UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549  (Mark One) FORM 10-K  X.ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  For the fiscal year ended December 31, 2010  or  .TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  For the transition period from _____________ to _____________  Commission file number 333-139746  TRANSACT ENERGY CORP. (Exact name of registrant as specified in its charter)  Nevada98-0515445(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)  105-5119 Beckwith Blvd., San Antonio, TX, USA 78249 (Address of principal executive offices) (Zip Code)  Registrants telephone number, including area code210-561-6015  Securities registered pursuant to Section 12(b) of the Act: None  Securities registered pursuant to Section 12(g) of the Act: None  Common Stock, par value $0.001 (Title of each class)  None (Name of each exchange on which registered)  Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. . Yes X. No  Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. . Yes X. No  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. X. Yes . No  Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. X.  Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.  Large accelerated filer.Accelerated filer.Non-accelerated filer.(Do not check if a smaller reporting company)Smaller reporting companyX.    Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). . Yes X. No  State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrants most recently completed second fiscal quarter.On June 30th, 2010 the aggregate market value of the voting stock of Transact Energy Corp. held by non-affiliates of the registrant was -$12,350,402.40  Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date: As of March 31, 2011 we had issued and outstanding 20,956,930 shares common stock, $.001 par value  APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:  Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. . Yes . No  DOCUMENTS INCORPORATED BY REFERENCE  List hereunder the following documents if incorporated by reference and the Part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) Any annual report to security holders; (2) Any proxy or information statement; and (3) Any prospectus filed pursuant to Rule 424(b) or (c) under the Securities Act of 1933. The listed documents should be clearly described for identification purposes (e.g., annual report to security holders for fiscal year ended December 24, 1980). None   2   PART I  CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS  The statements contained in this Annual Report on Form 10-K that are not historical facts are "forward-looking statements." Such forward-looking statements may be identified by, among other things, the use of forward-looking terminology such as "believes," "intends," "plan" "expects," "may," "will," "should," or "anticipates" or the negative thereof or other variations thereon or comparable terminology, and similar expressions are intended to identify forward-looking statements. We remind readers that forward-looking statements are merely predictions and therefore inherently subject to uncertainties and other factors and involve known and unknown risks that could cause the actual results, performance, levels of activity, or our achievements, or industry results, to be materially different from any future results, performance, levels of activity, or our achievements, or industry results, expressed or implied by such forward-looking statements. Such forward-looking statements appear in Item 1 - "Business" and Item 7 - "Management's Discussion and Analysis of Financial Condition and Results of Operations," as well as elsewhere in this Annual Report and include statements regarding the following: the expected development and potential benefits from our products to consumers, progress in our efforts to develop our facilities and our products and to achieve and maintain regulatory approvals, the potential market demand for our products, our expectations regarding our short- and long-term capital requirements, our outlook for the coming months and information with respect to any other plans and strategies for our business.  The factors discussed herein, including those risks described in Item 1A, and expressed from time to time in our filings with the Securities and Exchange Commission could cause actual results and developments to be materially different from those expressed in or implied by such statements. The forward-looking statements are made only as of the date of this filing, and we undertake no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.  INTRODUCTION  Unless otherwise specified or required by context, as used in this annual report, the terms "we," "our," "us" and the "Company" refer collectively to (i) TransAct Energy Corp., a Nevada corporation ("TransAct").  The Company's current corporate structure results from the issuance of founding shares equal to nine million four hundred thousand (9,400,000) , an initial public offering (IPO) of one million one hundred and two thousand shares (1,102,000) at twenty-five cents ($0.25) and  nine million four hundred and sixty two thousand six hundred and fifty three shares (9,462,653) shares for operations (including consulting, management and debt settlement). .  The Company was originally formed to manage energy related assets and has expanded its scope to power production. The Company incorporates new technologies to provide sustainable energy at power production cost parity.  Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles (U.S. GAAP).  In this annual report, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to "common shares" refer to the common shares in our capital stock.  Item 1. Business.  Our History and Business  We formed as a Nevada corporation on March 15, 2006 as TransAct Energy Corp. Although our business plan called for the securing and managing of any energy leasehold, the Company focused on securing producing and non-producing oil and gas leases in Alberta, Canada. On September 7, 2006 we acquired a one hundred percent (100%) interest in a Petroleum and Natural Gas Lease, from the province of Alberta, Canada for twelve thousand and fifty-one dollars ($12,051), the MedHat Project. We did not develop this resource. We looked to expand our holdings in Alberta through acquisitions and joint ventures for the following two years. We have since allowed this lease to lapse.  A distinct trend appeared in the energy sector supporting sustainable energies. About the same time in late 2008 the Company was introduced to Dr. Mory Gomshei one of the worlds leading geothermal experts and two of his geothermal power (using superheated water from the earth to turn turbines) projects in British Columbia, Canada. The acquisition, resource evaluation, exploration process and administration for geothermal are very similar and in many jurisdictions come under the petroleum sector. We worked with independent companies Aqua Terra Power and Aqua Terra Geothermal through the balance of 2009 on the two geothermal power projects in British Columbia. Other than lending Aqua Terra funds no formal arrangement was entered into pending them securing drill permits on the two projects.   3   TransAct in mid-2009 started introducing the concept of geothermal power to markets in Western and South Asia with the plan to enter joint venture relationships to develop geothermal power projects in these areas. To enter these markets as a power producer the Company found it strategic to develop traditional carbon fuelled power projects in addition After discussions with the Republic of Iraq regarding geothermal opportunities in Northern Iraq, the Company, together with Spectrum Energy Project Investments (a UAE power company), submitted applications to the Basra Investment Commission to develop/manage three natural gas power plants. These multi-billion dollar projects come with long-term power purchase agreements (PPA) and sovereign guarantees and our application through Spectrum was shortlisted. We were unsuccessful in completing our acquisition of 50% of Spectrum and the initial offering lapsed.  On August 31, 2009, TransAct Energy completed and closed its initial public offering at twenty-five cents ($0.25) per share selling one million one hundred and two thousand shares (1,102,000) for a total capital raise of two-hundred and seventy four thousand three hundred and ninety-eight dollars ($274,398 USD). The majority of these funds were placed with Aqua Terra Power as convertible notes to secure and develop 4 geothermal leases in British Columbia, Canada; the balance was used to pay the costs of the offering and a small amount went to working capital.  The Company was approved for listing on the OTCBB in December 2009 and received the trading symbol TEGY.  Throughout 2010 we laid the ground work for large power projects in South Europe, Asia and  Africa; smaller projects for solar and hydrogen fuel cells specifically in India.  We worked to secure markets for geothermal, new solar photo-voltaic and hydrogen fuel cell generators.  Joint development agreement negotiations took place in December 2010 clearing the way for Transact to enter into one major project in South East Asia in 2011; the Company concluded the year negotiating capital to fund its first quarter operating budget.  Business Strategy  The Company works to secure long term power projects under build own operate (BOO) schemes that have guaranteed revenues. These long term projects will provide the foundation for the Companys future earnings.  To secure these projects we have been building relationships in high power deficit countries where projects can attract international funding and underwriting. Joint Venture relationships are formed with local partners, international contractors and engineers to facilitate a sustainable project with limited environmental impact.  To further enhance the Companys ability to access markets the Company identifies and secures technologies that are used in sustainable power generation. By incorporating technologies that utilize energy more efficiently we are able to generate more power with less energy impact and with potentially greater profit (see Figure 1 for current levelized costs).  TransActs relationships with three different companies in solar, wind, geothermal and thermal power production technologies could provide us with lower levelized costs across the board  providing significant competitive advantages.  To execute our strategy the Company continues to broaden its team bringing on key individuals and consultants. January 1, 2011 the Company brought on our new CFO, Simon Thomas a specialist in Project Financing.  Anticipating the need by the second quarter of 2011 we have identified a suitable comptroller.  Dr. Mory Ghomshei, who heads up our Power Development, has selected several Project and Operating Managers to oversee specific projects in concert with international engineering firms we have signed working memorandums with.  In terms of project financing the Company has conditional expressions of interest to finance its first projects and will continue to develop project financing relationships with key banks, individuals and underwriters. The Company is also developing funding sources that will take out the construction debt/equity structures upon power plant commissioning; in order that the funder may secure ten to fifteen year guaranteed revenue streams. This will allow TransAct and its joint venture partners to move their funds into other projects on an ongoing basis.  As a lateral extension to the Companys core business of producing electricity, the Company intends on establishing joint venture relationships to manufacture its secured technologies.  By controlling the supply chain of our own technologies we are able to secure joint venture relationships for solar and wind farms that are already through the licensing process.  Markets and Customers  Greece: As a member of the EU Greece is required to have a certain amount of its energy derived from renewable sources. There are significant opportunities in geothermal, wind and solar power. Current estimates exceed 500MW of geothermal power with 25% capital costs subsidies from the government. Transact has entered preliminary discussions with one of Greeces main power producers to develop a geothermal power project in Greece.  A smaller Greek solar panel producer is prepared to incorporate the TransAct low-cost solar thin film into their projects.   4   India;Backup power has historically been provided by diesel generators in India. In recent years the government of India has mandated a serious reduction in carbon emissions and users of diesel gen-sets are being forced to look at alternatives. Emergency backup power is used in hospitals, law enforcement, military, perishable food processors and telecommunications as well as in many other industries. In 2010 we introduced hydrogen fuel cell generators as a solution to the cell-phone tower industry and this has been endorsed by the Ministry of Energy in India where we are supplying the Altergy Freedom Power system in India for initial beta site testing.  Arrangements are under way to ship the first unit.  We introduced a low-cost to manufacture solar photovoltaic technology to several solar farm license holders in the Indian marketplace in 2010. Now we are working to establish manufacturing of these panels in India for the Indian market and for export out of India. The Indian government has mandated very significant power production (20,000 MW) from solar by 2020.  Significant percentages of the rural population of India are off the grid and in need of economical localized power generation. We have met with agencies that have made arrangements for capitalizing these localized power sources. We are currently working with our science and engineering groups to develop a standardized, serviceable and affordable solution combining technologies available to us.  Pakistan: Pakistans Vision 2025 targets a long-term capacity increase of around 35,000 MW by the year 2025. A proposed 15,000 MW joint venture over 15 years is in discussion with the resource owners as part of our long-term development strategy provided we are able to incorporate our clean coal technologies.  Mozambique: Many of its neighbouring countries have power deficits and Mozambique has become a net exporter although many of its own rural citizens are off the grid. Through our consultants we were invited to submit on a 3000MW power-plant and have been invited to meet with government to further this mission.  South Africa: South Africa has a huge need for more base power (2000 MW Deficit). Through a South African consultant and a strategic power infrastructure partner we have submitted on and been requested to meet with government on a specific 1500MW project.  South East Asia: We have contracted with a Singapore consulting group to secure a power project (1000MW or larger) in SE Asia and have been introduced to a potential joint venture project in the area. Negotiations have been underway since the middle of last year and we have developed the framework for the joint development of a significant power plant subject to TransAct raising the  funding.  Tanzania: Tanzania is one of the fastest growing economies in Africa hampered only by the lack of power caused by recent droughts. The country has great power opportunities in geothermal, solar and wind and with our relationships on the ground in Tanzania we expect to develop projects there in the near-term.   Employees  At December 31, 2010, the Company has a CEO, CFO and VP Power Engineering under contract with one administrator as a salaried employee.   All others are employed as consultants on a demand basis.  The Company did not experience any labour disputes or labour stoppages during the current fiscal year.  Principal Products  The Companys product is clean electricity and the technologies that go into it. The power plants that produce the electricity range from individual hydrogen fuel cell generators to large scale thousand of megawatt carbon fuelled boilers.  Altergy Freedom PowerTM : We are representing the Altergy Freedom PowerTM hydrogen fuel cell generator designed for back-up/uninterrupted power into India. The Freedom Power TM is a fully scalable system thats combined capital and operating costs are lower than any other existing systems using diesel, wind or solar generators in combination with battery storage.  It is a perfect solution to provide electricity to essential services during power outages and to remote locations off the grid.  Solar One Solutions (Indigo Solar): TransAct is working with Solar One to promote the Indigo thin film photovoltaic solar technology into India and surrounding area. The key benefit being its less than $0.70 per watt manufacturing system. The Company is in the process of packaging the manufacturing equipment for a plant in India.  Geothermal: Our head of power engineering Dr. Mory Ghomshei is a global specialist in geothermal power generation with several proprietary geothermal technologies to his credit. We directly promote geothermal power as a product.  Most countries that have this resource within their borders wish to develop it, as in the case of India, Greece and Tanzania.   