1st NRG, CORP.(a Development Stage Company)BALANCE SHEETSDecenber 31, 2008 and 2007ASSETS
	
	2008
	
	2007Current AssetsCash
	
	$ 288
	
	$ -Prepaid expenses and other assets
	
	17,162Total current assets
	
	$ 17,450
	
	$ -LIABILITIES AND STOCKHOLDERS' DEFICITCurrent LiabilitiesAccounts payable
	
	$ 107,705
	
	$ 11,752Accrued management compensation
	
	1,020,383
	
	562,047Accrued interest
	
	2,678
	
	2,678Cash advances
	
	12,500
	
	12,500Advances from related parties
	
	25,320
	
	39,388Current portion of loans payable
	
	9,200
	
	-Current portion of loan payable to related party
	
	4,252
	
	-Total current liabilities
	
	1,182,038
	
	628,365Long-Term LiabilitiesLoans payable
	
	27,431
	
	9,200Loans payable from related party
	
	
	
	4,041Total long term liabilities
	
	27,431
	
	13,241Total liabilities
	
	1,209,469
	
	641,606Stockholders' DeficitPreferred stock - authorized 5,000,000 shares,par value $.001, none issued or outstanding
	
	-
	
	-Common stock - authorized 25,000,000 shares,par value $0.02, 10,884,021 and 2,828,028 shares issuedand outstanding for 2008 and 2007
	
	217,680
	
	56,561Common stock issuable, 579,286 and 1,215,446shares for 2008 and 2007
	
	11,586
	
	24,308Stock subscription receivable
	
	(5,000,000)
	
	-Additional paid-in capital
	
	10,472,710
	
	5,043,421Accumulated deficit
	
	(2,632,475)
	
	(2,632,475)Deficit accumulated during the development stage
	
	(4,261,520)
	
	(3,133,421)(1,192,019)
	
	(641,606)$ 17,450
	
	$ -


See Notes to Financial Statements

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|1st NRG CORP(a Development Stage Company)
|-----------------------------------------

STATEMENTS OF OPERATIONS

For the Years Ended December 31, 2008 and 2007 and for the Period from October 1, 2003 (the effective date of the development stage) through December 31,
2008

CumulativeDuring theDevelopment2008
	
	2007
	
	StageRevenue
	
	$ -
	
	$ -
	
	$ -ExpensesManagement compensation
	
	458,336
	
	398,245
	
	3,180,081General and administrative
	
	665,106
	
	139,276
	
	926,9161,123,442
	
	537,521
	
	4,106,997Other Income and ExpenseIncomeInterest earned
	
	-
	
	4,344
	
	4,344Extinguishment of related party debt
	
	-
	
	205,000
	
	205,000-
	
	209,344
	
	209,344ExpenseInterest expense
	
	4,657
	
	65
	
	8,100Loss of escrow deposits
	
	-
	
	355,767
	
	355,7674,657
	
	355,832
	
	363,8674,657
	
	146,488
	
	154,523Net loss
	
	$ (1,128,099)
	
	$ (684,009)
	
	$ (4,261,520)Net loss per common share (basic and fully diluted)
	
	$ (0.24)
	
