Industries Iberica (Solar Teyin) to market Solar products. We have not concluded a formal contract as of this time.  We expanded our focus is focused on commercializing Solar energy technology. The scope of our expected business has expanded  in 2013 beyond Solar to include wind, fuel cells, and geothermal in addition to research and development into innovative Solar energy solutions.



|    |                   
|--- | ------------------
|(b) | Business of Issuer





We plan to become a developer of renewable energy technologies for the commercial industrial and utility markets.Our target customers will be both distributors and end-users of energy who are interested in reducing their energy costs, environmental impact, and the variability of their monthly energy cost due to the volatility associated with these energy supplies. We believe we can become a leading energy solutions supplier to industrial, commercial and public sector clients.



We have not generated significant revenue since inception. Our primary focus is on building our business model in the areas of renewable energy.









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We believe that the long term prospects for renewable energies are very good in light of reductions in the costs compared to traditional fossil fuels, favorable business climate toward green energy, volatile prices for non-renewable energy sources such as oil and natural gas, current and anticipated federal and state legislation regulating carbon emissions and the use of fossil fuels, and government incentives for renewable energy.



Item 1A.  RISK FACTORS



RISKS THAT MAY AFFECT FUTURE RESULTS



The following risk factors and other information included in this Annual Report should be carefully considered. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business operations. If any of the following risks actually occur, our business, financial condition and operating results could be materially adversely affected.



We do not have sufficient capital to fund our operations.



We are a development stage company organized in June 2006 and have recently commenced operations, which makes an evaluation of us extremely difficult. At this stage of our business operations, even with our good faith efforts, we may never become profitable or generate any significant amount of revenues, thus potential investors have a high probability of losing their investment. Our auditors have substantial doubt about our ability to continue as a going concern. Additionally, our auditors report reflects the fact that the ability of the Company to continue as a going concern is dependent upon its ability to raise additional capital from the sale of common stock and, ultimately the achievement of significant operating revenues. If we are unable to continue as a going concern, you will lose your investment.



We were incorporated in June 2006 as a Florida corporation. As a result of our start-up operations we have; (i) generated no revenues, (ii) accumulated deficits of $ 563,863,241  for the year ended December 31, 2011 and $ (565,149,207)

year ended December 31, 2012 due to issuance in stock for services rendered and have been focused on organizational and start-up activities, business plan development, and website design since we incorporated.



We do not have not commercially available products.



We have not commenced the selling of any renewable energy products. There is nothing at this time on which to base an assumption that our business operations will prove to be successful or that we will ever be able to operate profitably. Our future operating results will depend on many factors, including our ability to raise adequate working capital, demand for our service, the level of our competition and our ability to attract and maintain key management and employees. Additionally, our auditors report reflects that the ability of Renewable Acquisition to continue as a going concern is dependent upon its ability to raise additional capital from the sale of common stock and, ultimately, the achievement of significant operating revenues. If we are unable to continue as a going concern, our business will fail.



Our management and board of directors has limited industry experience.



Our management has limited experience in framing a renewable energy company. The lack of experience in building a business in renewable energy could reduce or eliminate  your return on investment.



We have no full time employees. We intend to hire personnel in the future, when sufficiently capitalized, who may have the experience required to manage our company, such management is not anticipated until the occurrence of future financing. Since we are  not sufficiently capitalized, future offerings will be necessary to satisfy capital needs. Until such future offering occurs, and until such management is in place, we are reliant upon our management to make the appropriate management decisions.



Our management is involved with other businesses including other public companies and there can be no assurance that we will have will continue to provide services to us. This involvement could have the effect on our operations of preventing us from being a successful business operation, which ultimately could cause a loss of your investment.



We have limited industry contacts.









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We do not have a contract with any suppliers for renewable energy products that can be sold commercially at the present time.  There is no guarantee we will develop sufficient supplier relationships to create a business. If we are unable to do so, our business will fail.



Because of market pressures from competitors with more resources, we  may fail to implement our business model profitably.



The business of renewable energy in general is highly fragmented and extremely competitive. The market for customers is intensely competitive and such competition is expected to continue to increase. There are no substantial barriers to entry in this market and we believe that our ability to compete depends upon many factors within and beyond our control, including the timing and market acceptance of new solutions and enhancements to existing solutions developed by us, our competitors, and their advisors.



We are dependent on market acceptance of renewable energy.



Our ability to generate revenue and be successful in implementation of our business plan is dependent on the market for renewable energy growing.



A drop in the retail price of conventional energy or non-renewable renewable energy sources may negatively impact our business.



The demand for renewable energy systems depends in part on the price of conventional energy, which affects return on investment resulting from the purchase of renewable energy. . Fluctuations in economic and market conditions that impact the prices of conventional and non-renewable renewable energy sources, such as decreases in the prices of oil and other fossil fuels, could cause the demand for renewable energy systems to decline, which would have a negative impact on our business. Changes in utility electric rates could also have a negative effect on our business.



The reduction, elimination or expiration of government subsidies and economic incentives for  renewable energy could reduce the demand for our products.



Government subsidies are an important factor in the economic determination to purchase a renewable energy system. Certain states, including California and Colorado, localities and utilities offer incentives to offset a portion of the cost of qualified renewable energy systems. These incentives can take many forms, including direct rebates, state tax credits, system performance payments and renewable energy credits, or RECs. The reduction or elimination of such incentives or delays or interruptions in the implementation of favorable federal or state laws could substantially increase the cost of our systems to our customers, resulting in a significant reduction in demand for our products and services.



Existing regulations, and changes to such regulations, may present technical, regulatory and economic barriers to the installation of renewable energy systems, which may significantly reduce demand for our renewable energy systems.



The installation of renewable energy systems is subject to oversight and regulation under local ordinances; building, zoning and fire codes; environmental protection regulation; utility interconnection requirements for metering; and other rules and regulations. We attempt to keep up-to-date about these requirements on a national, state and local level and must design and install our renewable energy systems to comply with varying standards. Certain cities may have ordinances that prevent or increase the cost of installation of our renewable energy systems. In addition, new government regulations or utility policies pertaining to the installation of renewable energy systems are unpredictable and may result in significant additional expenses or delays, which could cause a significant reduction in demand for renewable energy systems.



Existing regulations and policies pertaining to electricity pricing and technical interconnection of customer-owned electricity generation and changes to these regulations and policies may deter the purchase and use of renewable energy systems and negatively impact development of the renewable energy industry.