5   Thermal power from traditional sources of energy such as coal, oil,  biomass (garbage, plant material) or bio-fuel all burn carbon molecules to produce electricity, creating the most efficient burn of the energy source with the least amount of non-usable by-products. TransAct is selling thermal power plants that incorporate clean technologies that enhance the fuel, burn more efficiently, isolate and strip out potential toxins for other uses.  Wind: TransAct has stayed out of wind power generation in anticipation of a non-subsidized technology. If the technology we have identified turns out to be commercially viable we expect to sell electricity from wind turbines at parity within the next year.  Sources and Availability of Raw Materials  The power projects contemplated by TransAct rely on a variety of materials. Where possible we look to ensure that the supply chain of raw materials required in the project will be available over the life of the project. Where the raw material is the fuel source, such as in the case of a geothermal or coal power plant, we look to ensure the required supply is under domestic control and good supply.  Seasonality of Business  Base power production is not supposed to be seasonal.  In the case of power generated by wind or solar, part of the feasibility study identifies the annual supply of either the sun or wind. Ideal locations are not affected by seasonality.  In many of the markets we intend to operate in, seasonally heavy rains can affect the roads and therefore the ability to bring the fuel to the plant can be difficult. Anticipating these conditions and stockpiling the fuel can help eliminate any supply chain issues.  Industry Practices/Needs for Working Capital  Power projects are capital intensive requiring funds upfront for feasibility, engineering, legal and site acquisition. Provided the plant secures a guaranteed power purchase agreement for the electricity that will be produced, the project can be financed to the extent the sale of electricity will support debt. An eighty percent debt to equity ratio is common in the industry where power can be produced in the $0.05 per kilowatt range.  Dependence on Few Customers  TransAct does not intend to rely on a few customers.  Besides plans for several regional power plants, the Company will have a variety of customers from direct sales of its technologies.   Competitive Conditions  The demand for sustainable energy continues to increase almost everywhere on the planet. Climate changes affect the demand for heating and cooling and the lack of rain in certain areas impacts on the ability to produce hydro-electricity. Political instability or the threat there of in oil producing regions sends countries that have petroleum based economies scrambling for alternatives. Economic instability impacts on many countries abilities to import energy causing them to look within their own borders for energy that provides autonomy. Finally the pressure is on all nations to look at and change the environmental impact of their power production.  It has become a global trend in order to meet the ever growing demand for power generation and infrastructure to look to independent power producers. Independent power producers come in all shapes and sizes from the homeowner selling surplus solar power into the grid to international EPC (Engineering, Procurement, and Construction) companies building and operating mega-projects. Many companies are specialized, focused only in one sector e.g. wind, solar or biomass.  The levalized costs of the various forms of power range from $0.06 (advanced combined cycle natural gas) to $0.31(solar thermal) per kilowatt as analysed by the USA Department of Energy.   6   [transact10k123110002.gif]  Availability of resources, upfront capital and customers willing to pay for the resulting power, determine the generation resource. In markets where they have resources but not expertise or upfront capital the field of competition opens up for those able to build, own, and operate the facility at a profit over the long-term.  The Company believes that the combination of greater reliability and base load generation from geothermal, access to infrastructure for deliverability and a low "full life" cost will allow it to successfully compete for long-term power purchase agreements globally. Factors that can influence the overall market for our product include some of the following:  · number of market participants buying and selling electricity; · availability and cost of transmission; · amount of electricity normally available in the market; · fluctuations in electricity supply due to planned and unplanned outages of competitors generators; · fluctuations in electricity demand due to weather and other factors; · cost of fuel used by generators, which could be impacted by efficiency of generation technology and fluctuations in fuel supply; · environmental regulations that impact us and our competitors; · availability of production tax credits and other benefits allowed by tax law; · relative ease or difficulty of developing and constructing new facilities; and · credit worthiness and risk associated with buyers.  7    Environmental Compliance   Environmental Site Assessments are required before the development of any resource. Geotechnical and environmental consultants are engaged to identify any and all environmental issues and develop mitigation strategies.  The Company has identified known environmental issues in certain types of power production and has sought out technologies that will mitigate these issues beyond established compliance.   Available Information  We will be making available in the near term,  through our Internet website at http://www.transactenergy.com, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. Information on our website is not incorporated into this report and is not a part of this report.  Governmental Regulation  Although we intend to comply with all applicable laws and regulations, we cannot assure you that we are in compliance or that we will be able to comply with all future laws and regulations. Additional federal or state legislation, or changes in regulatory implementation, may limit our activities in the future or significantly increase the cost of regulatory compliance. If we fail to comply with applicable laws and regulations, criminal sanctions or civil remedies, including fines, injunctions, or seizures, could be imposed on us. This could have a material adverse effect on our operations.  The business of power plant development and operation is subject to substantial regulation under governmental laws relating to the development, upgrading, marketing, pricing, taxation, and transmission of electricity and other matters. Amendments to current laws and regulations governing development and operations of power plants could have a material adverse impact on our business. In addition, there can be no assurance that income tax laws, royalty regulations and government incentive programs related to the power industry generally, will not be changed in a manner which may adversely affect our progress and cause delays, inability to develop or abandonment of these interests.  Permits, leases, licenses, and approvals are required from a variety of regulatory authorities at various stages of development and operation of power projects. There can be no assurance that the various government permits, leases, licenses and approvals sought will be granted in respect of our activities or, if granted, will not be cancelled or will be renewed upon expiry. There is no assurance that such permits, leases, licenses, and approvals will not contain terms and provisions which may adversely affect our development and operating activities.  The development and operations of our proposed projects are or will be subject to stringent federal, provincial and local laws and regulations relating to improving or maintaining environmental quality. Environmental laws often require parties to pay for remedial action or to pay damages regardless of fault. Environmental laws also often impose liability with respect to divested or terminated operations, even if the operations were terminated or divested many years ago.  The development activities and operating programs on our proposed and future projects are or will be subject to extensive laws and regulations governing, development, production, imports, taxes, labor standards, occupational health, waste disposal, protection and remediation of the environment, protection of endangered and protected species, plant safety, toxic substances and other matters. Power development and operations are also subject to risks and liabilities associated with pollution of the environment and disposal of waste products. Compliance with these laws and regulations will impose substantial costs on us and will subject us to significant potential liabilities.  Our business is subject to various federal, provincial and local laws and governmental regulations that may be changed from time to time in response to economic or political conditions. TransAct Energy Corp. in each jurisdiction is subject to regulation in respect of the production, sale and distribution of electricity. In many jurisdictions regulated utilities are required to purchase electricity on an avoided cost basis from renewable energy facilities, or they may acquire purchased power through bids or negotiated procedures.   TransAct will be required to obtain various government approvals for construction of future power producing facilities.  For project development TransAct will hire consulting and engineering services for transmission and interconnection issues, power plant siting, design, air quality, cooling water reuse, permitting, environmental engineering and regulatory compliance.  8    Environmental Credits  As a future green power producer, environmental-related credits, such as renewable energy credits or carbon credits may become available for sale to power companies (to allow them to meet their green power requirements) or to businesses which produce carbon based pollution. If available, these credits will belong exclusively to us or our joint venture, and may provide an additional source of revenue.  Item 1A. Risk Factors.  General Business Risks  We are a new business with limited operating history and making an investment in TransAct is risky. If we are unable to successfully identify and secure power projects or power conservation projects, then we will not be successful as a business. It will be difficult for you to evaluate an investment in our stock since our operating history is limited to developing our business plan, obtaining 100% interest in a petroleum and natural gas lease in Alberta, Canada referred to as the MedHat Project,and bidding on multiple power projects in Canada, Iraq, Bangladesh and Brazil. As a young Company, we are especially vulnerable to any problems, delays, expenses and difficulties we may encounter while implementing our business plan. We have not proven the essential elements of profitable operations and you will bear the risk of complete loss of your investment if we are not successful.  Our future performance may depend on our ability to establish that a geothermal, wind or solar resource is economically sustainable.Geothermal resource exploration and development involves a high degree of risk. The execution of our business plan is generally, dependent upon the existence of economically usable resources. Expansion of the production of power from our geothermal interests is not certain and depends on successful drilling and discovery of additional geothermal hydrothermal resources in quantities and containing sufficient heat necessary to economically fuel future plants.  We have a need for substantial additional financing and will have to significantly delay, curtail or cease operations if we are unable to secure such financing.The Company requires substantial additional financing to fund the cost of acquiring and developing power projects. The Company also requires funds for other operating activities and to finance the growth of our business, including the construction and commissioning of power generation facilities. We may not be able to obtain the needed funds on terms acceptable to us or at all. Further, if additional funds are raised by issuing equity securities, significant dilution to our current shareholders may occur and new investors may get rights that are preferential to current shareholders. Alternatively, we may have to bring in joint venture partners to fund further development work, which would result in reducing our interests in the projects.  We may be unable to obtain the financing we need to pursue our growth strategy in power production, which may adversely affect our ability to expand our operations.When we identify a power project that we may seek to acquire or to develop, a substantial capital investment will be required. Our continued access to capital, through project financing or through a partnership or other arrangements with acceptable terms, is necessary for the success of our growth strategy. Our attempts to secure the necessary capital may not be successful on favorable terms, or at all.  Market conditions and other factors may not permit future project and acquisition financing on terms favorable to us. Our ability to arrange for financing on favorable terms, and the costs of such financing, are dependent on numerous factors, including general economic and capital market conditions, investor confidence, the continued success of current projects, the credit quality of the projects being financed, the political situation in the jurisdiction in which the project is located and the continued existence of tax laws which are conducive to raising capital. If we are unable to secure capital through partnership or other arrangements, we may have to finance the projects using equity financing which will have a dilutive effect on our common stock. Also, in the absence of favorable financing or other capital options, we may decide not to build new plants or acquire facilities from third parties. Any of these alternatives could have a material adverse effect on our growth prospects and financial condition.   It is very costly to place power resources into commercial production.Before the sale of any power can occur, it will be necessary to construct a gathering and disposal system, a power plant and a transmission line and considerable administrative costs would be incurred To fund expenditures of this magnitude, we may have to find a joint venture participant with substantial financial resources. There can be no assurance that a participant can be found and, if found, it would result in us having to substantially reduce our interest in the project.  We may be unable to realize our strategy of utilizing the tax and other incentives available for developing sustainable power projects to attract strategic alliance partners, which may adversely affect our ability to complete these projects.Part of our business strategy is to utilize tax and other incentives available to developers of sustainable power generating plants to attract strategic alliance partners with the capital sufficient to complete these projects. Many of the incentives available for these projects are new and highly complex. There can be no assurance that we will be successful in structuring agreements that are attractive to potential strategic alliance partners. If we are unable to do so, we may be unable to complete the development of our geothermal power projects and our business could be harmed.  9     We may not be able to manage our growth due to the commencement of operations which could negatively impact our operations and financial condition. Significant growth in our operations will place demands on our operational, administrative and financial resources, and the increased scope of our operations will present challenges to us due to increased management time and resources required and our existing limited staff. Our future performance and profitability will depend in part on our ability to successfully integrate the operational, financial and administrative functions of our projects and other acquired properties into our operations, to hire additional personnel and to implement necessary enhancements to our management systems to respond to changes in our business. There can be no assurance that we will be successful in these efforts. Our inability to manage the increased scope of operations, to integrate acquired properties, to hire additional personnel or to enhance our management systems could have a material adverse effect on our results of operations.  