**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


Washington,
      D.C. 20549





**FORM
      10−Q**





(Mark
      One)


**x** **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
      ACT
      OF 1934**


For
      the
      quarterly period ended: June 30, 2008





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


For
      the
      transition period from ____________ to _____________




Commission
      File Number: 000-28543




**THORIUM
      POWER, LTD.**


(Exact
      name of registrant as specified in its charter)





Nevada
            
            91-1975651(State
                or other jurisdiction of
            
            (I.R.S.
                Empl. Ident. No.)incorporation
                or organization)





1600
      Tysons Boulevard, Suite 550


McLean,
      VA 22102


(Address
      of principal executive offices, Zip Code)





(571)
      730-1200


(Registrant’s
      telephone number, including area code)





8300
      Greensboro Drive, Suite 800


McLean,
      VA
      22102


(Former
      Name, Former Address and Former Fiscal Year if Changed Since Last
      Report)





Indicate
      by check mark whether the registrant (1) has 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  ̈





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





Large
                Accelerated Filer ̈
            Accelerated
                Filer ̈Non-Accelerated
                Filer(Do
                not check if a smaller reporting company) ̈
            Smaller
                reporting companyx





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).


Yes  ̈ No x





The
      number of shares outstanding of each of the issuer’s classes of common equity,
      as of June 30, 2008 is as follows:





Class
                of Securities
            
            Shares
                OutstandingCommon
                Stock, $0.001 par value
            
            299,395,310





Transitional
      Small Business Disclosure Format (check one): Yes  ̈  No x







**ITEM
      1. FINANCIAL STATEMENTS**





**THORIUM
      POWER, LTD.**





**UNAUDITED
      FINANCIAL STATEMENTS**





**SIX
      MONTHS ENDED JUNE 30, 2008 AND 2007**





**TABLE
      OF CONTENTS**





**Page**Condensed
                Consolidated Balance Sheets
            3Unaudited
                Condensed Consolidated Statements of Operations and Comprehensive
                Loss
            4Unaudited
                Condensed Consolidated Statements of Cash Flows
            5Unaudited
                Condensed Consolidated Statement of Changes in Stockholders’
                Equity
            6Notes
                to Unaudited Consolidated Financial Statements
            7-15


2




**Thorium
      Power, Ltd.**


**Condensed
      Consolidated Balance Sheets**






**June 30**
            
            **December 31****2008**
            
            **2007****(Unaudited)**
            
            ******ASSETS****Current
                Assets**Cash
                and cash equivalents
            
            $
            5,185,597
            
            $
            9,907,691Prepaid
                expenses & other current assets
            
            
            216,131
            
            
            204,035Deferred
                project costs
            
            
            -
            
            
            371,631Total
                Current Assets
            
            
            5,401,728
            
            
            10,483,357Property
                Plant and Equipment -net
            
            
            27,209
            
            
            30,676**Other
                Assets**Marketable
                securities - available for sale
            
            
            1,674,849
            
            
            -Patent
                costs - net
            
            
            217,875
            
            
            217,875Security
                deposits
            
            
            140,467
            
            
            2,049Total
                Other Assets
            
            
            2,033,191
            
            
            219,924**Total
                Assets**
            
            $
            **7,462,128**
            
            $
            **10,733,957****Liabilities
                and Stockholders' Equity****Current
                Liabilities**Accounts
                payable and accrued liabilities
            
            $
            2,799,489
            
            $
            2,122,649Current
                portion long term debt
            
            
            -
            
            
            4,651Customer
                deposit and other current liabilities
            
            
            13,191
            
            
            1,206,875Deferred
                revenue
            
            
            -
            
            
            3,793,125Total
                Current Liabilities
            
            
            2,812,680
            
            
            7,127,300Notes
                Payable - long term
            
            
            -
            
            
            5,782**Total
                Liabilities**
            
            
            2,812,680
            
            
            7,133,082**Stockholders'
                Equity**Preferred
                stock, $0.001 par value, 50,000,000 authorized shares, no shares
                issued
                and outstanding
            
            
            -
            
            
            -Common
                stock, $0.001par value, 500,000,000 authorized, 299,395,310 shares
                issued
                and outstanding at June 30, 2008 and 299,014,182 shares issued and
                outstanding at December 31, 2007
            
            
            299,395
            
            
            299,014Additional
                paid in capital - stock and stock equivalents
            
            
            44,530,174
            
            
            41,791,735Accumulated
                deficit
            
            
            (40,415,637
            )
            
            (38,630,572
            )Common
                stock reserved for issuance, 2,127,626 shares and 2,000,000 shares
                at June
                30, 2008 and December 31, 2007, respectively
            
            
            626,373
            
            
            590,000Accumulated
                other comprehensive income
            
            
            26,628
            
            
            30,143Deferred
                stock compensation
            
            
            (417,485
            )
            
            (479,445
            )**Total
                Stockholders' Equity**
            
            
            4,649,448
            
            
            3,600,875**Total
                Liabilities and Stockholders' Equity**
            
            $
            **7,462,128**
            
            $
            **10,733,957**




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


3




**Thorium
        Power, Ltd.**
 **Condensed
        Consolidated Statements of Operations and Comprehensive
        Loss**







Six Months Ended
            
            Three Months EndedJune 30,
            
            June 30,(Unaudited)
            
            (Unaudited)2008
            
            2007
            
            2008
            
            2007Revenue:Consulting revenue
            
            $
            8,116,625
            
            $
            -
            
            $
            4,301,500
            
            $
            -Total
                Revenue
            
            
            8,116,625
            
            
            -
            
            
            4,301,500
            
            
            -Cost
                of Consulting Services Provided
            
            
            3,384,566
            
            
            -
            
            
            1,736,562
            
            
            -Gross
                Margin
            
            
            4,732,059
            
            
            -
            
            
            2,564,938
            
            
            -Operating
                ExpensesGeneral
                and administrative
            
            
            3,116,988
            
            
            2,793,733
            
            
            1,597,941
            
            
            1,265,340Research
                and development expenses
            
            
            285,449
            
            
            155,471
            
            
            154,788
            
            
            129,402Stock-based
                compensation
            
            
            2,787,178
            
            
            2,454,734
            
            
            1,423,376
            
            
            1,119,217Total
                Operating Expenses
            
            
            6,189,615
            
            
            5,403,938
            
            
            3,176,105
            
            
            2,513,959Operating
                loss
            
            
            (1,457,556
            )
            
            (5,403,938
            )
            
            (611,167
            )
            
            (2,513,959
            )Other
                Income and (Expenses)Interest
                income
            
            
            143,180
            
            
            216,936
            
            
            53,898
            
            
            104,350Realized
                loss on marketable securities
            
            
            (438,750
            )
            
            -
            
            
            (438,750
            )
            
            -Other
                expenses
            
            
            -
            
            
            (58,600
            )
            
            -
            
            
            (58,600
            )Total
                Other Income and Expenses
            
            
            (295,570
            )
            
            158,336
            
            
            (384,852
            )
            
            45,750Net
                loss before income taxes
            
            
            (1,753,126
            )
            
            (5,245,602
            )
            
            (996,019
            )
            
            (2,468,209
            )Income
                taxes
            
            
            31,939
            
            
            -
            
            
            1,111
            
            
            -Net
                loss
            
            
            (1,785,065
            )
            
            (5,245,602
            )
            
            (997,130
            )
            
            (2,468,209
            )Other
                Comprehensive Income (Loss)Unrealized
                gain (loss) marketable securities
            
            
            (3,515
            )
            
            (657
            )
            
            128,208
            
            
            (8,063
            )Total
                Comprehensive Loss
            
            $
            (1,788,580
            )
            $
            (5,246,259
            )
            $
            (899,750
            )
            $
            (2,476,272
            )Net
                Loss Per Common Share, Basic and diluted
            
            $
            (0.01
            )
            $
            (0.02
            )
            $
            (0.00
            )
            $
            (0.01
            )Weighted
                Average Number of shares outstanding for the period used to compute
                per
                share data
            
            
            299,215,481
            
            
            295,979,377
            
            
            299,366,947
            
            
            296,784,409




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


4




Thorium
      Power, Ltd.


Condensed
      Consolidated Statements of Operations and Cash
      Flows






Six Months EndedJune 30(Unaudited)2008
            
            2007Operating
                Activities:Net
                Loss
            
            $
            (1,785,065
            )
            $
            (5,245,602
            )Adjustments
                to reconcile net loss from operations to net cash used in operating
                activities:Shares
                issued for other than cash for payment of expenses
            
            
            2,787,178
            
            
            2,645,051Depreciation
                and amortization
            
            
            3,467
            
            
            4,142Amortization
                of deferred revenue
            
            
            (3,793,125
            )
            
            -Amortization
                of deferred project costs
            
            
            3,384,566
            
            
            -Changes
                in non-cash operating working capital items:Prepaid
                expenses and other current assets
            
            
            (12,096
            )
            
            287,776Security
                deposits
            
            
            (138,418
            )
            
            -Accounts
                payable, accrued liabilities and other current liabilities
            
            
            673,325
            
            
            (941,672
            )Other
                current liabilities
            
            
            (1,193,684
            )
            
            -Deferred
                project costs
            
            
            (3,012,935
            )
            
            -Net
                Cash Used In Operating Activities
            
            
            (3,086,787
            )
            
            (3,250,305
            )Investing
                Activities:Net
                Cash Used In Investing Activities
            
            
            -
            
            
            -Financing
                Activities:Proceeds
                from issue of common shares
            
            
            49,975
            
            
            -Payments
                on notes payable and other
            
            
            (10,433
            )
            
            (2,515
            )Net
                Cash Provided By (Used In) Financing Activities
            
            
            39,542
            
            
            (2,515
            )Net
                Decrease In Cash and Cash Equivalents
            
            
            (3,047,245
            )
            
            (3,252,820
            )Cash
                and Cash Equivalents, Beginning of Period
            
            
            9,907,691
            
            
            10,927,775Reclassification
                of cash equivalents to marketable securities - available for
                sale
            
            
            (1,674,849
            )
            
            -Cash
                and Cash Equivalents, End of Period
            
            $
            5,185,597
            
            $
            7,674,955Supplemental
                Disclosure of Cash Flow InformationCash
                paid during the year:Interest
                paid
            
            $
            183
            
            $
            524Income
                taxes paid
            
            $
            31,939
            
            $
            0Non-cash
                transactionsConversion
                of liabilities to equity
            
            $
            -
            
            $
            1,410,884




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


5




Thorium
      Power, Ltd.


