As filed with the Securities and Exchange Commission on November 23, 2011
 
Registration No.


SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM S-1
 
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

XR ENERGY INC.
 (Exact name of Registrant as specified in its charter)
 
Nevada
 
4932
 
     27-085-1973
(State or other jurisdiction of
incorporation or organization)
 
(Primary Standard Industrial
Classification Code)
 
(I.R.S. Employer
Identification No.)
 
Anthony P. Muratore
XR Energy Inc.
373 Smithtown Bypass, Suite 198
Hauppauge, New York 11788
Telephone: 631-913-8090
(Address and telephone number of Registrant's principal executive offices)

Anthony P. Muratore
XR Energy Inc.
373 Smithtown Bypass, Suite 198
Hauppauge, New York 11788
Telephone:631-913-8090
 (Address of principal place of business or intended principal place of business)
 
V Corp Services LLC
4675 W. Teco Avenue
Suite 240
Las Vegas, Nevada 89118
Phone: 888-528-2677
 (Name, address, including zip code, and telephone number, including area code, of agent for service)
 
Copies of all Correspondence to:
 
David Lubin & Associates, PLLC
10 Union  Avenue
Suite 5
Lynbrook, NY 11563
Telephone: (516) 887-8200
Facsimile: (516) 887-8250
 
 
 

 
 
Approximate date of commencement of proposed sale to the public: As soon as possible after the effective date of this registration statement.
 
If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, please check the following box:  þ

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box: o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non accelerated filer, or a small reporting company.  See 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
o
       
Non-accelerated filer
o
Smaller reporting company
þ
 


 
 

 
 
Calculation of Registration Fee
 
Title of Class of Securities to be Registered
 
Amount to be Registered
   
Proposed Maximum Aggregate Price Per Share
   
Proposed Maximum Aggregate Offering Price
   
Amount of Registration Fee
 
Common Stock, $0.001 per share(1)
   
2,818,800
   
$
0.25
(2)
 
$
704,700
   
$
82.24
 
Total
   
2,818,800
   
$
0.25
(2)
 
$
704,700
   
$
82.24
 

(1)  
Represents common shares currently outstanding to be sold by the selling shareholders.

(2)  
The offering price has been estimated solely for the purpose of computing the amount of the registration fee in accordance with Rule 457(o). Our common stock is not traded on any national exchange and in accordance with Rule 457, the offering price was determined by the price shares were sold to the selling shareholders in private placement transactions. The selling shareholders may sell shares of our common stock at a fixed price of $.0.25 per share until our shares are quoted on the OTC Bulletin Board and thereafter at prevailing market prices or privately negotiated prices. The fixed price of $0.25 was the price the shares were offered and sold by the Company in its private placement. There can be no assurance that a market maker will agree to file the necessary documents with the Financial Industry Regulatory Authority (“FINRA”), which operates the OTC Electronic Bulletin Board, nor can there be any assurance that such an application for quotation will be approved. We have agreed to bear the expenses relating to the registration of the shares for the selling shareholders.

 
In the event of a stock split, stock dividend or similar transaction involving our common stock, the number of shares registered shall automatically be increased to cover the additional shares of common stock issuable pursuant to Rule 416 under the Securities Act of 1933, as amended.
 
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
 
 
3

 
 
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
 
PRELIMINARY PROSPECTUS

XR ENERGY INC.

2,818,800 Shares of Common Stock
 
This prospectus relates to the resale of 2,818,800 shares of common stock of XR Energy Inc. which are issued and outstanding and held by persons who are our shareholders. The company will not receive any proceeds from these sales; the selling shareholders identified in this prospectus will receive all the proceeds from this offering.
 