If we incur material debt to fund our business, we could face significant risks associated with such debt levels.We will need to procure significant additional financing to construct, commission and operate our power plants in order to generate and sell electricity. If this financing includes the issuance of material amounts of debt, this would expose the Company to risks including, among others, the following:  · a portion of our cash flow from operations would be used for the payment of principal and interest on such indebtedness and would not be available for financing capital expenditures or other purposes; · a significant level of indebtedness and the covenants governing such indebtedness could limit our flexibility in planning for, or reacting to, changes in our business because certain activities or financing options may be limited or prohibited under the terms of agreements relating to such indebtedness; · a significant level of indebtedness may make us more vulnerable to defaults by the purchasers of electricity or in the event of a downturn in our business because of fixed debt service obligations; and · the terms of agreements may require us to make interest and principal payments and to remain in compliance with stated financial covenants and ratios. If the requirements of such agreements were not satisfied, the lenders could be entitled to accelerate the payment of all outstanding indebtedness and foreclose on the collateral securing payment of that indebtedness, which would likely include our interest in the project.  In such event, we cannot assure you that we would have sufficient funds available or could obtain the financing required to meet our obligations, including the repayment of outstanding principal and interest on such indebtedness.  We may not be able to successfully integrate companies that we may acquire in the future, which could materially and adversely affect our business, financial condition, future results and cash flow.Our strategy is to continue to expand in the future, including through acquisitions. Integrating acquisitions is often costly, and we may not be able to successfully integrate our acquired companies with our existing operations without substantial costs, delays or other adverse operational or financial consequences. Integrating our acquired companies involves a number of risks that could materially and adversely affect our business, including:   · failure of the acquired companies to achieve the results we expect; · inability to retain key personnel of the acquired companies; · risks associated with unanticipated events or liabilities; and · the difficulty of establishing and maintaining uniform standards, controls, procedures and policies, including accounting controls and procedures.  If any of our acquired companies suffer performance problems, the same could adversely affect the reputation of our group of companies and could materially and adversely affect our business, financial condition, future results and cash flow.  The success of our business relies on retaining our key personnel.We are dependent upon the services of our President and Chief Executive Officer, Roderick C. Bartlett, our Chief Financial Officer, Simon Thomas, our Director Joe F. Dickson, our Director Des Biali, and Dr. Mory Gomshei, our Vice President  Power Engineering. The loss of any of their services could have a material adverse effect upon us. As of the date of this report, the Company has executed compensation agreements with some of these persons but does not hold key-man insurance on any of them.  Our geothermal development activities are inherently very risky. The high risks involved in the development of a geothermal resource cannot be over-stated. Exploration costs are high and are not fixed. The geothermal resource cannot be relied upon until substantial development, including drilling, has taken place. The costs of development drilling are subject to numerous variables such as unforeseen geologic conditions underground which could result in substantial cost overruns.  Our future drilling operations may be curtailed, delayed or cancelled as a result of numerous factors, many of which are beyond our control, including economic conditions, mechanical problems, title problems, weather conditions, compliance with governmental requirements and shortages or delays of equipment and services. If our drilling activities are not successful, we could experience a material adverse effect on our future results of operations and financial condition.   10   In addition to the substantial risk that wells drilled will not be productive, or may decline in productivity after commencement of production, hazards such as unusual or unexpected geologic formations, pressures, downhole conditions, mechanical failures, blowouts, cratering, explosions, uncontrollable flows of well fluids, pollution and other physical and environmental risks are inherent in geothermal exploration and production. These hazards could result in substantial losses to us due to injury and loss of life, severe damage to and destruction of property and equipment, pollution and other environmental damage and suspension of operations.   The impact of governmental regulation could adversely affect our business by increasing costs for financing or development of power plants. Our business is subject to certain jurisdictional laws and regulations, including laws and regulations on taxation, the exploration for and development, production and distribution of electricity, and environmental and safety matters. Most land management requires competitive auction of all geothermal leases on Government lands. Competitive leasing significantly increases the cost of obtaining leases on Government land, is adding to the capital costs needed to develop geothermal projects, is increasing the total electrical power prices needed to make a geothermal project viable and is making it more difficult to acquire additional adjacent lands for reservoir protection and exploration.  If Federal land or any Federal involvement is included in any geothermal development, requirements of the National Environmental legislation is evolving in a manner that means stricter standards, and enforcement, fines and penalties for non-compliance are more stringent. Environmental assessments of proposed projects carry a heightened degree of responsibility for companies and directors, officers and employees. The cost of compliance with changes in governmental regulations has a potential to reduce the profitability of operations.  The drilling for geothermal resources is governed by specific rules. These rules typically require drilling permits and govern the spacing of wells, rates of production, prevention of waste and other matters, and, may not allow or may restrict drilling activity, or may require that a geothermal resource be unitized (shared) with adjoining land owners. Such laws and regulations may increase the costs of planning, designing, drilling, installing, operating and abandoning our geothermal wells, the power plant and other facilities. Many environmental requirements and permits, include public disclosure and comment. It is possible that a legal protest could be triggered through one of the permitting processes that would delay construction and increase cost for one of our projects.   Because of these jurisdictional regulations, we could incur liability to governments or third parties for any unlawful discharge of pollutants into the air, soil or water, including responsibility for remediation costs. We could potentially discharge such materials into the environment:  · from a well or drilling equipment at a drill site; · leakage of fluids or airborne pollutants from gathering systems, pipelines, power plant and storage tanks; · damage to geothermal wells resulting from accidents during normal operations; and · blowouts, cratering and explosions.  Because the requirements imposed by such laws and regulations are frequently changed, we cannot assure you that laws and regulations enacted in the future, including changes to existing laws and regulations, will not adversely affect our business by increasing cost and the time required to explore and develop geothermal projects.  Any development project of our resource assets will be directly affected by the royalty regime applicable. The economic benefit of future capital expenditures for projects is, in many cases, dependent on a satisfactory royalty regime. There can be no assurance that the provincial/state governments will not adopt a new royalty regime that will make capital expenditures uneconomic or that the royalty regime currently in place will remain unchanged.  Industry competition may impede our growth and ability to enter into power purchase agreements on terms favorable to us, or at all, which would negatively impact our revenue. The electrical power generation industry, is highly competitive and we may not be able to compete successfully or grow our business. We compete in areas of pricing, grid access and markets. The industry in many jurisdictions is complex as it is composed of public utility districts, cooperatives and investor-owned power companies. Many of the participants produce and distribute electricity. Their willingness to purchase electricity from an independent producer may be based on a number of factors and not solely on pricing and surety of supply. If we cannot enter into power purchase agreements on terms favorable to us, or at all, it would negatively impact our revenue and our decisions regarding development of additional properties.   Actual costs of construction or operation of a power plant may exceed estimates used in negotiation of power purchase and power financing agreements.If the actual costs of construction or operations exceed the model costs, the Company may not be able to build the contemplated power plants, or if constructed, may not be able to operate profitably. The Companys financing agreements will typically provide for a priority payback to our partner. If the actual costs of construction or operations exceed the model costs, we may not be able to operate profitably or receive the planned share of cash flow and proceeds from the project.  11    There are some risks for which we do not or cannot carry insurance.Because our current operations are limited in scope, the Company carries property and, public liability insurance coverage, but does not currently insure against any other risks.   As its operations progress, the Company will acquire additional coverage consistent with its operational needs, but the Company may become subject to liability for pollution or other hazards against which it cannot insure or cannot insure at sufficient levels or against which it may elect not to insure because of high premium costs or other reasons. In particular, coverage is not available for environmental liability or earthquake damage.  Our officers and directors may have conflicts of interests arising out of their relationships with other companies.Several of our directors and officers serve (or may agree to serve) as directors or officers of other companies or have significant shareholdings in other companies. To the extent that such other companies may participate in ventures in which the Company may participate, the directors may have a conflict of interest in negotiating and concluding terms respecting the extent of such participation. From time to time, several companies may participate in the acquisition, exploration and development of natural resource properties thereby allowing for their participation in larger programs, permitting involvement in a greater number of programs and reducing financial exposure in respect of any one program. It may also occur that a particular company will assign all or a portion of its interest in a particular program to another of these companies due to the financial position of the company making the assignment.  Risks Relating To the Market for Our Securities  A significant number of shares of our common stock are eligible for public resale. If a significant number of shares are resold on the public market, the share price could be reduced and could adversely affect our ability to raise needed capital. The market price for our common stock could decrease significantly and our ability to raise capital through the issuance of additional equity could be adversely affected by the availability and resale of such a large number of shares in a short period of time. If we cannot raise additional capital on terms favorable to us, or at all, it may delay our exploration or development of existing properties or limit our ability to acquire new properties, which would be detrimental to our business.   Because the public market for shares of our common stock is limited, investors may be unable to resell their shares of common stock.There is currently only a limited public market for our common stock on the OTCBB in the United States, and investors may be unable to resell their shares of common stock. The development of an active public trading market depends upon the existence of willing buyers and sellers that are able to sell their shares and market makers that are willing to make a market in the shares. Under these circumstances, the market bid and ask prices for the shares may be significantly influenced by the decisions of the market makers to buy or sell the shares for their own account, which may be critical for the establishment and maintenance of a liquid public market in our common stock. We cannot give you any assurance that an active public trading market for the shares will develop or be sustained.  The price of our common stock is volatile, which may cause investment losses for our shareholders.The market for our common stock although newly initiated is assumed to be highly volatile. The trading price of our common stock on the OTCBB is subject to wide fluctuations in response to, among other things, quarterly variations in operating and financial results, and general economic and market conditions. In addition, statements or changes in opinions, ratings, or earnings estimates made by brokerage firms or industry analysts relating to our market or relating to our Company could result in an immediate and adverse effect on the market price of our common stock. The highly volatile nature of our stock price may cause investment losses for our shareholders.  We do not intend to pay any cash dividends in the foreseeable future.We intend to reinvest any earnings in the development of our projects. Payments of future dividends, if any, will be at the discretion of our board of directors after taking into account various factors, including our business, operating results and financial condition, current and anticipated cash.  Our stock is subject to the Penny Stock rules, which impose significant restrictions on broker-dealers and may affect the resale of our stock.A penny stock is generally a stock that:  · is not listed on a national securities exchange or NASDAQ, · is listed in the "pink sheets" or on the NASD OTC Bulletin Board, · has a price per share of less than $5.00 and · is issued by a company with net tangible assets less than $5 million.  The penny stock trading rules impose additional duties and responsibilities upon broker-dealers and salespersons effecting purchase and sale transactions in common stock and other equity securities, including:  · determination of the purchaser's investment suitability, · delivery of certain information and disclosures to the purchaser, and · receipt of a specific purchase agreement before effecting the purchase transaction.   12   Many broker-dealers will not effect transactions in penny stocks, except on an unsolicited basis, in order to avoid compliance with the penny stock trading rules. In the event our common stock becomes subject to the penny stock trading rules,  · such rules may materially limit or restrict the ability to resell our common stock, and · the liquidity typically associated with other publicly traded equity securities may not exist.  Because of the significant restrictions on trading penny stocks, a public market may never emerge for our securities. If this happens, you may never be able to publicly sell your shares.  Item 2. Properties.  Our principal executive offices and mailing address is #105-5119 Beckwith, San Antonio, TX, USA 78249. Our telephone number is 210-561-6015. We have a dedicated office in Canada at #258-5489 Byrne Rd, Burnaby, BC.  In September 2006, we purchased a 100% interest in a Petroleum and Natural Gas Lease from the province of Alberta, Canada for $12,051 cash. The lease is for a five year term and calls for annual rental and royalty payments in accordance with the Mines and Mineral Act of Alberta. The land consists of a one 1⁄4 section Crown lease of Petroleum and Natural Gas rights. We allowed this lease to lapse in the last quarter of 2010.  Item 3. Legal Proceedings.  Our Company is not a party to any bankruptcy, receivership or other legal proceeding.  Terra Energy Corp. whos President Chris van Vliet is a shareholder of TransAct through his legal council Palkowski & Company threatened in October 2010 to take legal action against TransAct Energy Corp. in regards to a $10,000 convertible promissory note. Terra Energy demanded conversion of the note to which TransAct Energy decided under the terms of the note they were not entitled to and instead issued them a cheque for payment in full which was promptly refused by Terra Energy. Since this time their legal council Mr. Robert J. Palkowski is no longer practising law and no further action has been taken. Terra Energy has verbally represented that they will only be satisfied with an issuance of common stock as demanded. We have had a legal review of the note in question and will defend the Company vigorously from any further claim.  