The market for renewable energy systems is heavily influenced by foreign, federal, state and local government regulations and policies concerning the electric utility industry, as well as policies adopted by electric utilities. These regulations and policies often relate to electricity pricing and technical interconnection of customer-owned electricity generation. For example, currently, metering caps exist in certain jurisdictions, which limit the aggregate amount of power that may be sold by renewable power generators into the electric grid. These regulations and policies have been modified in the past and may be modified in the future in ways that could deter purchases of renewable energy systems and investment in the research and







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development of renewable energy technology. For example, without a mandated regulatory exception for renewable energy systems, utility customers are often charged interconnection or standby fees for putting distributed power generation on the electric utility grid. Such fees could increase the cost to our customers of using renewable energy systems and make them less desirable, thereby harming our business, operating results and financial condition. Changes in net metering policies could also deter the purchase and use of renewable energy systems. In addition, electricity generated by renewable energy systems competes primarily with expensive peak hour electricity rates rather than with the less expensive average price of electricity. Modifications to the peak hour pricing policies of utilities, such as to a flat rate, would require renewable energy systems to achieve lower prices in order to compete with the price of electricity.



Our auditors have included a paragraph in their report regarding substantial doubt about our ability to continue as a going concern.





(c) Reports to security holders.



(1) The Company is not required to deliver an annual report to security holders and at this time does not anticipate the distribution of such a report.



(2) The Company will file reports with the SEC. The Company will be a reporting company and will comply with the requirements of the Exchange Act once this Registration Statement becomes effective which will be automatically be 60 days after filing..



(3) The public may read and copy any materials the Company files with the SEC at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Additionally, the SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, which can be found at http://www.sec.gov.



EMPLOYEES



As of December 31, 2012, we had a total of One Part -time employee. This part-time employee is not covered by a collective bargaining agreement.





ITEM 2. DESCRIPTION OF PROPERTY.



We currently maintain our executive offices, consisting of approximately 300 square feet of space, 215 Dino Drive Ann Arbor, MI 48103



ITEM 3. LEGAL PROCEEDINGS.



The company is not  party to any legal proceedings .





ITEM 4. Mine Safety Disclosures



Not Applicable.



PART II



ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY

,

 AND RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.





(a) 1,500,000 shares  of the Companys common stock have previously been registered with the Securities and Exchange Commission (the Commission@ or any state securities agency or authority.  The Company shares  are quoted on the OTC







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Bulletin Board.



If and when the Companys common stock is traded in the over-the-counter market, the shares will be subject to the provisions of Section 15(g) and Rule 15g-9 of the Securities Exchange Act of 1934, as amended (the Exchange Act@), commonly referred to as the A penny stock@ rule.  Section 15(g) sets forth certain requirements for transactions in penny stocks and Rule 15g9(d)(1) incorporates the definition of penny stock as that used in Rule 3a51-1 of the Exchange Act.



The Commission generally defines penny stock to be any equity security that has a market price less than $5.00 per share, subject to certain exceptions.  Rule 3a51-1 provides that any equity security is considered to be a penny stock unless that security is: registered and traded on a national securities exchange meeting specified criteria set by the Commission; authorized for quotation on The NASDAQ Stock Market; issued by a registered investment company; excluded from the definition on the basis of price (at least $5.00 per share) or the issuers net tangible assets; or exempted from the definition by the Commission.  If the Companys shares are deemed to be a penny stock, trading in the shares will be subject to additional sales practice requirements on broker-dealers who sell penny stocks to persons other than established customers and accredited investors, generally persons with assets in excess of $1,000,000 or annual income exceeding $200,000, or $300,000 together with their spouse.



For transactions covered by these rules, broker-dealers must make a special suitability determination for the purchase of such securities and must have received the purchaser=s written consent to the transaction prior to the purchase.  Additionally, for any transaction involving a penny stock, unless exempt, the rules require the delivery, prior to the first transaction, of a risk disclosure document relating to the penny stock market.  A broker-dealer also must disclose the commissions payable to both the broker-dealer and the registered representative, and current quotations for the securities.  Finally, the monthly statements must be sent disclosing recent price information for the penny stocks held in the account and information on the limited market in penny stocks.  Consequently, these rules may restrict the ability of broker dealers to trade and/or maintain a market in the Companys common stock and may affect the ability of shareholders to sell their shares.



(b) Holders. As of December 31, 2012, there were 18 record holder of shares of the Company's Common Stock.



(c) Dividends. The Registrant has not paid any cash dividends to date and does not anticipate or contemplate paying dividends in the foreseeable future. It is the present intention of management to utilize all available funds for the development of the Registrant's business.



SALES OF UNREGISTERED SECURITIES



None

ITEM 6.  SELECTED FINANCIAL DATA



As a registrant qualifying as a smaller reporting company, we are not required to provide the information required by this item.





ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS



FORWARD LOOKING STATEMENTS



This report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Shareholders are cautioned that all forward-looking statements involve risks and uncertainty, including without limitation, our ability to fully establish our proposed websites and our ability to conduct business with Palm, Inc. and be successful in selling products. Although we believe the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore, there can be no assurance that the forward-looking statements contained in the report will prove to be accurate.



GENERAL



The following discussion and analysis should be read in conjunction with our consolidated financial statements and related







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footnotes for the year ended December 31, 2012 elsewhere in this Annual Report on Form 10-K. The discussion of results, causes and trends should not be construed to imply any conclusion that such results or trends will necessarily continue in the future.



We plan to become a developer of renewable energy technologies for the commercial industrial and utility markets.  Our target customers will be both distributors and end-users of energy who are interested in reducing their energy costs, environmental impact, and the variability of their monthly energy cost due to the volatility associated with these energy supplies. We believe we can become a leading energy solutions supplier to industrial, commercial and public sector clients.







Critical Accounting Policies



Critical Accounting Policies for a 10K



We prepare our financial statements in conformity with GAAP, which requires management to make certain estimates and assumptions and apply judgments. We base our estimates and judgments on historical experience, current trends and other factors that management believes to be important at the time the financial statements are prepared and actual results could differ from our estimates and such differences could be material. We have identified below the critical accounting policies which are assumptions made by management about matters that are highly uncertain and that are of critical importance in the presentation of our financial position, results of operations and cash flows.  On a regular basis, we review our accounting policies and how they are applied and disclosed in our financial statements.



Use of Estimates



Management's Discussion and Analysis of Financial Condition and Results of Operations discusses the Company's



financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management bases its estimates and judgments on historical experiences and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The most significant accounting estimates inherent in the preparation of the Company's financial statements relate to the allowance for doubtful accounts. These accounting policies are described at relevant sections in this discussion and analysis and in the notes to the consolidated financial statements included in this Annual Report on Form l0-K for the year ended December 31, 2012.







LIQUIDITY AND CAPITAL RESOURCES





We have incurred net losses since our inception of



$565,149,207. In order for us to continue in existence, we will have to raise additional capital through the sale of equity or debt or generate sufficient profits from operations, or a combination of







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both.



We registerd for sale 1,500,000 shares of our common stock on a best efforts basis to provide us with up to $450,000 of additional capital.



We have no known demands or commitments and are not aware of any events or uncertainties as of December 31, 2012 that will result in or that are reasonably likely to materially increase or decrease our current liquidity.