Our common stock is presently not traded on any market or securities exchange. The 2,818,800 shares of our common stock can be sold by selling shareholders at a fixed price of $0.25 per share until our shares are quoted on the OTC Bulletin Board and, assuming we secure this qualification for quotation, thereafter at prevailing market prices or privately negotiated prices. The fixed price of $0.25 has been determined arbitrarily. If all 2,818,800 shares are sold, the selling shareholders will receive an aggregate of $704,700 of proceeds. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with FINRA, for our common stock to be eligible for trading on the Over the Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application. There is no guarantee that our common stock will be eligible for trading or quoted on the Over the Counter Bulletin Board.
 
INVESTING IN OUR SECURITIES INVOLVES SIGNIFICANT RISKS. SEE “RISK FACTORS” BEGINNING ON PAGE 9.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
 
The date of this prospectus is ____, 2011
 
 
4

 
 
Table of Contents
 
   
Page
 
       
Prospectus Summary
    6  
Risk Factors
    9  
Risk Factors Relating to Our Company
    9  
Risk Factors Relating to Our Common Shares
    13  
The Offering
    16  
Use of Proceeds
    17  
Determination of Offering Price
    17  
Forward Looking Statements
    17  
Selling Shareholders
    18  
Plan of Distribution
    20  
Description of Securities
    23  
Interest of Named Experts and Counsel
    23  
Description of Business
    24  
Description of Property
    26  
Legal Proceedings
    27  
Market for Common Equity and Related Stockholder Matters
    27  
Dividend Policy
    27  
Share Capital
    28  
Management’s Discussion and Analysis of Financial Conditions and Results of Operations
    29  
Changes in and Disagreements with Accountants
    31  
Directors, Executive Officers, Promoters, and Control Persons
    32  
Director Independence
    32  
Executive Compensation
    33  
Security Ownership of Certain Beneficial Owners and Management
    35  
Certain Relationships and Related Transactions
    36  
Expenses of Issuance and Distribution
    36  
Legal Matters
    37  
Indemnification for Securities Act Liabilities
    37  
Experts
    37  
Where You Can Find More Information
    37  
Financial Statements
    F-1  
Information not Required in Prospectus
    38  

You should rely only on the information contained in this prospectus. We have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where an offer or sale is not permitted. You should assume that the information appearing in this prospectus is accurate only as of the date on the front cover of this prospectus. Our business, financial condition, results of operations and prospects may have changed since that date.
 
 
5

 
 
PROSPECTUS SUMMARY

As used in this prospectus, references to the “Company,” “we,” “our,”  “us” or “XR Energy” refer to XR Energy Inc., unless the context otherwise indicates.

The following summary highlights selected information contained in this prospectus. Before making an investment decision, you should read the entire prospectus carefully, including the “Risk Factors” section, the financial statements and the notes to the financial statements.

Corporate Background

XR Energy Inc. was incorporated under the laws of the State of Nevada on August 31, 2009.  We were formed to offer energy consulting services to smaller sized middle market companies. The Company will analyze customer’s energy consumption and recommend energy saving solutions. From our inception to date, we have not generated any revenues, and our operations have been limited basically to organizational, start-up, and capital formation activities.  We currently have no employees other than our officers, two of whom are also our directors.  We have never intended and do not intend to be a blank check company. We have a specific business plan and do not intend to engage in any merger, acquisition or business reorganization with any entity.
 
Our offices are currently located at XR Energy Inc. c/o Anthony Muratore, 373 Smithtown Bypass, Suite 198, Hauppauge, New York 11788. Our telephone number is 631-913-8090. Our website is xrenergy.com. Information contained on our website, or which can be accessed through the website, does not constitute a part of this registration statement.
 
The Offering

Securities offered:
2,818,800 shares of common stock, par value $0.0001 per share.
 
Offering price :
$0.25, which is an arbitrary price we used based on the price per share offered by us in a private placement.
 
This is a fixed price at which the selling shareholders may sell their shares until our common stock is quoted on the OTC Bulletin Board, at which time the shares may be sold at prevailing market prices or privately negotiated prices. There is no guarantee that our common stock will be eligible for trading or quoted on the Over the Counter Bulletin Board.
 