Aqua Terra Power Corp. whos president is Chris van Vliet a shareholder of TransAct Energy Corp. borrowed money from TransAct Energy in regards to geothermal projects in British Columbia, Canada. At the time TransAct was contemplating acquiring Aqua Terra Power if they were successful in their geothermal exploration. Aqua Terra was not successful and any contemplated relationship was terminated. Since that time the Aqua Terra notes payable to TransAct Energy, now totalling $306,766.86 matured and were demanded. No payment has been made and to the best of our understanding they have no ability to repay this debt. We will take legal action if the cost of said action can be justified.  Mr. Shahhid Vohra was under a two year contract with TransAct Energy Corp. this relationship was terminated by Vohra and accepted effective the end of September 2010. Vohra threatened legal action after making a claim against the Company of $44,263.66 through his council Robert J. Palkowski. The Company disagreed with the claim  and instead claimed back that Vohra owed them $26,052.80. The Company intends on pursuing these funds.   Vohra to date has taken no further action other than disparaging the Company to clients Vohra was aware of. The Company is assessing if any material damage has occurred.  Apollo Financial Management Group, LLC and their attorney Robert Cook accepted escrow funds from TransAct Energy in the amount of $15,000. The terms of the agreement with Apollo were never met and TransAct terminated the agreement and demanded repayment of the escrow funds. To date there has been no return of the funds nor any response to our claims so the Company will evaluate its next legal steps in collecting its money.  Item 4. Submission of Matters to a Vote of Security Holders.  None.  PART II  Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.  The Company first traded on February 24, 2010 on the Over-The-Counter Bulletin Board (the OTCBB) under the trading symbol TEGY. Future trading prices of our common shares will depend on many factors, including, among others, our operating results and the market for similar securities.   13   As of March 31, 2011, there are 44 shareholders of record holding 12,560,949 shares of the Company common stock that have not deposited their shares into a clearing house, 8,395,981 are on deposit and able to be traded. The total issued and outstanding is 20,956,930 shares of common stock. The holders of common stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders. Holders of the common stock have no pre-emptive rights and no right to convert their common stock into any other securities. There are no redemption or sinking fund provisions applicable to the common stock.  We have not paid, nor declared, any dividends since our inception and do not intend to declare any such dividends in the foreseeable future. Our ability to pay dividends is subject to limitations imposed by Nevada law. Under Nevada law, dividends may be paid to the extent that a corporations assets exceed its liabilities and it is able to pay its debts as they become due in the usual course of business.  Item 6. Selected Financial Data.  Not Applicable.  Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations.  TransAct Energy Corp. is a Nevada corporation. The Companys shares of common stock trade on the over the counter bulletin board under the symbol TEGY. TEGY is a development stage company and has not started receiving revenues from operating activities.  During the year the Company entered into memorandums of understanding for distribution and manufacturing rights of  a solar technology represented by Solution One Solar (on behalf of Indigo Solar) which initially it promoted in India, Vietnam and Greece.  The Company is now working to secure manufacturing of the solar technology in India in order to provide solar panels to a variety of projects in India and Greece under joint venture relationships. Provided the plant is ready in the near term, the Company also has a multi-million dollar purchase order available for fulfillment.  The Company entered an MOU with Altergy Systems providing potential distribution and manufacturing rights of its Freedom PowerTM(scalable hydrogen fuel cell power generator) in India. The original MOU was extended into 2011 but expired before meeting its criteria. However the Company has agreed with Altergy to honour specific terms while proceeding with tests through theMinistry of Energy in India and one of the larger telecommunication tower providers.  During the year the Company entered consulting agreements to develop market share with consulting firms in Australia (for Pakistan), Greece, India and Singapore (for south east Asia).  Plan of Operation  For the 2011 year the Companys focus is to: 1.) Complete its entry into the Indian power market with solar technology and the Altergy fuel cell technology; 2.) Complete a joint venture agreement and initiate the development of a major power plant in South East Asia; 3.) Complete joint venture agreements and initiate the development of new technologies for wind, thermal, batteries and generators.   Results of Operations  Period from January 1, 2010 to December 31, 2010  We did not generate any revenue from January 1, 2010 to December 31, 2010. For the year ended December 31, 2010 our expenses were $757,564. Expenses consisted of professional fees, administrative and management fees and miscellaneous expenses. The professional fees incurred in 2010 were, to a large extent, to our auditors and legal counsel for continued SEC reporting requirements. During 2010 we recorded non-cash interest expense of $29,189 as a result of beneficial conversion on notes payable issued during 2010 and recorded a write-off of an unsuccessful lease purchase in the amount of $12,684. As a result, we have reported a net loss of $(1,086,561) for the period ended December 31, 2010. Our total net loss from inception on March 15, 2006 through December 31, 2010 was $(1,366,715)  Stock-Based Compensation Costs  Stock-based compensation represents 27.83% of the Companys operating expenses for the fiscal year ended December 31, 2010. The stocks are a part of our annual executive compensation plan, and are issued to obtain, retain and motivate our directors, executives and employees.  14    Liquidity and Capital Resources  At December 31, 2010 we had total assets of $5,624. Our Current assets are $3,401 consisting of $2,498 in cash and $903 in prepaid expenses. Further we have $2,223 in software. Current liabilities at December 31, 2010 totalled $552,548 they consisted of accounts payable in the amount of $62,276, accrued interest of $17,691, compensation payable in the amount of $289,949, notes payable, net in the amount of $142,632, and deposit on stock purchase of $40,000.  We filed a registration statement on Form S-1 with the Securities and Exchange Commission to register up to 2,000,000 shares of common stock for sale at a price of $.25 per share for a total of up to $500,000. The registration statement was declared effective on December 12, 2008. We exceeded the minimum of our offering of $250,000 on or before August 31, 2009 and subsequently closed the offering. We issued a total of 1,102,000 shares under our offering of $0.25 per share to raise a total of $275,500. The funds were used as per the prospectus to cover the offering costs and to secure additional business for our operations.  Potential Acquisitions  The Company intends to grow through the acquisition of ownership or leasehold interests in properties and/or property rights that it believes will create value as the Companys geothermal resources, and through possible mergers with or acquisitions of operating power plants and geothermal or other renewable energy properties.  Critical Accounting Policies  The discussion and analysis of our financial condition and results of operations are based upon the financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. Certain accounting policies involve judgments and uncertainties to such an extent that there is reasonable likelihood that materially different amounts could have been reported under different conditions, or if different assumptions had been made. We evaluate our estimates and assumptions on a regular basis. We base our estimates on historical experience and various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for the financial statements.  Cash and Cash Equivalents  The Company considers cash deposits and highly liquid investments to be cash and cash equivalents for financial reporting presentation on the balance sheet and statement of cash flows. The Company subscribes to the accounting standards that define cash equivalents as highly liquid, short-term instruments that are readily convertible to known amounts of cash, which are generally defined investments that have original maturity dates of less than three months.  Contractual Obligations  We have material commitments for the next twelve months that include, the office facilities, a consulting agreement with the engineering firm SNC-Lavelin, support staff, supporting professionals (including our accountants, lawyers and auditors) and the management compensation agreements. We will require additional capital to meet our liquidity needs. As a result, our independent auditors have expressed substantial doubt about our ability to continue as a going concern. In the past, we have relied on capital contributions from shareholders to supplement operating capital when necessary. We anticipate that we will receive sufficient contributions from shareholders to continue operations for at least the next twelve months. However, there are no agreements or understandings to this effect. We may sell common stock, take loans from officers, directors or shareholders or enter into debt financing agreements.  Need for Additional Financing  We estimate our upcoming expenses to be $4,000,000 per year. We do not have any commitments for capital expenditures however we do anticipate entering into commitments to secure acquisitions. We believe we will need additional funds to cover our expenses and acquisitions for the next twelve months. Our need for capital may change dramatically as we pursue our business plan during that period. At present, we have no understandings, commitments or agreements with respect to the acquisition of any business venture or capital commitments. Further, we cannot assure that we will be successful in consummating business opportunities on favourable terms or we will be able to profitably manage any business opportunities. Should we require additional capital, we may seek additional advances from officers, sell common stock or find other forms of debt financing.  We intend to raise $15,000,000 in order to satisfy our immediate ongoing expenses and planned business strategy. The likelihood is that we will have to secure a private placement or convertible debt to affect the raise of capital. Either scenario will result in the sale of equity and add to the dilution of existing shareholders.  15    Off Balance Sheet Arrangements  As of December 31, 2010, the Company does not have any off balance sheet arrangements.  Item 7A. Quantitative and Qualitative Disclosures About Market Risk.  Not Applicable.  Item 8. Financial Statements and Supplementary Data.  See Financial Statements following the signature page of this report.  Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.  None  Item 9A. Controls and Procedures.  None.  Item 9A(T). Controls and Procedures.  (a)Evaluation of Disclosure Controls and Procedures. The Companys management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended). We are committed to maintaining disclosure controls and procedures designed to ensure that information required to be disclosed in our periodic reports filed under the Securities Exchange Act of 1934, as amended, or the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures and implementing controls and procedures.  Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rules 13a-15(e) and 15d-15(e) promulgated under the Exchange Act and based on the criteria established in Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of December 31, 2010, the end of the period covered by this Report. However anticipating greater levels of business activity in the near term we expect that we will require a financial controller in order to maintain our disclosure controls and procedures. Steps have been taken to bring on this person in a timely manner.  Managements Annual Report on Internal Control over Financial Reporting.Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes of accounting principles generally accepted in the United States.  Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives.  Our management, with the participation of the President, evaluated the effectiveness of the Companys internal control over financial reporting as of December 31, 2010.  In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control  Integrated Framework.  Based on this evaluation, our management, with the participation of the President, concluded that, as of December 31, 2010, our internal control over financial reporting was effective.  This annual report does not include an attestation report of the Companys registered public accounting firm regarding internal control over financial reporting. Managements report was not subject to attestation by the Companys registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only managements report in this annual report.   16   (b) Changes in Internal Control over Financial Reporting. There were no changes in the Company's internal controls or procedures over financial reporting, known to the chief executive officer or the chief financial officer that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.  Item 9B. Other Information.  There are no further disclosures. All information that was required to be disclosed in a Form 8-K during the fourth quarter, 2010 has been disclosed.  PART III  Item 10. Directors, Executive Officers and Corporate Governance.  Identification of Directors, Executive Officers and Significant Employees  The following sets forth certain information concerning the current directors, executive officers and significant employees of our company. Each director has been elected to serve until our next annual meeting of stockholders and until his successor has been elected and qualified. Each executive officer serves at the discretion of the board of directors of our Company, and each has been elected for a 1 year term.  NAMEAGEPOSITIONHenry Andrews64PastDirectorRoderick C. Bartlett (1)54Chief Operating Officer and Director Corporate SecretarySimon Thomas (1)
Joseph F. Dickson (1) (2)56
55Chief Financial Officer, and Director
DirectorMory Ghomshei
Des Biali (2)48
65Senior Vice President, Power Engineering
Director  (1)Member of the Compensation and Governance Committees.(2)Independent Director.  Our director and executive officer has not, during the past five years:  · had any bankruptcy petition filed by or against any business of which such individual was a general partner or executive officer, either at the time of the bankruptcy or within two years prior to that time,  · been convicted in a criminal proceeding and is not subject to a pending criminal proceeding,  · been subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities, futures, commodities or banking activities; or been found by a court of competent jurisdiction (in a civil action), the Securities Exchange Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.  Business Experience  The following is a brief biography of our officers and directors.  Henry Andrews, Director. Mr. Andrews is 64 years old and holds a Bachelor of Science in Criminal Justice and a Masters of Education Counselling. He served for 30 years with the State of Georgia in public service. Mr. Andrews held such positions as Institutional Administrator, Psychologist, Counsellor, Warden and associate professor of Social Science at South Georgia College. For the past five years Mr. Andrews has been in the private sector as CEO and President of a real estate management company and a retail food company.  Rod Bartlett. President, CEO and Director has over 30 years of experience in business development. Rod was a founding shareholder of TransAct Energy Corp. and has been instrumental in bringing it through the regulatory and business development process. Rod is heavily involved in the negotiations related to securing future business for the Company. During the last decade, Rod has been active in the public markets. ActionView International (advertising), Quest Oil (oil & gas), and S2C Global Systems (water distribution) are a few of the companies that he has been instrumental in developing and taking them to the next level.   17   Joseph F. Dickson. Chief Financial Officer (2010), Corporate Secretary and Director, 55 years of age: Joseph Dickson was the Chief Operating Officer of Innovation Fuels, Inc. out of Syracuse, NY leading the companys bio-diesel plant operation and project development efforts from Sept. 2007 until Dec. 2009. Mr. Dickson was the Director of Entrepreneurship at Syracuse University, Syracuse, NY from Feb. 2006 to Sept. 2007, the COO, Integrated Defense Systems, Inc., Glen Rock, PA from June 2005 to Jan. 2006 and the COO, Drug Risk Solutions, LLC a drug discovery company from June 2000 to June 2005. Mr. Dickson has 30 years of business experience in new ventures, business plan execution, organizational management, and operations. He has a background in high tech product design and development, manufacturing, and sales and marketing to commercial and military markets gained while working at GE and other high tech companies. He started and successfully financed two companies in the microelectronics and information technology industries. He has an undergraduate degree in chemistry and an MBA. NB Simon G. Thomas became the Chief Financial Officer effective January 1, 2011.  