|                                                        
|--------------------------------------------------------
|UNITED
 STATES                                          
|SECURITIES
 AND EXCHANGE COMMISSION                     
|WASHINGTON, D.C. 20549                                  
|                                                        
|                                                        
|FORM
 10-Q                                              
|                                                        
|QUARTERLY REPORT
 PURSUANT TO SECTION 13 OR 15(D) OF THE
|SECURITIES EXCHANGE ACT
 OF 1934                        
|                                                        
|FOR THE QUARTERLY
 PERIOD ENDED MARCH 31, 2011          
|                                                        
|COMMISSION FILE NUMBER: 000-54132                       
|                                                        
|11 GOOD ENERGY, INC.                                    
|                                                        
|(Exact name of registrant as specified in its charter)  

|                                                               |                                     
|-------------------------------------------------------------- | ------------------------------------
|DELAWARE                                                       | 26-0299315                          
|(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.)

|                                                                                   
|-----------------------------------------------------------------------------------
|4450 Belden Village Street N.W., Suite 800                                         
|Canton, OH 44718                                                                   
|(Address of principal executive offices)                                           
|                                                                                   
|(330) 492-3835                                                                     
|(Registrants telephone number, including area code)                               
|                                                                                   
|NOT APPLICABLE                                                                     
|(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 Securities Exchange Act of
1934 during the preceding 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 o

Indicate
by checkmark whether the registrant has submitted electronically and posted on
its corporate website, if any, every Interactive Data File required to be
submitted pursuant to Rule 405 of Regulation S-T during the 12 preceding months
(or such shorter period that the registrant was required to submit and post
such file).

Yes o   No o

Indicate by checkmark 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 | o | Accelerated
 Filer         | o
| | Accelerated Filer       | o | Smaller
 Reporting Company | x

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

Yes o   No x

As of May 13,
2010, the registrant had a total of 19,856,239 shares of Common Stock
outstanding

---



11 GOOD ENERGY, INC. AND SUBSIDIARY

INDEX

|           |  |                                                                                                                                                                                          |  |             
|---------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------
|           |  |                                                                                                                                                                                          |  | Page
 Number
|PART I     |  | Financial
 Information                                                                                                                                                                   |  |             
|           |  |                                                                                                                                                                                          |  |             
|Item 1.    |  | Financial Statements (unaudited)                                                                                                                                                         |  |             
|           |  |                                                                                                                                                                                          |  |             
|           |  | Condensed Consolidated Balance Sheets  March 31, 2011 (Unaudited)
 and December 31, 2010                                                                                                |  | 3           
|           |  |                                                                                                                                                                                          |  |             
|           |  | Unaudited Condensed Consolidated Statements of Operations  Three
 Months Ended March 31, 2011 and March 31, 2010 and for the period May 23,
 2007 (date of inception) to March 31, 2011 |  | 4           
|           |  |                                                                                                                                                                                          |  |             
|           |  | Unaudited Condensed Consolidated Statements of Stockholders Equity 
 For the period May 23, 2007 (date of inception) to March 31, 2011                                                  |  | 5-8         
|           |  |                                                                                                                                                                                          |  |             
|           |  | Unaudited Condensed Consolidated Statements of Cash Flows  Three
 Months Ended March 31, 2011 and March 31, 2010 and for the period May 23, 2007
 (date of inception) to March 31, 2011 |  | 9-10        
|           |  |                                                                                                                                                                                          |  |             
|           |  | Notes to Unaudited Condensed Consolidated Financial Statements                                                                                                                           |  | 11          
|           |  |                                                                                                                                                                                          |  |             
|Item 2.    |  | Managements Discussion and Analysis of Financial Condition and
 Results of Operations                                                                                                   |  | 20          
|           |  |                                                                                                                                                                                          |  |             
|Item 3.    |  | Quantitative and Qualitative Disclosures About Market Risk                                                                                                                               |  | 26          
|           |  |                                                                                                                                                                                          |  |             
|Item 4.    |  | Controls and Procedures                                                                                                                                                                  |  | 26          
|           |  |                                                                                                                                                                                          |  |             
|PART II    |  | Other Information                                                                                                                                                                        |  |             
|           |  |                                                                                                                                                                                          |  |             
|Item 6.    |  | Exhibits                                                                                                                                                                                 |  | 27          
|           |  |                                                                                                                                                                                          |  |             
|SIGNATURES |  |                                                                                                                                                                                          |  | 29          

2

---



PART I.

FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

11 GOOD ENERGY, INC. AND
SUBSIDIARY
(a development stage company)
CONDENSED CONSOLIDATED BALANCE SHEETS

|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------- | ----------- | ------------------ | - | ----------- | -
|                                                                                                                                                                                                  |  | March 31,
 2011 |             | December 31,
 2010 |  
|                                                                                                                                                                                                  |  |                 |             |                    |  
|                                                                                                                                                                                                  |  | (unaudited)     |             |                    |  
|ASSETS                                                                                                                                                                                            |  |                 |             |                    |   |             |  
|Current assets:                                                                                                                                                                                   |  |                 |             |                    |   |             |  
|Cash                                                                                                                                                                                              |  | $               | 33,930      |                    | $ | 29,879      |  
|Inventory                                                                                                                                                                                         |  |                 | 532,386     |                    |   | 624,739     |  
|Accounts receivable, net                                                                                                                                                                          |  |                 | 14,869      |                    |   | 51,801      |  
|Available for sale securities                                                                                                                                                                     |  |                 | 7,980       |                    |   | 576,990     |  
|Other current assets                                                                                                                                                                              |  |                 | 18,024      |                    |   | 24,974      |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|Total current assets                                                                                                                                                                              |  |                 | 607,189     |                    |   | 1,308,383   |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|Property, plant and equipment, net                                                                                                                                                                |  |                 | 2,466,848   |                    |   | 2,562,675   |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|Other assets:                                                                                                                                                                                     |  |                 |             |                    |   |             |  
|Patents                                                                                                                                                                                           |  |                 | 65,479      |                    |   | 58,272      |  
|Goodwill                                                                                                                                                                                          |  |                 | 639,504     |                    |   | 639,504     |  
|Deposits                                                                                                                                                                                          |  |                 | 2,163       |                    |   | 2,163       |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|Total other assets:                                                                                                                                                                               |  |                 | 707,146     |                    |   | 699,939     |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|Total assets                                                                                                                                                                                      |  | $               | 3,781,183   |                    | $ | 4,570,997   |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|LIABILITIES
 AND STOCKHOLDERS EQUITY                                                                                                                                                             |  |                 |             |                    |   |             |  
|Current liabilities:                                                                                                                                                                              |  |                 |             |                    |   |             |  
|Accounts payable and accrued liabilities                                                                                                                                                          |  | $               | 711,991     |                    | $ | 458,043     |  
|Advances, related party                                                                                                                                                                           |  |                 | 170,350     |                    |   |            |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|Total current liabilities                                                                                                                                                                         |  |                 | 882,341     |                    |   | 458,043     |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|Stockholders equity:                                                                                                                                                                             |  |                 |             |                    |   |             |  
|Series A Preferred stock, $0.0001 par
 value; 11,000,000 shares authorized, issued and outstanding at March 31, 2011
 and December 31, 2010                                                       |  |                 | 1,100       |                    |   | 1,100       |  
|Common stock, $0.0001 par value;
 65,000,000 shares authorized; 20,811,561 issued as of March 31, 2011 and
 December 31, 2010; 19,856,239 outstanding as of March 31, 2011 and December
 31, 2010 |  |                 | 2,081       |                    |   | 2,081       |  
|Additional paid in capital                                                                                                                                                                        |  |                 | 22,498,920  |                    |   | 22,498,920  |  
|Receivable from
     purchase of treasury stock                                                                                                                                                   |  |                 | (78,519     | )                  |   | (53,519     | )
|Deficit accumulated during development
 stage                                                                                                                                                     |  |                 | (17,745,520 | )                  |   | (16,551,567 | )
|Accumulated other comprehensive income                                                                                                                                                            |  |                 | (281,720    | )                  |   | (286,561    | )
|Treasury stock, 955,322 shares as of
 March 31, 2011 and December 31, 2010                                                                                                                        |  |                 | (1,497,500  | )                  |   | (1,497,500  | )
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|Total stockholders equity                                                                                                                                                                        |  |                 | 2,898,842   |                    |   | 4,112,954   |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  
|Total liabilities and stockholders
 equity                                                                                                                                                       |  | $               | 3,781,183   |                    | $ | 4,570,997   |  
|                                                                                                                                                                                                  |  |                 |             |                    |   |             |  

See the accompanying notes to these unaudited
condensed consolidated financial statements

3

---



11 GOOD ENERGY, INC. AND SUBSIDIARY
(a development stage company)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)

|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|------------------------------------------------------------------------ |  | ---------------------------- | ---------- | ---------------------------------------------- | - | -------------- | - | - | ----------- | -
|                                                                         |  | Three months ended March 31, |            | From May 23, 2007
 (date of inception) through |  
|                                                                         |  | 2011                         |            | 2010                                           |   | March 31, 2011 |  
|                                                                         |  |                              |            |                                                |   |                |  
|                                                                         |  |                              |            | (restated)                                     |   |                |  
|                                                                         |  |                              |            |                                                |   |                |  
|REVENUE:                                                                 |  |                              |            |                                                |   |                |   |   |             |  
|Sales                                                                    |  | $                            | 29,222     |                                                | $ | 48,427         |   | $ | 499,222     |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|Cost of sales                                                            |  |                              | 114,397    |                                                |   | 107,248        |   |   | 1,021,960   |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|Gross (loss)                                                             |  |                              | (85,175    | )                                              |   | (58,821        | ) |   | (522,738    | )
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|OPERATING EXPENSES:                                                      |  |                              |            |                                                |   |                |   |   |             |  
|General, selling and administrative
 expenses                            |  |                              | 961,260    |                                                |   | 2,552,440      |   |   | 12,358,478  |  
|Research and development                                                 |  |                              | 100,551    |                                                |   | 101,323        |   |   | 912,533     |  
|Depreciation and amortization                                            |  |                              | 29,185     |                                                |   | 41,047         |   |   | 269,397     |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|Total operating expenses                                                 |  |                              | 1,090,996  |                                                |   | 2,694,810      |   |   | 13,540,408  |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|NET (LOSS) FROM OPERATIONS                                               |  |                              | (1,176,171 | )                                              |   | (2,753,631     | ) |   | (14,063,146 | )
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|Other income/(expense):                                                  |  |                              |            |                                                |   |                |   |   |             |  
|Interest income                                                          |  |                              |           |                                                |   |               |   |   | 55,384      |  
|Interest expense                                                         |  |                              |           |                                                |   | (7,077         | ) |   | (3,849,982  | )
|Realized (loss) on sale of securities                                    |  |                              | (17,782    | )                                              |   |               |   |   | 111,024     |  
|Gain on sale of property, plant and
 equipment                           |  |                              |           |                                                |   |               |   |   | 1,200       |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|Total other (expense)                                                    |  |                              | (17,782    | )                                              |   | (7,077         | ) |   | (3,682,374  | )
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|Net loss before provision for income
 taxes                              |  |                              | (1,193,953 | )                                              |   | (2,760,708     | ) |   | (17,745,520 | )
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|Provision for income taxes                                               |  |                              |           |                                                |   |               |   |   |            |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|NET LOSS ATTRIBUTABLE TO COMMON
 SHAREHOLDERS                            |  | $                            | (1,193,953 | )                                              | $ | (2,760,708     | ) | $ | (17,745,520 | )
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|Net loss per common share (basic and
 fully diluted)                     |  | $                            | (0.06      | )                                              | $ | (0.20          | ) | $ | (1.17       | )
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|Weighted average number of shares
 outstanding (basic and fully diluted) |  |                              | 19,856,239 |                                                |   | 14,154,603     |   |   | 15,221,872  |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|Comprehensive loss:                                                      |  |                              |            |                                                |   |                |   |   |             |  
|Net loss                                                                 |  | $                            | (1,193,953 | )                                              | $ | (2,760,708     | ) | $ | (17,745,520 | )
|Unrealized gain (loss) on securities
 available for sale                 |  |                              | 4,841      |                                                |   | (173,336       | ) |   | (281,720    | )
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  
|Comprehensive loss                                                       |  | $                            | (1,189,112 | )                                              | $ | (2,934,044     | ) | $ | (18,027,240 | )
|                                                                         |  |                              |            |                                                |   |                |   |   |             |  

