UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
DC 20549










FORM 10-K










x ANNUAL REPORT PURSUANT TO
SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the
Year Ended December 31, 2009





oTRANSITION REPORT PURSUANT TO
SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934





For
the transition period from  to





Commission
File Number 000-12493





NATURAL
BLUE RESOURCES, INC.





(Exact
name of registrant as specified in its charter)





Delaware
            13-3134389(State
      or other jurisdiction of incorporation or organization)
            (I.R.S.
      Employer Identification Number)146 West Plant Street, Suite 300, Winter Garden,
      FL
            34787(Address
      of principal executive offices)
            (Zip
      Code)





Registrant’s
telephone number: (321)
293-7420





Securities
registered pursuant to Section 12(b) of the Act:





Title
      of  Each Class:
              Name of each
      exchange on which registered:None
              None


Securities
registered pursuant to Section 12(g) of the Act:


Common
Stock, $.0001 par value


(Title of
Class)





Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act   oYes x No





Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 of section 15(d) of the Act oYes x No





Indicate
by check mark whether registrant (1) has filed all reports 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.  xYes o No





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).  oYes o No





Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulations S-K (229.405 of this chapter) is not contained herein, and will not
be contained, to the best of the 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.





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 (Check one):





Large
      accelerated filer
            o
            Accelerated
      filer
            oNon-accelerated
      filer (Do not check if smaller reporting company)
            o
            Smaller
      reporting company
            x





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).   o Yes x No





The
aggregate market value of the shares of common stock held by non-affiliates of
Natural Blue Resources, Inc. as of June 30, 2009, the last business day of its
most recently completed second fiscal quarter, based on the last trade price on
that date, as reported by the OTC Bulletin Board, was approximately
$221,785,799.





There
were 49,601,909 shares of common stock outstanding as of March 26,
2010.





.


Table of Contents





TABLE OF CONTENTS





PagePart
      IItem 1. Business
            3Item 2. Properties
            7Item 3. Legal Proceedings
            7Part IIItem 5. Market for Registrant’s Common Equity, Related
      Stockholder Matters and Issuer Purchases of Equity
      Securities
            7Item 7. Management’s Discussion and Analysis of Financial
      Condition and Results of Operations
            8Item 8.  Financial Statements and Supplementary
      Data
            10Item 9A(T). Controls and Procedures
            25Part
      IIIItem 10. Directors, Executive Officers and Corporate
      Governance
            27Item 11. Executive Compensation
            28Item 12. Security Ownership of Certain beneficial Owners and
      Management and Related Stockholder Matters.
            29Item 13. Certain Relationships and Related Transactions, and
      Director Independence
            30Item 14. Principal Accounting Fees and
      Services
            30Part
      IVItem 15. Exhibits, Financial Statement
      Schedules.
            31Signatures
            32





Table of Contents





PART
I





ITEM 1. BUSINESS





Overview


Natural
Blue Resources, Inc. is a Delaware corporation (the “Company”).  The
Company was formed on April 27, 2005 as Datameg Corporation.  The
Company was the surviving corporation in a merger effected on April 27, 2005,
with Datameg Corporation, a New York corporation formed in October 1982 as The
Viola Group, Inc. (“Viola”).





Change
of Control


On July
24, 2009, the Company entered into a Share Exchange Agreement (the “Share
Exchange Agreement”) with Natural Blue Resources, Inc., a Nevada corporation
(“NBRN”).  Pursuant to the Share Exchange Agreement, the Company
acquired all of NBRN’s outstanding common stock consisting of 44, 661,585 shares
in exchange for the right to receive a number of shares that would equal 90% of
the issued and outstanding shares of the Company’s common stock upon completion
of the transaction. The Company issued 44,356,598 shares of our common stock to
the NBRN shareholders. The exchange ratio of the Company to NBRN common stock in
terms of number of shares was approximately .993 to 1.00.  As a result
of the transaction, NBRN became a wholly owned subsidiary of the Company and the
Company became subject to a change of control with the former shareholders of
NBRN owning 90% of the Company’s outstanding common stock, including voting
control of the Company. Because NBRN’s former stockholders own a majority of the
Company’s outstanding voting common stock, and NBRN’s management has actual
operational control of the Company, NBRN is considered the accounting acquirer
in the share exchange transaction.  The transaction is considered a
reverse merger transaction for accounting purposes and is accounted for as a
capital transaction in substance equivalent to the issuance of NBRN’s common
stock for the net monetary assets of the Company, accompanied by a
recapitalization.  Accordingly, the accounting with respect to the
transaction does not contemplate the recognition of assets of the accounting
acquirer, such as goodwill.  Consolidated financial statements
presented herein and subsequent to the transaction reflect the consolidated
financial assets and liabilities and operations of NBRN at their historical
costs giving effect to the recapitalization, as if NBRN had been the Company
during the periods presented.





As a
condition of, and prior to, to the closing of the share exchange transaction,
NBRN effected a 1 for 100 reverse stock split on July 24,
2009.  Following the reverse stock split, but before the closing of
the share exchange, there were 4,928,511 shares of the Company’s common stock
outstanding.  Upon closing of the share exchange, there were
49,285,733 shares of the Company’s common stock outstanding, including shares
issued to the NBRN stockholders in the share exchange.  Our
stockholders approved the reverse stock split and the share exchange transaction
by written consent on June 18, 2009.





On July
24, 2009, concurrent with the closing of the transaction, the Company changed
its name from “Datameg Corporation” to “Natural Blue Resources,
Inc.”





Operations


The
Company is a development stage company currently engaged in the business of
exploring, acquiring and developing various interrelated “green” businesses,
including waste stream recycling, plastic and steel recycling, and a “print
responsibly” business segment that will, whenever possible, use recycled
printing processes both online and in the traditional print process. The Company
is also exploring entering into the robust and eco-friendly business of energy
management and generally intends to acquire, develop and operate businesses that
generally have existing earnings and quality, knowledgeable management in
place and that utilize proprietary, state-of-the-art technology. The
Company intends to develop these businesses into an interrelated,
environmentally friendly company.





3
 Table of Contents





As of
December 31, 2009, the Company had five employees, all of whom are full-time
employees.





As of
December 31, 2009, the Company had five direct or indirect wholly-owned
subsidiaries:





·
            Natural
      Blue Resources, Inc., a Nevada corporation
  (“NBRN”);





·
            NetSymphony
      Corporation, an inactive North Carolina
      corporation(“NetSymphony”),





·
            QoVox
      Corporation, an inactive North Carolina corporation
    (“QoVox”),





·
            EcoWave,
      LLC a Delaware limited liability company (“EcoWave”);
  and





·
            Natural
      Blue Steel, Inc., a Delaware corporation
  (“NBS”).





In
addition, the Company owns 40% of the equity interests of CASCommunications,
Inc., an inactive Florida corporation.





NBRN


NBRN was
formed on March 2, 2009 as a Nevada corporation.  On July 24, 2009,
the Company became the legal acquirer of NBRN as the result of a share exchange
with the stockholders of NBRN upon the completion of which NBRN became a
wholly-owned subsidiary of the Company.  Due to the nature of the
share exchange transaction, as more fully described above and in the
consolidated financial statements made a part of this annual report, NBRN is
considered the accounting acquirer of the consolidated entities.





NBRN is
currently in the development stage, as that term is defined in Accounting
Standards Codification (“ASC”) Topic 915, Development Stage
Entities.  During this stage of our development, NBRN is devoting
substantially all of its efforts in identifying companies and technologies for
acquisition and development to further its business strategy. NBRN had five
employees, all of whom are full-time employees.





In
October, 2009, NBRN signed a non binding letter of intent for the purchase of
all of the assets and select liabilities from Blue Earth Solutions, Inc., a
Nevada corporation (“BESN”), and provided a $100,000 deposit in connection
therewith.  The transaction is not being actively pursued by the
Company and the Company cannot provide any assurance that the transaction will
eventually close.  BESN is a company in which certain of the Company’s
consultants and their affiliates are shareholders. There is substantial doubt
that BESN has and will have the ability to repay the $100,000 deposit and if the
Company is entitled to the return of the deposit.   As a result, as of
December 31, 2009 management has determined that the deposit was uncollectible
and has been reserved.


4
 Table of Contents




EcoWave


EcoWave
was acquired on August 14, 2009 by NBRN, our wholly-owned subsidiary, from
Kaleida  Eco Ventures, Inc. a Delaware corporation,
(“Kaleida”).  In April 2009, Kaleida paid the Company $800 for
4,000,000 shares of its common stock in anticipation of furthering negotiations
between the two companies for the eventual sub-license agreement described below
that EcoWave now holds.




EcoWave
holds the exclusive worldwide, excluding the Republic of Korea, use and
manufacturing license to patents and technology rights for waste treatment
using microwave technology previously licensed by Kaleida.  Kaleida is
currently licensing the technology for use in waste treatment plants located in
Korea.  Kaleida is currently the sole manufacturer of the equipment
which EcoWave intends to market and sell, but EcoWave is not subject to any
restrictions or limitations which prevent it from sourcing the equipment
elsewhere.  EcoWave is required to pay a royalty to Kaleida of
$200,000 per installed unit.  The license term shall remain in effect
for the life of the last-to-expire patents or for 20 years, whichever occurs
last.





It is
intended that EcoWave will sell waste treatment equipment into which is
incorporated a proprietary process to third parties who will treat
waste.  This process dries waste that is generated from the customers
business processes, and converts the waste from a non-useable by-product to a
useable by-product.  The drying process is capable of reducing the
volume of waste by-product by eliminating the moisture content, without harming
the core properties of the by-product so that it may be either used again,
resold, or eliminated depending on the customer needs.  The process
that the EcoWave equipment provides is to dry waste from all sources, so EcoWave
is not dependant on any geographic or industry-specific
market.  Currently, EcoWave is in preliminary discussions with
potential customers in various industries including  agriculture,
mining, resorts, cruise lines and municipalities.





In
December, 2009, EcoWave purchased the pilot unit necessary to allow EcoWave to
facilitate a first hand review of the process and establish small scale residual
processing.  In late January 2010 the preliminary tests proved that
the EcoWave technology is working and the Company anticipates that EcoWave will
start operating in fiscal 2010.