Simon G Thomas.Chief Financial Officer and Director, 56 years of age Mr. Thomas is a British citizen with residency in Rome, Italy. Mr Thomas has spent the past ten years as an independent global project funding consultant across a diverse range of industry. The six years preceding this Mr. Thomas focused in electronics exclusively consulting on projects and their funding throughout the Eastern blocks, Asia and Far East countries. For twelve years starting in 1983 Mr. Thomas was the managing director of Electronic Applications Ltd. This company acted as overseas agents for a number of equipment manufacturers such as Gerber Scientific and Westinghouse. Mr. Thomass formal education included a degree in Business studies from Loughton College of Further Education.  Significant Employees Who Are Not Executive Officers  Mory Ghomshei P. Eng., P.Geo., Ph.DAs an advisor to TransAct Energy Corp Dr. Ghomshei will be bringing his full knowledge of the Geothermal industry to the Company. Dr. Ghomshei completed his Ph.D. in Mineral and Energy-Producing Materials at the University of Paris and Ecole Normale Superieure de Paris, 1983. He was invited to Canada in 1984 to work for the British Columbia Hydro and Power Authority (BC Hydro) on the deep geothermal drilling project at Meager Creek (near Whistler, B.C.). He later joined the University of British Columbia, where he is Professor of Energy Systems in the Norman B. Keevil Institute of Mining Engineering where he teaches energy resources of the ground and mine ventilation and conducts research in geothermal energy resources and systems.  As an international expert in geothermal energy systems, Dr. Ghomshei has participated in exploration and development of geothermal fields around the world (e.g. Coso in California, Meager Creek in B.C., Mt. Sabalan in Iran, and Mt. Labo in the Philippines). He has also designed and developed many medium and low-grade geothermal systems for hospitals, municipal buildings, and greenhouses. He has pioneered research into recovering geothermal energy from operating and abandoned mines (e.g., Britannia Mine, B.C. and the Con Mine in Yellowknife, NWT).  Dr. Ghomshei is Past-Chairman of the Canadian Geothermal Energy Association (CanGEA) which he headed up from 1989 to 2007. He has contributed to the promotion of geothermal energy in Canada through organization of several annual conferences and workshops. Mory has published over 100 papers in scientific journals, proceedings and professional magazines. He is fluent in English, French and his mother tongue (Persian), with working knowledge in Arabic and Spanish. In his spare times, he plays music and writes for children.  Family  There are no family relationships between the members of our board of directors.  Audit Committee and Audit Committee Financial Expert  To date, the newly formed board of directors (BOD) has not formed a formal audit committee, nor has it secured an audit committee financial expert. The BOD intends to form said committee and secure said expert when it becomes operational.  Audit Committee Financial Expert  Our board of directors currently acts as our audit committee. Because we have not commenced significant operations to date, our Board of Directors is still in the process of finding an "audit committee financial expert" (as defined in Regulation S-K) and directors that are "independent" (as that term is used in Section 10A of the Securities Exchange Act).   18   Audit Committee  Our audit committee will oversee a broad range of issues surrounding our accounting and financial reporting processes and audits of our financial statements, including by (1) assisting our board in monitoring the integrity of our financial statements, our compliance with legal and regulatory requirements, our independent auditor's qualifications and independence and the performance of our internal audit function and independent auditors, (2) appointing, compensating, retaining and overseeing the work of any independent registered public accounting firm engaged for the purpose of performing any audits, reviews or attest services, and (3) preparing the audit committee report that may be included in our annual proxy statement or annual report on Form 10-K. We will have at least three directors on our audit committee, each of whom will be independent under the requirements of the NASDAQ Capital Market, the Sarbanes-Oxley Act and the rules and regulations of the SEC.  Other Committees of the Board  Compensation Committee.Our compensation committee will review and recommend our policies relating to compensation and benefits for our executive officers and other significant employees, including reviewing and approving corporate goals and objectives relevant to compensation of our Chief Executive Officer and other executive officers, evaluating the performance of our executive officers relative to goals and objectives, determining compensation for these executive officers based on these evaluations and overseeing the administration of our incentive compensation plans. The compensation committee will also prepare the compensation committee report that may be included in our annual proxy statement or annual report on Form 10-K. We will have at least two directors on our compensation committee, each of whom will be independent under the requirements of the NASDAQ Capital Market.  Nominating and corporate governance committee. Our nominating and corporate governance committee will (1) identify, review and recommend nominees for election as directors, (2) advise our board of directors with respect to board composition, procedures and committees, (3) recommend directors to serve on each committee, (4) oversee the evaluation of our board of directors and our management, and (5) develop, review and recommend corporate governance guidelines and policies. We will have at least two directors on our nominating and corporate governance committee, each of whom will be independent under the requirements of the NASDAQ Capital Market.  Code of EthicsWe have recently adopted a Code of Ethics and Business Conduct authorizing the establishment of a committee to ensure that our disclosure controls and procedures remain effective. Our Code also defines the standard of conduct expected by our officers, directors and employees.  Item 11. Executive Compensation.  We have a formal compensation agreements or employment contracts with our Chief Financial Officer, and Chief Executive Officer. We do not currently have a compensation agreement with our BOD and our Advisory Board members, although we intend to do so in the future. All Officers, Directors and Advisory Board members are reimbursed for their expenses related to Company service. Our officer did receive compensation for the year ended December 31, 2010.   19   Executive Management changed in January 2010 with Henry Andrews resigning as CEO and CFO but remaining as a Director. Joe Dickson resumed the role of CFO and Rod Bartlett resumed the role of CEO. The table below reflects the compensation for the year 2010 only.  SUMMARY COMPENSATION TABLE  Name and
Principal PositionYear
EndedAnnual CompensationLong Term CompensationAll Other Compensation
($)AwardsPayoutsSalary
($)Bonus
($)Other Annual
Compensation
($)Restricted Stock Awards
($)Securities Underlying Options/
SARs (#)LTIP Payouts ($)Roderick Bartlett, CEO,President and Director2010$250,000-0--0--0--0--0-$-0-Joe F. Dickson, CFO,Treasurer and Director2010$-0--0--0-142,742-0--0-$-0-Des Biali,Director2010$-0--0--0--0--0--0-$-0-Henry AndrewsDiretor2010$-0--0--0-43,750-0--0-$-0-Simon Thomas,2010$-0--0--0--0--0--0-$-0-  N.B.: Simon Thomas our current CFO/Director is not list on the table above because he did not become an Officer/Director until January 01, 2011.  NB:Henry Andrews was the sole officer and Director through 2009 subsequent, and resigned on January 26, 2010  NB: Rod Bartlett was not an officer or director though 2009 however subsequent to the year ends completion became an O/D in 2010   20   Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.  The following table sets forth as of March 24, 2011, the name and shareholdings of each person known to us that either directly or beneficially holds more than 5% of our 20,956,930 issued and outstanding shares of common stock, $.001 par value. The table also lists the name and shareholdings of each director and of all officers and directors as a group. Except as otherwise indicated, the persons named in the table have sole voting and dispositive power with respect to all shares beneficially owned, subject to community property laws where applicable.  Name & AddressTitle of ClassNumber of Shares Beneficially Owned% of ClassHenry Andrews (1)
108 Water Front Drive,Milledgeville, Ga. 31061Common125,0000.60%Roderick Bartlett(1)
#105-5119 BeckwithSan Antonio, Texas 78249Common1,031,6704.93%Simon ThomasVia Aurelia 325, Pal 7, 00165 Rome ItalyCommon00%Joe F Dickson (1)
2345 Tucker Rd, New Woodstock, NYCommon139,6840.67%All directors and executive officers as a group:
(3 person)Common1,296,3546.19% (1) Officer and/or director.  Item 13. Certain Relationships and Related Transactions, and Director Independence.  We have received funds from our officers and directors to fund the Companys activities. Currently we owe Mr. Henry Andrews, $3,000, and Mr. Rod Bartlett $74,277. Our Canadian office was billed for office services through an unrelated Company that has similar officers and directors as TransAct for $6,384. The Company lent Aqua Terra Power a company wholly owned by one of our shareholders, $263,519.87. Terra Energy, a company owned by one of our shareholders lent us $27,500.  Except for the foregoing, we have not been a party to any transaction, proposed transaction or series of transactions in which the amount involved exceeded the lesser of $120,000 or one percent of the average of the Company's total assets at year end for the last two completed fiscal years, and in which, to our knowledge, any of our directors, officers, five percent beneficial security holders or any member of the immediate family of the foregoing persons has had or will have a direct or indirect material interest.  Except for the foregoing, none of the following parties has, since the date of incorporation of the Company, had any material interest, direct or indirect, in any transaction with the Company or in any presently proposed transaction that has or will materially affect us:  · any of our directors or officers; · any person proposed as a nominee for election as a director; · any person who beneficially owns, directly or indirectly, shares carrying more than 10% of the voting rights attached to our outstanding shares of common stock; or · any relative or spouse of any of the foregoing persons who has the same house as such person.   21   Item 14. Principal Accounting Fees and Services.  The fees for services billed by Pritchett, Siler & Hardy, P.C. to the Company in the last two fiscal years were as follows:  Twelve months
ended onTwelve months
ended onDecember 31,
2010December 31,
2009Audit Fees$15,940$13,255Audit-Related Fees$0$0Tax Fees$0$0All Other Fees$0$0Total Fees$15,940$13,255  Audit Fees. These fees were comprised of professional services rendered in connection with the audit of our financial statements for our annual report on Form 10-K and the review of our quarterly financial statements for our quarterly reports on Form 10-Q that are customary under auditing standards generally accepted in the United States.  Audit Committee Pre Approval Policies and Procedures  The Company does not have an audit committee and is in search of qualified candidates to form such committee. As a result, the Company does not have any pre-approval policies or procedures for audit or non-audit services.  PART IV  Item 15. Exhibits, Financial Statement Schedules.  (a) Index to Financial Statements and Financial Statement Schedules  The following audited financial statements are included on the pages indicated:  F-3 Report of Pritchett, Siler & Hardy, P.C. Certified Public Accountants F-4 Balance Sheets as of December 31, 2010 and 2009 F-5 Statements of Operations for the years ended December 31, 2010 and 2009 F-6 Statements of Stockholders' Equity (Deficit) for the years ended December 31, 2010 and 2009 F-7 Statements of Cash Flows for the years ended December 31, 2010 and 2009 F-8 Notes to Financial Statements  (b) Exhibits


|               |                                                                                                                                                          |         
|-------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------- | --------
|Exhibit Number | Title                                                                                                                                                    | Location
|               |                                                                                                                                                          |         
|Exhibit 3(i)   | Articles of Incorporation                                                                                                                                | *       
|               |                                                                                                                                                          |         
|Exhibit 3(ii)  | Bylaws                                                                                                                                                   | *       
|               |                                                                                                                                                          |         
|Exhibit 31     | Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                               | Attached
|               |                                                                                                                                                          |         
|Exhibit 31     | Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                               | Attached
|               |                                                                                                                                                          |         
|Exhibit 32     | Certification of the Principal Executive Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 ** | Attached
|               |                                                                                                                                                          |         
|Exhibit 32     | Certification of the Principal Financial Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 ** | Attached