Capital Resources.



We had no material commitments for capital expenditures as of December 31, 2012 and 2011.



Off Balance Sheet Arrangements.



We currently have no off-balance sheet arrangements



Results of Operations



Net loss for year ended December 31, 2012 was $(1,285,966) as compared to $(561,075,149) for the year ended December 31, 2011.



Total Operating Expenses



Total operating expenses for the year ended December 31, 2012 were $678,366 as compared to $561,075,149 for the year ended December 31, 2011 which included a writedown of $550,409,027.



Total Assets.  Total assets at December 31, 2012 and 2011



Total Assets as at December 31, 2012 were $5,396,930 as compared to $6,064,546 for the year ended December 31, 2011.



Total Liabilities.



Total liabilities for the year ended December 31, 2012 were $5,269,597 as compared to $4,651,247 for the year ended December 31, 2011.



ITEM 8. FINANCIAL STATEMENTS AND  SUPPLEMENTARY DATA.



See pages beginning with page F-1.  attached hereto at the end of this filing.



ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE..



On January 10, 2013, Peter Messineo, CPA declined to sit for re-election as the Companys independent registered audit firm due to changes in his firm. On December 17, 2012, Peter Messineo joined the firm now known as DKM Certified Public Accountants.

The reports of Peter Messineo, CPA as of and for the fiscal years ended December 31, 2011 and December 31, 2010 contained  no adverse  opinion or  disclaimer  of opinion and were not qualified  or modified as to  uncertainty,  audit scope or







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accounting principle  except to indicate that there was  substantial  doubt about the Companys ability to continue as a going concern.



During the fiscal years ended  December  31, 2011 and  2010, and through each subsequent  period,  there have been no disagreements with  Peter Messineo, CPA on any matter of  accounting  principles  or  practices,   financial  statement  disclosure  or  auditing  scope  or procedure,  which disagreements if not resolved to the satisfaction of Peter Messineo, CPA would have caused them to make  reference  thereto in connection  with their report on the financial  statements for such years.

On January 10, 2013 the Company engaged DKM Certified Public Accountants as their independent registered accounting firm.





Item 9A.     CONTROLS AND PROCEDURES.



Disclosure Controls and Procedures



Evaluation of Disclosure Controls and Procedures



We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, who is the same person, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered in this report, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.



Limitations on Systems of Controls



Our management, including our principal executive officer and principal financial officer, who is the same person, does not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. To address the material weaknesses identified in our evaluation, we performed additional analysis and other post-closing procedures in an effort to ensure our consolidated financial statements included in this annual report have been prepared in accordance with generally accepted accounting principles. Accordingly, management believes that the financial statements included in this report fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented.



Managements Report on Internal Control Over Financial Reporting



Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, the companys principal executive and principal financial officers and effected by the companys board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that:

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| |  | Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;                                                                                                                                                                                                             
| |   |                                                                                                                                                                                                                                                                                                                                                                           
| |  | Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and
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| |  | Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the companys assets that could have a material effect on the financial statements.



Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.



As of December  31, 2012 management assessed the effectiveness of our internal control over financial reporting based on the criteria for effective internal control over financial reporting established in Internal Control--Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and SEC guidance on conducting such assessments. Based on that evaluation, they concluded that, during the period covered by this report, such internal controls and procedures were not effective to detect the inappropriate application of US GAAP rules as more fully described below. This was due to deficiencies that existed in the design or operation of our internal controls over financial reporting that adversely affected our internal controls and that may be considered to be material weaknesses.



The matters involving internal controls and procedures that our management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives;  (3) ineffective controls over period end financial disclosure and reporting processes; and, (4) management is dominated by asingle individual without adequate compensating controls. The aforementioned material weaknesses were identified by our Chief Executive Officer in connection with the review of our financial statements as of December  31, 2012



Management believes that the material weaknesses set forth above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.



PART III



ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE



DIRECTORS AND EXECUTIVE OFFICERS



Our executive officers and directors are:



Name

Age

Position



Peter Klamka

44

Chairman of the Board, CEO, President

Treasurer and Secretary.



The business experience, principal occupations and employment, as well as the periods of service, of our sole director and executive officer.



The business experience, principal occupations and employment, as well as the periods of service, of our sole director and executive officer during the last five years are set forth below.



Peter Klamka has been our Chairman of the Board and Chief Executive Officer since our inception. Mr. Klamka has been active in developing, funding, and operating various start up companies over the past twenty years.  He is the former Chairman







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and CEO of GiraSolar Inc., a Solar energy company based in Europe that trades on the Pink Sheets. Mr. Klamka is also the CEO of Cephas Holdings Inc., a reporting company, that develops and markets mobile phone applications.  He is also a principal officer in several other ventures including WTTJ Corp.



EMPLOYMENT AND CONSULTING AGREEMENTS



We have no employment or other written agreement with Peter Klamka, our President and Chief Executive Officer. Mr. Klamka. The Company believes that Mr. Klamka will continue to waive any salary for the foreseeable future, although no assurance thereof can be given.



Mr. Klamka is involved in other business ventures, including the ownership and management other private and public businesses.



We have no employment or other written agreement with Mr. Klamka.



Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENTAND RELATED STOCKHOLDER MATTERS



The following table sets forth information as of the date of this report, relating to the beneficial ownership of our common stock by those persons known to us to beneficially own more than 5% of our capital stock, by our director and executive officer, and by all of our directors and executive officers as a group.



|                                                                                                                                                                                                     |                                                                                                           |                                                        | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------- | ------------------------------------------------------ | 
|Name of Beneficial Owner(1)                                                                                                                                                                          | Number Of Shares                                                                                          | Percent Ownership                                      | 
|Barton PK, LLC (2)
Richard Mays
Condor Financial Management, S.A. (3)
Ecorum Limited (4)
liveIR (5)
Susan Radke
Algol (6)
Ajoy Garapati
Joe Eberhard
HW Funds Group, LLC (7)
Dynamic Development (8) | 1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
500,000
500,000 | 8.6%
8.6%
8.6%
8.6%
8.6%
8.6%
8.6%
8.6%
8.6%
4.3%
4.3% | 
|All Directors, Officers and Principal Stockholders as a Group                                                                                                                                        | 1,0000000                                                                                                 | 86.6%                                                  | 









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|1.) | The address of each shareholder is care of Solar Acquisition Corp at 215 Dino Drive, Ann Arbor, MI 48103 unless otherwise stated.
|2.) | Peter Klamka, sole director and officer of Solar Acquisition Corp., is a beneficial owner in Barton PK, LLC.                     
|3.) | Joe Eberhard is the Director and the address is P.O. Box 9112 CH-8036 Zurich Switzerland                                         
|4.) | Joe Eberhard is the Director and the address is P.O. Box 9112 CH-8036 Zurich Switzerland                                         
|5.) | Brandon Wynn is the President and the address is 1919 Van Buren St. #611A, Hollywood, FL 33020                                   
|6.) | Carol Wynn Eldred is the President and the address is 2212 South Cypress Bend Drive #201, Pompano Beach, FL 33069                
|7.) | Joe Logan is the Managing Director and the address is 708 Third Avenue, 11th Floor, New York, NY 10017                           
|8.) | Avi Shapiro is the President and the address is YUNITSMAN 2/523, TEL AVIV YAFO 69360, ISRAEL                                     











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



CODE OF ETHICS



We have not yet adopted a code of ethics that applies to our principal executive officers, principal financial officer, principal accounting officer or controller, or persons performing similar functions, since we have been focusing our efforts on obtaining financing for the company. We expect to adopt a code by the end of the current fiscal year.



SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE



Section 16(a) of the Securities Exchange Act of 1934 requires our officers, directors, and persons who beneficially own more than 10% of our common stock to file reports of securities ownership and changes in such ownership with the Securities and Exchange Commission ("SEC"). Officers, directors and greater than 10% beneficial owners are also required by rules promulgated by the SEC to furnish us with copies of all Section 16(a) forms they file.



Based solely upon a review of the copies of such forms furnished to us, or written representations that no Form 5 filings were required, we believe that during the fiscal period ended December 31, 2006, there was compliance with all Section 16(a) filing requirements applicable to our officers, directors and greater than 10% beneficial owners.



(1) Incorporated by reference from the Companys Form 10SB filed September 2006.



ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.



AUDIT FEES

We have been billed $7,500 for our audit of the annual filing on Form 10-K, for the year ended December 31, 2012  by our current audit firm, DKM  CPAs, PA.



AUDIT-RELATED FEES



There were no fees billed for services reasonably related to the performance of the audit or review of our financial statements outside of those fees disclosed above under "Audit Fees".



TAX FEES



There were no fees billed during this fiscal period for tax compliance, tax advice, and tax planning services.



ALL OTHER FEES



There were no fees billed for services by our principal accountant, other than those disclosed above.



PRE-APPROVAL POLICIES AND PROCEDURES



Prior to engaging our accountants to perform a particular service, our board of directors obtains an estimate for the service to be performed.



ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES



31.1

Certification pursuant to Section 302 of the Sarbanes-Oxley Act



32.1

Certification pursuant to Section 906 of the Sarbanes-Oxley Act









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SIGNATURES



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



Solar ACQUISITION CORP.





Dated:

April 17, 2013

s/s Peter Klamka

Peter Klamka, President



In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.



SIGNATURE

TITLE

DATE

----------------

---------

---------



Chairman, President,

Secretary and

Chief Executive Officer

/s/ Peter Klamka

(Principal Executive

----------------------------

and Accounting Officer)

April 17, 2013

Peter Klamka







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SOLAR ACQUISITION CORP







FINANCIAL STATEMENTS









DECEMBER 31, 2012







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|                                 |                                                                                                       
|-------------------------------- | ------------------------------------------------------------------------------------------------------
|DKM CERTIFIED PUBLIC ACCOUNTANTS | 2451 N McMullen Booth Rd Ste. 308
Clearwater, FL  33759-1352
Main: (727) 444-1901
Cell: (727) 452-4803



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



To the Board of Directors of:

Solar Acquisition Corp.

Ann Arbor, MI



We have audited the accompanying balance sheet of Solar Acquisition Corp. as of December 31, 2012 and the related statements of operations, stockholders' equity and cash flows for the year then ended and for the period June 3, 2006 (date of inception) through December 31, 2012. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.



We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.



In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Solar Acquisition Corp. as of December 31, 2012 and the results of its operations and its cash flows for the year then ended and for the period June 3, 2006 (date of inception) through December 31, 2012, in conformity with accounting principles generally accepted in the United States of America.



The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has recurring losses and negative cash flows from operating activities, a working capital deficit, and a stockholders' deficit. These conditions raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.





S/S



DKM Certified Public Accountants

Clearwater, Florida

April 1, 2013









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|                                                        |                                                                |                         |                        
|------------------------------------------------------- | -------------------------------------------------------------- | ----------------------- | -----------------------
|Solar Acquisition Corp.                                
|(A Development Stage Company)                          
|Balance Sheets                                         
|                                                       
|                                                        |                                                                | December 31,            | December 31,           
|                                                        |                                                                | 2012                    | 2011                   
|                                                        |                                                                | (audited)               | (audited)              
|ASSETS                                                  |                                                                |                        
|Current Assets                                          |                                                                |                        
|                                                        | Cash and cash equivalents                                      | $                     1 | $                     1
|                                                        | Other current assets                                           | -                       | -                      
|Total Current Assets                                    | 1                                                              | 1                      
|Property and equipment, net of accumulated              |                                                                |                        
|                                                        | depreciation of $1,832 and $916 respectively                   | 2,746                   | 3,662                  
|                                                        |                                                                |                         |                        
|Intangible assets, net of accumulated                   |                                                                |                        
|                                                        | amortization of $1,272,817 and $606,117 respectively           | 5,394,183               | 6,060,883              
|                                                        |                                                                |                         |                        
|                                                        | TOTAL ASSETS                                                   | $       5,396,930       | $       6,064,546      
|                                                        |                                                                |                         |                        
|LIABILITIES AND STOCKHOLDERS' EQUITY                    |                                                                |                        
|Current Liabilities                                     |                                                                |                        
|                                                        | Accounts payable                                               | $              1,504    | $              5,754   
|                                                        | Accrued interest                                               | 935,753                 | 440,753                
|                                                        | Due to shareholder                                             | 19,640                  | 4,640                  
|                                                        | Derivative liability                                           | 1,012,700               | 900,100                
|Total Current Liabilities                               | 1,969,597                                                      | 1,351,247              
|                                                        |                                                                |                         |                        
|                                                        | Promissory note payable                                        | 3,300,000               | 3,300,000              
|                                                        | TOTAL LIABILITIES                                              | 5,269,597               | 4,651,247              
|Stockholders' Equity                                    |                                                                |                        
|Preferred stock: 1,000,000 authorized; $0.001 par value |                                                                |                        
|                                                        | 1,000,000 shares issued and outstanding                        | 1,000                   | 1,000                  
|Common stock: 100,000,000 authorized; $0.001 par value  |                                                                |                        
|                                                        | 22,503,501 and 2011 - 22,503,501 shares issued and outstanding | 22,504                  | 22,504                 
|Additional paid in capital                              | 565,253,036                                                    | 565,253,036            
|Accumulated deficit during development stage            | (565,149,207)                                                  | (563,863,241)          
|Total Stockholders' Equity                              | 127,333                                                        | 1,413,299              
|                                                        | TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                     | $       5,396,930       | $       6,064,546      