EcoWave
has implemented formal agency and distribution agreements to market and sell the
equipment.  These agreements provide for commissions based on sales
performance.  Since we have no customers, and we have yet to generate
revenue, we are not dependent on any one or a few major customers, EcoWave
intends to sell this equipment across North America and eventually
internationally.





EcoWave
will have competition from other waste treatment providers as well as two
separate companies that are using an alternate technology to dry
waste.  None of these companies is leading the market and many of the
older technologies are dependent upon fossil fuels and non eco-friendly
methods.  However, each of these companies may have a distinct
advantage as they are more seasoned, may have existing marketing and sales
distribution channels and may have more readily available access to capital at
rates that we may not achieve.





EcoWave
is currently dependent upon one international manufacturer of the equipment it
will sell, however, it is in the process of identifying several domestic sources
for the equipment, but there can be no assurance that there will not be a delay
in purchasing the equipment EcoWave sells.  Under the terms of the
sub- license from Kaleida to EcoWave, EcoWave is allowed to source the equipment
from any source that it finds reasonably and economically
practical.





The
technology EcoWave uses to treat waste is proprietary and EcoWave has the sole
sub-license.





Waste
treatment is regulated by several federal and state agencies and the effect of
existing or probable governmental regulations on the business is not
certain.  The impact of environmental laws may have a negative impact
on our ability to start profitable operations.




5
 Table of Contents




Currently,
EcoWave has no employees and is dependent on the Company and outside
consultants, agents and distributors for its operations.





NetSymphony  and
 QoVox


NetSymphony’s
and QoVox are both currently inactive.  We have taken the necessary
steps to cease all of NetSymphony’s and QoVox's operations and are evaluating
the future prospects for such entities.  Neither entity has any
employees.





Natural
Blue Steel


The
Company formed NBS in November 2009 to capitalize on the recycled steel
market.  The Company, through NBS intends to make strategic and
opportunistic arrangements for the purchase and subsequent resale of recycled
steel, predominantly through the acquisition of abandoned buildings, which the
Company will demolish in order to recover and sell the scrap
steel.  NBS is a development stage company and there have been no
revenues recorded to date.   The Company cannot provide
reasonable assurance that NBS will meet these objectives.





NBS’
principal product and service will be the identification and procurement of
recycled steel predominantly from old warehouses throughout North America and
then the dismantling, cutting and transporting of scrap steel to its end
customer.  Currently there is no supplier of recycled steel to the
Company, the Company must source each of these contracts on an opportunistic
basis.





As NBS
was recently formed, it has no suppliers or customers and is not reliant on any
supplier, customer or market.  Currently, the Company is still
developing its business plan for NBS which would include the sales and marketing
strategy, potential financing options and an evaluation of the impact of
environmental regulations pertaining to recycled steel as well as the impact of
any local, state or federal regulations.





Currently,
NBS has no employees and the Company is using outside consultants to help NBS
devise and implement its business plan and strategy.  The Company has
entered into an agreement on October 26, 2009 with two separate entities to
identify and procure recycled steel on behalf of and to manage the business of
NBS (“Steel Management Contract”).  Pursuant to the Steel Management
Contract, the Company shall pay to the principals of the counterparties on a
monthly basis, the amount of $15,000 or 10% of the net operating profit of NBS,
whichever is greater.  In addition, should NBS achieve certain
production and profit levels derived from the Steel Management Contract, the
Company shall pay a bonus of 100,000 shares of the Company’s common stock for
each month over a 16 month period that the target production and profit levels
are achieved.  The Company also agreed to reimburse the principals of
the Steel Management Contract for travel and other organizational expenses as
incurred.





Subsequent
to end of fiscal year 2009, NBS formed a wholly-owned subsidiary, Natural Blue
International, LLC, a Florida limited liability company, for the purpose of
engaging in business with third-party vendors for both the supply and
distribution of scrap steel.





CasCommunications


CasCommunications
is an inactive Florida corporation.  We own 40% of the outstanding
common stock of CasCommunications.  CasCommunications did not generate
any revenue for the fiscal year ended December 31, 2009. The Company is
exploring options related to CasCommunications, but has ceased any further
investment in this company.





Consulting,
Advisory and Management Agreements


In
November 2009, the Company executed an Engagement and Advisory Fee Agreement
with JEC Corp. (“JEC”), which is owned by one of our shareholders and the
shareholder is related to our consultants.  Pursuant to the agreement,
JEC will provide to the Company professional services in identifying and
representing the Company with respect to potential future merger and acquisition
opportunities to assist the Company in expanding its business.  Upon
execution of the agreement, JEC was entitled to receive 500,000 shares of the
Company’s common stock, however,were not issued and after December 31, 2009 JEC
waived the right to receive them.The Company will also pay to JEC a fee of
$20,000 for each letter of intent that the Company executes with a party in
connection with a potential merger or acquisition with certain companies
identified in the agreement.  In the event that the Company closes a
merger or acquisition with any such company, the Company will pay to JEC a fee
of $150,000.  This agreement also provides for the reimbursement of
reasonable operating expenses, including costs for travel, cost of preparation
of documents, reasonable fees and expenses of retained professionals and legal
expenses, not to exceed $10,000 without prior consent of the
Company.  Since inception of this agreement through December 31, 2009,
the Company has paid JEC $60,000.


6
 Table of Contents





In
November 2009, the Company executed a second Advisory and Management Fee
Agreement with JEC pursuant to which JEC would assist the Company in creating
and managing NBS.  Upon execution of the agreement, JEC was entitled
to receive -$100,000, payable 20% upon execution and the balance when NBS is
fully operational and (i) achieves a minimum gross revenue of $1,000,000 or (ii)
receives funding from outside sources of more than $1,000,000.  JEC
was also entitled to receive  100,000 shares of the Company’s common
stock or, at JEC’s election, an option exercisable for 100,000 shares of common
stock at a nominal exercise price however the shares and options were not issued
and after December 31, 2009 JEC waived the right to receive them. JEC is further
entitled to receive 20% of  the net profit derived from transactions
for the sale of steel by NBS.  Net profit means the gross proceeds
from such transactions less direct transaction expenses incurred in connection
therewith.  Such payments shall be made monthly during NBS’ full
operational life.   The agreement also provides for the
reimbursement of reasonable operating expenses, including costs for travel, cost
of preparation of documents, reasonable fees and expenses of retained
professionals and legal expenses, not to exceed $10,000 without prior consent of
the Company.  Since the inception of this agreement through December
31, 2009, the Company paid JEC $20,000.




ITEM 2. PROPERTIES




The
Company does not own any real property.  The Company’s maintains an
office at 146 West Plant Street, Suite 300, Winter Garden, Florida, but does not
currently have a lease or pay rent for such space.  The Company also
utilizes certain office and warehouse space at 13511 Granville Avenue, Clermont,
Florida, in a facility leased by Blue Earth Solutions, Inc. (“Blue Earth”), a
company in which certain of the Company’s consultants and their affiliates are
shareholders. There is a verbal agreement between the two parties that the rent
and related expenses are offset by professional services rendered by the
Company’s employees. There is no lease for such office and warehouse space and
the Company provides Blue Earth Solutions certain services and use of certain
personnel in consideration of the Company’s use of the space.  Because
the Company does not pay rent for any of the space it currently occupies or
uses, it may be removed from such premises at any time.  Currently,
Blue Earth pays approximately $6,100 per month for rent for the entire
building.  Should the Company be removed from its current space, have
rent imposed upon it or otherwise have to lease space for both its warehouse and
office needs, there is no assurance that the Company could rent space under
terms and rates that will be acceptable or affordable for the
Company.




ITEM 3. LEGAL PROCEEDINGS




On
October 13, 2009 in the General Court of Justice, Superior Court Division, Wake
County, North Carolina, Dan Ference, the former Chief Operating Officer of
QoVox, brought suit against the Company, QoVox, NetSymphony, Datameg
Corporation, and Bank of America. Mr. Ference contends he is owed unpaid salary
in the amount of $302,013. The Company believes that this claim has been
previously settled.  Mr. Ference denies that he settled this claim but
acknowledges receipt of consideration the Company believes was paid to him in
order to settle such claim. The Company and its subsidiaries have retained
counsel, and a mediation hearing is scheduled for April, 2010.  The
Company and its subsidiaries intend to vigorously defend the claim against them
and have filed counterclaims against Mr. Ference.




ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES





Market
Information


The
Company’s common stock is not  listed but is quoted and thinly traded
on the Over-the-Counter (OTC) Bulletin Board sponsored by the National
Association of Securities Dealers, Inc.   Until July 24,
2009, the Company’s common stock traded under the symbol DTMG.  Since
July 24, 2009, the Company’s common stock has traded under the symbol
NTUR.




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 Table of Contents




Holders


As
of March 23, 2010 there were approximately 558 shareholders of record of
the Company’s common stock. This number does not include beneficial owners of
the Company’s common stock whose shares are held in the names of various
dealers, clearing agencies, banks, brokers and other fiduciaries.





Dividend


The
Company has not declared or paid any dividends and does not intend to pay any
dividends in the foreseeable future to the holders of common stock. The Company
intends to retain future earnings, if any, for use in the operation and
expansion of its business. Any future decision to pay dividends on common stock
will be at the discretion of the board of directors and will depend on the
Company’s financial condition, results of operations, capital requirements and
other factors the board of directors may deem relevant.





Securities
Authorized for Issuance under Equity Compensation Plans


The
Company has not established any equity compensation plans as of the date of this
annual report on Form 10-K, however the Company may establish such plans in the
future.




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





The
following discussion and analysis should be read in conjunction with the audited
financial statements and notes thereto appearing elsewhere in this annual report
on Form 10-K.





Plan of
Operation





The
Company intends to operate its business primarily through its current
subsidiaries, as described above, as well as entities that may be formed or
acquired in the future.





Results of
Operations





For the
period from inception (March 2, 2009) to December 31, 2009 the Company incurred
a net loss from continuing operations of $1,478,983; the major components of
this operating loss were as follows:




Expense Item
      Description:
            
            AmountConsulting Expenses
      (1)
            
            $
            359,813Bad Debt Expense on
      Note Receivable (2)
            
            
            300,000Professional Fees
      (3)
            
            
            296,895Salaries, Wages
      & Personnel Costs (4)
            
            
            223,634All Other
    (5)
            
            
            298,641Total Net
    Loss
            
            $
            1,478,983




(1)
            Consulting
      Expenses were principally incurred for business brokers and financial and
      operational research for potential acquisitions of the
      Company.