Condensed
      Consolidated Statements of Changes in
      Stockholder' Equity


For
      Six Months Ended June 30, 2008
      (Unaudited)


and
      Year Ended December 31, 2007






Common Stock
            
            Additional
            
            Accumulated
            
            Stock
              Committed
            
            Accumulated
            
            Deferred
            
            Treasury Stock
            
            Stockholders’Shares
            
            Amount
            
            Paid-in Capital
            
            Deficit
            
            Future
              Issuance
            
            Comprehensive
              Income
            
            Stock
              Compensation
            
            Shares
            
            Amount
            
            EquityBalance - December 31, 2006
            
            
            257,291,709
            
            $
            257,292
            
            $
            23,148,560
            
            $
            (27,177,989
            )
            $
            1,200,000
            
            $
            18,861
            
            $
            (285,200
            )
            
            (850,000
            )
            $
            (255,850
            )
            $
            (3,094,326
            )Issuance of stock for services
            
            
            808,916
            
            
            809
            
            
            232,678
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            233,487Issuance
                of stock for payment of liabilities
            
            
            714,120
            
            
            714
            
            
            277,727
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            278,441Stock
                based compensation - shares committed for future issuance and
                issued
            
            
            2,350,000
            
            
            2,350
            
            
            866,150
            
            
            
            
            
            (1,200,000
            )
            
            
            
            
            
            
            
            
            
            
            
            
            
            (331,500
            )Stock
                Option Expense
            
            
            
            
            
            
            
            
            3,991,317
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            3,991,317Net
                loss for the period
            
            
            
            
            
            
            
            
            
            
            
            (11,452,583
            )
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (11,452,583
            )Unrealized
                gains on marketable securities
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            11,282
            
            
            
            
            
            
            
            
            
            
            
            11,282Amortization
                of deferred stock compensation costs
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            395,755
            
            
            
            
            
            
            
            
            395,755Reclassification
                of warrant liability to additional paid in capital
            
            
            
            
            
            
            
            
            1,132,444
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            1,132,444Cashless
                exercise of stock options and warrants
            
            
            888,534
            
            
            888
            
            
            (888
            )
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            -Retirement
                of treasury stock
            
            
            (850,000
            )
            
            (850
            )
            
            (255,000
            )
            
            
            
            
            
            
            
            
            
            
            
            
            
            850,000
            
            
            255,850
            
            
            -Stock
                settlement - merger
            
            
            128,139
            
            
            128
            
            
            37,032
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            37,160Stock
                based compensation - officers, directors and employees
            
            
            1,022,927
            
            
            1,023
            
            
            357,002
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            358,025Reclassification
                of temporary equity to permanent equity
            
            
            36,659,837
            
            
            36,660
            
            
            12,004,713
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            12,041,373Stock
                based compensation - shares committed for future issuance
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            590,000
            
            
            
            
            
            (590,000
            )
            
            
            
            
            
            
            
            -Balance –
                December 31, 2007
            
            
            299,014,182
            
            
            299,014
            
            
            41,791,735
            
            
            (38,630,572
            )
            
            590,000
            
            
            30,143
            
            
            (479,445
            )
            
            -
            
            
            -
            
            
            3,600,875Unrealized
                loss on marketable securities
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (3,515
            )
            
            
            
            
            
            
            
            
            
            
            (3,515
            )Exercise
                of stock options
            
            
            320,350
            
            
            320
            
            
            49,655
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            49,975Stock
                option expense
            
            
            
            
            
            
            
            
            2,668,845
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            2,668,845Stock
                based compensation - officers, directors and employees
            
            
            60,778
            
            
            61
            
            
            19,939
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            20,000Amortization
                of deferred stock compensation costs
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            98,333
            
            
            
            
            
            
            
            
            98,333Shares
                committed for future issuance
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            36,373
            
            
            
            
            
            (36,373
            )
            
            
            
            
            
            
            
            -Net
                loss for the period
            
            
            
            
            
            
            
            
            
            
            
            (1,785,065
            )
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (1,785,065
            )Balance
                June 30, 2008
            
            
            299,395,310
            
            $
            299,395
            
            $
            44,530,174
            
            $
            (40,415,637
            )
            $
            626,373
            
            $
            26,628
            
            $
            (417,485
            )
            
            -
            
            $
            -
            
            $
            4,649,448




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


6





1.  BASIS
      OF
      PRESENTATION AND NATURE OF OPERATIONS





Basis
      of
      presentation





The
      accompanying unaudited condensed consolidated financial statements of the
      Company and its subsidiary have been prepared in accordance with the rules
      and
      regulations of the Securities and Exchange Commission (the “SEC”) including the
      instructions to Form 10-Q and Regulation S-X. Certain information and note
      disclosures normally included in financial statements prepared in accordance
      with generally accepted accounting principles in the United States of America
      have been condensed or omitted from these statements pursuant to such rules
      and
      regulation and, accordingly, they do not include all the information and notes
      necessary for comprehensive consolidated financial statements and should be
      read
      in conjunction with our audited consolidated financial statements for the year
      ended December 31, 2007, included in our Annual Report on Form 10-K for the
      year
      ended December 31, 2007.





In
      the
      opinion of the management of the Company, all adjustments, which are of a normal
      recurring nature, necessary for a fair statement of the results for the
      three-month periods have been made. Results for the interim period presented
      are
      not necessarily indicative of the results that might be expected for the entire
      fiscal year.




Nature
      of
      Operations





Radkowsky
      Thorium Power Corp., incorporated in the state of Delaware on January 8, 1992
      (“Inception”), changed its name to Thorium Power, Inc. in Apri1 2001. On
      February 14, 2006, Novastar Resources Ltd. (“Novastar”), now called Thorium
      Power Ltd., entered into an Agreement and merged on October 6, 2006 with Thorium
      Power, Inc. (Collectively after the merger, all entities are
      referred to as the “Company" or “Thorium”). Thorium is engaged in two
      business segments. The first business segment is the development, promotion
      and
      marketing of its patented nuclear fuel designs: (1) thorium/uranium nuclear
      fuel
      and (2) thorium/reactor-grade plutonium disposing fuel. The Company also has
      a
      conceptual design of a thorium/weapons-grade plutonium disposing fuel. These
      fuels are designed to be used in existing light water reactors. Presently,
      we
      are focusing most of our efforts on demonstrating and testing our nuclear fuel
      technology for the Russian designed VVER-1000 reactors. Operations to date
      in
      this business segment have been devoted primarily to continued development
      of
      our fuel designs, filing for certain patents related to our technology,
      developing strategic relationships within the nuclear power industry, and
      securing political as well as some financial support from the United States
      and
      Russian governments.





Our
      business model expanded in 2007 and our second business segment is providing
      consulting and strategic advisory services to companies and governments planning
      to create or expand electricity generation capabilities using nuclear power
      plants. We have to date secured three contracts with successively larger values
      for consulting and strategic advisory services in the United Arab Emirates
      (“UAE”). We started working on our first consulting project with the Executive
      Affairs Authority (“EAA”) of Abu Dhabi, one of the member Emirates of the UAE in
      December 2007 and completed this first consulting project in March 2008. We
      secured our second consulting project with the EAA in March 2008 and completed
      our second project in June 2008. On August 1, 2008, we signed separate
      consulting services agreements with two government entities to be formed by
      Abu
      Dhabi. Under these two new agreements, we are to provide consulting and
      strategic advisory services over a contract term of five years, with automatic
      renewals of these contracts for one year periods, see note 2c below.





Once
      our
      reactor fuels are further developed and tested, we plan to license our
      intellectual property rights to fuel fabricators, nuclear generators, and
      governments for use in commercial light water nuclear reactors, or sell the
      technology to a major nuclear company or government contractor or some
      combination of the two. We anticipate having the final design of our fuel
      technology for VVER-1000 reactors and demonstration of our fuel in a VVER-1000
      operating reactor to commence in the next three to four years. Presently all
      our
      research, testing and demonstration activities are being conducted in Russia.
      Our research operations are subject to various political, economic, and other
      risks and uncertainties inherent in Russia.





We
      participate in a highly regulated industry that is characterized by governmental
      regulation. Our results of operations are affected by a wide variety of factors
      including general economic conditions, decreases in the use or public favor
      of
      nuclear power, the ability of our technology, the ability to safeguard the
      production of nuclear power and safeguarding our patents and intellectual
      property from competitors. Due to these factors, we may experience substantial
      period-to-period fluctuations in our future operating results.


7


We
      may in
      the future be designated as a potentially responsible party (PRP) by federal
      and
      state agencies with respect to certain sites with which we may have direct
      or
      indirect future involvement. Such designations can be made regardless of the
      extent of our involvement.




2.  SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES




a)
      Consolidation




These
      financial statements include the accounts of Thorium Ltd. (a Nevada corporation)
      and our wholly-owned subsidiary, Thorium Power, Inc. (a Delaware corporation).




All
      significant intercompany transactions and balances have been eliminated in
      consolidation.




b)
      Use of
      Estimates




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





These
      consolidated financial statements include some amounts that are based on
      management's best estimates and judgments. The most significant estimates relate
      to valuation of stock grants, stock options and stock purchase warrants, the
      net
      operating loss carry-forward and the valuation allowance for deferred taxes
      and
      various contingent liabilities. These above-mentioned estimates and others
      may
      be adjusted as more current information becomes available, and any adjustment
      could be significant in future reporting periods.





c)
      Revenue Recognition





*Revenue* —at
      the
      present time we are deriving all of our revenue from our consulting and
      strategic advisory services business segment, by offering services to foreign
      governments planning to create or expand electricity generation capabilities
      using nuclear power plants. Our fee structure for each client engagement is
      dependent on a number of variables, including the size of the client, the
      complexity, the level of the opportunity for us to improve the client’s
      electrical generation capabilities using nuclear power plants and other factors.
      All of the Company's revenues for the first quarter of 2008 have been derived
      from the completion of the defined contract deliverables required from the
      first
      consulting contract that we entered into with the EAA in December 2007. All
      of
      the Company’s revenues for the second quarter of 2008 have been derived from the
      completion of the defined contract deliverables required from the second
      consulting contract entered into in March 2008 with the EAA and completed in
      June 2008.





Both
      consulting contracts mentioned above were with the EAA of Abu Dhabi, one of
      the
      member Emirates of the UAE. For the first contract entered into, the consulting
      fee was fixed and determinable. The consulting fee could have been refundable
      under the provision of this contract if we would have breached the contract,
      such as not deliver the final report to the foreign government. Therefore,
      based
      on these contract terms, the consulting fee revenue from this contract was
      recognized on the completed performance model.
      We
      completed substantially all of the deliverables in our first consulting project
      in March 2008 and therefore recognized all of the revenue in accordance with
      the
      completed performance model revenue recognition guidelines. We received all
      of
      this revenue in December 2007, in advance of our billing in March 2008. The
      amount billed in advance of the period in which service was rendered was
      recorded as a liability in the accompanying balance sheet captioned “deferred
      revenue” in 2007. The total consulting revenue recognized under this contract
      during the three months ended March 31, 2008 was $3,793,125, which was the
      balance in the deferred revenue balance sheet account at December 31, 2007,
      as
      no revenue from this contract had been recognized in 2007.


8





For
      the
      second contract that was entered into with the EAA, the consulting fee revenue
      was recognized ratably over the contract period. This contract called for
      on-going consulting services for the period from March 2008 through June 22,
      2008. We started work on this project in April 2008. All revenue earned under
      this contract, $4,285,000 which was received in April 2008, was recognized
      ratably during the second quarter of 2008.





Based
      on
      the completion of the above contracts and the current work we are performing
      on
      new consulting contracts that we entered into, we are no longer a development
      stage company in 2008, as we now have an ongoing consulting and strategic
      advisory services business segment, having recognized revenue earned in the
      first and second quarter of 2008, and we will continue to recognize revenue
      in
      future periods in 2008 with the two new contracts that we entered into on August
      1, 2008, mentioned above.





These
      two
      new contracts, for consulting services to be rendered during the period June
      23,
      2008 through December 31, 2008, provide for a total payment of $17.4 million,
      with $10 million to be paid by the EAA on behalf of these two new governmental
      agencies to be formed ($5 million paid on behalf of each entity), upon the
      signing of this agreement, and the remaining total balance of $7.4 million
      to be
      paid by each of these new governmental entities equally, upon their formation.
      These new government entities will be called the Emirates Nuclear Energy
      Corporation (“ENEC”) and the Federal Authority for Nuclear Regulation (“FANR”).
      We will provide strategic advisory services to both of these entities during
      the
      five year term of these agreements. Under these agreements, revenue is being
      derived from a fixed professional fee agreement. Therefore, we will recognize
      revenue as the consulting services are performed and certain contract
      deliverables are met, in accordance with agreed-upon detailed work plans that
      we
      expect will be discussed with our clients and potentially adjusted on a
      quarterly basis in connection with project reviews.





All
      costs
      directly related to producing the work under these agreements, such as
      consulting costs, other professional fees and various administrative support
      and
      other costs, are capitalized as deferred project costs (current asset on the
      accompanying balance sheet). Deferred project costs are then recognized or
      amortized to an expense captioned, cost of consulting services provided, on
      the
      accompanying statement of operations, when the revenue is to be recognized
      or
      when the project is completed. Total deferred project costs that were charged
      to
      expense or cost of consulting services provided for the three month and six
      month periods ended June 30, 2008 was $1,736,562 and $3,384,566, respectively.
      Indirect corporate overhead incurred that was not allocated to the consulting
      and strategic advisory services business segment is being reported in the
      business segment information chart, in note 4 to these financial statements,
      as
      unallocated corporate overhead costs.