Shares outstanding prior to offering:
22,818,800 shares of common stock.
 
Shares outstanding after offering:
22,818,800 shares of common stock.
 
 
Our executive officers and directors currently own 87.65% of our outstanding common stock.  As a result, our executive officers and directors have substantial control over all matters submitted to our shareholders for approval.
 
 
6

 
 
Market for the common shares:
There has been no market for our securities.  Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with the FINRA for our common stock to eligible for trading on the Over The Counter Bulletin Board.  We do not yet have a market maker who has agreed to file such application.  There is no guarantee that our common stock will be eligible for trading or quoted on the Over the Counter Bulletin Board.
 
Consequently, a purchaser of our common stock may find it difficult to resell the securities offered herein should the purchaser desire to do so when eligible for public resale.
 
Use of proceeds:
We will not receive any proceeds from the sale of shares by the selling shareholders. We have agreed to bear the expenses relating to the registration of the shares for the selling shareholders.
 
Going Concern Considerations:
The Company has a cumulative net loss of $29,680 from August 31, 2009 (inception) through September 30, 2011.
 
The ability of the Company to continue as a going concern is dependent on management's plans which include raising additional funds for further implementation of the Company’s business plan and continuing to raise funds through debt or equity raises. The Company will likely rely upon related party debt or equity financing in order to ensure the continuing existence of the business.
 
The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.
 
Risk Factors
See “risk factors” beginning on page 9 of this prospectus for a discussion of factors you should carefully consider before deciding to invest in shares of our common stock.
 

 
7

 
  
Summary Financial Information
 
   
Nine
Months Ended
   
Year Ended
   
Period
August 31, 2009
(Inception) Through
 
   
September 30,
   
December 31,
   
December 31,
 
   
2011
   
2010
   
2009
 
   
(Unaudited)
             
                   
Current Assets
  $ 31,945     $ 18,413     $ 12,375  
                         
Total Assets
  $ 31,945     $ 18,413     $ 12,375  
                         
Current Liabilities
  $ 3,675     $ 2,100     $ -  
                         
Total Liabilities
  $ 4,925     $ 3,350     $ -  
                         
Total Stockholders' Equity   $ 27,020     $ 15,063     $ 12,375  
                         
Total Income
  $ 5,917     $ 1,112     $ -  
                         
Total Expenses
    6,960       15,124       14,625  
                         
Net (Loss)
  $ (1,043 )   $ (14,012 )   $ (14,625 )
                         
Basic and Diluted (Loss) Per Share
  $ (0.00 )   $ (0.00 )   $ (0.00 )
                         
Weighted Average Number of Shares Outstanding
    22,807,618       22,715,489       22,700,000  
 
 
8

 
 
RISK FACTORS
 
An investment in our common stock involves a high degree of risk. You should carefully consider the following factors and other information in this prospectus before deciding to invest in our company. If any of the following risks actually occur, our business, financial condition, results of operations and prospects for growth would likely suffer. As a result, you could lose all or part of your investment.
 
Risk Factors Relating to Our Company

We have no operating history and may never be able to effectuate our business plan or achieve any revenues or profitability; at this stage of our business, even with our good faith efforts, potential investors have a high probability of losing their entire investment.

We are subject to all of the risks inherent in the establishment of a new business enterprise. Our Company was established on August 31, 2009.  We were formed to offer energy consulting services to smaller sized middle market companies. Other than developing our website, conducting the private placement for the shares being registered in this prospectus and the execution of one agreement, we have no operating history and may not be able to successfully effectuate our business plan in a manner that will generate any revenues. In addition, any revenues that we may generate may be insufficient for us to become profitable.
 
In particular, potential investors should be aware that we have not proven that we can:
 
·
raise sufficient capital in the public and/or private markets;

·
have access to a line of credit in the institutional lending marketplace for the expansion of our business;
   
·
solicit customers interested in using our services;
 
·
respond effectively to competitive pressures; or
 
·
recruit and build a management team to accomplish our business plan.
 