(2)
            Bad
      Debt Expense on Note Receivable was incurred on two separate outstanding
      Notes Receivable (see Note D of the Footnotes to the Financial Statements)
      where collection is doubtful.


(3)
            Professional
      Fees include bookkeeping, accounting, auditing and legal fees incurred in
      conjunction with the Company’s public filings processes as well for
      occasional external help with day-to-day operations, as the Company has
      not hired its permanent accounting or legal
  staff.


(4)
            Salaries,
      Wages & Personnel Costs are for the principal executive officers as
      noted above.


(5)
            All
      Other expenses include travel, entertainment, supplies, postage and other
      General & Administrative expenses incurred in the day to day
      operations of the Company.




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Liquidity and Capital
Resources





The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern.  Currently, our sources of cash are
limited to our current cash reserves.  Cash on hand was $689,899 as of
December 31, 2009.  For the year ended December 31, 2009, the Company
incurred a net loss of $1,478,983 and used $886,477 of cash from operations
during 2009 which was funded by proceeds from equity
financings.  There is no assurance that such financing will be
available in the future.  In view of these matters, there is
substantial doubt that the Company will continue as a going
concern.


At
December 31, 2009 we had $689,899 of cash on hand, however our current
businesses are operating on a negative cash flow basis.  Our ability
to continue to operate our current businesses as a going concern and to acquire
and operate additional businesses in the future will be dependent upon raising
equity capital and generating positive cash flow from our existing
businesses.  There are no assurances that we will be successful in
raising equity capital at all, or that any capital available to us will be
available on terms and conditions acceptable to us.  There are also no
assurances that our existing businesses will be successful in generating cash
flow sufficient to sustain them and allow their continued
development.  We do not anticipate that we will have access to debt
financing under terms acceptable to us in the foreseeable future.  As
a result, there is significant risk to us in terms of having limited cash
resources with which to continue our operations as currently conducted or to
pursue new business opportunities. Either of these outcomes would materially and
adversely affect our results of operations, financial performance and stock
price.





We
believe we currently have sufficient cash to fund our operations through June,
2010. The extent to which we can sustain our operations beyond such date will
depend on our ability to generate cash from operations or from future equity
financing. However, there can be no assurance that we will be able to generate
sufficient cash flow from operations or to raise additional capital from equity
financing to permit us to continue our operations beyond such date.





The
financial statements of the Company do not include any adjustments relating to
the recoverability and classification of recorded assets, or the amounts and
classifications of liabilities that might be necessary should the Company be
unable to continue as a going concern.




RECENT
ACCOUNTING PRONOUNCEMENTS




See Note
C to the consolidated financial statements in Part 1 of this Annual Report on
Form 10-K for information related to new accounting pronouncements.




OFF-BALANCE
SHEET ARRANGEMENTS




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




9
 Table of Contents




ITEM 8. FINANCIAL STATEMENTS





Natural
Blue Resources, Inc. and Subsidiaries


Consolidated
Financial Statements




Period
from March 2, 2009 (inception) to December 31, 2009








PageReport of Independent Registered
      Public Accounting Firm for the period from March 2, 2009 (inception) to
      December 31, 2009
              11Financial
      Statements:Balance
      Sheet
              12Statement of
      Operations
              13Statement of Stockholders’
      Equity
              15Statement of Cash
      Flows
              14Notes to Financial
      Statements
              16





10
 Table of Contents





Report of Independent Registered Public Accounting
Firm








Board of
Directors and Stockholders


Natural
Blue Resources, Inc.




We have
audited the accompanying balance sheet of Natural Blue Resources, Inc. and
subsidiaries (“the Company”) as of December 31, 2009, and the related statements
of operations, stockholders’ equity, and cash flows for the period from March 2,
2009 (inception) to December 31, 2009. These financial statements are the
responsibility of the Company’s management. Our responsibility is to express an
opinion on these financial statements based on our audit.




We
conducted our audit 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 controls 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 also 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 audit provides 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 Natural Blue Resources, Inc. and
subsidiaries as of December 31, 2009, and the results of its operations and its
cash flows for the period then ended, in conformity with accounting principles
generally accepted in the United States.




The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern.  As discussed in Note B, the Company
has incurred significant losses since inception and used $886,477 of cash from
operations during 2009.  These factors raise substantial doubt about
the Company's ability to continue as a going concern. Management's plans in
regard to these matters are also discussed in Note B.  The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.




/s/
Cross, Fernandez & Riley LLP




Orlando,
Florida


April 2,
2010





11
 Table of Contents




NATURAL
BLUE RESOURCES, INC. AND SUBSIDIARIES
 (A
Development Stage Enterprise)
 Consolidated Balance Sheet


ASSETSDecember
      31,2009CURRENT
      ASSETSCash
            
            $
            689,899Note
      Receivable, net
            
            
            150,855Prepaid
      Expenses
            
            
            2,604Total
      Current Assets
            
            
            843,358EQUIPMENT
            
            
            463,849OTHER
      ASSETSInvestment
      in available-for-sale securities
            
            
            133,750TOTAL
      ASSETS
            
            $
            1,440,956LIABILITIES AND STOCKHOLDERS'
      EQUITYCURRENT
      LIABILITIESAccounts
      payable and accrued expenses
            
            $
            630,311Notes
      payable - current portion
            
            
            253,885TOTAL
      LIABILITIES
            
            
            884,195STOCKHOLDERS'
      EQUITYCommon
      stock, $0.0001 par value; 493,000,000 shares authorized,49,285,733
      shares issued and outstanding, atDecember
      31, 2009
            
            
            4,929Additional
      paid-in capital
            
            
            2,432,065Unrealized
      net (loss) on available for sale securities
            
            
            (401,250
            )Deficit
      accumulated during the development stage
            
            
            (1,478,983
            )Total
      Stockholders' Equity
            
            
            556,761TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
            
            $
            1,440,956The
      accompanying notes are an integral part of the financial
      statements.





12
 Table of Contents




NATURAL BLUE RESOURCES, INC. AND
SUBSIDIARIES


(A Development Stage Enterprise) Consolidated Statements of Operations


From
      March 2, 2009 (inception) toDecember
      31, 2009NET
      SALES
              
              $
              -TOTAL
      OPERATING EXPENSES
              
              
              1,470,202LOSS
      FROM OPERATIONS
              
              
              (1,470,202
              )OTHER
      EXPENSEInterest,
      net
              
              
              8,781Total
      Other Expense
              
              
              8,781LOSS
      BEFORE INCOME TAXES
              
              
              (1,478,983
              )PROVISION
      FOR INCOME TAXES
              
              
              -NET
      LOSS
              
              $
              (1,478,983
              )BASIC
      AND DILUTED:Net
      loss per common share
              
              $
              0.03Weighted
      average shares outstanding
              
              
              43,558,609
 The
accompanying notes are an integral part of the financial
statements.
  13
 Table of Contents
  NATURAL
BLUE RESOURCES, INC. AND SUBSIDIARIES
 (A
Development Stage Enterprise)
 Consolidated Statements of Cash Flows
 From
      March 2, 2009 (inception) toDecember
      31, 2009CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
              
              $
              (1,478,983
              )Adjustments
      to reconcile net loss to net cash used by operating
      activities:Reserve
      for notes receivable and advances
              
              
              300,000Changes
      in operating assets and liabilities:
              
              
              -Increase/(Decrease)
      in accounts payable and accruals
              
              
              286,045Increase/(Decrease)
      in prepaids
              
              
              (2,604
              )Increase/(Decrease)
      in accrued interest
              
              
              9,065Net
      cash used by operating activities
              
              
              (886,477
              )CASH
      FLOWS FROM INVESTING ACTIVITIES:Cash
      Acquired in share exchange with Datameg
              
              
              135,818Issuance
      of notes receivable
              
              
              (350,000
              )Advance
      of funds to Blue Earth Solutions, Inc.
              
              
              (100,000
              )(Increase)/decrease
      in interest income
              
              
              (855
              )Purchase
      of equipment
              
              
              (463,849
              )Purchase
      of investments
              
              
              (85,000
              )Net Cash Used by Investing Activities
              
              
              (863,886
              )CASH
      FLOWS FROM FINANCING ACTIVITIES:Proceeds
      from private placement
              
              
              2,440,262Net Cash Provided by Financing Activities
              
              
              2,440,262NET
      INCREASE IN CASH AND CASH EQUIVALENTS
              
              
              689,899CASH
      AND CASH EQUIVALENTS, BEGINNING OF PERIOD
              
              
              -CASH
      AND CASH EQUIVALENTS, END OF PERIOD
              
              $
              689,899SUPPLEMENTAL
      SCHEDULE OF NONCASH ACTIVITIES:Non
      Cash impact of Reverse Merger
              
              $
              3,272




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




14
 Table of Contents




Natural
Blue Resources, Inc. and Subsidiaries


(A Development Stage
Enterprise)


Statement of Stockholders’ Equity


Common
      Stock
                
                
                Capital
      in Excess of Par Value
                
                
                Comprehensive
      Items
                
                
                Deficit
      Accumulated during Development Stage
                
                
                Total
      Stockholders' EquityShares
                
                AmountSales of common stock:April
      4, 2009
                Initial capitalization
                
                38,226,113
                
                $
                3,822
                
                
                $
                170
                
                
                $
                -
                
                
                $
                -
                
                
                $
                3,991April
      4, 2009
                Shares
      issued to Kaleida EcoVentures, Inc.
                
                4,000,000
                
                
                400
                
                
                
                400
                
                
                
                -
                
                
                
                -
                
                
                
                800April
      14, 2009
                Private
      placement
                
                2,435,472
                
                
                247
                
                
                
                2,435,228
                
                
                
                -
                
                
                
                -
                
                
                
                2,435,475Unrealized
      gain on available for sale investments
                
                -
                
                
                -
                
                
                
                -
                
                
                
                (401,250
                )
                
                
                -
                
                
                
                (401,250
                )July
      24, 2010
                Recapitalization
      from Reverse Merger
                
                4,624,148
                
                
                461
                
                
                
                (3,733
                )
                
                
                -
                
                
                
                -
                
                
                
                (3,272
                )Net
      Loss for the Period
                
                -
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (1,478,983
                )
                
                $
                (1,478,983
                )Balances
      at December 31, 2009
                
                49,285,733
                
                $
                4,929
                
                
                $
                2,432,065
                
                
                $
                (401,250
                )
                
                $
                (1,478,983
                )
                
                $
                556,761
 The
accompanying notes are an integral part of the financial
statements.