* Incorporated by reference. Filed as exhibit to S-1 filed October 28, 2008  22   **The Exhibit attached to this Form 10-K shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to liability under that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing. SIGNATURES  Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.  TRANSACT ENERGY CORP.  By: /s/ Roderick C. BartlettChief Executive Officer, Corporate SecretaryApril 15, 2011Roderick C. BartlettBy /s/ Simon ThomasChief Financial Officer,April 15, 2011Simon Thomas    Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.   By: /s/ Roderick C. BartlettDirectorApril 15, 2011Roderick C. BartlettBy /s/ Joseph F. DicksonDirectorApril 15, 2011Joseph F. DicksonBy: /s/ Des BialiDirectorApril 15, 2011Des BialiBy: /s/ Simon ThomasDirectorApril 15, 2011Simon Thomas     23                   TRANSACT ENERGY CORP. [A Development Stage Company]  FINANCIAL STATEMENTS  DECEMBER  31, 2010 ______________                    TRANSACT ENERGY CORP. [A Development Stage Company]  PAGEReport of Independent Registered Public Accounting FirmF-3Balance Sheets, December 31, 2010 and 2009F-4Statements of Operations, for the years ended  December 31, 2010 and 2009 and from inception  on March 15, 2006 through December 31, 2010F-5Statement of Stockholders Equity (Deficit), from inception on March 15, 2006 through  December 31, 2010F-6Statements of Cash Flows, for the years ended  December 31, 2010 and 2009 and from inception  on March 15, 2006 through December 31, 2010F-7Notes to Financial StatementsF-8   F-2     REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM    Board of Directors TransAct Energy Corp. San Antonio, Texas  We have audited the accompanying balance sheets of TransAct Energy Corp. [a development stage company] as of December 31, 2010 and 2009 and the related statements of operations, stockholders' equity (deficit) and cash flows for each of the years in the two-year period ended December 31, 2010 and for the period from inception on March 15, 2006 through December 31, 2010. TransAct Energy Corp.s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.  We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Companys internal control over financial reporting.  Accordingly, we express no such opinion.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.  In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of TransAct Energy Corp. as of December 31, 2010 and 2009 and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2010 and for the period from inception on March 15, 2006 through December 31, 2010, in conformity with accounting principles generally accepted in the United States of America.  The accompanying financial statements have been prepared assuming TransAct Energy Corp. will continue as a going concern. As discussed in Note 9 to the financial statements, TransAct Energy Corp. has incurred losses since its inception and has not yet established profitable operations.  These factors raise substantial doubt about the ability of the Company to continue as a going concern.  Managements plans in regards to these matters are also described in Note 9.  The financial statements do not include any adjustments that might result from the outcome of these uncertainties.   /s/ PRITCHETT, SILER & HARDY, P.C. PRITCHETT, SILER & HARDY, P.C.  Salt Lake City, Utah April 15, 2011  F-3     TRANSACT ENERGY CORP. (A Development Stage Company) __________________________ BALANCE SHEETS  December 31,December 31,20102009CurrentCash$2,498$3,800Interest receivable, net-11,770Loans receivable, net  - related parties-248,521Prepaid expenses903-Total Current Assets3,401264,091Investment In Lease-12,684Software2,2233,383$5,624$280,158LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)CurrentAccounts payable$60,919$83,053Accounts payable-Related Party6,38412,664Accrued interest12,6643,094Compensation payable289,949-Deposit  for stock purchase40,000-Notes payable - net of discount65,355-Notes payable - Related parties, net of discount77,27792,964Total Current Liabilities552,548179,111Stockholders' Equity (Deficit)Preferred stock, $.001 par value,10,000,000 shares authorized no shares issued and outstandingCommon Stock, $.001 par value,100,000,000 shares authorized19,964,653 (Dec 2009 - 10,502,000) shares  issued and outstanding19,96510,502Capital in excess of par value1,350,257370,699Subscriptions receivable(550,431)-Deficit accumulated during the development stage(1,366,715)(280,154)Total Stockholders' Equity (Deficit)(546,924)101,047$5,624$280,158   The accompanying notes are an integral part of these financial statements.  F-4     TRANSACT ENERGY CORP. (A Development Stage Company) __________________________  STATEMENTS OF OPERATIONS  Cumulativefrom inceptionFor theFor theMarch 15, 2006Year endedYear endedDecember 31,December 31,December 31,201020102009REVENUE$-$-$-EXPENSESGeneral and administrative962,257757,564134,795Unsuccessful lease purchases18,673--Total Expenses980,930757,564134,795LOSS BEFORE OTHER INCOME (EXPENSE)(980,930)(757,564)(134,795)Interest income50,95439,18411,770Interest expense(124,581)(56,023)(68,361)Loss on write off of investment in lease(12,684)(12,684)-Allowance for loss on loans receivable and related interest(299,474)(299,474)-LOSS FROM OPERATIONSBEFORE INCOME TAXES(1,366,715)(1,086,561)(191,386)CURRENT TAX EXPENSE---DEFERRED TAX EXPENSE---NET LOSS$(1,366,715)$(1,086,561)$(191,386)LOSS PER COMMON SHARE$(0.10)$(0.02)  The accompanying notes are an integral part of these financial statements.  F-5     TRANSACT ENERGY CORP. (A Development Stage Company)  STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) __________________________  FROM INCEPTION ON MARCH 15, 2006 THROUGH DECEMBER 31, 2010


|                                                           |                 |              |            |              |             |              |              
|---------------------------------------------------------- | --------------- | ------------ | ---------- | ------------ | ----------- | ------------ | -------------
|                                                           |                 |              |            |              |             |              | Deficit      
|                                                           |                 |              |            |              |             |              | Accumulated  
|                                                           |                 |              |            |              | Capital in  |              | During the   
|                                                           | Preferred stock | Common Stock | Excess of  | Subscription | Development
|                                                           | Shares          | Amount       | Shares     | Amount       | Par Value   | Receivable   | Stage        
|                                                           |                 |              |            |              |             |              |              
|BALANCE, March 15,2006                                     | -               | $       -    | -          | $       -    | $       -   | $          - | $       -    
|                                                           |                 |              |            |              |             |              |              
|Issuance of 8,500,000 shares of common                     |                 |              |            |              |             |              |              
|stock for cash at $.001 per share, April 2006              | -               | -            | 8,500,000  | 8,500        | -           | -            | -            
|                                                           |                 |              |            |              |             |              |              
|Issuance of 900,000 shares of common                       |                 |              |            |              |             |              |              
|stock for cash at $.05 per share,                          |                 |              |            |              |             |              |              
|August 2006                                                | -               | -            | 900,000    | 900          | 44,100      | -            | -            
|                                                           |                 |              |            |              |             |              |              
|Net loss for the period ended                              |                 |              |            |              |             |              |              
|December 31, 2006                                          | -               | -            | -          | -            | -           | -            | (12,181)     
|                                                           |                 |              |            |              |             |              |              
|BALANCE, December 31, 2006                                 | -               | -            | 9,400,000  | 9,400        | 44,100      | -            | (12,181)     
|                                                           |                 |              |            |              |             |              |              
|Net loss for the year ended                                |                 |              |            |              |             |              |              
|December 31, 2007                                          | -               | -            | -          | -            | -           | -            | (22,024)     
|                                                           |                 |              |            |              |             |              |              
|BALANCE, December 31, 2007                                 | -               | -            | 9,400,000  | 9,400        | 44,100      | -            | (34,205)     
|                                                           |                 |              |            |              |             |              |              
|Net loss for the year ended                                |                 |              |            |              |             |              |              
|December 31, 2008                                          | -               | -            | -          | -            | -           | -            | (54,563)     
|                                                           |                 |              |            |              |             |              |              
|BALANCE, December 31, 2008                                 | -               | -            | 9,400,000  | 9,400        | 44,100      | -            | (88,768)     
|                                                           |                 |              |            |              |             |              |              
|Issuance of 1,102,000 shares of common                     |                 |              |            |              |             |              |              
|stock for cash at $.25 per share,                          |                 |              |            |              |             |              |              
|September 2009                                             | -               | -            | 1,102,000  | 1,102        | 274,398     | -            | -            
|                                                           |                 |              |            |              |             |              |              
|Deferred offering costs offset against offering            | -               | -            | -          | -            | (13,263)    | -            | -            
|                                                           |                 |              |            |              |             |              |              
|Beneficial conversion feature on notes payable             |                 | -            | -          | -            | 65,464      | -            | -            
|Net loss for the year ended                                |                 |              |            |              |             |              |              
|December 31, 2009                                          | -               | -            | -          | -            | -           | -            | (191,386)    
|BALANCE, December 31, 2009                                 | -               | -            | 10,502,000 | 10,502       | 370,699     | -            | (280,154)    
|                                                           |                 |              |            |              |             |              |              
|Issued for services at  $ .55 per share                    | -               | -            | 135,000    | 135          | 74,115      | -            | -            
|Issued for services at  $ 1.39 per share                   | -               | -            | 48,775     | 49           | 67,693      | -            | -            
|                                                           |                 |              |            |              |             |              |              
|Shares issued to existing shareholders in exchange         |                 |              |            |              |             |              |              
|for 1,008,625 free trading shares valued at $.50 per share | -               | -            | 1,109,488  | 1,110        | 553,634     | (550,431)    | -            
|                                                           |                 |              |            |              |             |              |              
|Issuance of 7,770,148 common shares pursuant               |                 |              |            |              |             |              |              
|to conversion of notes payable at $ .01 per share          | -               | -            | 7,770,148  | 7,770        | 69,931      | -            | -            
|                                                           |                 |              |            |              |             |              |              
|Issuance of 315,909 common shares                          |                 |              |            |              |             |              |              
|valued at $.41 -$.47 per share                             |                 |              |            |              |             |              |              
|in exchange  for compensation and consulting services      | -               | -            | 315,909    | 316          | 142,934     | -            | -            
|                                                           |                 |              |            |              |             |              |              
|Beneficial conversion feature on notes payable             | -               | -            | -          | -            | 56,334      | -            | -            
|                                                           |                 |              |            |              |             |              |              
|Issuance of 83,333 common shares                           |                 |              |            |              |             |              |              
|on conversion of debt at $.18 per share                    | -               | -            | 83,333     | 83           | 14,917      | -            | -            
|                                                           |                 |              |            |              |             |              |              
|Net loss for the year ended December 31,2010               | -               | -            | -          | -            | -           | -            | (1,086,561)  
|BALANCE, December 31, 2010                                 | -               | $       -    | 19,964,653 | $ 19,965     | $ 1,350,257 | $ (550,431)  | $ (1,366,715)

The accompanying notes are an integral part of these financial statements.  F-6     TRANSACT ENERGY CORP. (A Development Stage Company) __________________________  STATEMENTS OF CASH FLOWS


|                                                                                                                                             |   |                   |   |              |   |             
|-------------------------------------------------------------------------------------------------------------------------------------------- | - | ----------------- | - | ------------ | - | ------------
|                                                                                                                                             |   | Cumulative        |   |              |   |             
|                                                                                                                                             |   | from inception    |   | For the      |   | For the     
|                                                                                                                                             |   | March 15, 2006 to |   | Year ended   |   | Year ended  
|                                                                                                                                             |   | December 31,      |   | December 31, |   | December 31,
|                                                                                                                                             |   | 2010              |   | 2010         |   | 2009        
|                                                                                                                                             |   |                   |   |              |   |             
|Cash Flow From Operating Activities:                                                                                                         |   |                   |   |              |   |             
|Net loss for the period                                                                                                                      | $ | (1,366,715)       | $ | (1,086,561)  | $ | (191,386)   
|Adjustments to reconcile net loss to cash used by                                                                                            |   |                   |   |              |   |             
|operating activities:                                                                                                                        |   |                   |   |              |   |             
|Stock issued for services                                                                                                                    |   | 285,242           |   | 285,242      |   | -           
|Stock issued for expenses                                                                                                                    |   | 4,313             |   | 4,313        |   | -           
|Debt issued for services                                                                                                                     |   | 12,847            |   | 12,847       |   | -           
|Amortization                                                                                                                                 |   | 1,257             |   | 1,160        |   | 97          
|Loss on write off of investment in lease                                                                                                     |   | 12,684            |   | 12,684       |   | -           