The
      deferred project costs at June 30, 2008 were $0, as we completed all contract
      deliverables for the first two consulting projects with the EAA and we had
      not
      yet provided any substantial work on the two new agreements that we entered
      into
      on August 1, 2008, mentioned above.





Travel
      costs and other reimbursable costs were offset, in accordance with the
      consulting agreements, against the balance sheet account captioned “customer
      deposit account”, which is shown as a current liability on the balance sheet.
      The customer deposit account is money advanced to us for reimbursable expenses
      that are incurred in accordance with the contracts. The total travel and other
      reimbursable expenses charged for these consulting projects for the three months
      and six months ended June 30, 2008, was $479,904 and $1,193,684.





The
      Company’s future operations and earnings will depend on the results of the
      Company’s operations in foreign countries. There can be no assurance that the
      Company will be able to successfully conduct such operations, and a failure
      to
      do so would have a material adverse effect on the Company’s financial position,
      results of operations, and cash flows. Also, the success of the Company’s
      operations will be subject to numerous contingencies, some of which are beyond
      management’s control. These contingencies include general and regional economic
      conditions, prices for the Company’s services, competition, and changes in
      regulations. Because the Company is dependent on international operations,
      particularly in one country right now, the Company will be subject to various
      additional political, economic, and other uncertainties.




For
      our
      first business segment, once the company's thorium-based nuclear fuel designs
      have advanced to a commercially usable stage the company will seek to license
      its technology to major government contractors or nuclear companies, working
      for
      the US and other governments. We expect that our revenue from license fees
      will
      be recognized on a straight-line basis over the expected period of the related
      license term.


9




d)
      Segment Reporting




The
      Company uses the “management approach” in determining reportable operating
      segments. The management approach considers the internal organization and
      reporting used by the Company's chief operating decision maker for making
      operating decisions and assessing performance as the source for determining
      the
      Company's reportable segments. The Company has determined that the Company
      has
      two operating segments as mentioned above and defined by SFAS 131, “Disclosures
      about Segments of an Enterprise and Related Information”. The two reporting
      business segments are our technology business and our consulting and strategic
      advisory services business.





e) ** Deferred
      Project Costs





The
      Company defers certain costs related to its consulting and strategic advisory
      services business segment, until the Company recognizes revenue in accordance
      with its agreements. These costs are then expensed as revenue is recognized
      pursuant to the terms of a contract. Management periodically reviews and
      revises, when necessary, its estimate of the future benefit of these costs
      and
      expenses them if it is deemed there is no longer a future benefit. At June
      30,
      2008, and December 31, 2007, capitalized deferred project costs totaled $0
      and
      $371,631 respectively.





f)
      Cash
      and Cash Equivalents reclassified to Marketable Securities





At
      June
      30, 2008 the Company held auction rate and other government bonds with a total
      original cost of $2,114,443, which now carry a fair market value of $1,674,849
      (total realized loss of $439,594 for the three months and six months ended
      June
      30, 2008). These securities were reclassified as of March 31, 2008, based on
      a
      change of market conditions for these securities in the auction market for
      the
      six months ended June 30, 2008 as mentioned below, from cash equivalents to
      long-term marketable securities available for sale, as presented in the
      accompanying balance sheet and statement of cash flows at June 30, 2008, and
      for
      the six months then ended.





The
      auction rate securities as well as cash equivalents, all being held by one
      prominent US financial institution had a total market value of $5,090,517 at
      June 30, 2008. The auction rate securities were purchased in 2006 and were
      defined and classified by this financial institution as cash equivalents at
      December 31, 2007 and 2006. These securities were liquid to the company in
      2007
      and 2006 with cash available on an as needed basis to the company on a weekly
      or
      monthly basis (less than a 3 month period which is the company’s policy for cash
      equivalents). This financial institution reported the cost and fair market
      value
      of these securities as being the same throughout the 2007 year and at the years
      ended December 31, 2007 and 2006, with no realized or unrealized gain or loss
      in
      market value on these auction rate securities in 2007 and 2006. Based on the
      Company’s favorable sales experience regarding the liquidity of these securities
      in 2007 and 2006, and based on information received from this prominent
      financial institution at December 31, 2007 and 2006, the Company classified
      these securities in the same manner as this financial institution at December
      31, 2007 and 2006, as cash equivalents at December 31, 2007 and
      2006.





However,
      for the six months ended June 30, 2008, market conditions for these securities
      started to change and the company, due to the decline in the liquidity and
      market value of these securities for the six month period ended June 30, 2008,
      reclassified these securities from cash equivalents to long term marketable
      securities. This reclassification was recorded on the cash flow statement for
      the six months ended June 30, 2008 in the amount of $1,674,849 reducing the
      cash
      at the beginning of the period on the statement of cash flows from $9,907,691
      to
      $8,232,842, a decrease of $1,674,849, that was a result of this reclassification
      from cash equivalents to marketable securities available for sale. These
      marketable securities have various maturities ($800,000 – mature 6/1/30,
      $825,000 – mature 12/15/39 and $485,000 mature 10/1/08).





The
      Company’s investments in these marketable securities are classified as
      available-for-sale securities under FAS-115, Accounting for Certain Investments
      in Debt and Equity Securities. These securities are reported at their fair
      market value, with unrealized holding gains and losses reported in other
      comprehensive income. The unrealized gain (loss) reported on all securities
      for
      the three months and six months ended June 30, 2008 was $128,208 and $(3,515),
      respectively, which is being recorded in other comprehensive income and loss
      for
      the three and six months ended June 30, 2008.


10




3. FINANCIAL
      STATUS OF THE COMPANY – JUNE 30, 2008




Management
      anticipates, based on its current projected working capital requirements, that
      it will have enough working capital funds to sustain its current operations
      at
      its current operating level, until sometime during the second quarter of 2009. In
      support of the Company’s longer-term business plan, the Company will need to
      raise additional capital by way of an offering of equity securities, an offering
      of debt securities, or by obtaining financing through a bank or other entity
      to
      finance its research and development expenditures on any further basis. The
      Company will also need to raise capital to support its overhead operation if
      the
      consulting and strategic advisory services business becomes
      non-sustaining.





4. BUSINESS
      SEGMENTS





The
      Company has two principal operating segments, which are (1) technology and
      (2)
      consulting and strategic advisory services. These operating segments were
      determined based on the nature of the operations and the services offered.
      Operating segments are defined as components of an enterprise about which
      separate financial information is available that is evaluated regularly by
      the
      chief operating decision-maker in deciding how to allocate resources and in
      assessing performance. The Company’s chief executive officer, chief operating
      officer and chief financial officer have been identified as the chief operating
      decision makers. The Company’s chief operating decision makers direct the
      allocation of resources to operating segments based on the profitability, the
      cash flows, and the business plans of each respective segment.





The
      Company evaluates performance based on several factors, of which the primary
      financial measure is business segment income before taxes. The accounting
      policies of the business segments are the same as those described in “Note 1:
      Summary of Significant Accounting Policies.” There is no allocation of corporate
      level assets or certain corporate expenses even though they contribute to both
      segments. The following tables show the operations of the Company’s reportable
      segments for the six months and three months ended June 30, 2008. In 2007,
      the
      company was a development stage company, did not provide any consulting services
      and all expenses in 2007 were considered to be corporate expenses, other than
      research and development expenses of $155,471 and $129,402, for the six months
      and three months ended June 30, 2007.





Consulting
            
            Technology
            
            Corporate and EliminationsJune 30, 2008
            
            June 30, 2008
            
            June 30, 2008
            
            Total6 Months
            
            3 Months
            
            6 Months
            
            3 Months
            
            6 Months
            
            3 Months
            
            6 Months
            
            3 MonthsRevenue
            
            
            8,116,625
            
            
            4,301,500
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            8,116,625
            
            
            4,301,500Segment
                Profit - Before Tax
            
            
            4,732,059
            
            
            2,564,938
            
            
            (632,992
            )
            
            (315,543
            )
            
            (5,852,193
            )
            
            (3,245,414
            )
            
            (1,753,126
            )
            
            (996,019
            )Total
                Assets
            
            
            -
            
            
            
            
            
            17,932
            
            
            
            
            
            7,444,196
            
            
            
            
            
            7,462,128Property
                Additions
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Interest
                Expense
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            183
            
            
            -
            
            
            183
            
            
            -Depreciation
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            6,020
            
            
            3,010
            
            
            6,020
            
            
            3,010





5. RESEARCH AND
      DEVELOPMENT COSTS





Research
      and development costs, included in the statement of operations amounted to
      $154,788 and $285,449 for the three months and six months ended June 30, 2008,
      respectively. Total cumulative expense has amounted to $4,968,762 from January
      8, 1992 (date of inception of Thorium Power, Inc.) to June 30,
      2008.





6. STOCKHOLDERS'
      EQUITY





Total
      Common stock outstanding at June 30, 2008 was 299,395,310. At June 30, 2008,
      there were 512,556 stock purchase warrants (expiring 8/26/08) and 51,225,480
      stock options outstanding, all totaling 351,133,346 of total stock and stock
      equivalents outstanding at June 30, 2008.


11


a) Common
      Stock Issuances –





On
      March
      14, 2008, 320,350 stock options that were assumed in the merger and held by
      one
      consultant were exercised at a strike price of $.156 per share for total
      consideration of $49,975. Accordingly, 320,350 shares of the company’s common
      stock were issued in accordance with this option agreement. On May 13, 2008,
      60,778 shares were issued to our directors in accordance with their respective
      director agreements, valued at approximately $0.33 per share for a total value
      of $20,000, for services rendered for the six months ended June 30,
      2008.





b)
      Share-based Compensation





Total
      stock options outstanding at June 30, 2008 were 51,225,480, and 31,322,381
      of
      these total options were vested at June 30, 2008.





Stock
      option transactions to the employees, directors, advisory board members and
      consultants are summarized as follows for June 30, 2008:





2008**Stock
                Options Outstanding**Beginning
                of the Year
            
            
            51,354,656Granted
            
            
            191,174Exercised
            
            
            (320,350
            )Forfeited
            
            
            -Outstanding
                end of the period
            
            
            51,225,480Options
                exercisable at the end of the period
            
            
            31,322,381




The
      above
      table includes options issued as of June 30, 2008 as follows:





i).
            
            A
                total of 13,504,742 non-qualified 5-10 year options have been issued
                by
                Thorium Power, Ltd., to advisory board members at exercise prices
                of $0.30
                to $0.64 per share.ii).
            
            A
                total of 31,243,810 5-10 year options have been issued to directors,
                officers and employees of the Company, at exercise prices of $0.24
                to
                $0.80 per share. From this total, 18,619,906 options are outstanding
                to
                the Chief Executive Officer who is also a director, with remaining
                contractual lives of 1-9.6 years. All other options issued have a
                remaining contractual life ranging from 4.75 years to 9.6
                years.iii).
            
            A
                total of 6,476,928 non-qualified 3-10 year options have been issued
                to
                consultants of the Company, at exercise prices of $0.16 to $0.35
                per
                share.




The
      following table provides certain information with respect to the
      above-referenced stock options that are outstanding and exercisable at June
      30,
      2008:


12


**Stock Options Outstanding**
              
              **Stock Options Vested****Exercise Prices**
              
              **Weighted**
                **Average**
                **Remaining**
                **Contractual Life**
                **- Years**
              
              **Number of**
                **Awards**
              
              **Number of**
                **Awards**
              
              **Weighted**
                **Average**
                **Exercise Price**$0.16 - $0.29
              
              
              4.0
              
              
              16,869,745
              
              
              13,093,452
              
              $
              0.17$0.30
                  - $0.44
              
              
              7.3
              
              
              7,228,555
              
              
              2,512,896
              
              $
              0.34$0.445-$0.63
              
              
              5.8
              
              
              17,927,180
              
              
              10,182,693
              
              $
              0.47$0.64-$0.80
              
              
              7.6
              
              
              9,200,000
              
              
              5,533,340
              
              $
              0.76Total
              
              
              5.7
              
              
              51,225,480
              
              
              31,322,381
              
              $
              0.39





The
      aggregate intrinsic value of stock options outstanding at June 30, 2008 was
      $914,912 of which $914,912 related to vested awards. Intrinsic value is
      calculated based on the difference between the exercise price of the underlying
      awards and the quoted price of our common stock as of the reporting date ($0.24
      per share as of June 30, 2008)





Assumptions
      used in the Black-Scholes option-pricing model for the six months ended June
      30,
      2008 were as follows:





Average
                risk-free interest rate
            
            4.06%
                - 4.45%Average
                expected life
            
            5-10
                yearsExpected
                volatility
            
            99%
                - 275%Expected
                dividends
            
            0%





During
      the six months and three months ended June 30, 2008, $2,787,179 and $1,423,376
      was recorded as stock-based compensation expense in the statement of operations,
      respectively. The result of all the above stock option grants that occurred
      after January 1, 2006 for Thorium Power Inc and stock option grants for Thorium
      Power Ltd that were recorded in the statement of operations totaled $2,668,846
      and $1,354,210 for the six months and three months ended June 30, 2008
      respectively and $6,709,330 for the period from January 1, 2006 to June 30,
      2008
      (non-deductible for tax purposes, may provide a tax deduction for the Company
      when exercised).