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







---







|                                               |                 |              |            |             |               |                 |                 
|---------------------------------------------- | --------------- | ------------ | ---------- | ----------- | ------------- | --------------- | ----------------
|Solar Acquisition Corp.                       
|(A Development Stage Company)                 
|Statement of Stockholders' Equity             
|                                               |                 |              |            |             |               |                 |                 
|                                               |                 |              |            |             |               | Accumulated     |                 
|                                               |                 |              |            |             | Additional    | Deficit         |                 
|                                               | Preferred Stock | Common Stock | Paid in    | Development |              
|                                               | Shares          | Amount       | Shares     | Amount      | Capital       | Stage           | Total           
|Balance as of December 31, 2009                | -               | -            | 11,533,333 | $ 11,533    | $   1,431,067 | $   (1,356,305) | $         86,295
|(Audited)                                      |                 |              |            |             |               |                 |                 
|Net loss                                       |                 |              |            |             |               | (90,934)        | (90,934)        
|                                               |                 |              |            |             |               |                 |                 
|Balance as of December 31, 2010                | -               | -            | 11,533,333 | 11,533      | 1,431,067     | (1,447,239)     | (4,639)         
|(Audited)                                      |                 |              |            |             |               |                 |                 
|Issuance of stock:                             |                 |              |            |             |               |                 |                 
|- for services                                 |                 |              | 2,010,667  | 2,011       | 10,051,324    |                 | 10,053,335      
|- for acquisition of Clean Power, January 2011 |                 |              | 5,459,501  | 5,460       | 26,200,145    |                 | 26,205,605      
|- for acquisition of Nano, February 2011       | 1,000,000       | 1,000        |            | -           | 509,999,000   |                 | 510,000,000     
|- for acquisition of GNE, March 2011           |                 |              | 2,000,000  | 2,000       | 9,998,000     |                 | 10,000,000      
|- for acquisition of Solar Teyin, March 2011   |                 |              | 1,500,000  | 1,500       | 7,573,500     |                 | 7,575,000       
|                                               |                 |              |            |             |               |                 |                 
|Net loss                                       |                 |              |            |             |               | (562,416,002)   | (562,416,002)   
|                                               |                 |              |            |             |               |                 |                 
|Balance, December 31, 2011                     | 1,000,000       | 1,000        | 22,503,501 | 22,504      | 565,253,036   | (563,863,241)   | 1,413,299       
|(Audited)                                      |                 |              |            |             |               |                 |                 
|Net loss - December 31, 2012                   |                 |              |            |             |               | (1,285,966)     | (1,285,966)     
|                                               |                 |              |            |             |               |                 |                 
|Balance - December 31, 2012                    | 1,000,000       | $    1,000   | 22,503,501 | $ 22,504    | $ 565,253,036 | $(565,149,207)  | $       127,333 















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











---







|                                  |  |  |                     |                    |              |                      |                      |                      
|--------------------------------- |  |  | ------------------- | ------------------ | ------------ | -------------------- | -------------------- | ---------------------
|SOLAR ACQUISITION CORP.           |  |  |                     |                    |              |                     
|(A DEVELOPMENT STAGE COMPANY)     |  |  |                     |                    |             
|STATEMENT OF OPERATIONS           |  |  |                     |                    |              |                     
|(UNAUDITED)                       |  |  |                     |                    |              |                      |                     
|                                  |  |  |                     |                    |              |                      |                      |                      
|                                  |  |  |                     |                    |              |                      |                      | June 3, 2006         
|                                  |  |  |                     |                    | YEAR ENDED   | (Inception)         
|                                  |  |  |                     |                    | December 31, | To December 31,     
|                                  |  |  |                     |                    |              | 2012                 | 2011                 | 2012                 
|                                  |  |  |                     |                    |              |                      |                      |                      
|REVENUE                           |  |  |                     |                    |              | $                  - | $                  - | $                   -
|                                  |  |  |                     |                    |              |                      |                      |                      
|OPERATING EXPENSES                |  |  |                     |                    |              |                      |                     
|Stock based compensation          |  |  |                     |                    | -            | 10,053,335           | 10,053,335          
|Consulting fees                   |  |  |                     |                    | -            | -                    | 1,320,749           
|Professional fees                 |  |  |                     |                    | 10,730       | 5,650                | 34,130              
|General and administrative        |  |  |                     |                    | 20           | 104                  | 108,864             
|Depreciation and amortization     |  |  |                     | 667,616            | 607,033      | 1,274,649           
|Impairment of assets              |  |  |                     |                    | -            | 550,409,027          | 550,409,027         
|                                  |  |  |                     |                    |              |                      |                      |                      
|Total Operating Expenses          |  |  |                     |                    | 678,366      | 561,075,149          | 563,200,754         
|                                  |  |  |                     |                    |              |                      |                      |                      
|Net loss from operations          |  |  |                     |                    | (678,366)    | (561,075,149)        | (563,200,754)       
|                                  |  |  |                     |                    |              |                      |                      |                      
|Other items                       |  |  |                     |                    |              |                      |                      |                      
|Interest expense                  |  |  |                     |                    | (495,000)    | (440,753)            | (935,753)           
|Change in derivative              |  |  |                     |                    | (112,600)    | (900,100)            | (1,012,700)         
|                                  |  |  |                     |                    |              |                      |                      |                      
|Net Loss                          |  |  |                     |                    |              | $   (1,285,966)      | $(562,416,002)       | $(565,149,207)       
|                                  |  |  |                     |                    |              |                      |                      |                      
|WEIGHTED AVERAGE NUMBER OF SHARES |  |  | 22,503,501          | 21,552,637         |             
|                                  |  |  |                     |                    |              |                      |                      |                      
|BASIC AND DILUTED LOSS PER SHARE  |  |  | $            (0.06) | $          (26.09) |             
|                                  |  |  |                     |                    |              |                      |                      |                      