See accompanying notes to these unaudited
condensed consolidated financial statements

4

---



11 GOOD ENERGY, INC. AND SUBSIDIARY
(a development stage company)
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS
EQUITY
FROM MAY 23, 2007 (DATE OF INCEPTION) THROUGH MARCH 2011
(UNAUDITED)

|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|---------------------------------------------------------------------------- |  | --------- | ---------- | ------ | - | -------------------------------------------- |  | ------------------------- | ---------- | ---------------------------- | - | ------------------------ |  | --------------- | - | ---------------------------- | - | ---------------------------------------------- |  | ----- | - |  | - | - |  | - | --------- |  | - | -------- | - | - | - |  | - | - |  | - | ---------- | - | - | ---------- | -
|                                                                             |  | Preferred |            | Common |   | Common
 stock
 subscribed
 Convertible Notes |  | Common
 stock
 Subscribed |            | Additional
 Paid in
 Capital |   | Due
 from
 Related party |  | Treasury
 Stock |   | Other
 Comprehensive
 Income |   | Accumulated
 Deficit during
 Development Stage |  | Total |  
|                                                                             |  | Stock     |            | Amount |   | Stock                                        |  | Amount                    |            | Stock                        |   | Amount                   |  | Stock           |   | Amount                       |   |                                                |  |       |   |  |  
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|May 23, 2007, date of inception                                              |  |           | 11,000,000 |        | $ | 1,100                                        |  |                           | 9,700,000  |                              | $ | 970                      |  |                 |  |                              | $ |                                               |  | $     |  |  | $ |  |  | $ |          |  | $ |         |   | $ |  |  | $ |  |  | $ |           |   | $ | 2,070      |  
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|Common stock issued for services to be rendered                              |  |           |           |        |   |                                             |  |                           | 300,000    |                              |   | 30                       |  |                 |  |                              |   |                                               |  |       |  |  |   |  |  |   | 155,970   |  |   |         |   |   |  |  |   |  |  |   |           |   |   | 156,000    |  
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|Common stock issued to acquire 11 Goods Energy LTD                          |  |           |           |        |   |                                             |  |                           | 4,285,714  |                              |   | 429                      |  |                 |  |                              |   |                                               |  |       |  |  |   |  |  |   |          |  |   |         |   |   |  |  |   |  |  |   |           |   |   | 420        |  
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|Beneficial conversion feature relating to the issuance of convertible
 notes |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                 |  |                              |   |                                               |  |       |  |  |   |  |  |   | 639,719   |  |   |         |   |   |  |  |   |  |  |   |           |   |   | 639,710    |  
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|Increase in due from related party                                           |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                 |  |                              |   |                                               |  |       |  |  |   |  |  |   |          |  |   | (211,034 | ) |   |  |  |   |  |  |   |           |   |   | (211,034   | )
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|Net loss                                                                     |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                 |  |                              |   |                                               |  |       |  |  |   |  |  |   |          |  |   |         |   |   |  |  |   |  |  |   | (771,405   | ) |   | (771,405   | )
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|Balance, December 31, 2007                                                   |  |           | 11,000,000 |        |   | 1,100                                        |  |                           | 14,285,714 |                              |   | 1,429                    |  |                 |  |                              |   |                                               |  |       |  |  |   |  |  |   | 795,689   |  |   | (211,034 | ) |   |  |  |   |  |  |   | (771,405   | ) |   | (184,221   | )
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|Beneficial conversion feature relating to the issuance of convertible
 notes |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                 |  |                              |   |                                               |  |       |  |  |   |  |  |   | 613,254   |  |   |         |   |   |  |  |   |  |  |   |           |   |   | 613,254    |  
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|Increase in due from related party                                           |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                 |  |                              |   |                                               |  |       |  |  |   |  |  |   |          |  |   | (297,654 | ) |   |  |  |   |  |  |   |           |   |   | (297,654   | )
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|Net loss                                                                     |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                 |  |                              |   |                                               |  |       |  |  |   |  |  |   |          |  |   |         |   |   |  |  |   |  |  |   | (2,064,728 | ) |   | (2,064,728 | )
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|                                                                             |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                 |   |                              |   |                                                |  |       |   |  |   |   |  |   |           |  |   |          |   |   |   |  |   |   |  |   |            |   |   |            |  
|Balance, December 31, 2008                                                   |  |           | 11,000,000 |        | $ | 1,100                                        |  |                           | 14,285,714 |                              | $ | 1,429                    |  |                 |  |                              | $ |                                               |  | $     |  |  | $ |  |  | $ | 1,408,943 |  | $ | (508,688 | ) | $ |  |  | $ |  |  | $ | (2,836,133 | ) | $ | (1,933,349 | )

See the accompanying notes to these unaudited
condensed consolidated financial statements

5

---



11 GOOD ENERGY, INC. AND SUBSIDIARY
(a development stage company)
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY
FROM MAY 23, 2007 (DATE OF INCEPTION) THROUGH MARCH 2011
(UNAUDITED)

|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|-------------------------------------------------------------------------------------------------- |  | --------- | ---------- | ------ | - | -------------------------------------------- |  | ------------------------- | ---------- | ---------------------------- | - | ------------------------ |  | -------------- | --------- | ---------------------------- | - | ----------------------------------------------- |  | ----- | --------- |  | - | --------- |  | - | --------- |  | - | -------- | - | - | ---------- | - | - | ------ |  | - | ---------- | - | - | ---------- | -
|                                                                                                   |  | Preferred |            | Common |   | Common
 stock
 subscribed
 Convertible Notes |  | Common
 stock
 Subscribed |            | Additional
 Paid in
 Capital |   | Due
 from
 Related party |  | Treasury Stock |           | Other
 Comprehensive
 Income |   | Accumulated
 Deficit during
 Development
 Stage |  | Total |          
|                                                                                                   |  | Stock     |            | Amount |   | Stock                                        |  | Amount                    |            | Stock                        |   | Amount                   |  | Stock          |           | Amount                       |   |                                                 |  |       |           |  |  
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Balance, January 1, 2009                                                                           |  |           | 11,000,000 |        | $ | 1,100                                        |  |                           | 14,285,714 |                              | $ | 1,429                    |  |                |          |                              | $ |                                                |  | $     |          |  | $ |          |  | $ | 1,408,943 |  | $ | (508,688 | ) | $ |           |   | $ |       |  | $ | (2,836,133 | ) | $ | (1,933,349 | )
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Beneficial conversion feature relating to the issuance of convertible
 notes                       |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                |          |                              |   |                                                |  |       |          |  |   |          |  |   | 2,054,806 |  |   |         |   |   |           |   |   |       |  |   |           |   |   | 2,054,806  |  
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Common stock to be issued in exchange for convertible notes and
 accrued interest                  |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                | 2,540,290 |                              |   | 6,477,739                                       |  |       |          |  |   |          |  |   |          |  |   |         |   |   |           |   |   |       |  |   |           |   |   | 6,477,739  |  
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Compensation of services by a related party                                                        |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                |          |                              |   |                                                |  |       |          |  |   |          |  |   | 531,000   |  |   |         |   |   |           |   |   |       |  |   |           |   |   | 531,000    |  
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Compensation of services by a consultant                                                           |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                |          |                              |   |                                                |  |       |          |  |   |          |  |   | 59,000    |  |   |         |   |   |           |   |   |       |  |   |           |   |   | 59,000     |  
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Sale of common stock                                                                               |  |           |           |        |   |                                             |  |                           | 770,000    |                              |   | 77                       |  |                |          |                              |   |                                                |  |       | 2,931,333 |  |   | 7,137,223 |  |   | 2,309,923 |  |   |         |   |   |           |   |   |       |  |   |           |   |   | 9,447,223  |  
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Fair value of options granted to directors                                                         |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                |          |                              |   |                                                |  |       |          |  |   |          |  |   | 200,205   |  |   |         |   |   |           |   |   |       |  |   |           |   |   | 200,205    |  
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Increase in due from related party                                                                 |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                |          |                              |   |                                                |  |       |          |  |   |          |  |   |          |  |   | (278,456 | ) |   |           |   |   |       |  |   |           |   |   | (278,456   | )
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Common stock re-acquired for cash                                                                  |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                |          |                              |   |                                                |  |       |          |  |   |          |  |   |          |  |   |         |   |   | (450,000   | ) |   |       |  |   |           |   |   | (450,000   | )
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Common stock re-acquired for receivable due from related party and
 issuance of related party note |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                |          |                              |   |                                                |  |       |          |  |   |          |  |   |          |  |   | 787,144  |   |   | (850,000   | ) |   |       |  |   |           |   |   | (62,856    | )
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Unrealized gain on securities available for sale                                                   |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                |          |                              |   |                                                |  |       |          |  |   |          |  |   |          |  |   |         |   |   |           |   |   | 49,504 |  |   |           |   |   | 49,504     |  
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Net loss                                                                                           |  |           |           |        |   |                                             |  |                           |           |                              |   |                         |  |                |          |                              |   |                                                |  |       |          |  |   |          |  |   |          |  |   |         |   |   |           |   |   |       |  |   | (6,549,809 | ) |   | (6,549,809 | )
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|                                                                                                   |  |           |            |        |   |                                              |  |                           |            |                              |   |                          |  |                |           |                              |   |                                                 |  |       |           |  |   |           |  |   |           |  |   |          |   |   |            |   |   |        |  |   |            |   |   |            |  
|Balance, December 31, 2009 (Restated)                                                              |  |           | 11,000,000 |        | $ | 1,100                                        |  |                           | 15,055,714 |                              | $ | 1,506                    |  |                | 2,540,290 |                              | $ | 6,477,739                                       |  | $     | 2,931,333 |  | $ | 7,137,223 |  | $ | 6,563,877 |  | $ |         |   | $ | (1,300,000 | ) | $ | 49,504 |  | $ | (9,385,942 | ) | $ | 9,545,007  |  

See the accompanying notes to these unaudited
condensed consolidated financial statements