Stock
      compensation to two executive officers totaled $590,000, as a one-time stock
      grant pursuant to employment agreements that they entered into in 2007, was
      recorded to common stock (total 2 million shares) reserved for issuance. The
      Company issued additional shares of common stock of 127,626, which was issued
      in
      May 2008 to 3 individuals that resulted in $36,373 of deferred stock
      compensation. The amortization of deferred stock compensation, recorded as
      stock
      based compensation for the three months and six months ended June 30, 2008
      was
      $49,167 and $98,333, respectively. The remaining stock-based compensation was
      issued to two directors, as mentioned above, which resulted in recording $20,000
      of stock-based compensation.





e).
      Warrants





There
      were 512,556 warrants outstanding as of June 30, 2008.





At
      June
      30, 2008 the range of warrant prices for shares under warrants and the
      weighted-average remaining contractual life are as follows:


13




**Warrants Outstanding and**
                **Exercisable****Warrants - Exercise Price**
              
              **Number of**
                **Warrants**
              
              **Weighted**
                **Average**
                **Remaining**
                **Contractual Life**
                **- Years**$0.39
              
              512,556
              
              .2





On November
      17, 2006 the Board of Directors of Thorium Power, Ltd. authorized the extension
      of the expiration date of all common stock purchase warrants above by six months
      from the expiration date identified on the respective warrants.




f).
      Common Stock and Warrants reserved for Future Issuance





Common
      stock reserved for future issuance consists of





**Shares of**
            
            **Stock****Common**
            
            **Purchase****Stock**
            
            **Warrants**
            
            **Amount**Stock-based
                Compensation
            
            
            2,127,626
            
            
            0
            
            $
            626,373




The
      Compensation Committee of the Board of Directors unanimously voted to issue
      2
      million shares of restricted stock as an incentive for the Company’s COO and CFO
      to work for the Company. The price used to value these shares was the market
      price as of the date of the stock grant. The Compensation Committee also
      approved in May 2008 to grant 127,626 shares to three new executives and
      employees, as mentioned above.




7. INCOME
      TAXES





Deferred
      income taxes reflect the net tax effects of temporary differences between the
      carrying amounts of assets and liabilities recognized for financial reporting
      and the amounts recognized for income tax purposes. The significant components
      of deferred tax assets (at a 40% effective tax rate) as of June 30, 2008 are
      as
      follows:





Total Amount
            
            Deferred Tax
              Asset Amount**Assets**Stock-based
                compensation
            
            $
            7,991,205
            
            $
            3,196,482Approximate
                net operating loss  carryforward
            
            
            10,000,000
            
            
            4,000,000Less:
                valuation allowance
            
            
            (17,991,205
            )
            
            (7,196,482
            )$
            -
            
            $
            -





Management
      currently believes that it is more likely than not that the forecasted taxable
      income will not be sufficient to utilize the tax loss carry forward, which
      totaled approximately $10 million before their expiration in the years 2026
      through 2028, to fully recover the deferred tax asset. The Company has net
      operating loss carry forward for federal and state tax purposes with
      substantially all of the net operating losses expected to expire unused or
      not
      be available to offset future taxable income, due to the Internal Revenue Code
      Section 382 limitation for the ownership change that occurred on October 6,
      2006. As a result, the amount of the deferred tax assets considered realizable
      was reduced 100% by a valuation allowance. In the near term, the company will
      compute the actual Internal Revenue Code Section 382 limitation which will
      change the reported net operating loss carry forward and the valuation allowance
      shown above. The Company has no other deferred tax assets or
      liabilities.





The
      company had paid income taxes in the amount of $31,939 as many of the company’s
      operating expenses in its 2006 tax year were classified under the internal
      revenue code as start up costs which were not deductible for tax purposes,
      and
      the company had interest income that was taxable for tax purposes. This tax
      amount is not included in the above deferred tax asset information as it is
      deemed not significant at June 30, 2008.


14





8. RESEARCH
      AGREEMENT





On
      December 27, 2007, Thorium Power, Inc. (“TPI”), a wholly-owned subsidiary of the
      Company, entered into an agreement for ampoule irradiation testing (the
“Agreement”) with the Russian Research Centre “Kurchatov Institute”
(“Kurchatov”). The ampoule irradiation testing program has been ongoing since
      2002 pursuant to earlier agreements between TPI and Kurchatov. Under the
      Agreement TPI agreed to compensate Kurchatov for irradiation testing of TPI’s
      proprietary nuclear fuel designs conducted in 2006 and 2007. Pursuant to the
      Agreement, TPI is obligated to pay to Kurchatov $410,000.00 (liability accrued
      December 31, 2007), and Kurchatov is obligated to transfer to TPI the worldwide
      rights in all of the test data generated in the course of the irradiation
      testing of TPI’s proprietary nuclear fuel designs in 2006 and 2007. Kurchatov
      agrees not to use, in any manner, the work product associated with such testing
      or exercise any rights associated therewith without the written consent of
      TPI.
      Further, Kurchatov is obligated to provide to TPI and its affiliates specified
      information and documentation for audit purposes, and to obtain any and all
      permits from Russian governmental entities which may be required in order for
      Kurchatov to perform under the Agreement. In addition to this agreement, there
      are consulting agreements with several consultants working on various projects
      for the company, which total approximately $15,000 per month.





9. COMMITMENTS
      AND CONTINGENCIES





Commitments
      and Contractual Obligations





The
      Company has employment agreements with its executive officers, the terms of
      which expire at various times. Such agreements provide for minimum compensation
      levels, as well as incentive bonuses that are payable if specified management
      goals are attained. Under each of the agreements, in the event the officer's
      employment is terminated (other than voluntarily by the officer or by the
      Company for cause, or upon the death of the officer), the Company, if all
      provisions of the employment agreements are met, is committed to pay certain
      benefits, including specified monthly severance.





The
      Company has entered into an agreement to lease office space, under the terms
      of
      a sublease with a term of 65 months commencing August 1, 2008. Under the terms
      of the sublease, the lease payments are inclusive of pass-through costs, which
      include real estate taxes and standard operating expenses. As of June 30, 2008,
      the Company has prepaid the first month’s rent and the security deposit related
      to this sublease agreement in the amounts of $40,162 and $120,486 respectively.
      The Company pays monthly rental fees in the amount of $40,162 in the first
      year
      of the agreement, and payments increase by a factor of 4% each year thereafter.
      The Company may terminate this agreement by providing 60 days notice to the
      Sublessor.





**FORWARD-LOOKING
      STATEMENTS**





This
      Quarterly Report on Form 10-Q contains forward-looking statements within the
      meaning of Section 27A of the Securities Act of 1933, as amended (the
“Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as
      amended (the “Exchange Act”). The words “believe,” “expect,” “anticipate,”
“project,” “target,” “optimistic,” “intend,” “aim,” “will” or similar
      expressions are intended to identify forward-looking statements. Such statements
      include, among others, those concerning our expected financial performance
      and
      strategic and operational plans, as well as all assumptions, expectations,
      predictions, intentions or beliefs about future events. These statements are
      based on the beliefs of our management as well as assumptions made by and
      information currently available to us and reflect our current view concerning
      future events. As such, they are subject to risks and uncertainties that could
      cause our results to differ materially from those expressed or implied by such
      forward-looking statements. Such risks and uncertainties include, among many
      others: our significant operating losses; our limited operating history;
      uncertainty of capital resources; the speculative nature of our business; our
      ability to successfully implement new strategies; present and possible future
      governmental regulations; operating hazards; competition; the loss of key
      personnel; any of the factors in the “Risk Factors” section of the Company’s
      Annual Report on Form 10-K; other risks identified in this Report; and any
      statements of assumptions underlying any of the foregoing. You should also
      carefully review other reports that we file with the SEC. The Company assumes
      no
      obligation and does not intend to update these forward-looking statements,
      except as required by law.


15


**ITEM
      2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
      OPERATION.**





The
      following discussion should be read in conjunction with our financial
      statements, together with the notes to those statements, included elsewhere
      in
      this report. The following discussion contains forward-looking statements that
      involve risks, uncertainties, and assumptions such as statements of our plans,
      objectives, expectations, and intentions. Our actual results may differ
      materially from those discussed in these forward-looking statements because
      of
      the risks and uncertainties inherent in future events.





**General
      Overview**





We
      are a
      developer of proprietary nuclear fuel designs and a provider of nuclear energy
      consulting services, each of which will be described in the following
      sections.





***Consulting
      and Strategic Advisory Services Business Segment***





For
      the
      six months ended June 30, 2008, all of our revenue came from two consulting
      agreements, both with the Executive Affairs Authority (“EAA”), a government
      agency of Abu Dhabi, one of the member Emirates of the United Arab Emirates
      (“UAE”). The contracts involved the evaluation of a domestic nuclear energy
      program. We were first retained by the EAA on November 30, 2007 to provide
      consulting services designed to produce a roadmap that would constitute the
      first phase of a feasibility study (“Roadmap”) for a prospective program to
      deploy civilian nuclear power plants within the UAE, by acting as strategic
      advisor for the entity responsible for managing nuclear energy related
      activities in the UAE. The Roadmap contract agreement called for a $5 million
      upfront payment for professional fees and expenses, for a 15 week effort to
      develop a roadmap with recommendations related to timelines, as well as
      organizational structure and priorities for subsequent phases of the country’s
      future nuclear energy program. We completed the Roadmap project in March 2008
      and then entered into a larger follow-on consulting agreement (“Quickstart”).
      The terms of the Quickstart project called for an upfront payment of
      professional fees to Thorium Power of $4.3 million. We completed work on the
      Quickstart project in June 2008. For both agreements, certain reimbursable
      expenses repaid to us were capped at 20% of the total professional fees and
      were
      billed separately to the EAA





On
      August
      1, 2008, we entered into two separate consulting services agreements with two
      governmental entities in the UAE and a side agreement with the EAA. The first
      agreement is with the Emirates Nuclear Energy Corporation (“ENEC”), an Abu Dhabi
      entity that, upon formation, would be responsible for implementing the country’s
      nuclear energy infrastructure. We will provide strategic advisory services
      regarding the development and management of ENEC (the “ENEC Agreement”). Under
      the second agreement with the Federal Authority for Nuclear Regulation (“FANR”),
      which upon formation, will be the independent nuclear regulatory agency in
      the
      UAE, we will provide strategic advisory services regarding the development
      and
      management of FANR (the “FANR Agreement” and collectively with the ENEC
      Agreement, the “Agreements”). Pursuant to the Agreements, we will be paid $8.9
      million from ENEC and $8.5 million from FANR (aggregate of $17.4 million) for
      professional fees related to our strategic advisory services performed during
      the period from June 23, 2008 through December 31, 2008. In addition, we will
      be
      compensated for expenses which are capped at 20% of professional fees. The
      term
      of these Agreements is five years, with automatic renewal for one year periods
      unless otherwise terminated pursuant to the provisions of these Agreements.
      A
      Side Letter provides that upon execution of these Agreements, the EAA will
      pay
      us $10 million of the aggregate $17.4 million, with the remaining $7.4 million
      due under both of these agreements to be paid equally, by ENEC and FANR upon
      their formation. Of the $10 million payment by the EAA, $5 million will be
      deemed to be made as a partial payment from ENEC and FANR, under each of these
      Agreements. Potential adjustments to our billings for future periods under
      the
      two new Agreements will depend on detailed work-plans which will typically
      be
      discussed and agreed between us and our clients on a quarterly basis during
      project reviews.