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









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|                                                     |                                          |                                  |                                 |                              
|---------------------------------------------------- | ---------------------------------------- | -------------------------------- | ------------------------------- | -----------------------------
|Solar Acquisition Corp.                             
|(A Development Stage Company)                       
|Statements of Cash Flows                            
|                                                     |                                          |                                  |                                 |                              
|                                                     |                                          |                                  |                                 | June 3, 2006                 
|                                                     |                                          |                                  |                                 | (inception)                  
|                                                     |                                          | Year Ended                       | through                        
|                                                     |                                          | December 31,                     | December 31,                   
|                                                     |                                          | 2012                             | 2011                            | 2012                         
|CASH FLOWS FROM OPERATING ACTIVITIES:                |                                          |                                  |                                
|                                                     | Net loss                                 | $                (1,285,966)     | $       (562,416,002)           | $         (565,149,207)      
|                                                     | Adjustment to reconcile net loss to net  |                                  |                                 |                              
|                                                     | cash provided by operations:             |                                  |                                 |                              
|                                                     | Depreciation and amortization            | 667,616                          | 607,033                         | 1,274,649                    
|                                                     | Common stock issued for services         | -                                | 10,053,335                      | 11,043,335                   
|                                                     | Impairment of assets purchased           | -                                | 550,409,027                     | 550,409,027                  
|                                                     | Change in derivative liability           | 112,600                          | 900,100                         | 1,012,700                    
|                                                     | Changes in assets and liabilities:       |                                  |                                 |                              
|                                                     | Accounts payable                         | (4,250)                          | 5,754                           | 1,504                        
|                                                     | Accrued interest                         | 495,000                          | 440,753                         | 935,753                      
|                                                     | Net Cash Used in Operating Activities    | (15,000)                         | -                               | (472,239)                    
|                                                     |                                          |                                  |                                 |                              
|CASH FLOWS FROM INVESTING ACTIVITIES:                |                                          |                                  |                                
|                                                     | Purchased assets for cash                | -                                | -                               | -                            
|                                                     | Net Cash Used in Investing Activities    | -                                | -                               | -                            
|                                                     |                                          |                                  |                                 |                              
|CASH FLOWS FROM FINANCING ACTIVITIES:                |                                          |                                  |                                
|                                                     | Proceeds from issuance of notes payable  | -                                | -                               | -                            
|                                                     | Promissory note payable                  | -                                | -                               | -                            
|                                                     | Related party advances                   | 15,000                           | -                               | 19,640                       
|                                                     | Issuance of common stock                 | -                                | -                               | 452,600                      
|                                                     | Net Cash Provided by Financing Activates | 15,000                           | -                               | 472,240                      
|                                                     |                                          |                                  |                                 |                              
|Net increase (decrease) in cash and cash equivalents | -                                        | -                                | 1                              
|Cash and cash equivalents, beginning of period       | 1                                        | 1                                | -                              
|Cash and cash equivalents, end of period             | $                               1        | $                          1     | $                             1
|                                                     |                                          |                                  |                                 |                              
|Supplemental Cash Flow Information                   |                                          |                                  |                                
|                                                     | Cash paid for interest                   | $                              - | $                         -     | $                           -
|                                                     | Cash paid for taxes                      | $                              - | $                         -     | $                           -

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







---





SOLAR ACQUISITION CORP.

(A Development Stage Enterprise)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2012

(Audited)



NOTE 1 - ORGANIZATION AND BUSINESS:



| |  |                           
| |  | --------------------------
| |  |                           
| |  | Organization and Business:



SOLAR ACQUISITION CORP. (the Company) was incorporated in the State of Florida on June 3, 2006 for the purpose of raising capital that is intended to be used in connection with its business plans which may include a possible merger, acquisition or other business combination with an operating business.



The Company is currently in the development stage. All activities of the Company to date relate to its organization, initial funding and share issuances.



The year end of the Company is December 31.



NOTE 2  GOING CONCERN



The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  For the year ended December 31, 2012, the Company has had no significant operations, has a history of recurring losses resulting in accumulated deficit and has negative working capital.  As of December 31, 2012, the Company has not emerged from the development stage.  In view of these matters, the Companys ability to continue as a going concern is dependent upon the Companys ability to begin operations and to achieve a level of profitability.  The Company intends on financing its future development activities and its working capital needs largely from the sale of public equity securities with some additional funding from other traditional financing sources, including term notes until such time that funds provided by operations are sufficient to fund working capital requirements.  The financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.



NOTE 3.  SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES.



| |  |                      
| |  | ---------------------
| |  |                      
| |  | Basis of Presentation

The Financial Statements and related disclosures have been prepared pursuant to the rules and regulations of the SEC.  The Financial Statements have been prepared using the accrual basis of accounting in accordance with Generally Accepted Accounting Principles (GAAP) of the United States (See Note 2 regarding the assumption that the Company is a going concern).









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| |  |                  
| |  | -----------------
| |  |                  
| |  | Use of Estimates:



The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.



Development Stage Entity



The Company is a development stage company as defined by section FASB ASC 915, Development Stage Entities.  The Company is still devoting substantially all of its efforts on establishing the business and its planned principal operations have not commenced.  All losses accumulated since inception have been considered as part of the Company's development stage activities.





| |  |                           
| |  | --------------------------
| |  |                           
| |  | Cash and Cash Equivalents:



For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.  Cash and cash equivalents were $1 at December 31, 2012 and 2011.



Commitments and Contingencies

The Company follows ASC 450-20, Loss Contingencies, to report accounting for contingencies.  Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.  There were no commitments or contingencies as of December 31, 2012 and 2011.





Deferred Income Taxes and Valuation Allowance

The Company accounts for income taxes under ASC 740 Income Taxes.  Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs.  A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.  No deferred tax assets or liabilities were recognized as of December 31, 2012 and 2011.

| |  | 
| |  | 
| |  | 





Earnings (Loss) per Share



The Company computes basic and diluted earnings per share amounts in accordance with ASC Topic 260, Earnings per Share. Basic earnings per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if stock options and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company

| |  | 
| |  | 
| |  | 



Dilutive instruments include convertible preferred shares which represents an additional 100,000,000 common stock, if converted.



Financial Instruments







---





The Companys balance sheet includes certain financial instruments. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization.



ASC 820, Fair Value Measurements and Disclosures, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entitys own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:



Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3 - Inputs that are both significant to the fair value measurement and unobservable.



Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2012. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments.



| |  |                   
| |  | ------------------
| |  |                   
| |  |                   
| |  | Long-Lived Assets:



Property and equipment is stated at cost.  Depreciation is computed by the straight-line method over estimated useful lives (5 years).  Intellectual property assets are stated at their fair value acquisition cost. Amortization of intellectual property assets is calculated by the straight line method over their estimated useful lives (10 years).  Historical costs are reviewed and evaluated for their net realizable value of the assets.  The carrying amount of all long-lived assets is evaluated periodically to determine if adjustment to the depreciation and amortization period or the unamortized balance is warranted. Based upon its most recent analysis, the Company believes that no impairment of property and equipment existed at December 31, 2012.



Long-lived assets such as property, equipment and identifiable intangibles are reviewed for impairment whenever facts and circumstances indicate that the carrying value may not be recoverable.  When required impairment losses on assets to be held and used are recognized based on the fair value of the asset.  The fair value is determined based on estimates of future cash flows, market value of similar assets, if available, or independent appraisals, if required.  If the carrying amount of the long-lived asset is not recoverable from its undiscounted cash flows, an impairment loss is recognized for the difference between the carrying amount and fair value of the asset.  When fair values are not available, the Company estimates fair value using the expected future cash flows discounted at a rate commensurate with the risk associated with the recovery of the assets.  The Company recognized an impairment loss from acquisition of intangible property as the difference in the fair value of the compensation (shares issued) were believed to be greater than the future discounted cash flows that could be determined with reliable positive evidence, as assumptions for the values issued in the exchange were based on certain future events which may not be fulfilled.