6

---



11 GOOD ENERGY, INC. AND SUBSIDIARY
(a development stage company)
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY
FROM MAY 23, 2007 (DATE OF INCEPTION) THROUGH MARCH 2011
(UNAUDITED)

|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|--------------------------------------------------------------------------------- |  | --------- | ---------- | ------ | - | -------------------------------------------- |  | ------------------------- | ---------- | ---------------------------- | - | ------------------------------------------ |  | --------------- | ---------- | ---------------------------- | - | ----------------------------------------------- | - | ----- | ---------- | - | - | ---------- | - | - | ---------- |  | - | ------- | - | - | ---------- | - | - | -------- | - | - | ----------- | - | - | ---------- | -
|                                                                                  |  | Preferred |            | Common |   | Common
 stock
 subscribed
 Convertible Notes |  | Common
 stock
 Subscribed |            | Additional
 Paid in
 Capital |   | Receivable
from
purchase of
treasury
stock |  | Treasury
 Stock |            | Other
 Comprehensive
 Income |   | Accumulated
 Deficit during
 Development
 Stage |   | Total |           
|                                                                                  |  | Stock     |            | Amount |   | Stock                                        |  | Amount                    |            | Stock                        |   | Amount                                     |  | Stock           |            | Amount                       |   |                                                 |   |       |            |   |  
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|Balance, January 1, 2010                                                          |  |           | 11,000,000 |        | $ | 1,100                                        |  |                           | 15,055,714 |                              | $ | 1,506                                      |  |                 | 2,540,290  |                              | $ | 6,477,739                                       |   |       | 2,931,333  |   | $ | 7,137,223  |   | $ | 6,563,877  |  | $ |        |   | $ | (1,300,000 | ) | $ | 49,504   |   | $ | (9,385,942  | ) | $ | 9,545,007  |  
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|Common stock to be issued in exchange for convertible notes and
 accrued interest |  |           |           |        |   |                                             |  |                           |           |                              |   |                                           |  |                 | 8,223      |                              |   | 20,970                                          |   |       |           |   |   |           |   |   |           |  |   |        |   |   |           |   |   |         |   |   |            |   |   | 20,970     |  
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|Sale of common stock                                                              |  |           |           |        |   |                                             |  |                           |           |                              |   |                                           |  |                 |           |                              |   |                                                |   |       | 276,000    |   |   | 805,846    |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   | 805,846    |  
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|Contribution of services by a related party                                       |  |           |           |        |   |                                             |  |                           |           |                              |   |                                           |  |                 |           |                              |   |                                                |   |       |           |   |   |           |   |   | 1,493,840  |  |   |        |   |   |           |   |   |         |   |   |            |   |   | 1,493,840  |  
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|Common stock reacquired                                                           |  |           |           |        |   |                                             |  |                           |           |                              |   |                                           |  |                 |           |                              |   |                                                |   |       |           |   |   |           |   |   |           |  |   |        |   |   | (197,500   | ) |   |         |   |   |            |   |   | (197,500   | )
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|Receivable from purchase of treasury stock                                        |  |           |           |        |   |                                             |  |                           |           |                              |   |                                           |  |                 |           |                              |   |                                                |   |       |           |   |   |           |   |   |           |  |   | (53,519 | ) |   |           |   |   |         |   |   |            |   |   | (53,519    | )
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|Unrealized loss on securities available for sale                                  |  |           |           |        |   |                                             |  |                           |           |                              |   |                                           |  |                 |           |                              |   |                                                |   |       |           |   |   |           |   |   |           |  |   |        |   |   |           |   |   | (336,065 | ) |   |            |   |   | (336,065   | )
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|Common stock issued in settlement of common stock subscriptions                   |  |           |           |        |   |                                             |  |                           | 5,755,847  |                              |   | 575                                        |  |                 | (2,548,513 | )                            |   | (6,498,709                                      | ) |       | (3,207,333 | ) |   | (7,943,069 | ) |   | 14,441,203 |  |   |        |   |   |           |   |   |         |   |   |            |   |   |           |  
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|Net loss                                                                          |  |           |           |        |   |                                             |  |                           |           |                              |   |                                           |  |                 |           |                              |   |                                                |   |       |           |   |   |           |   |   |           |  |   |        |   |   |           |   |   |         |   |   | (7,165,625  | ) |   | (7,165,625 | )
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|Balance, December 31, 2010                                                        |  |           | 11,000,000 |        | $ | 1,100                                        |  |                           | 20,811,561 |                              | $ | 2,081                                      |  |                 |           |                              | $ |                                                |   |       |           |   | $ |           |   | $ | 22,498,920 |  | $ | (53,519 | ) | $ | (1,497,500 | ) | $ | (286,561 | ) | $ | (16,551,567 | ) | $ | 4,112,954  |  
|                                                                                  |  |           |            |        |   |                                              |  |                           |            |                              |   |                                            |  |                 |            |                              |   |                                                 |   |       |            |   |   |            |   |   |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  

See the accompanying notes to these unaudited
condensed consolidated financial statements

7

---



|                                                         
|---------------------------------------------------------
|11 GOOD ENERGY, INC. AND SUBSIDIARY                      
|(a development stage company)                            
|CONDENSED CONSOLIDATED STATEMENT OF
 STOCKHOLDERS EQUITY
|FROM MAY 23, 2007 (DATE OF INCEPTION) THROUGH MARCH 2011 
|(unaudited)                                              

|                                                 |  |           |            |        |   |                              |  |                                            |            |                 |   |                                |  |                                                  |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|------------------------------------------------ |  | --------- | ---------- | ------ | - | ---------------------------- |  | ------------------------------------------ | ---------- | --------------- | - | ------------------------------ |  | ------------------------------------------------ | ---------- |  | - | ------- | - | - | ---------- | - | - | -------- | - | - | ----------- | - | - | ---------- | -
|                                                 |  |           |            |        |   | Additional
 Paid in
 Capital |  | Receivable
from
purchase of
treasury
stock |            | Treasury
 Stock |   | Other
 
 Comprehensive
 Income |  | Accumulated
 Deficit during
 Development 
 Stage |            |  |   |        
|                                                 |  | Preferred |            | Common |   |                              |  |                                            |            |                 |   |                                | 
|                                                 |  | Stock     |            | Amount |   | Stock                        |  | Amount                                     |            |                 |   |                                |  |                                                  | Total      | 
|                                                 |  |           |            |        |   |                              |  |                                            |            |                 |   |                                |  |                                                  |            |  |   |         |   |   |           
|                                                
|Balance, January 1, 2011                         |  |           | 11,000,000 |        | $ | 1,100                        |  |                                            | 20,811,561 |                 | $ | 2,081                          |  | $                                                | 22,498,920 |  | $ | (53,519 | ) | $ | (1,497,500 | ) | $ | (286,561 | ) | $ | (16,551,567 | ) | $ | 4,112,954  |  
|                                                
|Receivable from purchase of treasury stock       |  |           |           |        |   |                             |  |                                            |           |                 |   |                               |  |                                                  |           |  |   | (25,000 | ) |   |           |   |   |         |   |   |            |   |   | (25,000    | )
|Unrealized gain on securities available for sale |  |           |           |        |   |                             |  |                                            |           |                 |   |                               |  |                                                  |           |  |   |        |   |   |           |   |   | 4,841    |   |   |            |   |   | 4,841      |  
|Net loss                                         |  |           |           |        |   |                             |  |                                            |           |                 |   |                               |  |                                                  |           |  |   |        |   |   |           |   |   |         |   |   | (1,193,953  | ) |   | (1,193,953 | )
|                                                 |  |           |            |        |   |                              |  |                                            |            |                 |   |                                |  |                                                  |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|                                                 |  |           |            |        |   |                              |  |                                            |            |                 |   |                                |  |                                                  |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  
|Balance, March 31, 2011                          |  |           | 11,000,000 |        | $ | 1,100                        |  |                                            | 20,811,561 |                 | $ | 2,081                          |  | $                                                | 22,498,920 |  | $ | (78,519 | ) | $ | (1,497,500 | ) | $ | (281,720 | ) | $ | (17,745,520 | ) | $ | 2,898,842  |  
|                                                 |  |           |            |        |   |                              |  |                                            |            |                 |   |                                |  |                                                  |            |  |   |         |   |   |            |   |   |          |   |   |             |   |   |            |  

See the accompanying notes to these unaudited condensed consolidated
financial statements

8

---



|11 GOOD ENERGY, INC. AND SUBSIDIARY             
|------------------------------------------------
|(a development stage company)                   
|CONDENSED CONSOLIDATED STATEMENTS OF CASH
 FLOWS
|(unaudited)                                     

|                                                                             |  |                              |            |                                                                |   |            |   |   |             |  
|---------------------------------------------------------------------------- |  | ---------------------------- | ---------- | -------------------------------------------------------------- | - | ---------- | - | - | ----------- | -
|                                                                             |  | Three months ended March 31, |            | From May 23, 2007
 (date of inception) through
 March 31, 2011 |  
|                                                                             |  | 2011                         |            | 2010                                                           |   |           
|                                                                             |  |                              |            |                                                                |   |            |  
|                                                                             |  |                              |            | (restated)                                                     |   |            |  
|                                                                             |  |                              |            |                                                                |   |            |  
|Cash flows
 from operating activities:                                       |  |                              |            |                                                                |   |            |   |   |             |  
|Net loss for the period                                                      |  | $                            | (1,193,953 | )                                                              | $ | (2,760,708 | ) | $ | (17,745,520 | )
|Adjustments to reconcile net loss to net
 cash used in operating activities: |  |                              |            |                                                                |   |            |   |   |             |  
|Depreciation and amortization                                                |  |                              | 95,827     |                                                                |   | 97,926     |   |   | 641,165     |  
|Amortization of debt discount                                                |  |                              |           |                                                                |   |           |   |   | 3,307,777   |  
|Compensation of services by a related party                                  |  |                              |           |                                                                |   | 1,493,840  |   |   | 2,024,840   |  
|Compensation of services to consultant                                       |  |                              |           |                                                                |   |           |   |   | 59,000      |  
|Fair value of options issued for services                                    |  |                              |           |                                                                |   |           |   |   | 200,205     |  
|Gain on sale of property and equipment                                       |  |                              |           |                                                                |   |           |   |   | (1,200      | )
|Realized gain (loss) on sale of securities
 available for sale               |  |                              | 17,782     |                                                                |   |           |   |   | (111,024    | )
|Changes in operating assets and
 liabilities:                                |  |                              |            |                                                                |   |            |   |   |             |  
|Inventory                                                                    |  |                              | 92,353     |                                                                |   | (402,862   | ) |   | (506,150    | )
|Accounts receivable                                                          |  |                              | 36,932     |                                                                |   | (888       | ) |   | (14,869     | )
|Other current assets                                                         |  |                              | 6,950      |                                                                |   | 179,543    |   |   | 139,986     |  
|Accounts payable and accrued liabilities                                     |  |                              | 253,948    |                                                                |   | (168,478   | ) |   | 752,023     |  
|                                                                             |  |                              |            |                                                                |   |            |   |   |             |  
|Net cash (used in) operating activities                                      |  |                              | (690,161   | )                                                              |   | (1,561,627 | ) |   | (11,253,767 | )
|                                                                             |  |                              |            |                                                                |   |            |   |   |             |  
|Cash flows from investing activities:                                        |  |                              |            |                                                                |   |            |   |   |             |  
|Acquisition, net of cash acquired                                            |  |                              |           |                                                                |   |           |   |   | (588,952    | )
|Proceeds from sale of property and
 equipment                                |  |                              |           |                                                                |   |           |   |   | 3,200       |  
|Purchase of property, plant and equipment                                    |  |                              |           |                                                                |   | (107,144   | ) |   | (3,039,723  | )
|Payments for acquisition of patent                                           |  |                              | (7,207     | )                                                              |   |           |   |   | (65,479     | )
|Proceeds from sale of securities available
 for sale                         |  |                              | 556,069    |                                                                |   |           |   |   | 1,103,816   |  
|Purchase of securities available for sale                                    |  |                              |           |                                                                |   | (89,700    | ) |   | (1,282,492  | )
|                                                                             |  |                              |            |                                                                |   |            |   |   |             |  
|Net cash provided by (used in) investing
 activities                         |  |                              | 548,862    |                                                                |   | (196,844   | ) |   | (3,869,630  | )
|                                                                             |  |                              |            |                                                                |   |            |   |   |             |  
|Cash flows from financing activities:                                        |  |                              |            |                                                                |   |            |   |   |             |  
|Proceeds from sale of shares to founders                                     |  |                              |           |                                                                |   |           |   |   | 2,070       |  
|Receivable from purchase of treasury stock                                   |  |                              | (25,000    | )                                                              |   |           |   |   | (865,663    | )
|Proceeds from related party advance                                          |  |                              | 170,350    |                                                                |   |           |   |   | 170,350     |  
|Proceeds from common stock subscription                                      |  |                              |           |                                                                |   | 805,846    |   |   | 10,253,069  |  
|Proceeds from issuance of convertible notes                                  |  |                              |           |                                                                |   |           |   |   | 8,039,323   |  
|Proceeds from related party note payable                                     |  |                              |           |                                                                |   |           |   |   | 25,000      |  
|Purchase of treasury stock                                                   |  |                              |           |                                                                |   | (122,500   | ) |   | (647,500    | )
|Payments of related party note payable                                       |  |                              |           |                                                                |   | (25,000    | ) |   | (25,000     | )
|Payments of notes payable                                                    |  |                              |           |                                                                |   |           |   |   | (84,322     | )
|Payments of convertible notes                                                |  |                              |           |                                                                |   | (15,000    | ) |   | (1,710,000  | )
|                                                                             |  |                              |            |                                                                |   |            |   |   |             |  
|Net cash provided by financing activities                                    |  |                              | 145,350    |                                                                |   | 643,346    |   |   | 15,157,327  |  
|                                                                             |  |                              |            |                                                                |   |            |   |   |             |  
|Net increase (decrease) in cash and cash
 equivalents                        |  |                              | 4,051      |                                                                |   | (1,115,125 | ) |   | 33,930      |  
|Cash and cash equivalents at beginning of
 period                            |  |                              | 29,879     |                                                                |   | 4,869,749  |   |   |            |  
|                                                                             |  |                              |            |                                                                |   |            |   |   |             |  
|                                                                             |  |                              |            |                                                                |   |            |   |   |             |  
|Cash and cash equivalents at end of period                                   |  | $                            | 33,930     |                                                                | $ | 3,754,624  |   | $ | 33,930      |  
|                                                                             |  |                              |            |                                                                |   |            |   |   |             |  