Accordingly, our prospects must be considered in light of the risks, expenses and difficulties frequently encountered in establishing a new business, and our Company is a highly speculative venture involving significant financial risk.

 
9

 
 
We expect losses in the future because we have insufficient revenue to offset losses.

As we have no minimal revenue, we are expecting losses over the next 12 months because we do not yet have sufficient revenues to offset the expenses associated with the development and implementation of our business plan. We have a cumulative net loss of $29,680 from August 31, 2009 (inception) through September 30, 2011. We cannot guarantee that we will ever be successful in generating revenues in the future. We recognize that if we are unable to generate revenues, we will not be able to earn profits or continue operations. There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide investors with no assurance that we will generate any operating revenues or ever achieve profitable operations.

We have a going concern opinion from our auditors, indicating the possibility that we may not be able to continue to operate.

The Company has minimal revenues and incurred a cumulative net loss of $29,680 from August 31, 2009 (inception) through September 30, 2011. Furthermore, we anticipate generating losses for the next 12 months. These factors raise substantial doubt that we will be able to continue operations as a going concern, and our independent auditors included an explanatory paragraph regarding this uncertainty in their report on our financial statements for the period August 31, 2009 (inception) to December 31, 2009 and for the year ended December 31, 2010. Our ability to continue as a going concern is dependent upon our ability to raise additional funds, either in the form of debt or equity or some combination thereof and/or achieve sufficient profitable operations. There is no assurance that the Company will be able to raise such funds or achieve such profitable operations.
 
We have no track record that would provide a basis for assessing our ability to conduct successful business activities. We may not be successful in carrying out our business objectives.

The revenue and income potential of our proposed business and operations are unproven as the lack of operating history makes it difficult to evaluate the future prospects of our business. There is nothing at this time on which to base an assumption that our business operations will prove to be successful or that we will ever be able to operate profitably. Accordingly, we have no track record of successful business activities, strategic decision making by management, fund-raising ability, and other factors that would allow an investor to assess the likelihood that we will be successful in developing and marketing of our products and thereafter making them available for sale. There is a substantial risk that we will not be successful in implementing our business plan, or if initially successful, in thereafter generating any operating revenues or in achieving profitable operations, irrespective of competition.

 
10

 
 
The recent widespread economic downturn and uncertainty and turmoil in the equity and credit markets could adversely impact our potential clients, diminish the demand for our services and products, and harm our operations and financial performance.
 
The energy efficiency solutions marketplace has experienced rapid evolution and growth, but the recent economic recession has increased the reluctance of some of our potential commercial and industrial customers to invest in energy efficiency projects.  We are not sure if conditions in this market will worsen or improve during coming months or how customers will react as the economy continues its recovery. The recession also may cause reductions or elimination of utility or government energy efficiency incentive programs used to partially fund the costs of customer projects. In addition, increased competition as a result of the recession may result in lower sales, reduced likelihood of profitability, and diminished cash flow to us.
 
Further, the sales of energy efficiency solutions are usually made on the basis of short-term contracts, rather than long-term purchase commitments and consequently our clients may cancel, delay or otherwise modify their purchase commitments in response to economic pressures with little or no consequence to them and with little or no notice to us. Whether in response to an economic downturn affecting an industry or a client’s specific business including its bankruptcy or insolvency, any cancellation, delay or other modification in our clients’ orders could significantly reduce our revenue, impact our working capital, cause our operating results to fluctuate from period to period and make it more difficult for us to predict our revenue.
 
Because we face intense competition for business, our future results of operations and our future financial condition may be adversely affected.