	$ (0.18)Weighted average number of shares outstanding
	
	4,727,241
	
	3,850,821


See Notes to Financial Statements

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|1st NRG CORP                                                                           
|---------------------------------------------------------------------------------------
|(a Development Stage Company)                                                          
|STATEMENT OF STOCKHOLDERS' DEFICIT                                                     
|For the Period from                                                                    
|October 1, 2003 (the effective date of the development stage) through December 31, 2008
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|Balance, December 31, 2003                                                             
|Stock subscription issued for                                                          
|services to be provided, May 2004                                                      
|Issuance of common stock                                                               
|issuable                                                                               
|Net loss                                                                               
|Balance, December 31, 2004                                                             
|Net loss                                                                               
|Balance, December 31, 2005                                                             
|Common stock issuable for prepaid expenses                                             
|on services to be provided in 2007,                                                    
|November 2006                                                                          
|Issuance of common stock for services,                                                 
|November 2006                                                                          
|Net loss                                                                               
|Balance, December 31, 2006                                                             
|Stock subscriptions returned, February 2007                                            
|Common stock issuable for cash, April 2007,                                            
|net of issuance costs of $10,000                                                       
|Warrants issuable for cash, April 2007                                                 
|Common stock issuable for cash, September 2007                                         
|Warrants issuable for cash, September 2007                                             
|Options issued for executive compensation, 2007                                        
|Net loss                                                                               
|Balance, December 31, 2007                                                             
|Common stock issued from issuable, June 2008                                           
|Warrants issued for services, July 2008                                                
|Common stock issued for cash, August 2008                                              
|Common stock issued for cash, September 2008                                           
|Common stock issued for cash, October 2008                                             
|Common stock and warrants issued for stock subscription                                
|receivable supported by restricted cash, October 2008                                  
|- allocated to common stock                                                            
|- allocated to warrants                                                                
|Common stock issuable to a Director for services received, October 2008                
|Common stock issued for cash, November 2008                                            
|Common stock issuable for services received, November 2008                             
|Net loss                                                                               
|Balance, December 31, 2008                                                             
|                                                                                       
|                                                                                       

---

1st NRG CORP

(a Development Stage Company) STATEMENTS OF CASH FLOWS

For the Years Ended December 31, 2008 and 2007 and for the Period from October 1, 2003 (the effective date of the development stage) through December 31,
2008

CumulativeDuring theDevelopment2008
	
	2007
	
	StageCash Flows From Operating ActivitiesNet loss
	
	$ (1,128,099)
	
	$ (684,009)
	
	$ (4,261,520)Adjustments to reconcile net loss to net cashused in operating activitiesCommon stock issuable for:services
	
	56,500
	
	-
	
	56,500future services
	
	-
	
	-
	
	10,000Options issuable for mangement compensation
	
	-
	
	19,698
	
	19,698Warrants issued for services
	
	271,186
	
	-
	
	271,186Common stock issued for:management compensation
	
	-
	
	-
	
	1,950,000services
	
	-
	
	-
	
	27,500Gain on extinguishment of related party debt
	
	
	
	(205,000)
	
	(205,000)Loss of deposits held in Escrow
	
	-
	
	355,767
	
	355,767Change in operating assets and liabilitiesPrepaid expenses and other assets
	
	(17,162)
	
	10,000
	
	(17,162)Accounts payable and accrued interest
	
	96,164
	
	(19,860)
	
	141,549Accrued management compensation
	
	458,336
	
	378,547
	
	1,173,883Net cash used in operating activities
	
	(263,075)
	
	(144,857)
	
	(477,599)Cash Flows From Investing ActivityIncrease in deposits in Escrow
	
	-
	
	(355,767)
	
	(355,767)Net cash used in investing activities
	
	-
	
	(355,767)
	
	(355,767)Cash Flows From Financing ActivitiesProceeds from contracts payable
	
	-
	
	-
	
	12,361Proceeds (Payments) on loans payable
	
	27,431
	
	9,200
	
	(23,190)Proceeds from loan payable, related party
	
	
	
	4,041
	
	4,041Proceeds from common stock and warrants, net
	
	250,000
	
	505,000
	
	755,000Proceeds (Payments) on advances from related parties
	
	(14,068)
	
	(17,727)
	
	85,439Net cash provided by financing activities
	
	263,363
	
	500,514
	
	833,650Net change in cash
	
	288
	
	(110)
	
	285Cash, beginning of period
	
	0
	
	110
	
	3Cash, end of period
	
	$ 288
	
	$ 0
	
	$ 288Supplementary Information - Non-cash Transactions:Common stock issued and issuable for debtand accrued expenses
	
	$ -
	
	$ -
	
	$ 1,041,353Stock subscription (returned) issued for servicesto be provided
	
	-
	
	(720,000)
	
	(720,000)Common stock issuable for services
	
	56,500
	
	-
	
	56,500Warrants issued for services
	
	271,186
	
	-
	
	271,186Common stock and warrants issued for stock subscriptionssupported by restricted cash
	
	5,000,000
	
	-
	
	5,000,000See Notes to Financial Statements


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