See the accompanying notes to these unaudited condensed consolidated
 financial statements

9

---



|                                                
|------------------------------------------------
|11 GOOD ENERGY, INC. AND SUBSIDIARY             
|(a development stage company)                   
|CONDENSED CONSOLIDATED STATEMENTS OF CASH
 FLOWS
|(unaudited)                                     

|                                                                                            |  |                               |   |                                                                 |   |   |  |   |           | 
|------------------------------------------------------------------------------------------- |  | ----------------------------- | - | --------------------------------------------------------------- | - | - |  | - | --------- | 
|                                                                                            |  |                               |   | From
 May 23, 2007
 (date of inception) through
 March 31, 2011 |  
|                                                                                            |  |                               |   |                                                                
|                                                                                            |  | Three
 months ended March 31, |   |                                                                
|                                                                                            |  | 2011                          |   | 2010                                                            |   |  
|                                                                                            |  |                               |   |                                                                 |   |   | 
|Supplemental disclosures of cash flow
 information:                                         |  |                               |   |                                                                 |   |   |  |   |           | 
|Taxes paid                                                                                  |  | $                             |  |                                                                 | $ |  |  | $ |          | 
|Interest paid                                                                               |  | $                             |  |                                                                 | $ |  |  | $ |          | 
|                                                                                            |  |                               |   |                                                                 |   |   |  |   |           | 
|Non cash financing activities:                                                              |  |                               |   |                                                                 |   |   |  |   |           | 
|Common stock issued to acquire 11 Goods Energy,
 LTD                                       |  | $                             |  |                                                                 | $ |  |  | $ | 429       | 
|Common stock issued in exchange for
 convertible note and accrued interest                  |  | $                             |  |                                                                 | $ |  |  | $ | 20,970    | 
|Common stock subscribed for conversion of
 convertible notes                                |  | $                             |  |                                                                 | $ |  |  | $ | 6,498,709 | 
|Treasury stock received in exchange for related
 party note receivable and accrued interest |  | $                             |  |                                                                 | $ |  |  | $ | 787,144   | 

See the accompanying notes to these unaudited
condensed consolidated financial statements

10

---



11 GOOD ENERGY, INC. AND SUBSIDIARY
(a development stage company)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
MARCH 31, 2011 AND 2010
(UNAUDITED)

NOTE 1  SIGNIFICANT ACCOUNTING POLICIES

Basis and business presentation

The accompanying unaudited condensed consolidated financial statements
of 11 Good Energy, Inc., (the Company), have been prepared in accordance with
Regulation S-X of the Securities and Exchange Act, as amended, and instructions
to Form 10-Q and should be read in conjunction with the audited financials for
the year ended December 31, 2010 included in the Companys SEC on Form 10-K
filed on April 15, 2011. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements.

In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. The results from operations for the three month period ended March
31, 2011, are not necessarily indicative of the results that may be expected
for the year ending December 31, 2011.

The consolidated financial statements include the accounts of the
Company, and its wholly-owned subsidiary 11 Goods Energy, LTD (11 Goods).
All significant intercompany balances and transactions have been eliminated in
consolidation.

Dependency on key management

The future success or failure of the Company is dependent primarily
upon the continued services of its key executives and founder, in particular,
the services of Frederick C. Berndt, Chief Executive Officer, Gary R. Smith,
the companys Chief Operations Officer, and Daniel T. Lapp, the companys Chief
Financial Officer. The ability of the company to pursue its business strategy
effectively will also depend upon, among other factors, the successful
recruitment and retention of additional highly skilled and experienced
managerial, marketing, engineering and technical personnel. There can be no
assurance that the company will be able to retain or recruit such personnel.

New accounting pronouncements

There were various updates recently issued, most of which represented
technical corrections to the accounting literature or application to specific
industries and are not expected to a have a material impact on the Companys
consolidated financial position, results of operations or cash flows.

NOTE 2  GOING CONCERN MATTERS

The accompanying unaudited condensed consolidated
    financial statements have been prepared on a going concern basis, which contemplates
    the realization of assets and the satisfaction of liabilities in the normal
    course of business. As shown in the accompanying unaudited condensed consolidated
    financial statements during the three months ended March 31, 2011, the Company
    incurred net losses attributable to common shareholders of $1,193,953 and
    used $690,161 in cash for operating activities during three months ended
    March 31, 2011. These factors among others may indicate that the Company
    will be unable to continue as a going concern for a reasonable period of
time.

11

---



The Companys existence is dependent upon managements ability to
develop profitable operations and to obtain additional funding sources. There
can be no assurance that the Companys financing efforts will result in
profitable operations or the resolution of the Companys liquidity problems.
The accompanying statements do not include any adjustments that might result
should the Company be unable to continue as a going concern.

NOTE 3  RESTATEMENT

The Company restated the financial statements for the three months
ended March 31, 2010 and from May 23, 2007 (date of inception) through March
31, 2010 to correct the amortization of previously capitalized nonmonetary
intangible assets acquired with the purchase of 11 Goods Energy LTD and the
related amortization.

Consolidated Statement of Operations
Three months ended March 31, 2010

|                                    |  |                          |            |            |   |           |   |              |   |  |   |            |  
|----------------------------------- |  | ------------------------ | ---------- | ---------- | - | --------- | - | ------------ | - |  | - | ---------- | -
|                                    |  | As
 Previously
 Reported |            | Adjustment |   | Reference |   | As
 Restated |  
|                                    |  |                          |            |            |   |           |   |              |  
|                                    |  |                          |            |            |   |           |   |              |   |  |   |            |  
|Sales                               |  | $                        | 48,427     |            | $ |           |   |              |   |  | $ | 48,427     |  
|Cost of sales                       |  |                          | 107,248    |            |   |           |   |              |   |  |   | 107,248    |  
|                                    |  |                          |            |            |   |           |   |              |  
|Gross (loss)                        |  |                          | (58,821    | )          |   |           |   |              |   |  |   | (58,821    | )
|                                    |  |                          |            |            |   |           |   |              |   |  |   |            |  
|                                    |  |                          |            |            |   |           |   |              |   |  |   |            |  
|Operating expenses:                 |  |                          |            |            |   |           |   |              |   |  |   |            |  
|General, selling and administrative |  |                          | 2,552,440  |            |   |           |   |              |   |  |   | 2,552,440  |  
|Research and development            |  |                          | 101,323    |            |   |           |   |              |   |  |   | 101,323    |  
|Depreciation and amortization       |  |                          | 62,201     |            |   | (21,154   | ) |              | 1 |  |   | 41,047     |  
|                                    |  |                          |            |            |   |           |   |              |  
|Total operating expenses            |  |                          | 2,715,964  |            |   | (21,154   | ) |              |   |  |   | 2,694,810  |  
|                                    |  |                          |            |            |   |           |   |              |   |  |   |            |  
|Other (expense)                     |  |                          | (7,077     | )          |   |           |   |              |   |  |   | (7,077     | )
|                                    |  |                          |            |            |   |           |   |              |   |  |   |            |  
|Income taxes                        |  |                          |           |            |   |           |   |              |   |  |   |           |  
|                                    |  |                          |            |            |   |           |   |              |   |  |   |            |  
|                                    |  |                          |            |            |   |           |   |              |   |  |   |            |  
|                                    |  |                          |            |            |   |           |   |              |  
|Net loss                            |  | $                        | (2,781,862 | )          | $ | 21,154    |   |              | 1 |  | $ | (2,760,708 | )
|                                    |  |                          |            |            |   |           |   |              |   |  |   |            |  
|Net loss per common share           |  | $                        | (0.20      | )          | $ | 0.00      |   |              |   |  | $ | (0.20      | )

|   |                                                                                                                                                   
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------
|1. | Correct amortization of intangible assets recorded as a result of
 determining $0 value assigned to intangible assets at the date of
 acquisition.

12

---



Consolidated Statement of Operations
From May 23, 2007 (date of inception) through March 31, 2010

|                                    |  |                          |             |            |   |           |   |              |   |  |   |             |  
|----------------------------------- |  | ------------------------ | ----------- | ---------- | - | --------- | - | ------------ | - |  | - | ----------- | -
|                                    |  | As
 Previously
 Reported |             | Adjustment |   | Reference |   | As
 Restated |  
|                                    |  |                          |             |            |   |           |   |              |  
|                                    |  |                          |             |            |   |           |   |              |   |  |   |             |  
|Sales                               |  | $                        | 226,361     |            | $ |           |   |              |   |  | $ | 226,361     |  
|Cost of sales                       |  |                          | 269,150     |            |   |           |   |              |   |  |   | 269,150     |  
|                                    |  |                          |             |            |   |           |   |              |  
|Gross (loss)                        |  |                          | (42,789     | )          |   |           |   |              |   |  |   | (42,789     | )
|                                    |  |                          |             |            |   |           |   |              |   |  |   |             |  
|                                    |  |                          |             |            |   |           |   |              |   |  |   |             |  
|Operating expenses:                 |  |                          |             |            |   |           |   |              |   |  |   |             |  
|General, selling and administrative |  |                          | 7,893,837   |            |   |           |   |              |   |  |   | 7,893,837   |  
|Research and development            |  |                          | 369,904     |            |   |           |   |              |   |  |   | 369,904     |  
|Depreciation and amortization       |  |                          | 357,152     |            |   | (201,945  | ) |              | 1 |  |   | 155,207     |  
|                                    |  |                          |             |            |   |           |   |              |  
|Total operating expenses            |  |                          | 8,620,893   |            |   | (201,945  | ) |              |   |  |   | 8,418,948   |  
|                                    |  |                          |             |            |   |           |   |              |   |  |   |             |  
|Other (expense)                     |  |                          | (3,685,693  | )          |   |           |   |              | 1 |  |   | (3,685,693  | )
|                                    |  |                          |             |            |   |           |   |              |   |  |   |             |  
|Income taxes                        |  |                          |            |            |   |           |   |              |   |  |   |            |  
|                                    |  |                          |             |            |   |           |   |              |   |  |   |             |  
|                                    |  |                          |             |            |   |           |   |              |   |  |   |             |  
|                                    |  |                          |             |            |   |           |   |              |   |  |   |             |  
|Net loss                            |  | $                        | (12,349,375 | )          | $ | 201,945   |   |              | 1 |  | $ | (12,147,430 | )
|                                    |  |                          |             |            |   |           |   |              |   |  |   |             |  
|Net loss per common share           |  | $                        | (0.91       | )          | $ | 0.02      |   |              |   |  | $ | (0.89       | )

|   |                                                                                                                              
|-- | -----------------------------------------------------------------------------------------------------------------------------
|1. | Correct
 amortization of intangible assets recorded as a result of determining $0
 value assigned at the date of acquisition.