The energy efficiency solutions market is highly competitive, and we expect competition to increase and intensify as the energy efficiency solutions market continues to evolve. We face strong competition primarily from lighting and lighting fixture manufacturers, gas appliances manufacturers, lighting fixture distributors, providers of energy efficiency upgrades and maintenance, other regional providers of energy efficiency solutions and local electrical and mechanical contractors and engineering firms.  As we extend energy efficiency offerings that are currently available to our public sector clients to our potential clients, we expect to face additional competition from providers of those services in the commercial and industrial market. We will compete primarily on the basis of client service and support, quality and scope of services and products, cost of services and products, ability to service clients on a national level, name recognition and financial resources and performance track record for services provided.

In addition to our existing competitors, new competitors such as large national or multinational engineering and/or construction companies could enter our markets.  Many of these current and potential competitors are better capitalized than we are, have longer operating histories and strong existing client relationships, greater name recognition, and more extensive engineering and sales and marketing capabilities. Competitors could focus their substantial resources on developing a competing business model or energy efficiency solutions that may be potentially more attractive to clients than our products or services. In addition, we may face competition from other products or technologies that reduce demand for gas and electricity. Our competitors may also offer energy efficiency solutions at reduced prices in order to improve their competitive positions.  Any of these competitive factors could make it more difficult for us to attract and retain clients, require us to lower our prices in order to remain competitive, and reduce our revenue and profitability, any of which could have a material adverse effect on our results of operations and financial condition.
 
 
11

 
 
We may be unable to obtain sufficient bonding capacity to support certain service offerings.
 
A significant number of public sector contracts require surety bonds to guarantee our performance and payment to our suppliers and subcontractors. Bonding capacity for construction projects has become increasingly difficult to obtain, and bonding companies are denying or restricting coverage to an increasing number of contractors.  Some sureties might require us to post collateral, guarantees, agreements of indemnity and letters of credit to secure the performance and surety bonds.  Our available collateral may be insufficient to support our increasing need for surety bonds, which could preclude us from being able to bid for certain contracts and successfully contract with certain customers. If we are unable to obtain surety bonds, our business, results of operations and financial condition could be materially adversely affected.
 
If we lose the services of key members of our management team, we may not be able to execute our business strategy effectively.
 
Our future success depends in a large part upon the continued service of key members of our management team. In particular, Anthony Muratore, our president, and Tara Muratore, our treasurer and secretary, are critical to our overall management as well as our strategic direction. We do not maintain any key-person life insurance policies. The loss of any of our management or key personnel could materially harm our business.

Since our officers can work or consult for other companies, their activities could slow down our operations.

Our officers and directors are not required to work exclusively for us and do not devote all of their time to our operations. Therefore, it is possible that a conflict of interest with regard to their time may arise based on their employment for other companies. Their other activities may prevent them from devoting full-time to our operations which could slow down our operations and may reduce our financial success. It is expected that each of our directors will devote between 20 and 30 hours per week to our operations on an ongoing basis, and will devote whole days and even multiple days at a stretch when required.

If we are unable to obtain additional funding, our business operations will be harmed.  Even if we do obtain additional financing then our existing shareholders may suffer substantial dilution.
 
We will require additional funds to implement our business plan. We anticipate that we will require a minimum of $100,000to fund our planned activities for the next twelve months. We hope to raise this capital through the sale of our securities in a private placement. The inability to raise the required capital will restrict our ability to grow and may reduce our ability to continue to conduct business operations. Although our officers and directors have orally agreed to finance the operations of the Company, if we are unable to obtain necessary financing, we will likely be required to curtail our development plans. This could cause the Company to become dormant. Any additional equity financing may involve substantial dilution to our then existing shareholders.
 
 
12

 
 
Our officers and directors own a majority of the outstanding shares of our common stock, and other stockholders may not be able to influence control of the company or decision making by management of the company.