15
 Table of Contents





NATURAL
BLUE RESOURCES, INC. AND SUBSIDIARIES


NOTES  TO CONSOLIDATED FINANCIAL
STATEMENTS


From
March 2, 2009 (inception) to December 31, 2009








A. BASIS
OF PRESENTATION AND ORGANIZATION





Overview


Natural
Blue Resources, Inc. (the “Company”) is incorporated in the State of
Delaware.





The
principal business of the Company is exploring, acquiring and developing various
interrelated “green” businesses, including waste stream recycling, plastic and
steel recycling, and a “print responsibly” business segment that will, whenever
possible, use recycled printing processes both online and in the traditional
print process. The Company is also exploring entering into the robust and
eco-friendly business of energy management and generally intends to acquire,
develop and operate businesses that generally have existing earnings and
quality, knowledgeable management in place and that utilize proprietary,
state-of-the-art technology. The Company intends to develop these businesses
into an interrelated, environmentally friendly company.





The
Company is in the development stage and the Company’s activities during the
development stage include developing a business plan and raising
capital.




Change
of Control


On July
24, 2009, the Company entered into a Share Exchange Agreement (the “Share
Exchange Agreement”) with Natural Blue Resources, Inc., a Nevada corporation,
(“NBRN”). Pursuant
to the Share Exchange Agreement, the Company acquired all of NBRN’s outstanding
common stock consisting of 44, 661,585 shares in exchange for the right to
receive a number of shares that would equal 90% of the issued and outstanding
shares of the Company’s common stock upon completion of the transaction. The
Company issued 44,356,598 shares of our common stock to the NBRN shareholders.
The exchange ratio of the Company to NBRN common stock in terms of number of
shares was approximately .993 to 1.00.  As a result of the
transaction, NBRN became a wholly owned subsidiary of the Company and the
Company became subject to a change of control with the former shareholders of
NBRN owning 90% of the Company’s outstanding common stock, including voting
control of the Company. Because NBRN’s former stockholders own a majority of the
Company’s outstanding voting common stock, and NBRN’s management has actual
operational control of the Company, NBRN is considered the accounting acquirer
in the share exchange transaction.  The transaction is considered a
reverse merger transaction for accounting purposes and is accounted for as a
capital transaction in substance equivalent to the issuance of NBRN’s common
stock for the net monetary assets of the Company, accompanied by a
recapitalization.  Accordingly, the accounting with respect to the
transaction does not contemplate the recognition of assets of the accounting
acquirer, such as goodwill.  Consolidated financial statements
presented herein and subsequent to the transaction reflect the consolidated
financial assets and liabilities and operations of NBRN at their historical
costs giving effect to the recapitalization, as if NBRN had been the Company
during the periods presented.





As a
condition of, and prior to, to the closing of the share exchange transaction,
NBRN effected a 1 for 100 reverse stock split on July 24,
2009.  Following the reverse stock split, but before the closing of
the share exchange, there were 4,928,511 shares of the Company’s common stock
outstanding.  Upon closing of the share exchange, there were
49,285,733 shares of the Company’s common stock outstanding, including shares
issued to the NBRN stockholders in the share exchange.  Our
stockholders approved the reverse stock split and the share exchange transaction
by written consent on June 18, 2009.





On July
24, 2009, concurrent with the closing of the transaction, the Company changed
its name from “Datameg Corporation” to “Natural Blue Resources,
Inc.”





Operations


The
Company is a development stage company currently engaged in the business of
exploring, acquiring and developing various interrelated “green” businesses,
including waste stream recycling, plastic and steel recycling. The Company
intends to acquire, develop and operate businesses that generally have existing
earnings and quality, knowledgeable management in place and that utilize
proprietary, state-of-the-art technology. The Company intends to develop these
businesses into an interrelated, environmentally friendly company.




16
 Table of Contents




As of
December 31, 2009, the Company had five employees, all of whom are full-time
employees.





As of
December 31, 2009, the Company had five wholly-owned subsidiaries:





·
            Natural
      Blue Resources, Inc., a Nevada corporation
  (“NBRN”);





·
            NetSymphony
      Corporation, an inactive North Carolina
      corporation(“NetSymphony”),





·
            QoVox
      Corporation, an inactive North Carolina corporation
    (“QoVox”),





·
            EcoWave,
      LLC a Delaware limited liability company (“EcoWave”);
  and





·
            Natural
      Blue Steel, Inc., a Delaware corporation
  (“NBS”).





In
addition, the Company owns 40% of the equity interests of CASCommunications,
Inc., an inactive Florida corporation.





The
Company operates under the name of Natural Blue Resources, Inc. and trades under
the symbol NTUR on the OTC Bulletin Board.




B. GOING
CONCERN; OPERATING LOSSES




The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern.  Currently, our sources of cash are
limited to our current cash reserves.  Cash on hand was $689,899 as of
December 31, 2009.  For the year ended December 31, 2009, the Company
incurred a net loss of $1,478,983 and used $886,477 of cash from operations
during 2009 which was funded by proceeds from equity
financings.  There is no assurance that such financing will be
available in the future.   The conditions described above raise
substantial doubt about our ability to continue as a going
concern.


As more
fully discussed in Note A of the consolidated financial statements, we completed
a share exchange transaction on July 24, 2009. We entered into this transaction
to provide a platform for raising capital. Our continuation as a going concern
is dependent upon strategically deploying our existing capital, raising
additional capital and further developing our green technologies so that they
will become commercially viable and generate revenue. However, there can be no
assurances that capital will be available at terms acceptable to our management,
if at all, or that our acquired or developed technologies can achieve profitable
operations. The financial statements of the Company do not include any
adjustments relating to the recoverability and classification of recorded
assets, or the amounts and classifications of liabilities that might be
necessary should the Company be unable to continue as a going
concern.





C.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES




FASB
Codification:




In June 2009, the
FASB issued ASC 105, Generally
Accepted Accounting Principles, (“Codification”) effective for interim
and annual reporting periods ending after September 15, 2009. This
statement establishes the Codification as the source of authoritative accounting
principles used in the preparation of financial statements in conformity with
generally accepted accounting principles. The Codification does not replace or
affect guidance issued by the SEC or its staff. As a result of the Codification,
the references to authoritative accounting pronouncements included herein in
this Annual Report on Form 10-K now refer to the Codification topic section
rather than a specific accounting rule as was past practice.




17
 Table of Contents




Principles
of Consolidation:


The
accompanying consolidated financial statements are presented on the basis that
NBRN is the accounting acquirer in the share exchange transaction with the
Company.   The consolidation of the financial statements includes
our wholly-owned subsidiaries, QoVox, NetSymphony, EcoWave  and
NBS.  In addition, the financial statements of the Company have been
consolidated into the NBRN financial statements.  All intercompany
transactions and balances have been eliminated in the
consolidation.





Use of
Estimates:


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





Risk and
Uncertainties:


Our
future results of operations and financial condition will be impacted by the
following factors, among others: our lack of capital resources, dependence on
the worldwide trend toward green solutions and rapidly changing technology,
dependence on third-party management that operates the companies in which we
invest and dependence on the successful development and marketing of new
products in new and existing markets. Generally, we are unable to predict the
future status of these areas of risk and uncertainty. However, negative trends
or conditions in these areas could have an adverse affect on our
business.





Cash:


Cash is
maintained with a major financial institution in the United States. Deposits may
exceed the amount of insurance provided on such deposits. Cash equivalents with
an original maturity of three months or less are considered to be cash
equivalents.  The Company does not have any cash equivalents at
December 31, 2009.





Prepaid
Expenses:


The
Company pays certain expenses, notably insurance, in advance of the insured year
and expenses the related portion each reporting period.





Equipment:


Equipment
consists of the microwave based technology and the trailer to transport the
equipment for EcoWave and was acquired in December 2009.  The
equipment was not in service at December 31, 2009 and therefore was not
depreciated.  Subsequent to year end, we placed the equipment into
service and will depreciate the equipment over its estimated useful life of
seven years.





Fair
Value of Financial Instruments:


In
September 2006, the Financial Accounting Standards Board (FASB) introduced a
framework for measuring fair value and expanded required disclosure about fair
value measurements of assets and liabilities.  The Company adopted the
standard for those financial assets and liabilities as of the beginning of the
2008 fiscal year and the impact of adoption was not significant. FASB Accounting
Standards Codification (ASC) 820 “Fair Value Measurements and
Disclosures” (ASC 820) defines fair value as the exchange price that
would be received for an asset or paid to transfer a liability (an exit price)
in the principal or most advantageous market for the asset or liability in an
orderly transaction between market participants on the measurement date. ASC 820
also establishes a fair value hierarchy that distinguishes between
(1) market participant assumptions developed based on market data obtained
from independent sources (observable inputs) and (2) an entity’s own
assumptions about market participant assumptions developed based on the best
information available in the circumstances (unobservable inputs). The fair value
hierarchy consists of three broad levels, which gives the highest priority to
unadjusted quoted prices in active markets for identical assets or liabilities
(Level 1) and the lowest priority to unobservable inputs (Level 3). The three
levels of the fair value hierarchy are described below:





●
            Level
      1—Unadjusted quoted prices in active markets that are accessible at the
      measurement date for  identical, unrestricted assets or
      liabilities.●
            Level
      2—Inputs other than quoted prices included within Level 1 that are
      observable for the asset or liability; either directly or indirectly,
      including quoted prices for similar assets or liabilities in active
      markets; quoted prices for identical or similar assets or liabilities in
      markets that are not active; inputs other than quoted prices that are
      observable for the asset or liability (e.g. interest rates); and inputs
      that are derived principally from or corroborated by observable market
      data by correlation or other means.●
            Level
      3—Inputs that are both significant to the fair value measurement and
      unobservable.




18
 Table of Contents




Fair
value estimates discussed herein are based upon certain market assumption and
pertinent information available to management as of December 31,
2009.  The respective carrying value of certain on-balance-sheet
financial instruments approximated their fair values due to the short-term
nature of these instruments.  These financial instruments include
investments in available-for-sale securities and accounts payable and accrued
expenses.  The fair value of the Company’s note payable is estimated
based on current rates that would be available for debt of similar terms which
is not significantly different than its stated value.