13

---



Consolidated Statement of Cash Flows
For the three months ended March 31, 2010

|                                                                   |  |                         |            |            |   |           |   |             |   |  |   |            |  
|------------------------------------------------------------------ |  | ----------------------- | ---------- | ---------- | - | --------- | - | ----------- | - |  | - | ---------- | -
|                                                                   |  | As Previously
 Reported |            | Adjustment |   | Reference |   | As Restated |  
|                                                                   |  |                         |            |            |   |           |   |             |  
|                                                                   |  |                         |            |            |   |           |   |             |   |  |   |            |  
|Cash flows from operating activities:                              |  |                         |            |            |   |           |   |             |   |  |   |            |  
|Net loss                                                           |  | $                       | (2,781,862 | )          | $ | 21,154    |   |             | 1 |  | $ | (2,760,708 | )
|Adjustments to reconcile net loss to net
 cash used in operations: |  |                         |            |            |   |           |   |             |   |  |   |            |  
|Depreciation and amortization                                      |  |                         | 119,080    |            |   | (21,154   | ) |             | 1 |  |   | 97,926     |  
|Other operating activities                                         |  |                         | 1,101,155  |            |   |           |   |             |   |  |   | 1,101,155  |  
|                                                                   |  |                         |            |            |   |           |   |             |   |  |   |            |  
|                                                                   |  |                         |            |            |   |           |   |             |   |  |   |            |  
|Net cash used in operating activities                              |  |                         | (1,561,627 | )          |   |           |   |             |   |  |   | (1,561,627 | )
|                                                                   |  |                         |            |            |   |           |   |             |   |  |   |            |  
|Net cash used in investing activities                              |  |                         | (196,844   | )          |   |           |   |             |   |  |   | (196,844   | )
|                                                                   |  |                         |            |            |   |           |   |             |   |  |   |            |  
|Net cash provided in financing activities                          |  |                         | 643,346    |            |   |           |   |             |   |  |   | 643,346    |  
|                                                                   |  |                         |            |            |   |           |   |             |   |  |   |            |  
|                                                                   |  |                         |            |            |   |           |   |             |   |  |   |            |  
|Net decrease in cash                                               |  |                         | (1,115,125 | )          |   |           |   |             |   |  |   | (1,115,125 | )
|Cash and cash equivalents, beginning of
 period                    |  |                         | 4,869,749  |            |   |           |   |             |   |  |   | 4,869,749  |  
|                                                                   |  |                         |            |            |   |           |   |             |   |  |   |            |  
|Cash and cash equivalents, end of period                           |  | $                       | 3,754,624  |            |   |           |   |             |   |  | $ | 3,754,624  |  
|                                                                   |  |                         |            |            |   |           |   |             |   |  |   |            |  

1          Correction of amortization and depreciation due to change in fair values.

14

---



Consolidated Statement of Cash Flows
From May 23, 2007 (date of inception) through March 31, 2010)

|                                                                   |  |                         |             |            |   |           |   |             |   |  |   |             |  
|------------------------------------------------------------------ |  | ----------------------- | ----------- | ---------- | - | --------- | - | ----------- | - |  | - | ----------- | -
|                                                                   |  | As Previously
 Reported |             | Adjustment |   | Reference |   | As Restated |  
|                                                                   |  |                         |             |            |   |           |   |             |  
|                                                                   |  |                         |             |            |   |           |   |             |  
|Cash flows from operating activities:                              |  |                         |             |            |   |           |   |             |   |  |   |             |  
|Net loss                                                           |  | $                       | (12,349,375 | )          | $ | 201,945   |   |             | 1 |  | $ | (12,147,430 | )
|Adjustments to reconcile net loss to net cash
 used in operations: |  |                         |             |            |   |           |   |             |   |  |   |             |  
|Depreciation and amortization                                      |  |                         | 446,003     |            |   | (201,945  | ) |             | 1 |  |   | 244,058     |  
|Other operating activities                                         |  |                         | 4,675,632   |            |   |           |   |             |   |  |   | 4,675,632   |  
|                                                                   |  |                         |             |            |   |           |   |             |   |  |   |             |  
|                                                                   |  |                         |             |            |   |           |   |             |   |  |   |             |  
|Net cash used in operating activities                              |  |                         | (7,227,740  | )          |   |           |   |             |   |  |   | (7,227,740  | )
|                                                                   |  |                         |             |            |   |           |   |             |   |  |   |             |  
|Net cash used in investing activities                              |  |                         | (4,099,609  | )          |   |           |   |             |   |  |   | (4,099,609  | )
|                                                                   |  |                         |             |            |   |           |   |             |   |  |   |             |  
|Net cash provided in financing activities                          |  |                         | 15,081,973  |            |   |           |   |             |   |  |   | 15,081,973  |  
|                                                                   |  |                         |             |            |   |           |   |             |   |  |   |             |  
|                                                                   |  |                         |             |            |   |           |   |             |   |  |   |             |  
|Net increase in cash                                               |  |                         | 3,754,624   |            |   |           |   |             |   |  |   | 3,754,624   |  
|Cash and cash equivalents, beginning of
 period                    |  |                         |            |            |   |           |   |             |   |  |   |            |  
|                                                                   |  |                         |             |            |   |           |   |             |   |  |   |             |  
|Cash and cash equivalents, end of period                           |  | $                       | 3,754,624   |            |   |           |   |             |   |  | $ | 3,754,624   |  
|                                                                   |  |                         |             |            |   |           |   |             |   |  |   |             |  

1.          Correction of amortization and depreciation due to change in fair values

NOTE 4  INTANGIBLE ASSETS

Patents

Patents are capitalized at incurred costs and are amortized ratably
over the lesser of their economic or legal life. The patents are currently in
development stage not subject to current period amortization.

Goodwill

The Company does not amortize goodwill. The Company recorded goodwill
in the amount of $639,504 as a result of the acquisition of 11 Goods Energy
LTD during the year ended December 31, 2007.

The Company accounts for and reports acquired goodwill under Accounting
Standards Codification subtopic 350-10, Intangibles-Goodwill and Other (ASC
350-10). In accordance with ASC 350-10, the Company tests its intangible
assets for impairment on an annual basis or more often if events and
circumstances warrant. Any write-downs will be included in results from
operations.

During the years ended December 31, 2010 and 2009, the Company
management performed an evaluation of its goodwill for purposes of determining
the implied fair value of the assets at the end of each respective year. The
test indicated that the recorded remaining book value of its goodwill did not
exceed its fair value for the years ended December 31, 2010 and 2009.
Considerable management judgment is necessary to estimate the fair value.
Accordingly, actual results could vary significantly from managements
estimates.

15

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NOTE 5 - INVENTORIES

Inventory is stated at the lower of cost or market. The cost is
determined using the first-in first-out method. Costs of finished goods
inventory include costs associated with the procurement and transportation of
Soybean oil and other raw materials used in the manufacture of G2 Diesel.

As of March 31, 2011 and December 31, 2010, inventories are comprised
of the following:

|               |  |                  |         |              |   |         | 
|-------------- |  | ---------------- | ------- | ------------ | - | ------- | 
|               |  | March 31, 
 2011 |         | December 31, |  
|               |  | (unaudited)      |         | 2010         |  
|               |  |                  |         |              |  
|Raw
 materials |  | $                | 351,874 |              | $ | 351,874 | 
|Finished
 fuel |  |                  | 180,512 |              |   | 272,865 | 
|               |  |                  |         |              |  
|Total          |  | $                | 532,386 |              | $ | 624,739 | 
|               |  |                  |         |              |   |         | 

NOTE 6  OTHER CURRENT ASSETS

Other assets as of March 31, 2011 and December 31, 2010 are comprised
of the following:

|                              |  |                  |        |              |   |        | 
|----------------------------- |  | ---------------- | ------ | ------------ | - | ------ | 
|                              |  | March 31, 
 2011 |        | December 31, |  
|                              |  | (unaudited)      |        | 2010         |  
|                              |  |                  |        |              |  
|                              |  |                  |        |              |  
|Prepaid
 fuel/product testing |  | $                |       |              | $ | 19,637 | 
|Prepaid
 insurance            |  |                  | 12,687 |              |   |       | 
|Prepaid
 other                |  |                  | 5,337  |              |   | 5,337  | 
|                              |  |                  |        |              |  
|Total                         |  | $                | 18,024 |              | $ | 24,974 | 
|                              |  |                  |        |              |   |        | 

NOTE 7  PROPERTY, PLANT AND EQUIPMENT

The Companys property, plant and equipment at March 31, 2011 and
December 31, 2010 consist of the following:

|                                |  |                  |           |          |   |           | 
|------------------------------- |  | ---------------- | --------- | -------- | - | --------- | 
|                                |  | March 31, 
 2011 |           | December |  
|                                |  | (unaudited)      |           | 31, 2010 |  
|                                |  |                  |           |          |  
|Leasehold improvements          |  | $                | 345,381   |          | $ | 345,381   | 
|Factory equipment               |  |                  | 2,381,478 |          |   | 2,381,478 | 
|Furniture and fixtures          |  |                  | 21,709    |          |   | 21,709    | 
|Office equipment                |  |                  | 20,545    |          |   | 20,545    | 
|Vehicles                        |  |                  | 131,225   |          |   | 131,225   | 
|Computer equipment and software |  |                  | 148,300   |          |   | 148,300   | 
|Web design                      |  |                  | 51,505    |          |   | 51,505    | 
|                                |  |                  |           |          |  
|Total                           |  |                  | 3,100,143 |          |   | 3,100,143 | 
|Less accumulated depreciation   |  |                  | 633,295   |          |   | 537,468   | 
|                                |  |                  |           |          |  
|Net                             |  | $                | 2,466,848 |          | $ | 2,562,675 | 
|                                |  |                  |           |          |   |           | 

16

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Property and equipment are recorded on the basis of cost. For financial
statement purposes, property, plant and equipment are depreciated using the
straight-line method over their estimated useful lives.

Expenditures for repair and maintenance which do not materially extend
the useful lives of property and equipment are charged to operations. When
property or equipment is sold or otherwise disposed of, the cost and related
accumulated depreciation are removed from the respective accounts with the
resulting gain or loss reflected in operations. Management periodically reviews
the carrying value of its property and equipment for impairment.

Depreciation expense was $95,827 and $97,926 for the three months ended
March 31, 2011 and 2010, respectively, of which $66,642 and $56,879 was
included as part of cost of sales for the three months ended March 31, 2011 and
2010, respectively.