Revenue
      from the Roadmap contract was recognized during our first fiscal quarter of
      2008, when the work on the contract was substantially completed. We recognized
      revenue related to the Quickstart project ratably over the term of the agreement
      as this contract called for on-going consulting services from March 2008 through
      June 2008. Under the August 1, 2008 Agreements, revenues are being derived
      from
      fixed professional fee agreements. Therefore, we will recognize revenue as
      the
      consulting services are performed and certain contract deliverables are met.
      Going forward, we may enter into additional consulting contracts to provide
      support and assistance to other commercial and governmental entities that are
      looking to develop and expand their nuclear power industry capabilities and
      infrastructure. In future consulting engagements we expect that revenues may
      be
      derived either from fixed professional fee agreements or from fees generated
      through hourly rates billed on a time and expense basis. Our current strategy
      in
      the consulting services business is focused on the following:


16





Primarily:
      Further strengthening the relationship with our existing clients in the UAE
      and
      increasing the revenue potential by providing additional consulting and
      strategic advisory services;





Secondarily:
      Expanding our client base by further penetrating our markets and attracting
      new
      clients with similar needs as our existing clients, and also enhancing and
      extending our services, including the creation of new service offerings.





Our
      most
      significant expense related to our consulting and strategic advisory services
      business segment is the cost of services before reimbursable expenses, which
      generally relates to costs associated with generating consulting revenues,
      and
      includes employee payroll expenses and benefits, contractor compensation, vendor
      compensation, marketing expenses and direct costs of training and recruiting
      the
      consulting staff. Consultant compensation consists of salaries, incentive
      compensation and benefits. As revenues are generated from services performed
      by
      our permanent staff and contractors, our success depends on attracting,
      retaining and motivating talented, creative and experienced professionals at
      all
      levels.





***Technology
      Business Segment***





For
      most
      of the past decade we have been engaged in the development of proprietary
      nuclear fuel designs which we ultimately intend to introduce for sale into
      two
      markets: (1) nuclear fuel designs for use in commercial nuclear power plants
      and
      (2) nuclear fuel designs for reactor-grade plutonium disposition. In addition,
      we have a conceptual nuclear fuel design for weapons-grade plutonium
      disposition. These three types of fuel designs are primarily for use in existing
      or future VVER-1000 light water reactors. We have also been conducting research
      and development related to a variant of these nuclear fuel designs for use
      in
      existing pressurized water reactors (PWR).





Our
      future customers may include nuclear fuel fabricators and/or nuclear power
      plants, and/or the U.S. or foreign governments.





To
      date,
      our operations have been devoted primarily to the development and demonstration
      of our nuclear fuel designs, developing strategic relationships within and
      outside of the nuclear power industry, securing political and financial support
      from the U.S. and Russian governments, and the filing of patent applications
      including related administrative functions.





While
      we
      do not currently have any direct revenues from our research and development
      activities regarding our proprietary nuclear fuel technology, and expect that
      we
      will not generate licensing revenues from this business for several years,
      until
      our fuel designs can be fully tested and demonstrated and we obtain the proper
      approvals to use our nuclear fuel designs in nuclear reactors, we are utilizing
      certain common corporate capabilities in both our technology and consulting
      businesses. We believe we can leverage our general nuclear technology, business
      and regulatory expertise as well as industry relationships, to optimize our
      technology development plans and create integrated advisory services with the
      highest levels of expertise and experience in the nuclear power industry.
      Additionally, our knowledge of and credibility in addressing proliferation
      related issues that we have developed over many years, benefit our new
      consulting business. Our advisory services include a focus on non-proliferation,
      safety and operational transparency of nuclear power programs.





**Material
      Opportunities and Challenges**





***Consulting
      and Strategic Advisory Services***





Our
      emergence in the field of nuclear energy consulting is in direct response to
      the
      need for independent assessments, and highly qualified and integrated strategic
      advisory services for countries looking to establish nuclear energy programs,
      while still providing a blueprint for safe, clean, efficient and cost-effective
      non-proliferative nuclear power. We offer full-scope planning and strategic
      advisory services for new and existing markets, and offer such services without
      a bias towards or against any reactor vendor or fuel technology. We believe
      that
      there are significant opportunities available to provide services to governments
      that are dedicated to non-proliferative, safe and transparent nuclear
      programs.


17




Our
      major
      challenge in pursuing our business is that the decision making process for
      nuclear power programs typically involves careful consideration by many parties
      and therefore requires significant time. Also, many of the potential clients
      that could benefit from our services are in regions of the world where tensions
      surrounding nuclear energy are high, or in countries where public opinion plays
      an important role. Domestic and international political pressure may hinder
      our
      efforts to provide nuclear energy services, regardless of our focus on
      non-proliferative nuclear power.





***Proprietary
      Nuclear Fuel Technology Development***





We
      believe that a major opportunity for us is the possibility that our fuel
      designs, which are currently in the research and development stage, will be
      used
      in the manufacturing of nuclear fuel utilized in many existing light water
      nuclear reactors in the future. Light water reactors are the dominant reactor
      types currently in use in the world and fuels for such reactors constitute
      the
      majority of the commercial market for nuclear fuel. Our focus is on two
      different types, or variants, of thorium-based fuel designs. The first is
      designed to provide reactor owner-operators with an economically viable
      alternative fuel that will not generate weapons-usable plutonium in the spent
      fuel. The second is designed to dispose of reactor-grade plutonium that has
      been
      extracted from spent fuel from commercial reactors and stockpiled in Russia,
      Western Europe, the U.S., Japan and other countries. We also have developed
      a
      conceptual design for a fuel to dispose of weapons-grade plutonium that is
      stockpiled in Russia and the United States. All three of these fuel variants
      are
      expected to have additional benefits, including reduced volume and reduced
      long-term radio-toxicity of spent fuel for the same amount of electricity
      generated, as compared with the uranium fuels that are currently used in light
      water reactors.





We,
      through our wholly owned subsidiary Thorium Power, Inc., have been developing
      relations with relevant entities within the United States and Russian
      governments for over fourteen years. Thorium Power, Inc., in cooperation with
      these governments, has been demonstrating its fuel designs in a research reactor
      in Russia for over four years. Independent analyses of the technology have
      been
      performed, including a May 2005 report by the International Atomic Energy Agency
      (the “IAEA”) and an April 2005 report by Westinghouse Electric Company LLC
      (“Westinghouse”). The IAEA and Westinghouse analyses were positive and
      management believes that they can help lead to the favorable reception of our
      nuclear fuel designs in the future.





We
      are
      also working with Russian nuclear research institutes and Russian nuclear
      regulatory authorities to have one or more of the fuel designs demonstrated
      in a
      Russian VVER-1000 reactor within the next three to four years, if we are able
      to
      obtain necessary support and enter into agreements with the Russian government
      and Russian research institutes. We believe that it will be necessary to enter
      into commercial arrangements with one or more major nuclear fuel fabricators,
      which in many cases are also nuclear fuel vendors, as a prerequisite to having
      our fuel designs widely deployed in global markets.





Our
      nuclear fuel designs have never been demonstrated in a full-size commercial
      reactor. Our planned demonstration of the fuels in a VVER-1000 reactor in Russia
      would provide operating experience that is critical to reactor owners and
      regulatory authorities. We believe that once the fuels have been demonstrated
      in
      the VVER-1000 reactor, this can help convince other light water reactor
      operators around the world to accept our thorium-based fuel
      designs.





We
      have
      also been conducting research and development related to a variant of these
      nuclear fuel designs for use in existing and future Western pressurized water
      reactors (PWR).





We
      believe that our greatest challenge will be acceptance of these fuel designs
      by
      nuclear power plant operators, which have in the past been hesitant to be the
      first to use a new type of nuclear fuel. In addition, our fuel designs would
      require regulatory approval by relevant nuclear regulatory authorities, such
      as
      the Nuclear Regulatory Commission in the United States or its equivalent
      agencies in other countries, before they can be used in commercial reactors.
      The
      regulatory review process, which is outside of our control, may take longer
      than
      expected and may delay a rollout of the fuel designs into the market. We believe
      that demonstration of one of the Company’s fuel designs in a commercial nuclear
      reactor would make deployment of the other designs easier due to the many
      similarities that exist among all of our fuel designs.


18





Thorium
      Power, Inc. has been building relationships with companies and organizations
      in
      the nuclear power industry for several years. We will attempt to cause some
      or
      all of these companies and organizations to work in a consortium or a joint
      venture type arrangement with us in the future, however, we may not be able
      to
      develop any such consortium or arrangement in the near term or at all. The
      companies that we have identified for potential relationships have existing
      contracts with nuclear power plant owner-operators under which they supply
      nuclear fuel branded with their name to such nuclear power plants. We will
      attempt to cause these nuclear fuel vending companies to provide their nuclear
      power plant operating customers with fuels that are designed with our
      technology. To do so, we will need to enter into agreements with one or more
      of
      these companies. Without such arrangements it would be more difficult for us
      to
      license our fuel designs because, in addition to the reputations, guarantees,
      services, and other benefits that these nuclear fuel vendors provide when
      selling fuel to nuclear power plant operators, they also often have multi-year
      fuel supply contracts with the reactor operators. These multi-year fuel supply
      contracts act as a barrier to entry into the market, such that it can be almost
      impossible to penetrate some markets for nuclear fuel without working with
      a
      nuclear fuel vendor that can support long term contracts. If we are successful
      in demonstrating our fuel designs in Russia and in continuing to build
      relationships with nuclear fuel vendors, we believe it may lead to one or more
      of these major companies in the nuclear power industry working with us in
      producing and selling our nuclear fuel designs to commercial reactor operators
      and governments.




***Business
      Segments and Periods Presented***




Prior
      to
      January 1, 2008, we operated as a single reportable segment. As a result of
      the formation of our consulting and strategic advisory services business segment
      in December 2007, and based on a review of SFAS No. 131, Disclosures about
      Segments of an Enterprise and Related Information, we have determined that
      we
      now operate in two business segments starting in 2008; the "technology business"
      and the "consulting and strategic advisory services business." We present our
      segment information along the same lines that our chief executive, chief
      operating officer and chief financial officer review our operating results
      in
      assessing performance and allocating resources.




We
      have
      provided a discussion of our results of operations on a consolidated basis
      and
      have also provided certain detailed segment information for each of our business
      segments below for the six months and three months ended June 30, 2008, in
      order
      to provide a meaningful discussion of our business segments.




Consulting
            
            Technology
            
            Corporate and EliminationsJune 30, 2008
            
            June 30, 2008
            
            June 30, 2008
            
            Total6 Months
            
            3 Months
            
            6 Months
            
            3 Months
            
            6 Months
            
            3 Months
            
            6 Months
            
            3 MonthsRevenue
            
            
            8,116,625
            
            
            4,301,500
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            8,116,625
            
            
            4,301,500Segment
                Profit - Before Tax
            
            
            4,732,059
            
            
            2,564,938
            
            
            (632,992
            )
            
            (315,543
            )
            
            (5,852,193
            )
            
            (3,245,414
            )
            
            (1,753,126
            )
            
            (996,019
            )Total
                Assets
            
            
            -
            
            
            
            
            
            17,932
            
            
            
            
            
            7,444,196
            
            
            
            
            
            7,462,128Property
                Additions
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Interest
                Expense
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            183
            
            
            -
            
            
            183
            
            
            -Depreciation
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            6,020
            
            
            3,010
            
            
            6,020
            
            
            3,010




**Factors
      Affecting the Comparability of Business Segment Results**




As
      discussed above, the formation of our consulting and strategic advisory services
      business segment at the end of 2007 (December 2007), impacts the comparability
      of our results of segment operations in the first six months of 2008 and three
      months ended June 30, 2008 versus the first six months and three months ended
      June 30, of 2007, as we were not performing consulting services during the
      first
      six months and three months ended June 30, of 2007, therefore we are not showing
      comparative 2007 figures in the business segment information above.