Our executive officers and directors presently own, in the aggregate, 87.65% of our outstanding common stock. As a result, our executive officers and directors have substantial control over all matters submitted to our stockholders for approval including the following matters: election of our board of directors; removal of any of our directors; amendment of our Articles of Incorporation or bylaws; and adoption of measures that could delay or prevent a change in control or impede a merger, takeover or other business combination involving us.  Other shareholders may find the corporate decisions influenced by our executive officers are inconsistent with the interests of other shareholders.  In addition, other shareholders may not be able to change the directors and officers, and are accordingly subject to the risk that management cannot manage the affairs of the company in accordance with such shareholders’ wishes.
 
RISK FACTORS RELATING TO OUR COMMON STOCK

We may, in the future, issue additional common shares, which would reduce investors’ percent of ownership and may dilute our share value.

Our Articles of Incorporation authorizes the issuance of 100,000,000 shares of common stock, par value $.0001 per share, of which 22,818,800 shares are currently issued and outstanding. The future issuance of common stock may result in substantial dilution in the percentage of our common stock held by our then existing shareholders. We may value any common stock issued in the future on an arbitrary basis. The issuance of common stock for future services or other corporate actions may have the effect of diluting the value of the shares held by our investors, and might have an adverse effect on any trading market for our common stock.

Our common stock is subject to the "penny stock" rules of the SEC and the trading market in our securities is limited, which makes transactions in our stock cumbersome and may reduce the value of an investment in our stock.

Trading in our common stock is subject to the “penny stock” rules. The Securities and Exchange Commission (“SEC”) has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. These rules require that any broker-dealer that recommends our common stock to persons other than prior customers and accredited investors, must, prior to the sale, make a special written suitability determination for the purchaser and receive the purchaser’s written agreement to execute the transaction. Unless an exception is available, the regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated with trading in the penny stock market. In addition, broker-dealers must disclose commissions payable to both the broker-dealer and the registered representative and current quotations for the securities they offer. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in our common stock, which could severely limit the market price and liquidity of our common stock.

 
13

 
 
The market for penny stocks has experienced numerous frauds and abuses which could adversely impact investors in our stock.

We believe that the market for penny stocks has suffered from patterns of fraud and abuse. Such patterns include:

·  
Control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer;

·  
Manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases;

·  
"Boiler room" practices involving high pressure sales tactics and unrealistic price projections by inexperienced sales persons;

·  
Excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and

We believe that many of these abuses have occurred with respect to the promotion of low price stock companies that lacked experienced management, adequate financial resources, an adequate business plan and/or marketable and successful business or product. The wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the inevitable collapse of those prices with result in investor losses.
  
The offering price of our common stock by our shareholders could be higher than the market value, causing investors to sustain a loss of their investment.

The price of our common stock in this offering has not been determined by any independent financial evaluation, market mechanism or by our auditors, and is therefore, to a large extent, arbitrary. Our audit firm has not reviewed management's valuation, and therefore expresses no opinion as to the fairness of the offering price as determined by our management. As a result, the price of the common stock in this offering may not reflect the value perceived by the market. There can be no assurance that the shares offered hereby are worth the price for which they are offered and investors may therefore lose a portion or all of their investment.

State securities laws may limit secondary trading, which may restrict the states in which and conditions under which you can sell the shares offered by this prospectus.

Secondary trading in common stock sold in this offering will not be possible in any state until the common stock is qualified for sale under the applicable securities laws of the state or there is confirmation that an exemption, such as listing in certain recognized securities manuals, is available for secondary trading in the state. If we fail to register or qualify, or to obtain or verify an exemption for the secondary trading of, the common stock in any particular state, the common stock could not be offered or sold to, or purchased by, a resident of that state. In the event that a significant number of states refuse to permit secondary trading in our common stock, the liquidity for the common stock could be significantly impacted thus causing you to realize a loss on your investment.

 
14

 
 
Currently, there is no public market for our securities, and there can be no assurances that any public market will ever develop or that our common stock will be quoted for trading and, even if quoted, it is likely to be subject to significant price fluctuations.