Share-based Expense

ASC 718, Compensation  Stock Compensation, prescribes accounting and reporting standards for all share-based payment transactions in which employee services are acquired.  Transactions include incurring liabilities, or issuing or offering to issue shares, options, and other equity instruments such as employee stock ownership plans and stock appreciation rights.  Share-based payments to employees, including grants of employee stock options, are recognized as compensation expense in the







---





financial statements based on their fair values. That expense is recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).



The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, Equity  Based Payments to Non-Employees.  Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable:  (a) the goods or services received; or (b) the equity instruments issued.  The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.

Share-based expense for the years ended December 31, 2012 and 2011 was $0.



| |  | 
| |  | 
| |  | 









---







| |     |                                  
| | --- | ---------------------------------
| |     |                                  
| | (j) | Recent Accounting Pronouncements:



From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption.



Except for rules and interpretive releases of the SEC under authority of federal securities laws and a limited number of grandfathered standards, theFASB Accounting Standards CodificationTM(“ASC”) is the sole source of authoritative GAAP literature recognized by the FASB and applicable to the Company.  Management has reviewed the aforementioned rules and releases and believes any effect will not have a material impact on the Company's present or future financial statements.





NOTE 4  PROPERTY AND EQUIPMENT



Property and equipment consists of:

|                              |              |       |              |   |      
|----------------------------- | ------------ | ----- | ------------ | - | -----
|                              |              |       |              |   |      
|                              | December 31, |       | December 31,
|                              | 2012         |       | 2011        
|Office equipment              | $            | 4,578 |              | $ | 4,578
|Less accumulated depreciation |              | 1,832 |              |   | 916  
|                              | $            | 2,746 |              | $ | 3,662



Depreciation of equipment was $916 for the years ended December 31, 2012 and 2011.



NOTE 5  INTANGIBLE ASSETS



The Company owns intellectual property, which it is amortizing on a straight-line basis over the assets useful life.  The Company assesses fair market value for any impairment to the carrying values.



| |              |  |              |  | 
| | ------------ |  | ------------ |  | 
| |              |  |              |  | 
| | December 31, |  | December 31,
| | 2012         |  | 2011        



|                                          |   |           |  |   |           | 
|----------------------------------------- | - | --------- |  | - | --------- | 
|                                          |   |           |  |   |          
|Intellectual property                     | $ | 6,667,000 |  | $ | 6,667,000 | 
|Less accumulated amortization             |   | 1,272,817 |  |   | 606,117   | 
|                                          | $ | 5,394,183 |  | $ | 6,060,883 | 
|                                          |   |           |  |   |           | 
|Future amortization through December 31,: |   |           |  |   |           | 
|2012                                      | $ | 0         |  | $ | 666,700   | 
|2013                                      |   | 666,700   |  |   | 666,700   | 
|2014                                      |   | 666,700   |  |   | 666,700   | 
|2015                                      |   | 666,700   |  |   | 666,700   | 
|2016                                      |   | 666,700   |  |   | 666,700   | 
|2017 and thereafter                       |   | 2,727,383 |  |   | 2,727,383 | 
|                                          | $ | 5,560,858 |  | $ | 6,060,883 | 









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Amortization of the intangible assets was $666,700 for the years ended December 31, 2012 and 2011, .





Intangible assets were the results of the following transactions:



Clean Power, Inc.



On January 11, 2011 the Company closed on the purchase of Clean Power, Inc. in an exchange for 5,459,501 shares of common stock, which represented approximately 40% of the outstanding shares.  The Company has valued the transaction at $26,205,605 based on the fair market of shares issued in the exchange.  The purchase price was allocated to all identified tangible assets and then to intangible assets. The Company immediately recorded an impairment of $25,546,027, resulting in an unamortized value of $655,000, or 2.5% of the gross purchase price valuation, as of December 31, 2012, to reflect the estimated return of the intangible assets, based on projected discounted cash flows and other subjective considerations.



Nano CP, LLC



On February 9, 2011 the company closed a series of transactions with Nano CP, LLC, a Florida limited liability company (Nano), WATT Fuel Cell Corp, a New York corporation (WATT), and Evolution Fuel Cell, Inc., a Delaware corporation (Evolution) whereby the Company simultaneously acquired assets for the development of solid oxide fuel cells and created two (2) subsidiaries capitalized by the equipment and intellectual property, CP SOFC Equipment, LLC and CP SOFC IP, LLC, respectively.  The subsidiaries, wholly owned by the Company, in turn, have leased the equipment to WATT and have licensed the intellectual property to WATT and Evolution, with conflicts resolved through  a cross licensing agreement between WATT and Evolution.  As consideration for the assets purchased from Nano, the Company has made a promissory note for three million three hundred thousand dollars ($3,300,000.00) and issued exactly one million (1,000,000) preferred shares, convertible at 100:1, common for preferred.  As consideration for the leasing and licensing, the Company shall receive exactly five percent (5%) of WATT outstanding and issued shares and thirty five percent (35%) of the outstanding and issued shares of Evolution.  The Company also maintains an option to purchase from WATT sixteen percent (16%) of Evolution for exactly one million one hundred two hundred fifty thousand (1,250,000) shares of the Companys common stock, if certain triggering events occur.   The contract was negotiated by the Board of Directors and the valuation was set arbitrarily.  The Company has valued the transaction at $513,300,000 based on the fair market of shares issued in the exchange.  The purchase price was allocated to all identified tangible assets and then to intangible assets. The Company immediately recorded an impairment of $508,167,000, resulting in an unamortized value of $5,133,000, or 1.0% of the gross purchase price valuation, as of December 31, 2012, to reflect the estimated return on the investment, based on projected discounted cash flows and other subjective considerations.



Global Natural Energy, Ltd.



On March 16, 2011 the Company entered into a Joint Venture with Global Natural Energy, Limited, a corporation duly formed in the Republic of Cyprus (GNE) to develop algae farms in the United States.  The Master Agreement stipulates the creation of the entity, GNE-USA, Inc., an Arkansas based company that will lead the algae production efforts, whereby the Company shall retain fifty one percent (51%) and GNE shall retain forty nine percent (49%) of the outstanding shares of the subsidiary.   As part of the transaction, the Company issued exactly two million (2,000,000) shares of restricted common stock of the Company.   The contract was negotiated by the Board of Directors and the valuation was set arbitrarily.  The Company has valued the transaction at $10,000,000 based on the fair market of shares issued in the exchange.  The purchase price was allocated to all identified tangible assets and then to intangible assets. The Company immediately recorded an impairment of $9,500,000, resulting in an unamortized value of $500,000, or 5.0% of the gross purchase price valuation, as of December 31, 2012, to reflect the estimated return on the investment, based on projected discounted cash flows and other subjective considerations.



Solar Teyin, S.L.