The
Company has also applied ASC 820
 for all non-financial
assets and liabilities measured at fair value on a non-recurring basis. The
adoption of ASC 820 for non-financial assets and liabilities did not have a
significant impact on the Company’s financial statements.





Investments:


Our
investments consist of common stock of publicly traded companies and are valued
based on the closing stock price. We account for our investments in accordance
with ASC Topic 320, Investments. We have
designated our investments at December 31, 2009 as available-for-sale and
reported these investments at fair value, with unrealized gains and losses
recorded in other comprehensive income (loss). We determined the fair value of
these investments based on the closing traded stock price on December 31,
2009.  We base the cost of the investment sold on the specific
identification method using market rates.





Other-Than-Temporary
Impairment:


All of
our non-marketable and other investments are subject to a periodic impairment
review. Investments are considered to be impaired when a decline in fair value
is judged to be other-than-temporary. The indicators that we use to identify
those events and circumstances include:





●
            the
      investee’s revenue and earnings trends relative to predefined milestones
      and overall business prospects;●
            the
      technological feasibility of the investee’s products and
      technologies;●
            the
      general market conditions in the investee’s industry or geographic area,
      including regulatory or economic changes;●
            factors
      related to the investee’s ability to remain in business, such as the
      investee’s liquidity, debt ratios, and the rate at which the investee is
      using its cash; and●
            the
      investee’s receipt of additional funding at a lower valuation. If an
      investee obtains additional funding at a valuation lower than our carrying
      amount or a new round of equity funding is required for the investee to
      remain in business, and the new round of equity does not appear imminent,
      it is presumed that the investment is other than temporarily impaired,
      unless specific facts and circumstances indicate
  otherwise.





Income
Taxes:


The
Company, a C-corporation, accounts for income taxes under ASC Topic 740 (SFAS
No. 109).Under
this method, deferred tax assets and liabilities are determined based on
differences between the financial reporting and tax bases of assets and
liabilities and are measured using the enacted tax rates and laws that will be
in effect when the differences are expected to reverse. Valuation allowances are
established when necessary to reduce deferred tax assets to the amount expected
to be realized.





The
Company adopted the provisions of FASB ASC 740-10 “Uncertainty in Income Taxes”
(ASC 740-10), on January 1, 2007. The Company has not recognized a
liability as a result of the implementation of ASC 740-10. A reconciliation of
the beginning and ending amount of unrecognized tax benefits has not been
provided since there is no unrecognized benefit since the date of adoption. The
Company has not recognized interest expense or penalties as a result of the
implementation of ASC 740-10.  If there were an unrecognized tax
benefit, the Company would recognize interest accrued related to unrecognized
tax benefits in interest expense and penalties in operating
expenses.





Comprehensive
Income:


ASC Topic
220 (SFAS No. 130) establishes standards for reporting comprehensive income
and its components. Comprehensive income is defined as the change in equity
during a period from transactions and other events from non-owner
sources.  Per Note E of the consolidated financial statements, the
Company has purchased available-for-sale securities that are subject to this
reporting.





19
 Table of Contents




Loss Per
Common Share:


The
Company reports basic and diluted earnings per share (EPS) according to the
provisions of ASC Topic 260, which requires the presentation of basic EPS and,
for companies with complex capital structures, diluted EPS. Basic EPS excludes
dilution and is computed by dividing net income (loss) available to common
stockholders by the weighted average number of common shares outstanding during
the period. Diluted EPS is computed by dividing net income (loss) available to
common stockholders, adjusted by other changes in income or loss that would
result from the assumed conversion of those potential common shares, by the
weighted number of common shares and common share equivalents (unless their
effect is antidilutive) outstanding. The Company also considers the potential
effects of the exercise of options and warrants outstanding during the reporting
period. At December 31, 2009, the Company had options outstanding to employees
to acquire 45,000 common shares. Exercising the options would have an
antidilutive effect for existing shareholders. Thus, these options are not
included in the calculation of diluted loss per share, resulting in basic and
diluted loss per share being equal.


Recently
Issued Accounting Pronouncements:


In June
2009, the Financial Accounting Standards Board (“FASB”) established the
Accounting Standards Codification (“Codification” or “ASC”) as the source of
authoritative accounting principles recognized by 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.





In
October 2009, the FASB issued Accounting Standard Update (“ASU”) No. 2009-13,
Multiple-Deliverable Revenue
Arrangements (“ASU 2009-13”) and No. 2009-14, Certain Revenue Arrangements that
include Software Elements (“ASU 2009-14”). These standards update FASB
ASC 605, Revenue Recognition(“ASC 605”) and FASB ASC 985, Software(“ASC 985”). The
amendments to ASC 605 requires entities to allocate revenue in an arrangement
using estimated selling prices of the delivered goods and services based on a
selling price hierarchy. The amendments to ASC 985 remove tangible products from
the scope of software revenue guidance and provide guidance on determining
whether software deliverables in an arrangement that includes a tangible product
are covered by the scope of the software revenue guidance. These amendments to
ASC 605 and ASC 985 should be applied on a prospective basis for revenue
arrangements entered into or materially modified in fiscal years beginning on or
after June 15, 2010, with early adoption permitted. The Company adopted these
amendments on January 1, 2010.  Management does not believe that the
adoption of this standard will have any impact on the Company’s financial
statements.
  In
January 2010, the FASB issued ASU No. 2010-06, Fair Value Measurements and
Disclosures (“ASU 2010-06”).  This standard updates FASB ASC
820, Fair Value
Measurements (“ASC 820”). ASU 2010-06 requires additional disclosures
about fair value measurements including transfers in and out of Levels 1 and 2
and separate disclosures about purchases, sales, issuances, and settlements
relating to Level 3 measurements. It also clarifies existing fair value
disclosures about the level of disaggregation and about inputs and valuation
techniques used to measure fair value. The standard is effective for interim and
annual reporting periods beginning after December 15, 2009 except for the
disclosures about purchases, sales, issuances and settlements which is effective
for fiscal years beginning after December 15, 2010 and for interim periods
within those fiscal years.  The Company adopted ASU 2010-06 on January
1, 2010, which had no material impact on the financial statements.
  20
 Table of Contents





Other
recent accounting pronouncements issued by the FASB (including its EITF), the
AICPA, and the SEC did not or are not believed by management to have a material
impact on the Company’s present or future financial statements.





D. NOTE
RECEIVABLE




On September
15, 2009, the Company entered into a letter of intent to purchase the assets of
On Demand Color Group, LLC and certain of its affiliates (“On
Demand”).In
accordance with the letter of intent the Company made a loan to On Demand in the
principal amount of $150,000 which accrues interest at a rate of 2% per
annum.  Such loan is evidenced by a promissory note dated September
16, 2009.  This amount, along with the accrued interest, is reflected
as a Note Receivable on the balance sheet. No closing on the potential purchase
of the assets of On Demand has occurred and negotiations relating to the
purchase price and format of the new entity are still
ongoing.


On May
22, 2009, NBRN made a loan in the amount of $200,000 to Samir Burshan
(“Burshan”) who was a Director of NBRN at that time.  Mr. Burshan was
appointed to the Board of the Company on August 24, 2009, and later resigned as
a Director of the Company on October 31, 2009.  Such loan is evidenced
by a promissory note dated January 29, 2010 and effective as of May 22, 2009,
bears interest at the rate of 8% per annum and is due and payable in full on May
22, 2012.   The note is non-recourse to Burshan, but is to be
secured by the assignment of a promissory note in the principal amount of
$200,000 made by Prism One, Inc. (“Prism One”) to Burshan.  The
Prism One note bears interest at the rate of 8% per annum and is payable in full
on or about May 22, 2012. It is the Company’s belief that there exists
substantial doubt that Prism One will be able to meet its obligations and
therefore, as of December 31, 2009, NBRN has fully reserved for this
loan.




In
October, 2009 NBRN signed a non-binding letter of intent to potentially acquire
the assets of Blue Earth Solutions, Inc.  In connection therewith,
NBRN advanced $100,000 to Blue Earth Solutions, Inc.  Management
determined as of December 31, 2009 that the deposit was uncollectible and has
been reserved as of December 31, 2009.




E.
INVESTMENTS




In
conjunction with the share exchange transaction, the Company has reviewed their
investments held and has valued them at fair value as of December 31,
2009.





Investment Type:
            
            Fair
      Value at
              December
      31, 2009Common
      Stock 1,000,000 shares in Blue Earth Solutions, Inc,
      $0.07/share
            
            $
            70,000Common
      Stock 375,000 shares in Prism One, $0.17/share
            
            
            63,750Total
      Investments available for sale
            
            $
            133,750





Fair
value of the listed investments was determined by the closing price of the
related common stock on December 31, 2009; as of April 1, 2010 the closing price
of the Blue Earth Solutions, Inc. common stock (BESN) was $0.03 and the closing
price of Prism One (PMOZ) common stock was $0.250. Management intends to divest
both of these investments.  Management views the price decline of the
Blue Earth Solutions,  Inc. investment as temporary in nature.
However, the Company’s investment in both Blue Earth Solutions Inc., and Prism
One, Inc. are subject to the specific risks applicable to each of Blue Earth
Solutions, Inc and Prism One specifically, and to market risks
generally.


F. NOTES
PAYABLE





Balance
      at
              Dec
      31, 2009On
      July 1, 2008, QoVox executed a promissory note in favor of a consultant
      for $230,605, which represents past-due fees previously included in
      accounts payable. The note bears interest at the rate of 8% per annum.
      Payment terms stated therein require monthly installments of $1,000 paid
      to the consultant the last day of each month commencing July 31, 2008
      through December 31, 2008; $2,000 per month starting January 2009 through
      September 2009; and $3,000 per month thereafter until the remaining
      balance is paid. QoVox made $3,000 in principal payments during 2008, and
      $1,000 in February 2009, resulting in a payable balance of $226,605 at
      December 31, 2009.  QoVox is currently in default on the note,
      so the principal balance has been reflected as a current
      liability.  We are currently disputing the balance of the note
      but have recorded further interest expense of $8,781during the year ended
      December 31, 2009, which we have included in the Notes Payable balance at
      December 31, 2009.
            