19




***Consulting
      and Strategic Advisory Services Business***





At
      the
      present time we are deriving all of our $8,116,625 of revenue for the six months
      ended June 30, 2008 and $4,301,500 for the three months ended June 30, 2008
      from
      our consulting and strategic advisory services business segment, by offering
      services to foreign governments planning to create or expand electricity
      generation capabilities using nuclear power plants benefiting from thorium-based
      or other nuclear fuels. Our fee type and structure that we offer for each client
      engagement is dependent on a number of variables, including the complexity,
      the
      level of the opportunity for us to improve the client’s electricity generation
      capabilities using nuclear power plants, and other factors. All of the Company's
      revenues for the first six months and three months ended June 30, 2008 have
      been
      derived from the completion of the Roadmap and Quickstart projects with the
      Executive Affairs Authority of Abu Dhabi, one of the member Emirates of the
      United Arab Emirates. The cost of consulting services provided are $3,384,566
      for the six months ended June 30, 2008 and $1,736,562 for the three months
      ended
      June 30, 2008, which consists primarily of direct labor consulting expenses
      and
      other labor support costs incurred, to complete our first and second consulting
      projects with the EAA. Other indirect corporate overhead incurred was not
      allocated to the consulting and strategic advisory services business segment
      and
      is reported above in the business segment information chart as unallocated
      corporate overhead costs.





Based
      on
      the completion of the Roadmap and Quickstart projects and the August 1, 2008
      Agreements, we are no longer a development stage company in 2008.





***Technology
      Business***





Over
      the
      next 12 to 18 months we expect to incur approximately $3-5 million in research
      and development expenses related to the development of our proprietary nuclear
      fuel designs. We expect to incur these expenses after we have entered into
      formal agreements with Russian nuclear entities that will grant us licensing
      and
      other rights to use such technologies or intellectual property developed by
      the
      Russian entities. Any such agreement would require formal review and approval
      by
      the Russian Federal Agency for Atomic Energy (RosAtom). We have spent
      approximately $285,000 for research and development so far in 2008, and a
      cumulative amount from the date of our inception (January 8, 1992, date of
      inception of Thorium Power Inc.) to June 30, 2008 of $4,968,762. In addition
      we
      incurred approximately $348,000 in salary, benefits and other general and
      administrative support costs for the six months ended June 30, 2008. We have
      established an office in Moscow and leased office space to support our research
      and development activities in Russia, as of May 1, 2008.





Over
      the
      next several years, we expect that our research and development activities
      will
      increase and will be primarily focused on testing and demonstration of our
      thorium/uranium and thorium/reactor-grade plutonium disposing fuel designs.
      The
      main objective of this research and development phase is to prepare for
      full-scale demonstration of our nuclear fuel technology in an operating
      commercial VVER-1000 reactor in Russia. Key research and development activities
      will include: (1) Scaling up the fuel fabrication process to full length (10
      feet) rods used in commercial VVER-1000 reactors, (2) Validating thermal
      hydraulic performance of full size (10 feet) seed and blanket fuel assembly,
      (3)
      Continuing capsule irradiation testing of seed and blanket fuel samples in
      a
      research reactor and performing post-irradiation examination of fuel samples
      that have reached the target burn-up level to confirm fuel performance, and
      (4)
      Obtaining final regulatory approvals for insertion of fuel in VVER-1000
      commercial reactors. As this research and development program relates to
      commercial applications of our fuel technology, and retaining ownership or
      control over as much key intellectual property as we possibly can is critical
      to
      the long-term success of our licensing business model, our plan is to fully
      fund
      these research and development activities ourselves. At the same time, we do
      not
      currently plan to fund research, testing and demonstration of our
      thorium/weapons-grade plutonium disposing fuel, which can only be used in the
      U.S.-Russia government-to-government weapons-grade plutonium disposition program
      and has no commercial applications. Hence, funding for any future research
      and
      development activities on this fuel design would have to be provided by the
      U.S.
      government or other stakeholders.





***Financial
      Status***





At
      June
      30, 2008, our total assets were approximately $7.5 million and total liabilities
      as of June 30, 2008 were approximately $2.8 million. We had a working capital
      surplus of approximately $2.7 million at June 30, 2008.


20




Since
      the
      year ended December 31, 2007, our consulting revenues have improved our total
      cash plus marketable securities available for sale substantially to $6.9 million
      as of June 30, 2008, primarily due to the $4.3 million received in April 2008
      as
      pre-payment for the Quickstart consulting contract that we entered into in
      March
      2008, as mentioned above. Pursuant to the August 1, 2008 Agreements, the Company
      will be paid a total of $8.9 million from ENEC and $8.5 million from FANR
      (aggregate of $17.4 million), for professional fees and services performed
      during the period from June 23, 2008 through December 31, 2008. The term of
      the
      Agreements is five years, with automatic renewal for one year periods unless
      otherwise terminated pursuant to the provisions of the Agreements. A Side Letter
      provides that upon execution of the Agreements, EAA will pay to the Company
      $10
      million of the aggregate $17.4 million, with the remaining $7.4 million due
      under the agreements to be paid, equally, by ENEC and FANR upon their formation.





In
      support of our longer-term business plan for our technology business segment,
      we
      will need to raise additional capital by way of an offering of equity
      securities, an offering of debt securities, or by obtaining financing through
      a
      bank or other entity to finance our overhead and research and development
      expenditures. We will also need to raise capital to support our overhead
      operation if the consulting and strategic advisory services business becomes
      non-sustaining. Our current average monthly projected working capital
      requirements for the company, excluding the $3-5 million of research and
      development expenses we expect to incur in Russia over the next
      12 – 18 months is approximately $1,000,000 per month. This financing
      will need to take place early in 2009, to ensure that we have the necessary
      working capital to continue our business operations through 2009 and beyond.
      It
      is important to note that financing may not be available or we may not be able
      to obtain that financing on terms acceptable to us. If additional funds are
      raised through the issuance of equity securities, there may be a significant
      dilution in the value of our outstanding common stock. To support this financing
      activity, we are exploring transaction opportunities that could simultaneously
      create strategic industry and market alliances for the company, to support
      our
      operations in 2009 and beyond.




**Consolidated
      Results of Operations**





***Comparison
      of the Six Months Ended June 30, 2008 to June 30,
      2007***





The
      following table summarizes certain aspects of the Company’s consolidated results
      of operations for the six months ended June 30, 2008 compared to the six months
      ended June 30, 2007:





**Six Months Ended****June 30,****2008**
            
            **2007**
            
            **Change $**
            
            **Change %****Consulting
                Revenues**
            
            $
            8,116,625
            
            $
            -
            
            $
            8,116,625
            
            
            -**Cost
                of services provided**Consulting
                expenses
            
            $
            3,384,566
            
            $
            -
            
            $
            3,384,566%
                of total revenues
            
            
            42
            %
            
            -
            
            
            
            
            
            -**Gross
                profit**
            
            $
            4,732,059
            
            $
            -
            
            $
            4,732,059%
                of total revenues
            
            
            58
            %
            
            -
            
            
            
            
            
            -**Operating
                Expenses**General
                and administrative
            
            $
            3,116,987
            
            $
            2,793,733
            
            $
            323,254%
                of total revenues
            
            
            38
            %
            
            N/A
            
            
            
            
            
            12
            %Research
                and development expenses
            
            $
            285,449
            
            $
            155,471
            
            $
            129,978%
                of total revenues
            
            
            4
            %
            
            N/A
            
            
            
            
            
            -Stock-based
                compensation
            
            $
            2,787,179
            
            $
            2,454,734
            
            $
            332,445%
                of total revenues
            
            
            34
            %
            
            N/A
            
            
            
            
            
            14
            %Total
                Operating Loss
            
            $
            (1,457,556
            )
            $
            (5,403,938
            )
            $
            3,946,382%
                of total revenues
            
            
            -18
            %
            
            N/A
            
            
            
            
            
            -73
            %Other
                Income and (Expenses)Interest
                income/expense, other
            
            $
            (295,570
            )
            $
            158,336
            
            $
            (453,906
            )%
                of total revenues
            
            
            -4
            %
            
            N/A
            
            
            
            
            
            -287
            %**Net
                loss - before income taxes**
            
            $
            (1,753,126
            )
            $
            (5,245,602
            )
            $
            3,492,476%
                of total revenues
            
            
            -22
            %
            
            N/A
            
            
            
            
            
            -67
            %




21




Revenues





The
      increase in revenues for the six months ended June 30, 2008, as compared to
      the
      same period in 2007, is primarily due to us coming out of the development stage
      with our consulting and strategic advisory services business segment. We earned
      revenue by completing the Roadmap and Quickstart consulting projects mentioned
      above. We will earn additional consulting revenues in the future quarters of
      2008 from the
      two new consulting agreements we entered into on August 1, 2008, and potential
      additional consulting contracts we may obtain in 2008.





Cost
      of Services Provided





The
      increase in the cost of services for the six months ended June 30, 2008 is
      due
      to the expenses related to the consulting, professional, travel, administrative
      and other costs that were incurred to complete the work performed on our Roadmap
      and Quickstart consulting projects. We will incur additional consulting and
      other support expenses while working on the two new consulting agreements that
      we entered into on August 1, 2008 as well as potential additional consulting
      contracts we may obtain, in the future reporting periods in 2008.





General
      and Administrative Expenses





The
      increase in the general and administrative expenses for the six months ended
      June 30, 2008 is primarily due to an increase in corporate consulting costs
      of
      approximately $232,000, (from $266,000 in 2007 to $498,000 in 2008) and an
      increase of approximately $216,000 in employee wages and benefits, due to the
      increase in wages and also the increase in the number of employees hired to
      support both business segments. This increase was offset by a decrease of
      amounts paid for corporate travel expenses of $128,000, (from 337,000 in 2007
      to
      $209,000 in 2008). We expect our general and administrative expenses to increase
      in future periods due to the expansion of our consulting and strategic advisory
      services business segment and the hiring of new officers, employees and
      consultants to help further develop and support both our (1) consulting and
      strategic advisory services and (2) technology business segments.





Research
      and Development Costs





The
      increase in research and development costs for the six months ended June 30,
      2008 is due to the increase in the scope of work for our research and
      development activities both in Russia and elsewhere. We expect that our research
      and development expenses will increase in the future periods.





Stock-Based
      Compensation





The
      increase in stock based compensation for the six months ended June 30, 2008
      is
      due to the long-term incentive stock options and stock that were granted under
      our stock plan to our executives, directors, advisors and employees at the
      end
      of 2007, which is now being expensed as these grants are vesting in 2008 and
      in
      future years. We expect that our stock based compensation will increase in
      future periods due to the granting of additional stock options and stock to
      attract new executives and consultants, as well as granting stock options and
      stock to our current executives, directors, consultants and other support staff.





22




Other
      Income and Expense





The
      decrease in other income and expense for the six months ended June 30, 2008
      is
      due to the decrease in interest income earned on our idle cash balances and
      the
      realized loss on marketable securities. Due to the current lack of liquidity
      for
      auction rate securities held by the Company, we have concluded that the carrying
      value of these investments was higher than its fair value as of June 30, 2008.
      Accordingly, these auction rate securities have been recorded at their estimated
      fair value of $1,674,849 (total realized loss of $439,594 for the three months
      and six months ended June 30, 2008). The Company considers this to be an
      other-than-temporary reduction in the carrying value of these auction rate
      securities. Accordingly, the loss associated with these auction rate securities
      of $439,594 has been recorded as a recognized loss on investments in the
      Company’s consolidated statement of operations for the three months and six
      months ended June 30, 2008. The Company does not know at the present time when
      it will be able to convert these investments into cash.  Accordingly,
      management has classified these investments as a non-current asset on its
      consolidated balance sheet as of June 30, 2008. Management will continue to
      monitor these investments closely for future indications of further impairment.
      The Company currently expects to be able to sustain its operations as it
      anticipates having adequate cash reserves for future operations. We expect
      to
      hold these auction rate securities until such time that the market recovers
      for
      these types of investments.