NOTE 8  AVAILABLE-FOR-SALE SECURITIES

Cost and fair value of marketable equity securities at March 31, 2011
and December 31, 2010 are as follows:

|                                                                |  |                  |          |              |   |          |  
|--------------------------------------------------------------- |  | ---------------- | -------- | ------------ | - | -------- | -
|                                                                |  | March 31, 
 2011 |          | December 31, |  
|                                                                |  | (unaudited)      |          | 2010         |  
|                                                                |  |                  |          |              |  
|                                                                |  |                  |          |              |  
|Available
 for sale securities:                                 |  |                  |          |              |   |          |  
|Equity
 securities:                                             |  |                  |          |              |   |          |  
|Fair value                                                      |  | $                | 7,980    |              | $ | 576,990  |  
|Total
 (losses) gains in accumulated other comprehensive income |  | $                | (281,720 | )            | $ | (286,561 | )

During the three months ended March 31, 2011 and 2010, the Company
realized an aggregate loss of $17,782 and Nil with the sales of marketable
securities, respectively. Unrealized gains (losses) are accounted for as other
comprehensive income (loss).

NOTE 9  COMMON STOCK

As of March 31, 2011, the Company has received net proceeds of
$10,253,069, through the subscription for common stock consisting of 3,977,333
shares of common stock and 1,988,667 warrants. All common shares subscribed
were issued during the year ended December 31, 2010.

NOTE 10  RELATED PARTY TRANSACTIONS

Facilities

Since April 1, 2008, the Company has occupied warehouse space provided
by one of the Companys founders. The Company agreed to pay a total of $1 per
month for the space. The Company records this fee as rent expense when
incurred. During this time period, the Company constructed a leasehold
improvement to the leased warehouse space for the purpose of locating our
bio-fuel manufacturing facility.

Due to related party

During the three months ended March 31, 2011, the Companys President
and CEO advanced an aggregate of $170,350 for working capital purposes to the
Company. The advances are short term, non-interesting bearing, and are due upon
demand.

17

---



Receivable from purchase of treasury stock

During the three months ended March 31, 2011, the
    Company paid $25,000 to acquire the Companys common stock (treasury
    stock). As of March 31, 2011, the common stock has not been received.

Consistent with ASC 505-10-45 (Equity-Other Presentation), the amount
recorded on the balance sheet is presented as a deduction from stockholders
equity (deficit). This is also consistent with Rule 5-02.30 of Regulation S-X
of the Code of Federal Regulations.

NOTE 11  FAIR VALUE

ASC 825-10 defines fair value as the price that would be received from
selling an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. When determining the fair
value measurements for assets and liabilities required or permitted to be
recorded at fair value, the Company considers the principal or most
advantageous market in which it would transact and considers assumptions that
market participants would use when pricing the asset or liability, such as
inherent risk, transfer restrictions, and risk of nonperformance. ASC 825-10
establishes a fair value hierarchy that requires an entity to maximize the use
of observable inputs and minimize the use of unobservable inputs when measuring
fair value. ASC 825-10 establishes three levels of inputs that may be used to
measure fair value:

Level 1 - Quoted prices in active markets for identical assets or
liabilities.

Level 2 - Observable inputs other than Level 1 prices such as quoted
prices for similar assets or liabilities; quoted prices in markets with
insufficient volume or infrequent transactions (less active markets); or
model-derived valuations in which all significant inputs are observable or can
be derived principally from or corroborated by observable market data for
substantially the full term of the assets or liabilities.

Level 3 - Unobservable inputs to the valuation methodology that are
significant to the measurement of fair value of assets or liabilities.

To the extent that valuation is based on models or inputs that are less
observable or unobservable in the market, the determination of fair value
requires more judgment. In certain cases, the inputs used to measure fair value
may fall into different levels of the fair value hierarchy. In such cases, for
disclosure purposes, the level in the fair value hierarchy within which the
fair value measurement is disclosed is determined based on the lowest level
input that is significant to the fair value measurement.

Items recorded or measured at fair value on a recurring basis in the
accompanying consolidated financial statements consisted of the following items
as of March 31, 2011:

|                               |  |       |       |                                                                         |   |                                                 |  |                                            |   |  |   |   | 
|------------------------------ |  | ----- | ----- | ----------------------------------------------------------------------- | - | ----------------------------------------------- |  | ------------------------------------------ | - |  | - | - | 
|                               |  | Total |       | Quoted
 Prices in
 Active
 Markets for
 Identical
 Instruments
 Level 1 |   | Significant
 Other
 Observable
 Inputs
 Level 2 |  | Significant
 Unobservable
 Inputs
 Level 3 |  
|                               |  |       |       |                                                                         |   |                                                 |  |                                            |  
|Assets:                        |  |       |       |                                                                         |   |                                                 |  |                                            |   |  |   |   | 
|Securities
 available for sale |  | $     | 7,980 |                                                                         | $ | 7,980                                           |  | $                                          |  |  | $ |  | 
|                               |  |       |       |                                                                         |   |                                                 |  |                                            |  
|Total                          |  | $     | 7,980 |                                                                         | $ | 7,980                                           |  | $                                          |  |  | $ |  | 
|                               |  |       |       |                                                                         |   |                                                 |  |                                            |   |  |   |   | 

18

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The Company adopted the provisions of ASC 825-10 prospectively
effective as of the beginning of Fiscal 2008. For financial assets and
liabilities included within the scope of ASC 825-10, the Company will be
required to adopt the provisions of ASC 825-10 prospectively as of the
beginning of Fiscal 2009. The adoption of ASC 825-10 did not have a material
impact on our consolidated financial position or results of operations.

The fair value of the assets, securities available for sale, at March
31, 2011 was grouped as Level 1 valuation as the market price was readily
available.

NOTE 12  SUBSEQUENT EVENTS

We are currently in the process of raising capital through a private
placement sale of common stock. The current private placement memorandum outlines
the sale of up to 2,000,000 shares of common stock at $5 per share for an
aggregate of up to $10,000,000. Subsequent to the date of the financial
statements and as of the date of this filing, we have raised and collected
$225,000 as a result of a private placement sale of equity.

19

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ITEM 2. MANAGEMENTS DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

The
information contained in this Form 10-Q and documents incorporated herein by
reference are intended to update the information contained in the Companys
Annual Report on Form 10-K for the year ended December 31, 2010 and such
information presumes that readers have access to, and will have read, the
Managements Discussion and Analysis of Financial Condition and Results of
Operations, Risk Factors and other information contained in such Form 10-K
and other Company filings with the Securities and Exchange Commission (SEC).

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. These forward-looking statements involve risks and uncertainties,
and actual results could be significantly different than those discussed in
this Form 10-Q. Certain statements contained in Managements Discussion and
Analysis, particularly in Liquidity and Capital Resources, and elsewhere in
this Form 10-Q are forward-looking statements. These statements discuss, among
other things, expected growth, future revenues and future performance. Although
we believe the expectations expressed in such forward-looking statements are
based on reasonable assumptions within the bounds of our knowledge of our
business, a number of factors could cause actual results to differ materially
from those expressed in any forward-looking statements, whether oral or
written, made by us or on our behalf. The forward-looking statements are
subject to risks and uncertainties identified under the Risk Factors section
of the aforementioned Form 10-K for the fiscal year ended December 31, 2010.
The risk factors of said Form 10-K should not be construed as an exhaustive
list of all factors that could cause actual results to differ materially from
those expressed in forward-looking statements made by us. All forward-looking
statements included in this document are made as of the date hereof, based on
information available to the Company on the date thereof, and the Company
assumes no obligation to update any forward-looking statements.

Overview

11
Good Energy, Inc. is a Delaware corporation formed on May 23, 2007 for the
purposes of developing, testing, manufacturing and distributing bio-fuel with
energy related plans and pursuits relying on the commercialization of our
proprietary fuel product, G2 Diesel, as discussed below.

On
October 23, 2007, we completed the purchase of an existing biodiesel
manufacturer, 11 Goods Energy, LTD, a limited liability company (becoming our
wholly-owned subsidiary), formed in the State of Ohio in February 2006.
Historically, our subsidiary has been a development stage company, which has
primarily engaged in research activities to develop a proprietary manufacturing
process to produce bio-fuel for diesel applications.

In
early 2008, we began construction on our manufacturing facility at the location
of our operating subsidiary in Magnolia, Ohio (Magnolia Plant). In June 2008,
we began placing tanks and constructing the infrastructure of the Magnolia
Plant. Unfortunately, the industry experienced changes in fire suppression
regulations requiring us to invest over $1,500,000 in additional infrastructure
not anticipated in the original capital expenditure budget. We had to cease
plant construction and operations from November 2008 to October 2009 in order
to secure the financing and make the necessary changes to the fire suppression
system and design of the Magnolia Plant.

20

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Acquisition of 11 Goods Energy, LTD

As
a result of the purchase of 11 Goods Energy, LTD (11 Goods) all of the
assets, liabilities and proprietary technology of 11 Goods were transferred to
us by the former partners of 11 Goods in exchange for cash of $611,900,
$111,230 in assumed liabilities and 4,285,714 shares of common stock of the
company valued at $429. The assets and liabilities of 11 Goods were recorded
at fair market value at the time of acquisition. 11 Goods is our sole
subsidiary and operations and the management of 11 Goods and us are the same.
The consolidated financial statements include the accounts of us and our
wholly-owned subsidiary and all intercompany balances and transactions have
been eliminated.

The
Company accounts for acquisitions in accordance with the provisions of ASC
805-10. The Company assigns to all identifiable assets acquired a portion of
the cost of the acquired company equal to the estimated fair value of such
assets at the date of acquisition. The Company records the excess of the cost
of the acquired company over the sum of the amounts assigned to identifiable
assets acquired as goodwill. Management determined the fair values assigned to
inventory based upon selling prices less cost of disposal and the Companys
profit allowance and the case of work in process less cost to complete. The
Fair value of plant and equipment are based on current replacement costs. The
Company recorded goodwill in the amount of $639,504 as a result of the
acquisition of 11 Goods Energy LTD during the year ended December 31, 2007.
The Company accounts for and reports acquired goodwill under Accounting
Standards Codification subtopic 350-10, Intangibles-Goodwill and Other (ASC
350-10). The Company does not amortize goodwill. In accordance with ASC
350-10, the Company tests its intangible assets for impairment on an annual
basis or more often if events and circumstances warrant. Any write-downs will
be included in results from operations.

Development Stage Company - Product
Development

We
are currently in an early stage of our current business plan. We have limited
operating history with respect to the construction and operation of biodiesel
refineries for our own use. In this respect, from May 23, 2007 (date of
inception) through March 31, 2011, our revenues have totaled $499,222 and our
deficit accumulated during our development stage was $17,745,520. Further, our
operating subsidiary incurred from February 2006 through October 2007, costs
    of approximately $100,000 in the development of our subsidiarys proprietary
manufacturing process and G2 Diesel product which are not reflected in our
accumulated deficit since their costs were incurred prior to the acquisition
date of our subsidiary. These costs were primarily comprised of feedstock
materials, labor and facilities costs. Since the acquisition, we have further
developed our process and product through testing and trials and have expended
money on labor, consulting, facilities and media productions in order to
further our product development. Currently, the development of the fuels
functionality is complete, although we continue to incur research and
development costs to develop new feedstock alternatives and to improve
materials procurement and fuel manufacturing techniques.

Critical Accounting Policies

Our
discussion and analysis of our financial condition and results of operations
are based upon our financial statements, which have been prepared in accordance
with accounting principles generally accepted in the United States. The
preparation of financial statements requires management to make estimates and
disclosures on the date of the financial statements. On an on-going basis, we
evaluate our estimates including, but not limited to, those related to revenue
recognition. We use authoritative pronouncements, historical experience and
other assumptions as the basis for making judgments. Actual results could
differ from those estimates. We believe that the following critical accounting
policies affect our more significant judgments and estimates in the preparation
of our financial statements.