            
            253,885Total
      notes payable
            
            
            253,885




21
 Table of Contents




H. INCOME
TAXES




As of
December 31, 2009, the Company had approximately $1,176,228 in net operating
loss carry forwards for federal and state income tax purposes which expire
between 2009 and 2029.  Generally, these can be carried forward and
applied against future taxable income.  However, as a result of stock
offerings and stock issued in connection with acquisitions, the Company’s use of
these NOLs may be limited under the provisions of Section 382 of the Internal
Revenue Code of 1986, as amended.  The Company is in the process of
evaluating the implications of Section 382 on its ability to utilize some or all
of its NOLs.


Components
of deferred tax assets and (liabilities) are as follows:




December31,
      2009Reserves
      for notes receivable and advances
              
              $
              112,890Net
      operating loss carry forwards
              
              
              442,615555,505Valuation
      Allowance
              
              
              (555,505
              )Difference
              
              $
              0







In
accordance with FASB ASC 740 “Income Taxes”, valuation allowances are provided
against deferred tax assets, if, based on the weight of available evidence, it
is more likely than not that some or all of the deferred tax assets will not be
realized. The Company has evaluated its ability to realize some or all of the
deferred tax assets on its balance sheet and has established a valuation
allowance in the amount of $555,505at December 31, 2009.


The
following is a reconciliation of tax computed at the statutory federal rate to
the income tax expense in the statements of operations for the year ended
December 31, 2009.




2009Amount
                
                
                %Tax
      benefit at US statutory rate
                
                $
                (399,917
                )
                
                
                34.0State
      income tax benefit, net of federal benefit
                
                
                (42,697)
                
                
                
                3.6Change
      in valuation allowance
                
                
                442,615
                
                
                
                (37.6
                )Income
      Tax Expense
                
                
                0
                
                
                
                0.0


22
 Table of Contents





I. STOCK
OPTIONS




At  December
31, 2009, the Company had options outstanding to three former employees for
prior services rendered  in the total amount of 45,000 common shares.
These options are fully vested and exercisable at December 31,
2009.





Options
      Outstanding
              
              Date
      Issued
              
              Date Options
      Expire
              
              Exercise
      Price25,000
              
              November
      23, 2004
              
              January
      1, 2013
              
              $
              5.3810,000
              
              June
      1, 2005
              
              June
      1, 2011
              
              $
              3.3210,000
              
              August
      25, 2005
              
              January
      1, 2011
              
              $
              28.2545,000




J.
RELATED PARTY TRANSACTIONS




At
December 31, 2009, the Company was not indebted to any related
parties.





In
November 2009, the Company executed an Engagement and Advisory Fee Agreement
with JEC Corp. (“JEC”), which is owned by one of our shareholders and the
shareholder is related to our consultants.  Pursuant to the agreement,
JEC will provide to the Company professional services in identifying and
representing the Company with respect to potential future merger and acquisition
opportunities to assist the Company in expanding its business.  Upon
execution of the agreement, JEC was entitled to receive 500,000 shares of the
Company’s common stock, however,were not issued and after December 31, 2009 JEC
waived the right to receive them.The Company will also pay to JEC a fee of
$20,000 for each letter of intent that the Company executes with a party in
connection with a potential merger or acquisition with certain companies
identified in the agreement.  In the event that the Company closes a
merger or acquisition with any such company, the Company will pay to JEC a fee
of $150,000.  This agreement also provides for the reimbursement of
reasonable operating expenses, including costs for travel, cost of preparation
of documents, reasonable fees and expenses of retained professionals and legal
expenses, not to exceed $10,000 without prior consent of the
Company.  Since inception of this agreement through December 31, 2009,
the Company has paid JEC $60,000.
 
 In
November 2009, the Company executed a second Advisory and Management Fee
Agreement with JEC pursuant to which JEC would assist the Company in creating
and managing NBS.  Upon execution of the agreement, JEC was entitled
to receive (a) $100,000, payable 20% upon execution and the balance when NBS is
fully operational and (i) achieves a minimum gross revenue of $1,000,000 or (ii)
receives funding from outside sources of more than $1,000,000.  JEC
was also entitled to receive  100,000 shares of the Company’s common
stock or, at JEC’s election, an option exercisable for 100,000 shares of common
stock at a nominal exercise price however the shares and options were not issued
and after December 31, 2009 JEC waived the right to receive them  JEC
is further entitled to receive 20% of  the net profit derived from
transactions for the sale of steel by NBS.  Net profit means the gross
proceeds from such transactions less direct transaction expenses incurred in
connection therewith.  Such payments shall be made monthly during NBS’
full operational life.   The agreement also provides for the
reimbursement of reasonable operating expenses, including costs for travel, cost
of preparation of documents, reasonable fees and expenses of retained
professionals and legal expenses, not to exceed $10,000 without prior consent of
the Company.  Since the inception of this agreement through December
31, 2009, the Company paid JEC $20,000.





On May
22, 2009, NBRN made a loan in the amount of $200,000 to Samir Burshan
(“Burshan”) who was a Director of NBRN at that time.  Mr. Burshan was
appointed to the Board of the Company on August 24, 2009, and later resigned as
a Director of the Company on October 31, 2009.  Such loan is evidenced
by a promissory note dated January 29, 2010 and effective as of May 22, 2009,
bears interest at the rate of 8% per annum and is due and payable in full on May
22, 2012.   The note is non-recourse to Burshan, but is to be
secured by the assignment of a promissory note in the principal amount of
$200,000 made by Prism One, Inc. (“Prism One”) to Burshan.  The
Prism One note bears interest at the rate of 8% per annum and is payable in full
on or about May 22, 2012. It is the Company’s belief that there exists
substantial doubt that Prism One will be able to meet its obligations and
therefore, as of December 31, 2009, NBRN has fully reserved for this
loan.




23
 Table of Contents




K. LEGAL
PROCEEDINGS




On
October 13, 2009 in the General Court of Justice, Superior Court Division, Wake
County, North Carolina, Dan Ference, the former Chief Operating Officer of
QoVox, brought suit against the Company, QoVox, NetSymphony, Datameg
Corporation, and Bank of America. Mr. Ference contends he is owed unpaid salary
in the amount of $302,013. The Company believes that this claim has been
previously settled.  Mr. Ference denies that he settled this claim but
acknowledges receipt of consideration the Company believes was paid to him in
order to settle such claim. The Company and its subsidiaries have retained
counsel, and a mediation hearing is scheduled for April, 2010.  The
Company and its subsidiaries intend to vigorously defend the claim against them
and have filed counterclaims against Mr. Ference.





L.
ECOWAVE LICENSE AGREEMENT
  The
Company’s subsidiary, EcoWave, holds an exclusive worldwide,
excluding  the Republic of Korea,  use and technology
license to patent and technology rights for waste treatment using microwave
technology previously licensed by Kaleida Eco Ventures, Inc., a Delaware
corporation (“Kaleida”). EcoWave is required to pay a royalty to Kaleida of
$200,000 per installed unit. The license term shall remain in effect for the
life of the last-to-expire patents or for 20 years, whichever occurs
last.


M.
SUBSEQUENT EVENTS




On
September 15, 2009, the Company entered into a letter of intent to purchase the
assets of On Demand Color Group, LLC and certain of its affiliates (“On
Demand”). In
accordance with the letter of intent the Company made a loan to On Demand in the
principal amount of $150,000 which accrues interest at a rate of 2% per
annum.  Such loan is evidenced by a promissory note dated September
16, 2009.   On February 23, 2010, the Company entered into a
revised non-binding letter of intent to, among other things, extend the term of
letter of intent.  In accordance with the original letter of intent
the Company made a loan to On Demand in the principal amount of $150,000,
earning an initial interest rate of 2% per annum.  Such loan is
evidenced by a promissory note dated September 16, 2009.  This amount
is reflected as a Note Receivable on the balance sheet. The Company has made a
second loan to On Demand and its affiliates in the amount of $50,000 which also
bears interest rate of 2% per annum.  The non-binding letter of intent
contains various provisions that the Company and the Seller must comply with
before the transaction can close. Currently the Company is performing its due
diligence on this acquisition.





On March
5, 2010, the Company conducted a private placement of its common stock pursuant
to which the Company issued 316,176 shares of its common stock and received
gross proceeds of $268,750.


24
 Table of Contents
 
 ITEM 9A(T).  CONTROLS AND PROCEDURES




Disclosure
Controls and Procedures


The
Company’s management, consisting of its Chief Executive Officer and Chief
Financial Officer, evaluated the effectiveness of the design and operation of
the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e)
and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)) as of December 31, 2009. Based upon this evaluation, the Chief
Executive Officer and Chief Financial Officer concluded that, as of December 31,
2009, the Company’s disclosure controls and procedures were not effective in
providing reasonable assurance that information required to be disclosed in the
reports that the Company files or submits under the Exchange Act, are timely
recorded, processed, summarized and reported as required by the Exchange
Act.





Management’s
Annual Report on Internal Control over Financial Reporting


The
Company’s management is responsible for establishing and maintaining adequate
internal control over financial reporting (as defined in Rue 13a-15(f) under the
Exchange Act).  Internal control over financial reporting is a
process, including policies and procedures, designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of financial statements for external reporting purposes in accordance with U.S.
generally accepted accounting principles.  Based on the results of
this assessment, management concluded that the Company’s internal control over
financial reporting was ineffective as of December 31, 2009 based on such
criteria.





Management
did not use a formal framework to conduct the required evaluation of the
effectiveness of the Company’s disclosure controls and procedures or the
Company’s internal control over financial reporting since, in the view of
management, comparison with a formal framework was unwarranted because of (1)
the small size of the Company’s current operations and (2) the Company’s
executive management structure (consisting of only the Company’s principal
executive officer and principal financial officer) which enables management to
be aware of all transactions.  The Company has limited resources and
as a result, a material weakness in financial reporting currently exists,
because of our limited resources and personnel, including those described
below.




●The Company
      lacks personnel with the experience to properly analyze and record complex
      transactions in accordance with GAAP.● The
      Company has in insufficient quantity of dedicated resources and
      experienced personnel involved in reviewing and designing internal
      controls.  As a result, a material misstatement of the interim
      and annual financial statements could occur and not be prevented or
      detected on a timely basis.● The Company
      has not achieved the optimal level of segregation of duties relative to
      key financial reporting functions.● The Company
      does not have an audit committee or an independent audit committee
      financial expert.  While not being legally obligated to have an
      audit committee or independent audit committee financial expert, it is the
      management’s view that to have an audit committee, comprised of
      independent board members, and an independent audit committee financial
      expert is an important entity-level control over the Company’s financial
      statements.● The Company
      has not achieved an optimal segregation of duties for executive officers
      of the Company.