***Comparison
      of the Three Months Ended June 30, 2008 to June 30,
      2007***





The
      following table summarizes certain aspects of the Company’s consolidated results
      of operations for the three months ended June 30, 2008 compared to the three
      months ended June 30, 2007





**Three Months Ended****June 30,****2008**
            
            **2007**
            
            **Change $**
            
            **Change %****Consulting
                Revenues**
            
            $
            4,301,500
            
            $
            -
            
            $
            4,301,500**Cost
                of services provided**Consulting
                expenses
            
            $
            1,736,562
            
            $
            -
            
            $
            1,736,562%
                of total revenues
            
            
            40
            %
            
            -
            
            
            
            
            
            -**Gross
                profit**
            
            $
            2,564,938
            
            $
            -
            
            $
            2,564,938%
                of total revenues
            
            
            60
            %
            
            -
            
            
            
            
            
            N/A**Operating
                Expenses**General
                and administrative
            
            $
            1,597,941
            
            $
            1,265,340
            
            $
            332,601%
                of total revenues
            
            
            37
            %
            
            N/A
            
            
            
            
            
            26
            %Research
                and development
            
            $
            154,788
            
            $
            129,402
            
            $
            25,386%
                of total revenues
            
            
            4
            %
            
            N/A
            
            
            
            
            
            N/AStock-based
                compensation
            
            $
            1,423,376
            
            $
            1,119,217
            
            $
            304,159%
                of total revenues
            
            
            33
            %
            
            N/A
            
            
            
            
            
            27
            %Total
                Operating Loss
            
            $
            (611,167
            )
            $
            (2,513,959
            )
            $
            1,902,792%
                of total revenues
            
            
            -14
            %
            
            N/A
            
            
            
            
            
            -76
            %Other
                Income and (Expenses)Interest
                income/expense, other
            
            $
            (384,852
            )
            $
            45,750
            
            $
            (430,602
            )%
                of total revenues
            
            
            -9
            %
            
            N/A
            
            
            
            
            
            -941
            %**Net
                loss**
            
            $
            (996,019
            )
            $
            (2,468,209
            )
            $
            1,472,190%
                of total revenues
            
            
            -23
            %
            
            N/A
            
            
            
            
            
            -60
            %





23




Revenues





The
      increase in revenues for the three months ended June 30, 2008, as compared
      to
      the same period in 2007, is primarily due to us coming out of the development
      stage with our consulting and strategic advisory services business segment.
      We
      earned revenue for the three months ended June 30, 2008 from our Quickstart
      consulting project. We will earn additional consulting revenues in the future
      quarters of 2008 from the two new consulting contracts that we entered into
      on
      August 1, 2008, mentioned above.





Cost
      of Services Provided





The
      increase in the cost of services for the three months ended June 30, 2008 is
      due
      to expenses related to the consulting, professional, travel, administrative
      and
      other costs that were incurred to complete the work performed on our Quickstart
      consulting project. We anticipate incurring additional consulting and other
      support expenses related to the August 1, 2008 Agreements as well as other
      consulting projects that we may enter into, in future reporting periods in
      2008.





General
      and Administrative Expenses





The
      increase in the general and administrative expenses for the three months ended
      June 30, 2008 is primarily due to an increase in corporate consulting costs
      that
      are recorded as administrative expenses of approximately $300,000, (from $22,000
      in 2007 to $322,000 in 2008) and an increase of approximately $153,000 in
      employee wages and benefits due to the increase in wages and also the increase
      in the number of employees hired. We also had an increase in fees and expenses
      for our advisory boards of approximately $156,000. This increase was offset
      by a
      decrease in amounts paid for corporate travel expenses of $154,000, (from
      212,000 in 2007 to $58,000 in 2008) and a decrease in legal fees paid of $74,000
      (from 252,000 in 2007 to $178,000 in 2008). We expect our general and
      administrative expenses to increase in future periods due to the expansion
      of
      our consulting and strategic advisory services business segment and the hiring
      of new officers, employees and consultants to help further develop and support
      our (1) consulting and strategic advisory services and (2) technology business
      segments.





Research
      and Development Costs





The
      increase in research and development costs for the six months ended June 30,
      2008 is due to the increase in the scope of work for our research and
      development activities both in Russia and elsewhere. We expect that our research
      and development expenses will increase in the future periods.





Stock-Based
      Compensation





The
      increase in stock based compensation for the three months ended June 30, 2008
      is
      due to the long-term incentive stock options and stock that were granted under
      our stock plan to our executives, directors, advisors and employees at the
      end
      of 2007, and in the six months ended June 30, 2008, which are now being expensed
      as these grants are vesting in 2008 and in future years.





Other
      Income and Expense





The
      decrease in other income and expense for the six months ended June 30, 2008
      is
      due to the decrease in interest income earned on our idle cash balances and
      the
      realized loss on marketable securities, as mentioned above in the six month
      analysis in the changes in other income and expense.





24




**Liquidity
      and Capital Resources**





As
      of
      June 30, 2008, we had a total of cash and cash equivalents of $5,185,597. The
      following table provides detailed information about our net cash flow for all
      financial statements periods presented in this Report.




**Cash
      Flow**




**Six Months Ended June 30,****2008**
            
            **2007**Net
                cash used in operating activities
            
            $
            (3,086,787
            )
            $
            (3,250,305
            )Net
                cash used in investing activities
            
            
            -
            
            
            -Net
                cash provided (used by) financing activities
            
            
            39,542
            
            
            (2,515
            )Net
                cash outflow
            
            $
            (3,047,245
            )
            $
            (3,252,820
            )





In
      August
      2008 we will receive $10 million as an advance payment for consulting services
      to be performed under our two new consulting agreements signed on August 1,
      2008.





*Operating
      Activities*




Net
      cash
      used for operating activities was $ 3,086,787 for the
      six months ended June 30, 2008, which is a decrease of $163,518  from
      the
      $3,250,305 net cash used for operating activities for the same period in 2007.
      This decrease in the use of funds for our operating activities was primarily
      due
      to the cash received from the Quickstart consulting agreement of $4,285,000,
      received in April 2008. The cash received of $3,793,125 for fees earned from
      our
      first consulting agreement, the Roadmap consulting agreement that was completed
      in March 2008, was received in December 2007 as a full prepayment prior to
      the
      start of the Roadmap consulting contract and this amount (recorded as deferred
      revenue at December 31, 2007) was recorded as cash received in the our statement
      of cash flows for the year ended December 31, 2007 and is not included in the
      statement of cash flows for the six months ended June 30, 2008 nor in the above
      liquidity chart for the six months ended June 30, 2008. This decrease in the
      cash used in operation activities was offset by an increase
      in our cost of services provided to perform these contracts, which was paid
      to
      our consultants in order to provide the necessary services for both the Roadmap
      and Quickstart consulting projects. The other changes to the operating
      activities cash flows are mentioned above in the consolidated results of
      operations section regarding expenses incurred for general and administrative
      expenses, and items mentioned in the other income and expense.




*Financing
      Activities*




Net
      cash
      provided by financing activities in the six months ended June 30, 2008 totaled
      $ 39,542, as
      compared to cash used of $ 2,515 in the
      same period of 2007. This increase in the cash provided by financing activities
      was mainly attributable to money received from the exercise of stock options
      in
      the amount of $ 49,975 .
      This
      increase in cash provided by our financing activities was offset by an increase
      in our payments of our notes payable in the amount of $10,433.




Management
      expects that the proceeds from our first two consulting agreements, as well
      as
      the expected proceeds from the two new consulting agreements we entered into
      in
      August 2008, will meet our foreseeable working capital needs for our current
      operations for the next 6 to 12 months. However, we will need to raise
      additional capital by way of an offering of equity securities, an offering
      of
      debt securities, or by obtaining financing through a bank or other entity to
      support our longer term business plan. We will also need to raise capital to
      support our overhead operation if the consulting and strategic advisory services
      business becomes non-sustaining. If we need to obtain additional financing,
      that
      financing may not be available or we may not be able to obtain that financing
      on
      terms acceptable to us. If additional funds are raised through the issuance
      of
      equity securities, there may be a significant dilution in the value of our
      outstanding common stock.




25




***Off
      Balance Sheet Arrangements***




We
      do not
      have any off balance sheet arrangements that have or are reasonably likely
      to
      have a current or future effect on our financial condition, changes in financial
      condition, revenues or expenses, results of operations, liquidity or capital
      expenditures or capital resources that is material to an investor in our
      securities.





***Seasonality***




Our
      business has not been subject to any material seasonal variations in operations,
      although this may change in the future.




***Inflation***




Our
      business, revenues and operating results have not been affected in any material
      way by inflation.





***Critical
      Accounting Policies and Estimates***




The
      SEC
      issued Financial Reporting Release No. 60, "Cautionary Advice Regarding
      Disclosure About Critical Accounting Policies" suggesting that companies provide
      additional disclosure and commentary on their most critical accounting policies.
      In Financial Reporting Release No. 60, the SEC has defined the most critical
      accounting policies as the ones that are most important to the portrayal of
      a
      company's financial condition and operating results, and require management
      to
      make its most difficult and subjective judgments, often as a result of the
      need
      to make estimates of matters that are inherently uncertain. Based on this
      definition, we have identified the following significant policies as critical
      to
      the understanding of our financial statements.




The
      preparation of financial statements in conformity with generally accepted
      accounting principles requires management to make a variety of estimates and
      assumptions that affect (i) the reported amounts of assets and liabilities
      and
      disclosure of contingent assets and liabilities as of the date of the financial
      statements and (ii) the reported amounts of revenues and expenses during the
      reporting periods covered by the financial statements.




Our
      management expects to make judgments and estimates about the effect of matters
      that are inherently uncertain. As the number of variables and assumptions
      affecting the future resolution of the uncertainties increase, these judgments
      become even more subjective and complex. Although we believe that our estimates
      and assumptions are reasonable, actual results may differ significantly from
      these estimates. Changes in estimates and assumptions based upon actual results
      may have a material impact on our results of operation and/or financial
      condition. We have identified certain accounting policies that we believe are
      most important to the portrayal of our current financial condition and results
      of operations. Our significant accounting policies are disclosed in Note 2
      to
      the Consolidated Financial Statements included in the Annual Report on Form
      10-K
      filed with the Commission on March 27, 2008.





Accounting
      for Stock Based Compensation, Stock Options and Warrants Granted to Employees
      and Non-employees




We
      adopted SFAS 123(R), as of January 1, 2006. SFAS 123(R) replaced
      the existing requirements under SFAS No. 123, Accounting for Stock Based
      Compensation, and Accounting Principles Board Opinion No. 25, Accounting
      for Stock-based Compensation to Employees, or APB 25. According to
      SFAS 123(R), all forms of share-based payments to employees, including
      employee stock options and employee stock purchase plans, are treated the same
      as any other form of compensation by recognizing the related cost in the
      statement of income.




Under
      SFAS 123(R), stock-based compensation expense is measured at the grant date
      based on the fair value of the award, and the expense is recognized ratably
      over
      the award's vesting period. For all grants made, we recognize compensation
      cost
      under the straight-line method.




26




We
      measure the fair value of stock options on the date of grant using a
      Black-Scholes option-pricing model which requires the use of several estimates,
      including:




•
the
      volatility of our stock price;


•
the
      expected life of the option;


•
risk
      free interest rates; and


•
      expected dividend yield.




Prior
      to
      the completion of our merger in October 2006, we had limited historical
      information on the price of our stock as well as employees' stock option
      exercise behavior for stock options issued prior to the merger. As a result,
      we
      could not rely on historical experience alone to develop assumptions for stock
      price volatility and the expected life of options. As such, our stock price
      volatility was estimated with reference to our historical stock price for the
      time period before the merger, from the date the announcement of the merger
      was
      made. We utilized the closing prices of our publicly-traded stock from the
      announcement date in January 2006 to determine our volatility and will continue
      to use our historical stock price closing prices to determine our volatility
      in
      2008.