21

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Revenue Recognition. We recognize revenue from product sales in accordance with ASC 605
Revenue Recognition. Four basic criteria must be met before revenue can be
recognized: (1) persuasive evidence of an arrangement exists (through written
sales documentation); (2) delivery has occurred (through delivery into
customers tanks and acceptance); (3) the selling price is fixed and
determinable; and (4) collectability is reasonably assured. For criteria (1) we
generate a sales order and a shipping document defining number of gallons of
fuel ordered, delivery and payment terms based on standing customer data and
the customers purchase order. For criteria (2) we ensure delivery has occurred
by documented delivery terms defining where the customer accepts the fuel
delivery. Fuel stored off-site by the company remains as inventory until the
customer receives the fuel from the offsite storage facility. For criteria (3)
management determines the selling price based on feedstock costs and our
desired margin level. Our selling price fluctuates as feedstock prices increase
or decrease, primary the cost of soybean oil. Currently, management determines
our selling price on a weekly basis. For criteria (4) we establish
creditworthiness of the customer based on a review of established credit limits
and current financial health of the entity placing the fuel order. Provisions
for estimated returns and allowances, and other adjustments are provided for in
the same period the related sales are recorded, although we have not
experienced any such items to date and do not expect any significant provisions
in the future. We have no discount, rebate or warranty programs. Payments
received in advance are deferred until revenue recognition is appropriate. We
have no post-delivery obligations related to our products.

Inventory Valuation. We are required to make judgments based on historical experience and
future expectations, as to the realizability of our inventory. We make these
assessments based on the following factors: (a) existing orders and usage, (b)
age of the inventory, and (c) historical experience.

Property and Equipment.We are required to make judgments based on
historical experience and future expectations, as to the realizability of our
property and equipment. We made these assessments based on the following
factors: (a) the estimated useful lives of such assets, (b) technological
changes in our industry, and (c) the changing needs of our customers.

Fair Value of Intangible Assets.We have adopted Statement of Accounting
Standards Codification subtopic 805-10 (ASC 805-10). ASC 805-10 requires that
long-lived assets and certain identifiable intangibles held and used by the
Company be reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of an asset may not be recoverable. Events
relating to recoverability may include significant unfavorable changes in
business conditions, recurring losses, or a forecasted inability to achieve
break-even operating results over an extended period.

We
evaluate the recoverability of long-lived assets based upon forecasted
undiscounted cash flows. Should impairment in value be indicated, the carrying
value of intangible assets will be adjusted, based on estimates of future
discounted cash flows resulting from the use and ultimate disposition of the asset.
ASC 805-10 also requires assets to be disposed of be reported at the lower of
the carrying amount or the fair value less costs to sell.

Stock-Based Compensation

We
account for our stock based compensation under ASC 718 Compensation  Stock
Compensation using the fair value based method. Under this method,
compensation cost is measured at the grant date based on the value of the award
and is recognized over the service period, which is usually the vesting period.
This guidance establishes standards for the accounting for transactions in
which an entity exchanges its equity instruments for goods or services. It also
addresses transactions in which an entity incurs liabilities in exchange for
goods or services that are based on the fair value of the entitys equity
instruments or that may be settled by the issuance of those equity instruments.

There
were no employee stock options and employee stock purchases granted to
employees and directors during the period from May 23, 2007 (date of inception)
through December 31, 2008. On July 22, 2009, the company granted 500,000 stock
options to outside directors at an exercise price of $3.00 per share. We
recorded the fair value of $200,205 as compensation expense during the year
ended December 31, 2009 as a result of this transaction. These options are for
a period of three years and are fully vested. There were no unvested options
outstanding as of the date of adoption of FASB ASC Topic 718.

22

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We
use the fair value method for equity instruments granted to non-employees (if
any) and will use the Black-Scholes model for measuring the fair value of
options, if issued. The stock based fair value compensation is determined as of
the date of the grant or the date at which the performance of the services is
completed (measurement date) and is recognized over the vesting periods.

Results of Operations

By
virtue of our purchase of 11 Goods, which became our sole operations, the
company is considered to be in the development stage in accordance with the
FASB ASC Topic 915  Development Stage Enterprises.Since its inception, the company has devoted substantially
all of its time to raising capital, obtaining financing, research and
development activities and obtaining many governmental organizations,
municipalities and corporations to test our G2 Diesel and its performance as a
blend with traditional #2 diesel fuel.

Three months Ended March 31, 2011 Compared to the Three
months Ended March 31, 2010

The
following table sets forth certain selected condensed consolidated statement of
operations data for the periods indicated:

|                                     |  |                               |            |   |  |      |   |   |            |   |  |      |  
|------------------------------------ |  | ----------------------------- | ---------- | - |  | ---- | - | - | ---------- | - |  | ---- | -
|                                     |  | Three
 Months Ended March 31, |           
|                                     |  |                               |           
|                                     |  | 2011                          |            | % |  | 2010 |   | % |           
|                                     |  |                               |            |   |  |      |   |   |           
|Revenue                              |  | $                             | 29,222     |   |  | 100  | % | $ | 48,427     |   |  | 100  |  
|Cost of goods sold                   |  |                               | 114,397    |   |  | >100 | % |   | 107,248    |   |  | >100 | %
|                                     |  |                               |            |   |  |      |   |   |            |   |  |      |  
|Gross loss                           |  |                               | (85,175    | ) |  |     |   |   | (58,821    | ) |  |     |  
|                                     |  |                               |            |   |  |      |   |   |            |   |  |      |  
|Operating expenses:                  |  |                               |            |   |  |      |   |   |            |   |  |      |  
|Selling, general and
 administrative |  |                               | 961,260    |   |  | >100 | % |   | 2,552,440  |   |  | >100 | %
|Research and development             |  |                               | 100,551    |   |  | >100 | % |   | 101,323    |   |  | >100 | %
|Depreciation and
 amortization       |  |                               | 29,185     |   |  | <100 | % |   | 41,047     |   |  | <100 | %
|                                     |  |                               |            |   |  |      |   |   |            |   |  |      |  
|Total operating expenses:            |  |                               | 1,090,966  |   |  |      |   |   | 2,694,810  |   |  |      |  
|                                     |  |                               |            |   |  |      |   |   |            |   |  |      |  
|Net loss from operations             |  |                               | (1,176,171 | ) |  |      |   |   | (2,753,631 | ) |  |      |  
|                                     |  |                               |            |   |  |      |   |   |            |   |  |      |  
|Other income/expense:                |  |                               |            |   |  |      |   |   |            |   |  |      |  
|Interest, net                        |  |                               |           |   |  |      |   |   | (7,077     | ) |  | <100 | %
|Other income, net                    |  |                               | (17,782    | ) |  | <100 | % |   |           |   |  |      |  
|                                     |  |                               |            |   |  |      |   |   |            |   |  |      |  
|                                     |  |                               |            |   |  |      |   |   |            |   |  |      |  
|                                     |  |                               |            |   |  |      |   |   |            |   |  |      |  
|Net loss                             |  | $                             | (1,193,953 | ) |  | <100 | % | $ | (2,760,708 | ) |  | <100 | %
|                                     |  |                               |            |   |  |      |   |   |            |   |  |      |  

The
decrease in revenues of $19,205 from the three months ended March 31, 2011 of
    $29,222 compared to the three months ended March 31, 2010 of $48,427 and
    the minimal amount of revenues in total is the result of our testing and
    pilot programs continuing beyond our original time estimates due to regulatory
    milestones that have proven more difficult to acquire than originally anticipated,
    which has also led to a longer sales order cycle than the Company originally
    anticipated. For our testing programs that completed in 2010, results showed
    both efficiency and emissions improvements that remain of great interest
    to metropolitan bus systems and the rail and trucking industries. We are
    currently cultivating these pilot programs to sales orders. The remaining
    existing pilot programs and regulatory approvals are expected to be finalized
    in 2011 and continue to show great promise to generate significant demand
    over the next quarter leading to more significant sales orders and contracts
    to purchase our fuel.

23

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Our
most significant efforts have been focused on approval of our fuel variance in
the state of California. The fuel variance is required for our fuel to meet
California regulations to sell bio-diesel fuel, which is the result of G2
Diesels flash point being less than traditional Biodiesel. This is the result
of the small amount of ethanol in our finished fuel, which creates a lower
flashpoint. We have spent considerable resources to meet Californias
requirements to meet this regulation and have received positive feedback from
our representatives that it should pass in 2011. We currently are licensed to
sell fuel in California; however, we must meet this regulation to sell G2
Diesel. The variance requirement has certainly delayed our ability to expand
our market presence in California and has delayed our ability to sell our fuel
in California. Its passage will allow many of our customers in California,
which have tested and approved the use of G2 Diesel, to go to order and
purchase G2 Diesel.

Cost
of goods sold was $114,397 for the three months ended March 31, 2011 and
$107,248 for the three months ending March 31, 2010. Cost of goods sold exceeded
    revenues for both periods as a result of applying fixed factory depreciation
    and overhead to cost of goods sold, even though only a small volume of sales
    were generated. The first quarter of 2011 experienced less sales activity
    as described in the preceding paragraph. For the three months ended March
    31, 2011, there were certain factory costs associated with operating the
    plant and selling fuel applied to cost of goods sold, whereas there was no
    such cost in the first quarter of 2010.

Current
margins for our testing programs resulted in gross losses of $85,175 for the
three months ended March 31, 2011 and $58,821 for the three months ending March
31, 2010. We expect sales margins to improve once we have sales contracts in
place at our scheduled premium prices after the testing programs are concluded.
Currently, our G2 Diesel is being sold to companies and governmental
organizations and municipalities at reduced prices equivalent to the cost of
traditional #2 diesel fuel or less, to encourage them to test our G2 Diesel as
a blended product for:

|  |                                                  
|- | -------------------------------------------------
| | power performance,
 maintenance and engine noise;
| | emissions and exhaust
 smell; and                
| | fuel economy.                                    

Research
and development costs were $100,551 for the three months ended March 31, 2011
and $101,323 for the three months ending March 31, 2010. Our Research and
Development activities have shown consistent from quarter to quarter. We have
continued our focus on developing new feedstock alternatives and improving fuel
manufacturing techniques to gain production efficiencies.

Depreciation
and amortization included in operating expenses decreased by $11,862. We have
allocated more depreciation to cost of goods sold during the quarter ended
March 31, 2011 when compared to the quarter ended March 31, 2010 as a result of
more fixed assets purchased and used in production.

Selling,
general, and administrative expenses for the three months ended March 31, 2011
of $961,260 exceeded revenues by $932,038. Such costs include, among others,
payroll and related expenses, insurance costs and occupancy costs. The decrease
in selling, general and administrative expenses of $1,591,180 in 2011 over the
comparable period of the prior year is primarily related to payments of common
stock to consultants and employees from the Companys CEO and a founding
shareholder, which was treated for accounting purposes as operating expenses
and donated capital, in the amount of $1,493,850. The company also experienced
a decrease in consulting, legal and bonus costs of approximately $28,000. Other
overhead costs such as travel, marketing and promotional cost decreased
approximately $195,000 and salaries and payroll costs increased by
approximately $11,000 in comparison to the first quarter of 2010.

Net
loss was $1,193,953 in the three months ended March 31, 2011 as compared to
$2,760,708 for the comparable period in 2010. Basic and fully diluted net loss
per share for the three months ended March 31, 2011 and March 31, 2010 was
$(0.06) and $(0.20), respectively. Basic and fully diluted weighted average
shares outstanding for the fiscal three months ended March 31, 2011 and March
31, 2010 was 19,856,239 and 14,154,603, respectively.