|Allowance for interest receivable                                                                                                            |   | 50,954            |   | 50,954       |   | -           
|Allowance for loans receivable                                                                                                               |   | 248,521           |   | 248,521      |   | -           
|Interest expense from beneficial conversion                                                                                                  |   |                   |   |              |   |             
|feature on notes payable                                                                                                                     |   | 94,653            |   | 29,189       |   | 65,464      
|Change in assets and liabilities:                                                                                                            |   |                   |   |              |   |             
|Decrease (Increase) in interest receivable                                                                                                   |   | (50,954)          |   | (39,184)     |   | (11,770)    
|Increase in prepaid expenses                                                                                                                 |   | (903)             |   | (903)        |   | -           
|Increase (decrease) in accounts payable                                                                                                      |   | 67,169            |   | (15,884)     |   | 30,025      
|Increase (decrease) in accounts payable-Related Party                                                                                        |   | 6,384             |   | 6,384        |   | -           
|Increase in compensation payable                                                                                                             |   | 289,949           |   | 289,949      |   | -           
|Increase in accrued interest                                                                                                                 |   | 18,651            |   | 15,557       |   | 2,897       
|Net Cash (used) by Operating Activities                                                                                                      |   | (325,948)         |   | (185,732)    |   | (104,673)   
|                                                                                                                                             |   |                   |   |              |   |             
|Cash Flows From Investing Activities:                                                                                                        |   |                   |   |              |   |             
|Acquisition of oil and gas leases                                                                                                            |   | (12,684)          |   | -            |   | (206)       
|Purchase of software                                                                                                                         |   | (3,480)           |   | -            |   | (3,480)     
|Loans receivable                                                                                                                             |   | (263,521)         |   | -            |   | (263,521)   
|Proceeds from loans receivable                                                                                                               |   | 15,000            |   | -            |   | 15,000      
|Net Cash (Used) by Investing Activities                                                                                                      |   | (264,685)         |   | -            |   | (252,207)   
|                                                                                                                                             |   |                   |   |              |   |             
|Cash Flow From Financing Activities                                                                                                          |   |                   |   |              |   |             
|Proceeds from common stock issuance                                                                                                          |   | 329,000           |   | -            |   | 275,500     
|Proceeds received for stock not yet issued                                                                                                   |   | 40,000            |   | 40,000       |   | -           
|Stock offering costs                                                                                                                         |   | (13,263)          |   | -            |   | (4,110)     
|Proceeds from notes payable                                                                                                                  |   | 237,394           |   | 144,430      |   | 82,964      
|Net Cash Provided by Financing Activities                                                                                                    |   | 593,131           |   | 184,430      |   | 354,354     
|                                                                                                                                             |   |                   |   |              |   |             
|Net Increase (Decrease) in Cash                                                                                                              |   | 2,498             |   | (1,302)      |   | (2,526)     
|Cash at Beginning of Period                                                                                                                  |   | -                 |   | 3,800        |   | 6,326       
|Cash at End of Period                                                                                                                        | $ | 2,498             | $ | 2,498        | $ | 3,800       
|                                                                                                                                             |   |                   |   |              |   |             
|Supplemental Disclosures of Cash Flow Information:                                                                                           |   |                   |   |              |   |             
|Cash paid during the period for:                                                                                                             |   |                   |   |              |   |             
|Interest                                                                                                                                     | $ | -                 | $ | -            | $ | -           
|Income taxes                                                                                                                                 | $ | -                 | $ | -            | $ | -           
|                                                                                                                                             |   |                   |   |              |   |             
|Supplemental Schedule of Noncash Investing and Financing Activities:                                                                         |   |                   |   |              |   |             
|                                                                                                                                             |   |                   |   |              |   |             
|For the years ended December 31, 2010 and 2009:                                                                                              |   |                   |   |              |   |             
|Shares issued on conversion of debt                                                                                                          | $ | 92,701            | $ | 92,701       | $ | -           
|Shares issued to shareholders in exchange                                                                                                    |   |                   |   |              |   |             
|for free trading shares                                                                                                                      |   | 554,744           |   | 554,744      |   | -           
|Subscriptions receivable                                                                                                                     |   | (550,431)         |   | (550,431)    |   | -           
|The Company increased Capital in excess of par value by $ 56,334 as a result of a beneficial conversion feature on notes payable during 2010 |   |                   |   |              |   |             

The accompanying notes are an integral part of these financial statements.  F-7     TRANSACT ENERGY CORP. [A Development Stage Company]  NOTES TO FINANCIAL STATEMENTS  DECEMBER 31, 2010  NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  Organization - TransAct Energy Corp. (the Company) was organized under the laws of the State of Nevada on March 15, 2006. The Company is in the business of developing and managing power production facilities globally primarily using alternative/sustainable energy sources. The Company has not generated revenues and is considered a development stage company as defined in Accounting Standards Codification (ASC) Topic No. 915. The Company has, at the present time, not paid any dividends and any dividends that may be paid in the future will depend upon the financial requirements of the Company and other relevant factors.  Cash and Cash Equivalents - The Company considers all highly liquid debt investments purchased with a maturity of three months or less to be cash equivalents.  Software and related amortization - Software is recorded at cost and the Company  provides for amortization using the straight line method over three years.  Income Taxes -The Company accounts for income taxes in accordance with ASC Topic No. 740, Accounting for Income Taxes.  The Company adopted the provisions of ASC Topic No. 740, Accounting for Income Taxes, on January 1, 2007. As a result of the implementation of ASC Topic No. 740, the Company recognized approximately no increase in the liability for unrecognized tax benefits.  The Company has no tax positions at December 31, 2010 and 2009 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility.  The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. During the years ended December 31, 2010 and 2009, the Company recognized no interest and penalties. The Company had no accruals for interest and penalties at December 31, 2010 and 2009. All tax years starting with 2008 are open for examination.  Loss Per Share - The computation of loss per share is based on the weighted average number of shares outstanding during the period presented in accordance with ASC Topic No. 260, Earnings Per Share [See Note 11].  Accounting Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimated by management.  Recently Enacted Accounting Standards - In September 2009 the FASB established the Accounting Standards Codification (Codification or ASC) as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in accordance with generally accepted accounting principles in the United States (GAAP). Rules and interpretive releases of the Securities and Exchange Commission (SEC) issued under authority of federal securities laws are also sources of GAAP for SEC registrants.  Existing GAAP was not intended to be changed as a result of the Codification, and accordingly the change did not impact our financial statements. The ASC does change the way the guidance is organized and presented.  Accounting Standards Update (ASU) ASU No. 2009-05 (ASC Topic 820), which amends Fair Value Measurements and Disclosures  Overall, ASU No. 2009-13 (ASC Topic 605), Multiple-Deliverable Revenue Arrangements, ASU No. 2009-14 (ASC Topic 985), Certain Revenue Arrangements that include Software Elements, and various other ASUs No. 2009-2 through ASU No. 2011-2 which contain technical corrections to existing guidance or affect guidance to specialized industries or entities were recently issued.  These updates have no current applicability to the Company or their effect on the financial statements would not have been significant.  F-8     TRANSACT ENERGY CORP. [A Development Stage Company]  NOTES TO FINANCIAL STATEMENTS  DECEMBER 31, 2010  NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)  Investment in Leases -All costs such as bid fees and lease rental payments related to the acquisition of energy leases are deferred and amortized on a straight-line basis over the term of the lease (See Note 3).  Foreign Currency Translation - Transactions in foreign currencies are translated into U.S. dollars using the exchange rate at each balance sheet date for assets and liabilities and the weighted average exchange rate for each period for revenues, expenses, gains and losses. Translation adjustments are recorded as a separate component of accumulated other comprehensive income (loss) when material and foreign currency transaction gains and losses are recorded in other income and expense.  Stock Offering Costs - Costs incurred in connection with stock offerings will be deferred and offset against the proceeds of the stock offering.  Costs incurred in connection with unsuccessful offerings will be expensed.  NOTE 2  LOANS RECEIVABLE  RELATED PARTY  The $12,000, $5,000, $7,000, $212,000 and $12,520 loans receivable from a company whose sole shareholder holds less than 10% in TransAct, are unsecured and were due on November 1, November 10, November 29, December 6 and December 6, 2010, respectively. The loans are secured by certain assets and equipment of the Company and bear interest at rates between 15% and 18% per annum for the terms of the loans. At December 31, 2010 and December 31, 2009 Interest receivable was $50,954 and $40,505 respectively. These notes have not been granted an extension, are in default and management has formally demanded payment of the outstanding principal and interest and may pursue legal action if the cost of said action can be justified. At December 31, 2010 the Company has recorded a total allowance of $299,475 charged to operations including principal of $248,521 and interest of $50,954.  NOTE 3 - INVESTMENT IN LEASE  In November 2010 management decided not to renew the lease of the 100% interest in a Petroleum and Natural Gas Lease from the province of Alberta, Canada and as a result, has lapsed and been cancelled. The previously capitalized cost of $12,684 has been charged to operations for the year ended December 31, 2010.   NOTE 4 - SOFTWARE  AccumulatedNet Book ValueCostAmortization20102009Software$3,480$1,257$2,223$3,383  Depreciation expense totalled $1,160 and $97 for December 31, 2010 and December 31, 2009, respectively.  NOTE 5  NOTES PAYABLE  The two $40,000 convertible promissory notes dated June 10, 2010 and October 5, 2010 bear interest at 8% per annum and are due and payable on March 11, 2011 and July 7, 2011, respectively. The holder has the option to convert the entire principal amount of each particular note on or before March 11, 2011 and July 7, 2011 into common shares of the Company based on a conversion rate of 60% of the Market Price being the average of the lowest three trading prices over the past ten days prior to the conversion. At no time may the holder convert into an amount of shares which would result in the holder and its affiliates to beneficially own more than 4.99% of the outstanding shares of common stock. In December 2010 the holder elected to convert $15,000 of the June 10, 2010 note into 83,333 common shares of the Company. Accrued interest for the notes at December 31, 2010 was $2,515. A beneficial conversion feature of $53,334 has been recorded as a discount to the notes with an offset to additional paid in capital. The discount will be amortized over the life of the notes. Interest expense relating to the notes for year ended December 31, 2010 was $26,189. At December 31, 2010 the remaining unamortized discount was $27,145.  F-9     TRANSACT ENERGY CORP. [A Development Stage Company]  NOTES TO FINANCIAL STATEMENTS  DECEMBER 31, 2010  NOTE 6  NOTES PAYABLE  RELATED PARTIES  a) The $10,000 convertible promissory note payable to a company whose shareholders hold less than 10% in TransAct is unsecured, bears interest at 10% per annum and was due and payable on March 31, 2010. The payee had the option to convert the entire principal amount on or before April 29, 2009 into common shares of the Company based on a conversion rate of $.00345 per share and no interest was payable if the principal was converted to shares of the Company. The payee did not exercise its conversion option. The note is currently outstanding and in October 2010 the Company issued a check in the amount of $11,876 as payment in full of principal and interest which was returned uncashed by the payee. The Company is currently in dispute regarding the expiration date of the conversion option in the agreement and the note remains in default.  