The
      expected life of options is based on internal studies of historical experience
      and projected exercise behavior. We estimate expected forfeitures of stock-based
      awards at the grant date and recognize compensation cost only for those awards
      expected to vest. The forfeiture assumption is ultimately adjusted to the actual
      forfeiture rate. Estimated forfeitures are reassessed in subsequent periods
      and
      may change based on new facts and circumstances. We utilize a risk-free interest
      rate, which is based on the yield of U.S. treasury securities with a maturity
      equal to the expected life of the options. We have not and do not expect to
      pay
      dividends on our common shares.




The
      options were valued using the Black-Scholes option pricing model. The
      assumptions used were as follows: volatility of 99% to 275%, a risk-free
      interest rate of 4.06% to 4.45%, dividend yield of 0% and an exercise term
      of
      five to ten years.




*Income
      Taxes*




We
      account for income taxes using the liability method in accordance with SFAS
      No. 109 Accounting for Income Taxes, which requires the recognition of
      deferred tax assets or liabilities for the tax-effected temporary differences
      between the financial reporting and tax bases of our assets and liabilities
      and
      for net operating loss and tax credit carry forwards. The tax expense or benefit
      for unusual items, prior year tax exposure items or certain adjustments to
      valuation allowances are treated as discrete items in the interim period in
      which the events occur.




On
      January 1, 2007, we adopted FASB Interpretation No. 48, Accounting for
      Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109, or
      FIN 48. FIN 48 addresses the determination of whether tax benefits
      claimed or expected to be claimed on a tax return should be recorded in the
      financial statements. Under FIN 48, we may recognize the tax benefit from
      an uncertain tax position only if it is more likely than not that the tax
      position will be sustained on examination by the taxing authorities, based
      on
      the technical merits of the position. As a result of the implementation of
      FIN 48, we did not recognize any current tax liability for unrecognized tax
      benefits. We have estimated the amount of our net operating loss carry-forwards
      and we currently have engaged tax professionals to evaluate the amount of net
      operating loss carry-forward available to us to offset future taxable income,
      under Internal Revenue Code Section 382.





*Revenue
      Recognition from Consulting Contracts*





We
      believe one of our critical accounting policies is revenue recognition from
      our
      consulting contracts. We are currently primarily deriving our revenue from
      fees
      by offering consulting and strategic advisory services to foreign commercial
      and
      government owned entities planning to create or expand electricity generation
      capabilities, using nuclear power plants. Our fee type and structure for each
      client engagement depend on a number of variables, including the size of the
      client, the complexity, the level of the opportunity for us to improve the
      client’s electricity generation capabilities using nuclear power plants, and
      other factors.





We
      recognized the revenues for our first consulting project which we completed
      in
      March 2008, using the completed performance model. We recognized the revenues
      from our second consulting contract in our second fiscal quarter of 2008 and
      we
      will recognize revenue from the two new consulting agreements that we entered
      into in August 2008 as the consulting services are performed and certain
      contract deliverables, performed in accordance with an agreed-upon detail work
      plan, are met.





27




We
      recognize revenue in accordance with SEC Staff Accounting Bulletin or SAB,
      No. 104, Revenue Recognition. We recognize revenue when all of the
      following conditions are met:





1.  There
      is
      persuasive evidence of an arrangement;





2.  The
      service has been provided to the customer;




3.  The
      collection of the fees is reasonably assured; and




4.  The
      amount of fees to be paid by the customer is fixed or determinable.




In
      situations where contracts include client acceptance provisions, we do not
      recognize revenue until such time as the client has confirmed its acceptance.




Intangibles




As
      presented on the accompanying balance sheet, we had patents with a net book
      value of $217,875 as of June 30, 2008. There are many assumptions and estimates
      that may directly impact the results of impairment testing, including an
      estimate of future expected revenues, earnings and cash flows, and discount
      rates applied to such expected cash flows in order to estimate fair value.
      We
      have the ability to influence the outcome and ultimate results based on the
      assumptions and estimates we choose for testing. To mitigate undue influence,
      we
      set criteria that are reviewed and approved
      by various levels of management. The determination of whether or not intangible
      assets have become impaired involves a significant level of judgment in the
      assumptions. Changes in our strategy or market conditions could significantly
      impact these judgments and require adjustments to recorded amounts of intangible
      assets.




Marketable
      Securities




The
      Company’s investments in auction rate marketable securities are classified as
      available-for-sale securities under FAS-115, Accounting for Certain Investments
      in Debt and Equity Securities. These securities are reported at their fair
      market value, with unrealized holding gains and losses reported in other
      comprehensive income. Due to the current lack of liquidity for auction rate
      securities held by the Company, we have concluded that the carrying value of
      these investments was higher than its fair value as of June 30, 2008.
      Accordingly, these auction rate securities have been recorded at their estimated
      fair value.





**ITEM
      4T.****CONTROLS
      AND PROCEDURES.**





***Disclosure
      Controls and Procedures***





As
      required by Rule 13a-15 under the Exchange Act, we carried out an evaluation
      of
      the effectiveness of the design and operation of our disclosure controls and
      procedures, as of the end of the period covered by this report on Form 10-Q.
      This evaluation was carried out under the supervision and with the participation
      of our management, including our President and Chief Executive Officer, and
      our
      Chief Financial Officer. Based upon that evaluation, management concluded that
      our disclosure controls and procedures are effective to ensure that information
      required to be disclosed in the reports that it files or submits under the
      Exchange Act is accumulated and communicated to management (including the chief
      executive officer and chief financial officer) to allow timely decisions
      regarding required disclosure and that our disclosure controls and procedures
      are effective to give reasonable assurance that the information required to
      be
      disclosed by us in reports that we file under the Exchange Act is recorded,
      processed, summarized and reported within the time periods specified in the
      rules and forms of the SEC.





There
      were no changes in our internal control over financial reporting identified
      in
      connection with the evaluation performed that occurred during the period covered
      by this report that have materially affected or are reasonably likely to
      materially affect, our internal control over financial reporting.




28




Disclosure
      controls and procedures are controls and other procedures that are designed
      to
      ensure that information required to be disclosed in our reports filed or
      submitted under the Exchange Act is recorded, processed, summarized and
      reported, within the time periods specified in the SEC’s rules and forms.
      Disclosure controls and procedures include, without limitation, controls and
      procedures designed to ensure that information required to be disclosed in
      our
      reports filed under the Exchange Act is accumulated and communicated to
      management, including the Company’s Chief Executive and acting Chief Financial
      Officer as appropriate, to allow timely decisions regarding required disclosure.





***Internal
      Controls Over Financial Reporting***





Section
      404 of the Sarbanes-Oxley Act of 2002 requires that management document and
      test
      the Company’s internal control over financial reporting and include in this
      Quarterly Report on Form 10-Q a report on management’s assessment of the
      effectiveness of our internal control over financial reporting.





Our
      management is responsible for establishing and maintaining adequate internal
      control over financial reporting, as such term is defined in Rule 13a-15(f)
      of
      the Exchange Act. Under the supervision and with the participation of our
      management, including our Chief Executive Officer and Chief Financial Officer,
      we conducted an evaluation of the effectiveness of our internal control over
      financial reporting based upon the framework in Internal Control—Integrated
      Framework issued by the Committee of Sponsoring Organizations of the Treadway
      Commission (“COSO”). Based on that evaluation, our management concluded that our
      internal control over financial reporting is effective, as of June 30, 2008,
      and
      was effective during the entire quarter ended June 30, 2008.





**PART
      II**


**OTHER
      INFORMATION**





**ITEM
      1. LEGAL PROCEEDINGS**





From
      time
      to time, we may become involved in various lawsuits and legal proceedings which
      arise in the ordinary course of business. However, litigation is subject to
      inherent uncertainties, and an adverse result in these or other matters may
      arise from time to time that may harm our business. We are currently not aware
      of any such legal proceedings or claims that we believe will have a material
      adverse affect on our business, financial condition or operating
      results.





**ITEM
      1A. Risk Factors**





Risk
      factors are normally included in financial statements prepared in accordance
      with generally accepted accounting principles in the United States of America
      but have been omitted from these statements pursuant to such rules and
      regulation and, accordingly, they do not include all the information and notes
      necessary for comprehensive consolidated financial statements and should be
      read
      in conjunction with our audited consolidated financial statements for the year
      ended December 31, 2007, included in our Annual Report on Form 10-K for the
      year
      ended December 31, 2007.




**ITEM
      2. UNREGISTERED SALES OF EQUITY SECURITIES OR USE OF
      PROCEEDS**





There
      were no unregistered sales of equity securities during the fiscal quarter ended
      June 30, 2008.





**ITEM
      3. DEFAULTS UPON SENIOR SECURITIES**





There
      were no defaults upon senior securities during the fiscal quarter ended June
      30,
      2008.





**ITEM
      4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**





No
      matters were submitted to a vote of security holders during the fiscal
      quarter ended June 30, 2008 .





**ITEM
      5. OTHER INFORMATION**





N/A




29




**ITEM
      6. EXHIBITS**





The
      following exhibits are filed with this report, except those indicated as having
      previously been filed with the SEC and are incorporated by reference to another
      report, registration statement or form. As to any shareholder of record
      requesting a copy of this report, we will furnish any exhibit indicated in
      the
      list below as filed with this report upon payment to us of our expenses in
      furnishing the information.





***Exhibit
                Number***
            
            ***Description***3.1
            
            Articles
                of Incorporation (incorporated by reference from the Company’s
                Registration Statement on Form 10-SB filed on December 17,
                1999).3.2
            
            By-laws
                (incorporated by reference from the Company’s Current Report on Form 8-K
                filed on September 18, 2006).4.1
            
            2005
                Compensation Plan for Outside Consultants of Custom Brand Networks,
                Inc.
                dated March 1, 2005 (incorporated by reference from the Company’s
                Registration Statement on Form S-8 filed on March 10,
                2005).4.2
            
            2005
                Augmented Compensation Plan for Outside Consultants of the Company
                dated
                August 15, 2005 (incorporated by reference from the Company’s Registration
                Statement on Form S-8 filed on August 19, 2005).4.3
            
            2006
                Stock Plan (incorporated by reference to Exhibit 10.1 of the current
                report of the Company on Form 8-K filed February 21,
                2006)31.1*
            
            Rule
                13a-14(a)/15d-14(a) Certification - Principal Executive
                Officer31.2*
            
            Rule
                13a-14(a)/15d-14(a) Certification - Principal Accounting
                Officer32*
            
            Section
                1350 Certifications


______________


*
      Filed
      Herewith




30


SIGNATURES





In
      accordance with section 13 or 15(d) of the Securities Exchange Act of 1934,
      the
      Registrant caused this Report on Form 10-Q to be signed on its behalf by the
      undersigned, thereto duly authorized individual.





Date:
      August 13, 2008





THORIUM
      POWER, LTD.




By: /s/
          Seth
          Grae
 Seth
          Grae


Chief
      Executive Officer,


President
      and Director




31


**EXHIBIT
      INDEX**




***Exhibit
                Number***
            
            ***Description***3.1
            
            Articles
                of Incorporation (incorporated by reference from the Company’s
                Registration Statement on Form 10-SB filed on December 17,
                1999).3.2
            
            By-laws
                (incorporated by reference from the Company’s Current Report on Form 8-K
                filed on September 18, 2006).4.1
            
            2005
                Compensation Plan for Outside Consultants of Custom Brand Networks,
                Inc.
                dated March 1, 2005 (incorporated by reference from the Company’s
                Registration Statement on Form S-8 filed on March 10,
                2005).4.2
            
            2005
                Augmented Compensation Plan for Outside Consultants of the Company
                dated
                August 15, 2005 (incorporated by reference from the Company’s Registration
                Statement on Form S-8 filed on August 19, 2005).4.3
            
            2006
                Stock Plan (incorporated by reference to Exhibit 10.1 of the current
                report of the Company on Form 8-K filed February 21,
                2006)31.1*
            
            Rule
                13a-14(a)/15d-14(a) Certification - Principal Executive
                Officer31.2*
            
            Rule
                13a-14(a)/15d-14(a) Certification - Principal Accounting
                Officer32*
            
            Section
                1350 Certifications


______________


*Filed
      Herewith




32