25
 Table of Contents




A
material weakness is a deficiency (within the meaning of the Public Company
Accounting Oversight Board (PCAOB) auditing standard 5) or combination of
deficiencies in internal control over financial reporting such that there is a
reasonable possibility that a material misstatement of the Company’s annual or
interim financial statements will not be prevented or detected on a timely
basis.  Management has determined that a material weakness exists due
to a lack of segregation of duties, resulting from the Company’s limited
resources and personnel.





Changes
in Internal Control over Financial Reporting


Except as
described above, there has been no change in the Company’s internal control over
financial reporting identified in connection with the evaluation made by
management required by paragraph (d) of Section 240.13a-15 or Section 240.15d-15
under the Exchange Act that occurred during the Company’s fourth fiscal quarter
that has materially affected, or is reasonably likely to materially affect, the
Company’s internal control over financial reporting.




Auditor’s
Report on Internal Control over Financial Reporting


This
annual report does not include an attestation report of the Company’s
independent 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.








26
 Table of Contents





PART
III





ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE





Directors
and Officers


The
following sets forth the names and ages of all of our directors and executive
officers as of the date of this annual report. Also provided herein is a brief
description of the business experience of each director and executive officer
during the past five years and an indication of directorships held by each
director in other companies subject to the reporting requirements under the
Federal securities laws. All of the directors will serve until the next annual
meeting of shareholders and until their successors are elected and qualified, or
until their earlier death, retirement, resignation or removal.  There are
no arrangements or understandings between any director or executive officer and
any other person pursuant to which the director or executive officer was
selected.





Toney Anaya, 66,Chief Executive Officer and Chairman
of the Board


Toney
Anaya has served as the Company’s Chief Executive Officer and Chairman of the
Board of Directors since July 24, 2009.  He is a former Governor
(1983-1986) and Attorney General of New Mexico (1975-1978). As Attorney General,
he is recognized for turning a previously obscure office into a major force as a
protector of consumer rights. As Governor, he focused on energy alternatives,
water development and conservation, the environment, education, economic
development, and provided leadership in investing of the state’s multi-billion
dollar trust funds. Known as a visionary, he successfully steered the state
through a national recession, transforming New Mexico into a more
technology-based economy and laid the groundwork for future deployment of rapid
rail transit, education and social reform.





Intermittently
throughout his professional career, Governor Anaya has been the principal of
Anaya Law Offices in Santa Fe, New Mexico, from which he represents major
corporate clients; pursues his own business development initiatives, including
real estate and energy projects; was a founding member of Valor
Telecommunications which provides telephone service in New Mexico, Texas, and
Oklahoma; for five years was a principal advisor to the country of Mexico during
negotiations and passage in the U.S. of the North American Free Trade Agreement.
He has served on many public and private boards and commissions, and currently
only is on the board of the Company.  In the 1960’s and 1970’s, he
also served seven years at the U.S. Department of Labor and U.S. Department of
State and five years as legal counsel to a U.S. Senator.  In 2009, New
Mexico Governor Bill Richardson tapped Anaya to oversee the state’s
implementation of billions of dollars of funding and other economic benefits
coming to the state from the federal “stimulus” law, the American Recovery &
Reinvestment Act helping establish a nationally-recognized office.





He has a
Juris Doctorate from American University School of Law and a B.A. from
Georgetown University.





Walter R. Cruikshank, 63,Chief Financial
Officer


Walter R.
Cruikshank has served as the Company’s Chief Financial Officer since August
2009.  In addition, Mr. Cruikshank is also Controller of Blue Earth
Solutions, Inc.  Prior to joining the Company, Mr. Cruikshank was the
District Controller for Waste Service of Florida from August 2007 to May 2008
and the Controller of Eye Centers of Florida from August 2005 to August
2007.  Mr. Cruikshank has held various general accounting positions in
numerous companies throughout his career.





He has a
Bachelors of Science degree from Rutgers University and holds an inactive
Certified Public Accounting license from the State of New Jersey.





Daryl Kim, Director


Mr. Kim
has served as a Director of the Company since August 24, 2009.  He has
served as the Director of Operations of Cornerstone Apparel, Inc. and has
actively managed the Papaya specialty clothing stores in the Florida region
since 2000.Mr. Kim
has also served as President of Vision Caanan Apparel, Inc. a retail clothing
store, since June, 2007 and is a partner in Kaleida Eco Ventures, Inc., an
eco-focused venture capital concern and is primarily responsible for identifying
and seeking out forward looking technologies and processes.  In
addition, Mr. Kim was a former director of Kaleida and upon the Company’s
acquisition of Eco Wave became a director of Eco Wave.





27
 Table of Contents





Code
of Ethics


The
Company has not adopted a formal code of ethics that applies to our officers,
directors and employees in accordance with applicable federal securities
laws.  Current management does not know why a code of ethics was not
adopted by previous Boards of Directors and management of the
Company.  Since the share exchange with NBRN’s stockholders, the
Company has pursued a number of corporate governance and business initiatives,
but has not had the resources to complete all of them.  The Company
intends to adopt a code of ethics prior to June 30, 2010, and will disclose such
code of ethics in a current report on Form 8-K.





Compliance
with Section 16(a) of the Exchange Act


Section 16(a)
of the Securities Exchange Act of 1934, as amended, requires each of the
Company’s directors and executive officers, and any beneficial owner of more
than 10 percent of the Company's common stock, to file reports
with the SEC. These include initial reports and reports of changes in the
individual’s beneficial ownership of the Company’s common stock. Such persons
are also required by SEC regulations to furnish the Company with copies of such
reports. To our knowledge, based solely on the review of such reports furnished
to the Company, the Company believes that during the year ended
December 31, 2009, (a) all directors and executive officers filed on a
timely basis the reports required by Section 16(a), and (b) all beneficial
owners of more than 10 percent of the Company's common stock filed on a timely
basis, except that Mrs. Patricia Cohen failed to report three transactions
and to file a Form 3 and a Form 5 with respect to her beneficial ownership of
Company common stock.  Mrs. Cohen is the beneficial owner of 5,844,465
shares of common stock comprised of 1,882, 457 shares owned by Mrs. Cohen,
1,991,060 shares owned by Mrs. Cohen's daughter, and 1,970,948 other shares for
which Mrs. Cohen holds the voting power and investment control through JEC
Corp., a Nevada corporation of which she is the sole owner.





Audit
Committee and Audit Committee Financial Expert


The
Company does not have a separately-designated standing audit committee
established in accordance with Section 3(a)(58)(A) of the Exchange Act, or a
committee performing similar functions.  The board of directors has
determined that the Company does not have an audit committee financial expert
serving on the board.  The Company does not have an audit committee
financial expert because it has been unable to attract and compensate an
individual with the necessary skills to serve in such role.  The
Company intends to identify and appoint a financial expert when
possible.




ITEM 11. EXECUTIVE COMPENSATION




The
following executive compensation disclosure reflects all compensation awarded
to, earned by or paid to the executive officers below for the year ended
December 31, 2009. The following table summarizes all compensation for fiscal
years 2009 received by our Chief Executive Officer, and most highly compensated
executive officers in fiscal year 2009.





SUMMARY
COMPENSATION TABLE





Summary
Compensation Table


Salary
              
              
              TotalName
      and principal position
              
              Year
              
              ($)
              
              
              ($)Toney
      Anaya
              
              2009
              
              $
              79,839
              
              
              $
              79,839Chief
      Executive Officer, President, and Chairman of the Board of
      Directors
              
              2008
              
              $
              0
              
              
              $
              0Walter
      R. Cruikshank
              
              2009
              
              $
              29,731
              
              
              $
              29,731Chief
      Financial Officer
              
              2008
              
              $
              0
              
              
              $
              0Jim
      Murphy
              
              2009
              
              $
              4,500
              
              
              $
              4,500Prior
      Chief Executive Officer, President, and Chairman of the Board of
      Directors(1)
              
              2008
              
              $
              150,000
              
              
              $
              150,000Daniel
      Ference
              
              2009
              
              $
              0
              
              
              $
              0Chief
      Operating Officer QoVox Corporation
              
              2008
              
              $
              144,000
              
              
              $
              144,000Paul
      Pelosi, Jr.
              
              2009
              
              $
              43,548
              
              
              $
              43,548President,
      Natural Blue Resources, Inc. (2)
              
              2008
              
              $
              0
              
              
              $
              0




(1)
            Jim
      Murphy was the Company’s Chief Executive Officer, President and Chairman
      of the Board of Directors until August 24,
2009.


(2)
            Paul
      Pelosi Jr. was the President of the Company and NBRN until January 10,
      2010.




28
 Table of Contents




Narrative
Disclosure to Summary Compensation Table


Salary
described in the Summary Compensation Table consists of cash payments and
accrued amounts owed to such named executive officers as of December 31, 2009.
The Company does not have any other forms of compensation arrangements nor has
the Company paid such named executive officers any additional
compensation.  There are no bonus plans, stock awards, option awards,
non-equity incentive plans, non-qualified deferred compensation plans or other
compensation programs, and there are no outstanding unexercised options,
unvested stocks or equity incentive plan awards as of December 31,
2009.





Employment
Agreements


The
Company does not have any employment agreements with its executive
officers.  Our executive officers are employees-at-will and,
therefore, may be terminated at any time, with or without cause, and with no
severance award owed to them.





Director
Compensation


The
Company’s directors do not receive cash compensation for their services on the
board of directors. Non-employee directors are reimbursed for out-of-pocket
expenses associated with attending Company meetings and otherwise fulfilling
their duties as directors.




ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
AND RELATED STOCKHOLDER MATTERS





Security
Ownership of Certain Beneficial Owners


The
following table sets forth, as of March 26, 2010, the number and percentage of
outstanding shares of our common stock owned by: (i) each director at such date,
(ii) each of the officers named in the Summary Compensation Table above, (iii)
our directors and executive officers as a group at such date, and (iv) each
person known by the Company to be the beneficial owner of more than 5% of our
outstanding common stock at such date.