b) The $17,500 promissory note payable to a company whose shareholders hold less than 10% in TransAct is unsecured, bears interest at 10% per annum and is due on demand. This notes is currently in default.  c) In November and December 2010 the 18% $12,000, $5,000, $7,000 and $41,464 promissory notes payable to an officer and shareholder plus accrued interest of $12,237 for a total of $77,701 were converted at the option of the note holder into 7,770,148 common shares which were issued at $.01 per share.  d) Promissory notes payable totalling $74,277 to an officer and shareholder are secured  by certain assets and equipment of the Company and  bear interest at 8% and 10% per annum and are due on demand.  e) A $3,000 promissory note payable to a former officer is secured by certain assets and equipment of the Company and bears interest at 8% per annum and is due on demand. A beneficial conversion feature of $3,000 has been recorded as a discount to the note with an offset to additional paid in capital. The discount has been amortized over the life of the note. Interest expense relating to this note for year ended December 31, 2010 was $3,000.  Accrued interest for the notes at December 31, 2010 was $10,149 and at December 31, 2009 was $3,094.  NOTE 7 - CAPITAL STOCK  Preferred Stock - The Company has authorized 10,000,000 shares of preferred stock, $.001 par value, with such rights, preferences and designations and to be issued in such series as determined by the Board of Directors. No shares are issued and outstanding at December 31, 2010.  NOTE 7 - CAPITAL STOCK (CONTINUED)  Common Stock - The Company has authorized 100,000,000 shares of common stock, $.001 par value, with such rights, preferences and designations and to be issued in such series as determined by the Board of Directors.  During April 2006, the Company issued 8,500,000 shares of its previously authorized, but unissued common stock. Total proceeds from the sale of stock amounted to $8,500 (or $.001 per share).  During August 2006, the Company issued 900,000 shares of its previously authorized, but unissued common stock. Total proceeds from the sale of stock amounted to $45,000 (or $.05 per share).  During September 2009, the Company issued 1,102,000 shares of its previously authorized, but unissued common stock. Total proceeds from the sale of stock amounted to $275,500 (or $.25 per share). Offering costs of $13,263 were netted against the proceeds.  On July 6, 2010, the Company issued 125,000 common shares in exchange for consulting services at a value of $.55 per share.  The Company issued 48,775 common shares in exchange for consulting services at a value of $1.39 per share for services during 2010.  On July 6, 2010, the Company issued 10,000 common shares in exchange for consulting services at a value of $.55 per share.  F-10     TRANSACT ENERGY CORP. [A Development Stage Company]  NOTES TO FINANCIAL STATEMENTS  DECEMBER 31, 2010  During September 2010, the Company issued 1,109,488 shares of its previously authorized, but unissued common stock for consulting services at a value of $.47 per share.  In November 2010 the Company issued 225,000 shares of its previously authorized, but unissued common stock for consulting and compensation services at a value of $.50 per share.  On November 3, 2010 the Company issued 90,909 common shares in exchange for consulting services at a value of $.41 per share.  In November 2010 the Company issued 2,828,892 common shares pursuant to a convertible option of certain promissory notes totaling $28,289 including principal and interest.  In December 2010 the Company issued 4,941,256 common shares pursuant to a convertible option of certain promissory notes totaling $49,412 including principal and interest.  In December 2010 subscriptions were received for 200,000 common shares at $.15 per share and 50,000 common shares at $.20 per share for a total of $40,000 which was received. To date the shares have not been issued and the proceeds received are a liability on the balance sheet.  In December 2010 the Company issued 83,333 common shares pursuant to a convertible option of a note payable totaling $15,000 at $.18 per share.  NOTE 8 - INCOME TAXES  The Company accounts for income taxes in accordance with ASC Topic No. 740, Income Taxes. This standard requires the Company to provide a net deferred tax asset or liability equal to the expected future tax benefit or expense of temporary reporting differences between book and tax accounting and any available operating loss or tax credit carryforwards.  The Company adopted the provisions of ASC Topic 740, Accounting for Uncertainty in Income Taxes, on January 1, 2007. As result of the implementation of ASC Topic 740, the Company recognized approximately no increase in the liability for unrecognized tax benefits.  The Company has no tax provisions at December 31, 2010 and 2009, for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility.  The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. During the periods ended December 31, 2010 and 2009, the Company recognized no interest and penalties. The Company had no accruals for interest and penalties at December 31, 2010 and December 31, 2009.  Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss (NOL). Tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.  F-11     TRANSACT ENERGY CORP. [A Development Stage Company]  NOTES TO FINANCIAL STATEMENTS  DECEMBER 31, 2010  NOTE 8 - INCOME TAXES (CONTINUED)  Net deferred tax assets (liabilities) consist of the following components as of December 31, 2010 and 2009:  20102009Deferred tax assets:NOL Carryover$273,300$56,000Related Party Accrual00Valuation allowance(273,300)(56,000)Net deferred tax asset$-$-  The income tax provision differs from the amount of estimated income tax determined by applying the U.S. federal income tax rate to pretax income from continuing operations for the periods ended December 31, 2010 and 2009 due to the following:  20102009Book Loss (20% statutory rate)$(217,300)$(38,200)Valuation allowance217,30038,200Tax at effective rate$-$  At December 31, 2010, the Company had net operating loss carryforwards of approximately $1,087,000 that may be offset against future taxable income from the year 2011 through 2030. No tax benefit has been reported in the December 31, 2010 or 2009 financial statements since the potential tax benefit is offset by a valuation allowance of the same amount.  Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carryforwards for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carryforwards may be limited as to use in future years.  NOTE 9 - GOING CONCERN  The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern.  However, the Company has a working capital deficit and has incurred losses since its inception. These factors raise substantial doubt about the ability of the Company to continue as a going concern. In this regard, management is proposing to raise any necessary additional funds not provided by operations through loans and/or through additional sales of its common stock. There is no assurance that the Company will be successful in raising this additional capital or in achieving profitable operations. The financial statements do not include any adjustments that might result from the outcome of these uncertainties.  NOTE 10 - RELATED PARTY TRANSACTIONS  Management Compensation - In October 2010 the Company issued 125,000 common shares to a former officer for consulting services valued at $58,750.  During the year the Company paid $70,944 as compensation to a former executive of the Company of which $26,053 is due from this former executive as a result of his early termination of his employment agreement (see Note 12).  The Company has also accrued executive compensation of $250,000 to the President of the Company for the year ended December 31, 2010 (See Note 12).  During the year the Company issued 139,684 common shares to the Chief Financial Officer of the Company and accrued compensation of $37,500 to December 2010 (See Note 12).  F-12      TRANSACT ENERGY CORP. [A Development Stage Company]  NOTES TO FINANCIAL STATEMENTS  DECEMBER 31, 2010  Office Space - The Company shared office space with a related company of an officer/shareholder on a month to month basis to June 30, 2010. Effective July 1, 2010 the Company committed to an office lease (see Note 12), and agreed to sub-lease on a month to month basis a portion to a related party for $2,557 per month. As of December 31, 2010 the Company had a net payable of $6,384 for the use of telephone, fax and office equipment.  NOTE 11 - LOSS PER SHARE  The following data show the amounts used in computing loss per share for the periods presented:  Year endedYear endedDecember 31December 31,20102009Loss from operations available to common shareholders(numerator)$(1,086,561)$(191,386)Weighted average number of common sharesoutstanding during the period used in loss pershare (denominator)11,347,9379,754,586  Dilutive loss per share was not presented, as the Company had no common equivalent shares for all periods presented that would affect the computation of diluted loss per share.  NOTE 12  COMMITMENTS AND CONTINGENCIES  Compensation agreement - Effective October 1, 2009 through September 30, 2011, the Company entered into a compensation agreement with Shahhid Shafiq Vohra to assist the Company with business development globally for consideration of $90,000 for the contract period to be paid over 12 months plus 100,000 common shares of the Company valued at $0.55 per share which were issued in July 2010. On September 30, 2010 Shahhid Vohra resigned and terminated the agreement. Vohra threatened legal action after making a claim against the Company of $44,264 through his legal council. The Company has claimed back that Vohra owes them $26,052 and intends on pursuing this claim. The $26,052 has been charged to operations as consulting fees. If any funds are received they will be recorded as an expense recovery in the year received.  Compensation agreement - During January 2010 the Company entered into an agreement with an outside consultant to serve as the Chief Financial Officer of the Company through December 31, 2010 with continuing one month extensions until cancelled. Compensation for the services will be $12,500 per month and is payable in common stock of the Company until such time as the Company secures its first $500,000. During the year the Company issued 139,684 common shares valued from $.40 to $1.88 per share to satisfy this compensation agreement for the months of January to September 2010 valued at $105,242. Compensation for the period October to December 2010 has been accrued as a liability in the amount of $37,500.  Lease agreement - The Company is committed to a three year lease for office space which commences July 1, 2010 and expires on June 30, 2013. The annual minimum lease payments over this three year period for this office space are $9,092 per year plus common area costs and Harmonized Sales Tax. The Company has also agreed to sub-lease a portion to a related party on a month to month basis for $2,557 per month. The future minimum lease payments through June 30, 2013 are as follows:  Year ending December 31,2011$9,09220129,09220134,546$22,730   F-13     TRANSACT ENERGY CORP. [A Development Stage Company]  NOTES TO FINANCIAL STATEMENTS  DECEMBER 31, 2010  NOTE 12  COMMITMENTS AND CONTINGENCIES (CONTINUED)  Financing agreement - In May 2010 the Company also entered into a financing brokerage agreement where the broker introduced potential investors up to November 11, 2010. As a retainer for their services the Company issued in July 2010, 10,000 common shares valued at $.55 per share and agreed to pay 8% on funds raised. To date cash compensation of $6,400 has been paid for $80,000 raised as two convertible debentures and in addition, this agreement has been terminated as of December 31, 2010.  Financing agreement - In April 2010 the Company entered into an investment banking agreement to arrange funding of not less than $6,000,000 through the sale of common shares of the Company. The Company has agreed to pay a fee in the amount of $50,000 of which $15,000 was paid and still held in escrow, to be disbursed for third party due diligence expenses according to the terms of the agreement. Under the terms of the agreement the Company has also agreed to pay a fee of not less than 2% of the monies obtained as a loan and 8% of the monies obtained via equity investors. InNovember 2010 the Company terminated this agreement due to unfulfilled terms and requested the funds held in escrow to be released back to the Company. As of December 31,2010 the Company has not received any funds nor any response and has expensed the $15,000 as consulting fees. If any funds are returned they will be recorded as an expense recovery in the year received.  Compensation agreement - In February 2010, the Board of Directors of TransAct Energy appointed Rod Bartlett as the new President, Chief Executive Officer and as an independent director. The Agreement pays an annual base salary of $250,000 which has been accrued to date, with a cash bonus annually based on 5% of EBITDA and a stock bonus formulated around the return on invested capital where the issued and outstanding stock of the Company times the rate of return divided by ten will equate to the stock issued.  Administration agreement - Effective July 1, 2010 the Company entered into an office administration compensation agreement for one year to June 30, 2011. The terms of this agreement is a salary of $ 42,227 per annum of which $21,114 is included in Compensation payable on the balance sheet plus 50,000 common shares which were issued in November 2010 valued at $23,500 at $.47 per share.  Consulting agreement - Pursuant to an agreement dated September 15, 2010 the Company entered into a strategic and financial consulting agreement to assist the Company in its current financing activities. As an engagement fee for their services, the consultant is to receive 1,000,000 free trading common shares valued at $.50 per share.  In order to facilitate the terms of this agreement the Company by way of special resolution identified certain shareholders of the Company that had sufficient unrestricted common shares and agreed to replace the unrestricted shares with restricted common shares plus an incentive of an additional 10% of bonus shares. In September 2010 the Company issued 1,109,488 common shares, including 100,863 bonus shares, valued at $.50 per share.  In January 2011 the Company terminated this agreement due to the unfulfilled terms by the consultant and demanded a full refund of the shares issued. The Company is currently negotiating for a return of 80% of the original 1,000,000 common shares. This has been reflected as stock subscription receivable in the amount of $550,431 on the balance sheet.  Collaboration agreement - On October 22, 2010 the Company entered into a collaboration agreement to license, sell and distribute certain fuel cell technology in India. The purchase price for the distribution rights is as follows:  i) 50% of the purchase price ($5 million)  to be paid within 30 days after October 22, 2010;  ii) 25% of the purchase price ($2.5 million)  to be paid on or before January 1, 2011;  iii) 25% of the purchase price ($2.5 million)  to be paid on or before January 1, 2012;  If bona fide purchase orders of 10,000 or more are attained on or before January 1, 2012 and completed on or before January 1, 2013, the distributions rights fee will be waived.   F-14     The agreement also provides for an option to acquire a license to manufacture, sell and distribute products in India for $15,000,000. To date no payments have been made pursuant to this agreement.  TRANSACT ENERGY CORP. [A Development Stage Company]  NOTES TO FINANCIAL STATEMENTS  DECEMBER 31, 2010  NOTE 13  SUBSEQUENT EVENTS  In January 2011, 588,235 common shares were subscribed for at $.17 per share for a total of $100,000.  In February 2011, the Company issued a promissory note to a former officer in the amount of $22,030 which bears interest of $6,000. The note is due on March 4, 2011.  Effective January 1, 2011 the Company entered into a CFO compensation agreement for a term of 5 years to December 31, 2016. The agreement pays an annual base salary of $250,000 and includes a signing bonus of 200,000 shares plus a cash bonus equal to 3% of the annual EBITDA to a maximum of $15,000,000 in the first year with a 10% increase each year thereafter.  In February 2011 the holder of the June 10, 2010 convertible promissory note (see note 5) elected to convert $12,000 of principal into 404,040 common shares of the Company leaving a principal balance outstanding of $13,000.  Also in February 2011 the terms of the June 10, 2010 and October 5, 2010 convertible promissory notes (see note 5) were amended by both parties to include a repayment option. Under this repayment option the borrower has the right to repay the balance of a note in cash equal to 150% of the outstanding principal and interest. On February 24, 2011 the Company paid $22,000 as its right to repay the remaining $13,000 balance of the June 10, 2010 note.  The Company has evaluated subsequent events from the balance sheet date through the date the financial statements were issued and determined there are no additional events to disclose.   F-15