On March 25, 2011 the Company closed an Asset Purchase Agreement with Solar Teyin, S.L., a limited liability company formed in the Kingdom of Spain (Solar Teyin) related to the production and distribution of portable solar lighting units.  The Asset Purchase Agreement stipulates the creation of an entity to oversee the operations of all things related to the solar lighting technology.  The Company shall maintain eighty percent (80%) of the subsidiary. As consideration for the transaction, the company issued exactly one million five hundred thousand (1,500,000) shares to Solar Teyin, S.L.  The contract was







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negotiated by the Board of Directors and the valuation was set arbitrarily.  The Company has valued the transaction at $7,575,000 based on the fair market of shares issued in the exchange.  The purchase price was allocated to all identified tangible assets and then to intangible assets. The Company immediately recorded an impairment of $7,196,000, resulting in an unamortized value of $379,000, or 5.0% of the gross purchase price valuation, as of December 31, 2012, to reflect the estimated return on the investment, based on projected discounted cash flows and other subjective considerations.



NOTE 6  RELATED PARTY TRANSACTIONS:

A note payable to a related party is unsecured, non-interest bearing, has no fixed terms of repayment and is considered payable upon demand.  Notes payable to related parties totaled $19,640 and $4,640 at December 31, 2012 and 2011, respectively.



The Company does not require office space at the current time.  The officers and directors have provided office space, as necessary, at no cost.  The Company will consider arrangements at such time that operations commence.



NOTE 7 - PROMISSORY NOTE PAYABLE



On February 9, 2011 the Company issued a promissory note in agreement to purchase assets. The promissory note bears interest at the rate of 15% per annum, due February 1, 2016.  Interest shall be paid in monthly payments of interest in arrears. If the Buyer has insufficient cash on hand to pay interest due it may pay interest in common shares at a price per share equal to the 20 day moving average price of common shares of the Buyer, rounded up to the next whole share. If the Buyer does have sufficient cash on hand to pay interest due, Seller may, at its sole discretion, elect to take payment in common shares instead of cash. The method for calculation shall be the same as if the Buyer had insufficient cash on hand.  Principle shall be paid as cash flow allows, thereafter to be paid on Maturity Date or a funding event sufficient to pay the balance of the note, whichever occurs first.



Seller shall agree that note shall be subordinate to any debt instrument or other encumbrance against the physical assets, provided that prior to or simultaneously with any such encumbrance the Buyer has paid/pays at least $1,500,000 of the outstanding principle balance. In the event the Buyer wishes to encumber any of the assets but has not paid $1,500,000 of the outstanding principle, the Seller shall allow the encumbrance, provided that the Buyer ensures that only such part of the assets equal in value to the financing resulting in the encumbrance are in fact encumbered, and no less than 80% of the financing is utilized to reduce the outstanding balance due to Seller.



As of December 31, 2012 and 2011 the Company had accrued interest$935,753 and $440, respectively.

 As of December 31, 2011 the Company accrued $440,753 of unpaid interest on the promissory note.



NOTE 8- CAPITAL STOCK:



No holder of shares of stock of any class shall be entitled as a matter of right to subscribe for or purchase or receive any part of any new or additional issue of shares of stock of any class, or of securities convertible into shares of stock of any class, whether now hereafter authorized or whether issued for money, for consideration other than money, or by way of dividend.



Preferred Stock



On February 9, 2011, the Company issued 1,000,000 shares of preferred stock, convertible 1:100, preferred into common as payment for the intellectual property acquired from Nano CP, LLC.  Upon intent to exercise, Seller shall give notice to Buyer and Buyer shall take action required to duly authorize the issuance of common shares sufficient to fulfill Sellers exercise.  See Note 5.



Common Stock



The total number of shares of capital stock which the Company shall have authority to issue is 100 million common shares with a par value of $.001, as amended in the Articles of Incorporation, filed with the State of Florida on May 12, 2008.



Holders of shares of Common stock shall be entitled to cast one vote for each share held at all stockholders' meetings for all purposes, including the election of directors. The Common Stock does not have cumulative voting rights.









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On June 3, 2006, date of inception, the company issued 100,000 shares at par value of $.001 for $100.



In 2008, the Company issued 9,900,000 shares of common stock for services, at fair market value of $.10 per share or $990,000.



In 2009, the Company issued 1,533,333 shares of common stock for cash, at a purchase price of $.30 per share or $452,500.



In 2011, the Company issued 2,010,667 shares of common stock for services, at fair market value of $5.00 per share or $10,051,324.



On February 9, 2011, the Company acquired Clean Power, Inc. in exchange for 5,459,501 restricted shares of common stock.  Shares were valued at fair market at the date of the transaction, resulting in a purchase price of $26,205,605. The shares have been recorded per the agreement; however remain unissued from the stock transfer agent. See Note 4.



On March 16, 2011, the Company issued 2,000,000 shares of restricted common shares in connection with an acquisition of various assets. Shares were valued at fair market at the date of the transaction, resulting in a purchase price of $10,000,000. The shares have been recorded per the agreement; however remain unissued

from the stock transfer agent. See Note 4.



On March 25, 2011 the Company contracted to issue an additional 1,500,000 of restricted common shares in connection with the acquisition of various assets.  Shares were valued at fair market at the date of the transaction, resulting in a purchase price of $7,575,000. The shares have been recorded per the agreement; however remain unissued from the stock transfer agent. See Note 4.



NOTE 8  INCOME TAXES



The components of income tax (benefit) expense for the year ended December 31, 2012 and 2011



respectively, are as follows:



|         |  |      |   |  |      |   |   | 
|-------- |  | ---- | - |  | ---- | - | - | 
|         |  |      |   |  |      |   |   | 
|         |  | 2012 |   |  | 2011 |  
|         |  |      |   |  |      |  
|Federal: |  |      |   |  |      |  
|Current  |  | $    | - |  |      | $ | - | 
|Deferred |  |      | - |  |      |   | - | 
|         |  |      | - |  |      |   | - | 
|         |  |      |   |  |      |   |   | 
|State:   |  |      |   |  |      |   |   | 
|Current  |  |      | - |  |      |   | - | 
|Deferred |  |      | - |  |      |   | - | 
|         |  |      | - |  |      |   | - | 
|         |  | $    | - |  |      | $ | - | 



The Company has a net operating loss carry forward to offset future taxable income of approximately $4,808,387.  Subject to current regulations, this carry forward will begin to expire in 2022.  The amount and availability of the net operating loss carry forwards may be subject to limitations set forth by the Internal Revenue Code.  Factors such as the number of shares ultimately issued within a three year look-back period; whether there is a deemed more than 50 percent change in control; the applicable long-term tax exempt bond rate; continuity of historical business; and subsequent income of the Company all enter into the annual computation of allowable annual utilization of the carry forwards.



Subsequent Events



Management has evaluated subsequent events through the date the financial statements were issued. Based on our evaluation no events have occurred requiring adjustment or disclosure.







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