The
number of shares beneficially owned by each director or executive officer is
determined under SEC rules, and the information is not necessarily indicative of
the beneficial ownership for any other purpose.  Under such rules,
beneficial ownership includes any shares to which the individual has the sole or
shared voting power or investment power and also any shares which the individual
has the right to acquire within 60 days of March 26, 2010, through the exercise
of any stock option or other right to purchase, such as a
warrant.  Unless otherwise indicated, each person has sole investment
and voting power (or shares such power with his or her spouse) with respect to
the shares set forth in the following table. In certain instances, the number of
shares listed may include, in addition to shares owned directly, shares held by
the spouse or children of the person, or by a trust or estate of which the
person is a trustee or an executor or in which the person may have a beneficial
interest.  The table that follows is based upon information supplied
by the executive officers, directors and named stockholders and Forms 3 filed
with the SEC.


Unless
otherwise indicated below, the address for each of the persons named below is
c/o Natural Blue Resources, Inc., 146 West Plant Street, Suite 300, Winter
Garden, Florida 34787.





Name
      and Address
              of
      Beneficial Owner
            
            Title
            
            Amount
      and Nature of BeneficialOwnership
            
            
            Percent
              of
      ClassDirectors
      and Executive OfficersToney
      Anaya
            
            Chief
      Executive Officer and Chairman of the Board
            
            
            9,010,049
            
            
            
            18.28
            %Daryl
      Kim
            
            Director
            
            
            1,324,227
            
            
            
            2.69
            %Walter
      R. Cruickshank
            
            Chief
      Financial Officer
            
            
            -0-
            
            
            
            0.0
            %Officers
      and Directors as a Group (total of 3 persons)
            
            
            
            
            10,334,276
            
            
            
            20.968
            %Paul
      Pelosi, Jr.
              2269
      Chestnut
              San
      Francisco, CA 94123
            
            Greater
      than 5% Stockholder
            
            
            8,125,133
            
            
            
            16.49
            %Patricia
      Cohen
              5036
      Dr. Phillips Blvd.
              Suite
      321
              Orlando,
      FL 32819
            
            Greater
      than 5% Stockholder
            
            
            5,844,465
            (1)
            
            
            11.9
            %




(1)Includes
1,882,457 shares owned by Mrs. Cohen and 1,991,060 shares owned by Ms.
Cohen’s daughter.  Also includes 1,970, 948 shares owned by the JEC
Family Limited Partnership over which Mrs. Cohen holds the voting
power and investment control though JEC Corp., a Nevada corporation
wholly owned by Mrs. Cohen, which is the general partner and holder of a 1%
interest in the partnership.




29
 Table of Contents




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





Certain
Relationships and Related Transactions


When the
Company is contemplating entering into any transaction in which any executive
officer, director, nominee or any family member of the foregoing would have any
direct or indirect interest, regardless of the amount involved, the terms of
such transaction have to be presented to the full board of directors (other than
any interested director) for approval. The board has not adopted a written
policy for related party transaction review but when presented with such
transaction, they are discussed by the full board of directors and documented in
the board minutes.





During
the fiscal year ended December 31, 2009, the Company engaged in the following
transactions with a related person:




In
November 2009, the Company executed an Engagement and Advisory Fee Agreement
with JEC Corp. (“JEC”), which is owned by one of our shareholders and the
shareholder is related to our consultants.  Pursuant to the agreement,
JEC will provide to the Company professional services in identifying and
representing the Company with respect to potential future merger and acquisition
opportunities to assist the Company in expanding its business.  Upon
execution of the agreement, JEC was entitled to receive 500,000 shares of the
Company’s common stock, however, were not issued and after December 31, 2009 JEC
waived the right to receive them. The Company will also pay to JEC a fee of
$20,000 for each letter of intent that the Company executes with a party in
connection with a potential merger or acquisition with certain companies
identified in the agreement.  In the event that the Company closes a
merger or acquisition with any such company, the Company will pay to JEC a fee
of $150,000.  This agreement also provides for the reimbursement of
reasonable operating expenses, including costs for travel, cost of preparation
of documents, reasonable fees and expenses of retained professionals and legal
expenses, not to exceed $10,000 without prior consent of the
Company.  Since inception of this agreement through December 31, 2009,
the Company has paid JEC $60,000.
  In
November 2009, the Company executed a second Advisory and Management Fee
Agreement with JEC pursuant to which JEC would assist the Company in creating
and managing NBS.  Upon execution of the agreement, JEC was entitled
to receive (a) $100,000, payable 20% upon execution and the balance when NBS is
fully operational and (i) achieves a minimum gross revenue of $1,000,000 or (ii)
receives funding from outside sources of more than $1,000,000.  JEC
was also entitled to receive  100,000 shares of the Company’s common
stock or, at JEC’s election, an option exercisable for 100,000 shares of common
stock at a nominal exercise price however the shares and options were not issued
and after December 31, 2009 JEC waived the right to receive them.JEC is further
entitled to receive 20% of  the net profit derived from transactions
for the sale of steel by NBS.  Net profit means the gross proceeds
from such transactions less direct transaction expenses incurred in connection
therewith.  Such payments shall be made monthly during NBS’ full
operational life.   The agreement also provides for the
reimbursement of reasonable operating expenses, including costs for travel, cost
of preparation of documents, reasonable fees and expenses of retained
professionals and legal expenses, not to exceed $10,000 without prior consent of
the Company.  Since the inception of this agreement through December
31, 2009, the Company paid JEC $20,000.


On May
22, 2009, NBRN made a loan in the amount of $200,000 to Samir Burshan
(“Burshan”) who was a Director of NBRN at that time.  Mr. Burshan was
appointed to the Board of the Company on August 24, 2009, and later resigned as
a Director of the Company on October 31, 2009.  Such loan is evidenced
by a promissory note dated January 29, 2010 and effective as of May 22, 2009,
bears interest at the rate of 8% per annum and is due and payable in full on May
22, 2012.   The note is non-recourse to Burshan, but is to be
secured by the assignment of a promissory note in the principal amount of
$200,000 made by Prism One, Inc. (“Prism One”) to Burshan.  The
Prism One note bears interest at the rate of 8% per annum and is payable in full
on or about May 22, 2012. It is the Company’s belief that there exists
substantial doubt that Prism One will be able to meet its obligations and
therefore, as of December 31, 2009, NBRN has fully reserved for this
loan.





Director
Independence


Our board
of directors affirmatively determines the independence of each director and
nominee for election as a director in accordance with guidelines it has adopted,
which include all elements of independence set forth in NASDAQ Rule
4200(a)(15).  Based on this standard, the board of directors has
determined that it currently has no members who qualify as
“independent.”




ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES




Audit
Fees


The
aggregate audit fees billed for the year ended December 31, 2009 was
$69,106.  Audit services include the audits of the financial
statements included in the Company’s annual reports on Form 10-K and reviews of
interim financial statements included in the Company’s quarterly reports on Form
10-Q.





Audit-Related
Fees


None.





Tax
Fees


None.





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All
Other Fees
 None.
 
 Audit
Committee Policies and Procedures
 As of the
date of this Annual Report, the Company does not have an established audit
committee.  The appointment of Cross, Fernandez & Riley LLP was
approved by the Board of Directors as the principal auditors for the Company.
There are no board members that are considered to have significant financial
experience.  When independent directors with the appropriate financial
background join the board, the board plans to establish an audit committee,
which will then adopt an appropriate charter and pre-approval policies and
procedures in connection with services to be rendered by the independent
auditors.


Part
IV




Item 15. Exhibits and Financial Statement Schedules.




3.      Exhibits




Exhibit
      Number
              Description
              Note3.1
              Certificate
      of Incorporation of the Registrant filed April 27, 2005 with the Secretary
      of State of Delaware
              13.2
              Certificate
      of Amendment to Certificate of Incorporation of the Registrant filed June
      18, 2009 with the Secretary of State of Delaware 3.3  Bylaws of
      the Registrant, effective August 24, 2009
              23.3
              Bylaws
      of the Registrant, effective August 24, 2009
              310.1
              Engagement and Advisory Fee Agreement dated November 9,
      2009, between the Registrant and JEC Corp.
              *10.2
              Advisory and Management Fee Agreement dated November 9,
      2009, between the Registrant and JEC Corp.
              *10.3
              Acquisition Agreement dated October 26, 2009 between the
      Registrant and Enso Steel Company, LLC and DK Steel
      Inc.
              *14
              Code
      of Ethics- not included, see Item 14 above.  The Company
      has not formally adopted a Code of Ethics as required.
              *16.1
              Letter
      from Child, Van Wagoner & Bradshaw PLLC, dated January 26,
      2010
              421
              List of Subsidiaries of the
      Registrant
              *31.1
              Certification of Chief
      Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange
      Act of 1934
              *31.2
              Certification of Chief
      Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange
      Act of 1934
              *32.1
              Certification of Chief
      Executive Officer pursuant to 18 U.S.C. Section
      1350
              *32.2
              Certification of Chief
      Financial Officer pursuant to 18 U.S.C. Section
      1350.
              *





Notes:


1.           Filed
as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the
Securities and Exchange Commission on May 4, 2005.





2.            Filed
as Exhibit 99 to the Registrant’s Current Report on Form 8-K filed with the
Securities and Exchange Commission July 24, 2009.





3.
            Filed as
Exhibit 3 to the Registrant’s Current Report on Form 8-K filed with the
Securities and Exchange Commission August 26, 2009.





4.
            Filed as
Exhibit 16.1 to the Registrant’s Current Report on Form 8-K filed with the
Securities and Exchange Commission January 26, 2009.




*           Filed
herewith.




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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 on this 2nd day of April,
2010.







Natural
      Blue Resources, Inc.BY:
            
            /s/   Toney
      AnayaToney
      Anaya,Chairman,
      Chief Executive Officer (Principal Executive
  Officer)






Pursuant to the requirements of the
Securities Exchange Act of 1934, this Annual Report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
dates indicated.




Signature
            Title
            Date/s/
      Toney
      Anaya
            Chairman,
      Chief Executive Officer and Director
            April
      2, 2010Toney
      Anaya
            (Principal
      Executive Officer)/s/
      Walter
      Cruickshank
            Chief
      Financial Officer
            April
      2, 2010Walter
      Cruickshank
            (Principal Financial
      and Accounting Officer)/s/
      Daryl
      Kim
            Director
            April
      2, 2010Daryl
      Kim









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