24

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Liquidity and Capital Resources

The
company had cash and cash equivalents of $33,930 at March 31, 2011. Net cash
was used in operating activities of $690,161 for the three months ended March
31, 2011. Cash used in operations was a result of a net loss for the period of
$1,193,953; a decrease in inventory of $92,353; a decrease in accounts
receivable of $36,932; an increase in payables of $253,948, depreciation and
amortization of $95,827 and a decrease in other assets of $6,950. Net cash
investing activities of $548,862 for the three months ended March 31, 2011,
included patent costs of $7,207 and proceeds from the sale of securities
available for sale of $556,069. Net cash provided by financing activities of
$145,350 for the three months ended March 31, 2011, included proceeds from a
related party advance of $170,350, partially offset by $25,000 due from a
related party.

The
company had cash and cash equivalents of $3,754,624 at March 31, 2010. Net cash
was used in operating activities of $1,561,627 for the three months ended March
31, 2010. Cash used in operations was a result of a net loss for the period of
$2,760,708, net changes in assets and liabilities in the amount of $392,685,
partially offset by non cash compensation of services by a related party of
$1,493,840, depreciation and amortization of $97,926. Net cash used in
investing activities of $196,844 for the three months ended March 31, 2010,
included the purchase of property, plant and equipment of $107,144 and the
purchase of securities available for sale of $89,700. Net cash provided by
financing activities of $643,346 for the three months ended March 31, 2010,
included proceeds from common stock subscriptions of $805,846, offset by the
purchase of Treasury stock of $122,500, and payments totaling $40,000 for
convertible and related party notes payable.

From
May 23, 2007 (date of inception) through March 31, 2011, the company raised
$7,930,000 by issuing notes payable convertible into Common Stock, bearing 8%
interest per annum. These Notes, in aggregate of $8,039,323 (including
principal and accrued interest thereon), became convertible at a price of $2.55
per share (the Conversion Price) based upon a 15% discount to the companys
equity raise which was completed at an offering price of $3.00 per share
between August 2009 and March 2010. In addition to the number of conversion
shares to be delivered to each Holder of this Note, upon conversion of the
Principal Amount and accrued interest thereon, the company also delivered
Warrants expiring June 30, 2012 to purchase a number of shares of
Common Stock equal to the number of Conversion Shares. As March 31, 2011 and
December 31, 2010, the company had outstanding $0 of these convertible notes.

As
of March 31, 2011, the company had converted $6,498,709 of Convertible notes
payable to Common Stock issued at a price of $2.55 per share, and issued
2,548,513 shares of common stock and warrants to purchase 3,228,523 shares of
Common Stock. All remaining note balances and accrued interest were redeemed in
cash.

As
of March 31, 2011, the company received gross proceeds of $11,932,000 (net
proceeds of $10,253,069) through the sale of its Common Stock at a price of
$3.00 per share, for a total of 3,977,333 shares.

We
have a history of losses from operations and an accumulated deficit of
$17,745,520 at March 31, 2011 and negative working capital (total current
liabilities in excess of total current liabilities) of $275,152. As of March
31, 2011, we are operating one production facility; currently have a total of
11 employees, with a burn rate of approximately $285,000 per month. In the
absence of significant revenues, management believes that we will require
capital funding and liquidity needs for our current corporate and plant
operations. While the company anticipates more than nominal revenues will
result during 2011, our ability to achieve profitable operations will depend
    on our ability to raise additional financing in 2011, on terms satisfactory
    to us, particularly if cash flow from operations continues at its current
    level. Further, there is no guarantee that we will ever be able to operate
profitably or derive any significant revenues from our operations.

We
anticipate that our future liquidity requirements will arise from the need to
finance our accounts receivable and inventories, and from the need to fund our
current obligations and capital expenditures. The primary sources of funding
for our current operations will be cash generated from operations and the sale
of current inventory and raising additional capital from the sale of equity
securities.

25

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We
are currently in the process of raising capital through a private placement
sale of common stock. The current private placement memorandum outlines the
sale of up to 2,000,000 shares of common stock at $5 per share for an aggregate
of up to $10,000,000. As of the date of this filing, we have raised and
collected $225,000 as a result of a private placement sale of equity. Exemption
is claimed under Section 4(2) and/or Rule 506 of Regulation D of the Securities
Act of 1933, as amended.

Our
future plans include purchasing and/or leasing a site for the purpose of
constructing a second production facility with an estimated annual output
capacity of 30,000,000 gallons of G2 Diesel. To date, we have completed
engineering and construction plans for such a facility and have made inquiries
into potential sites in the State of Ohio for such a facility. However,
detailed milestones of these plans and the specific steps needed to accomplish
each milestone do not currently exist. Management estimates that once a site is
secured, that construction permitting and all the other steps necessary to have
such a site constructed and operational would take approximately one year to
complete.

The
actual costs of this new facility will depend upon many factors, including,
without limitation, the location and cost of the land, demolition costs of
existing facilities (if any) on the site, environmental concerns (if any) and
the size of the new plant. We can provide no assurances that the company will
be able to obtain adequate financing for its second production facility on
terms satisfactory to us, if at all.

Off-Balance
Sheet Arrangements

We have no off-balance sheet
arrangements

Item 3.
Quantitative and
Qualitative Disclosures About Market Risk

Market
risk is the risk of loss arising from adverse changes in market rates and
prices, such as interest rates, foreign currency exchange rates and commodity
prices. Our primary exposure to market risk is interest rate risk associated
with our short term money market investments. The Company does not have any
financial instruments held for hedging or other speculative purposes and does
not invest in derivative financial instruments, interest rate swaps or other
investments that alter interest rate exposure.

Item 4. Controls and
Procedures

We
maintain disclosure controls and procedures, which are designed to ensure that
information required to be disclosed in the reports we file or submit under the
Securities Exchange Act of 1934, as amended, is recorded, processed, summarized
and reported within the time periods specified in the Securities and Exchange
Commissions rules and forms, and that such information is accumulated and
communicated to our management, including our CEO and CFO, as appropriate, to
allow timely decisions regarding required disclosure.

Under the supervision and
with the participation of our management, including our CEO and CFO, an
evaluation was performed on the effectiveness of the design and operation of
our disclosure controls and procedures as of the end of the period covered by
this quarterly report. Based on that evaluation, our management, including our
CEO and CFO, concluded that our disclosure controls and procedures were ineffective
as of the end of the period covered by this report due to the Companys limited
resources and limited number of employees. To mitigate the current limited
resources and limited employees, we rely heavily on direct management oversight
of transactions, along with the use of legal and outsourced accounting
professionals. As we grow, we expect to increase our number of employees,
which, we believe, will enable us to implement adequate segregation of duties
within the internal control framework.

There
were no changes in the Companys internal controls over financial reporting
during the most recently completed fiscal quarter that have materially affected
or are reasonably likely to materially affect the Companys internal control
over financial reporting.

26

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PART II. OTHER
INFORMATION

Item
1. Legal Proceedings

As of the
filing date of this Form 10-Q, we are not a party to any pending legal
proceedings.

Item 1A. Risk Factors

As a
Smaller Reporting Company as defined Rule 12b-2 of the Exchange Act and in item
10(f)(1) of Regulation S-K, we are electing scaled disclosure reporting
obligations and therefore are not required to provide the information requested
by this Item 1A.

Item
2. Changes in Securities

None.

Item
3. Defaults Upon
Senior Securities

None.

Item
4. Reserved

Item
5. Other Information

We are
currently in the process of raising capital through a private placement sale of
common stock. The current private placement memorandum outlines the sale of up
to 2,000,000 shares of common stock at $5 per share for an aggregate of up to
$10,000,000. As of the date of this filing, we have raised and collected
$225,000 as a result of a private placement sale of equity. Exemption is
claimed under Section 4(2) and/or Rule 506 of Regulation D of the Securities
Act of 1933, as amended.

Item
6. Exhibits

Except for
the exhibits listed below, other required exhibits have been previously filed
with the Securities and Exchange Commission under the Securities Exchange Act
of 1934, as amended.

The following exhibits were previously filed under a Form S-1
Registration Statement, file No. 333-166149 unless otherwise noted:

|             |  |                                                                                  
|------------ |  | ---------------------------------------------------------------------------------
|Exhibit
 No. |  | Description of Exhibit                                                           
|             |  |                                                                                  
|             |  |                                                                                  
|2.1          |  | Agreement and Plan of Organization between Registrant and 11 Goods
 Energy, LTD.
|             |  |                                                                                  
|2.2          |  | Corrections to Exhibit 2.1                                                       
|             |  |                                                                                  
|3.1          |  | Certification of Incorporation                                                   
|             |  |                                                                                  
|3.2          |  | By-Laws                                                                          
|             |  |                                                                                  
|3.3          |  | Certificate of Amendment to Certificate of Incorporation                         

27

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|     |  |                                                                                                                                                                                    
|---- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.4  |  | Certificate of Designation                                                                                                                                                         
|     |  |                                                                                                                                                                                    
|10.1 |  | Employment Contract - Frederick C. Berndt                                                                                                                                          
|     |  |                                                                                                                                                                                    
|10.2 |  | Employment Contract - Daniel Lapp                                                                                                                                                  
|     |  |                                                                                                                                                                                    
|10.3 |  | Employment Contract - Aaron Harnar                                                                                                                                                 
|     |  |                                                                                                                                                                                    
|10.4 |  | Consulting Agreement with Clayton R. Livengood                                                                                                                                     
|     |  |                                                                                                                                                                                    
|10.5 |  | Employment Agreement - Gary R. Smith                                                                                                                                               
|     |  |                                                                                                                                                                                    
|10.6 |  | Finders Agreement - Jesup Lamont                                                                                                                                                  
|     |  |                                                                                                                                                                                    
|10.7 |  | Consulting Agreement with Capital Keys                                                                                                                                             
|     |  |                                                                                                                                                                                    
|10.8 |  | Consulting Agreement with California Strategies                                                                                                                                    
|     |  |                                                                                                                                                                                    
|10.9 |  | Office Lease dated April 25, 2007 between the Registrant and Triad
 Realty, LLC, including a First Lease Amendment dated June 21, 2007 and a
 Second Amendment dated July 15, 2009.
|     |  |                                                                                                                                                                                    
|21.1 |  | Subsidiary of Registrant                                                                                                                                                           
|     |  |                                                                                                                                                                                    
|31.1 |  | Principal Executive Officer Rule 13a-14(a)/15d-14(a) Certification
 (*)                                                                                                            
|     |  |                                                                                                                                                                                    
|31.2 |  | Principal Financial Officer Rule 13a-14(a)/15d-14(a) Certification
 (*)                                                                                                            
|     |  |                                                                                                                                                                                    
|32.1 |  | Principal Executive Officer Section 1350 Certification (*)                                                                                                                         
|     |  |                                                                                                                                                                                    
|32.2 |  | Principal Financial Officer Section 1350 Certification (*)                                                                                                                         
|     |  |                                                                                                                                                                                    
|99.1 |  | Results of Operations - Press Release dated May___, 2011*                                                                                                                          

|                  
|------------------
|                  
|* Filed
 herewith.

28

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SIGNATURES

Pursuant to
the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.

|                    |                                                              
|------------------- | -------------------------------------------------------------
|                    | 11 GOOD
 ENERGY, INC.                                        
|                    |                                                              
|Date: May
 19, 2011 | By: /s/ Frederick
 C. Berndt                                 
|                    |                                                              
|                    | Frederick C.
 Berndt, President (principal executive officer)
|                    |                                                              
|Date: May
 19, 2011 | By: /s/
 Daniel T. Lapp                                      
|                    |                                                              
|                    | Daniel T.
 Lapp,                                             
|                    | Chief
 Financial Officer (principal financial officer)       

29

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