There has never been any established trading market for our common stock, and there is currently no public market whatsoever for our securities. Additionally, no public trading can occur until we file and have declared effective a Registration Statement with the SEC. There can be no assurances as to whether, subsequent to registration with the SEC:

·  
any market for our shares will develop;

·  
the prices at which our common stock will trade; or

·  
the extent to which investor interest in us will lead to the development of an active, liquid trading market.  Active trading markets generally result in lower price volatility and more efficient execution of buy and sell orders for investors.

In addition, our common stock is unlikely to be followed by any market analysts, and there may be few institutions acting as market makers for our common stock. Either of these factors could adversely affect the liquidity and trading price of our common stock. Until our common stock is fully distributed and an orderly market develops in our common stock, if ever, the price at which it trades is likely to fluctuate significantly. Prices for our common stock will be determined in the marketplace and may be influenced by many factors, including the depth and liquidity of the market for shares of our common stock, developments affecting our business, including the impact of the factors referred to elsewhere in these Risk Factors, investor perception of the Company and general economic and market conditions.  No assurances can be given that an orderly or liquid market will ever develop for the shares of our common stock.

If our shares are quoted on the OTC Bulletin Board, sales of our shares relying upon rule 144 may depress prices in that market by a material amount.
 
After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with FINRA for our common stock to be eligible for trading on the Over the Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application, and there is no guarantee that such a market maker will be located.  Even if we successful and locate a market maker who files an application, there is no assurance that such application will be approved and our shares be accepted for quotation on the OTC BB.

The majority of the outstanding shares of our common stock held by present shareholders are "restricted securities" within the meaning of Rule 144 under the Securities Act of 1933, as amended.

As restricted shares, these shares may be resold only pursuant to an effective registration statement, such as this one (for the shares registered hereunder) or under the requirements of Rule 144 or other applicable exemptions from registration under the Act and as required under applicable state securities laws. On November 15, 2007, the Securities and Exchange Commission adopted changes to Rule 144, which, would shorten the holding period for sales by non-affiliates to six months (subject to extension under certain circumstances) and remove the volume limitations for such persons.   The changes became effective in February 2008. Rule 144 provides in essence that an affiliate who has held restricted securities for a prescribed period may, under certain conditions, sell every three months, in brokerage transactions, a number of shares that does not exceed 1.0% of a company's outstanding common stock. The alternative average weekly trading volume during the four calendar weeks prior to the sale is not available to our shareholders being that the Over the Counter Bulletin Board (“OTCBB”) (if and when listed thereon) is not an "automated quotation system" and, accordingly, market based volume limitations are not available for securities quoted only over the OTCBB. As a result of the revisions to Rule 144 discussed above, there is no limit on the amount of restricted securities that may be sold by a non-affiliate (i.e., a stockholder who has not been an officer, director or control person for at least 90 consecutive days) after the restricted securities have been held by the owner for a period of six months, if the Company has filed its required reports. A sale under Rule 144 or under any other exemption from the Act, if available, or pursuant to registration of shares of common stock of present stockholders, may have a depressive effect upon the price of the common stock in any market that may develop.
 
 
15

 
 
We may be exposed to potential risks resulting from new requirements under Section 404 of the Sarbanes-Oxley Act of 2002.

If we become registered with the SEC, we will be required, pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, to include in our annual report our assessment of the effectiveness of our internal control over financial reporting. We do not have a sufficient number of employees to segregate responsibilities and may be unable to afford increasing our staff or engaging outside consultants or professionals to overcome our lack of employees.

Because we are not subject to compliance with rules requiring the adoption of certain corporate governance measures, our shareholders have limited protections against interested director transactions, conflicts of interest and similar matters.

The Sarbanes-Oxley Act of 2002, as well as rule changes proposed and enacted by the SEC, the New York and NYSE AMEX Equities exchanges and the Nasdaq Stock Market, as a result of Sarbanes-Oxley, require the implementation of various measures relating to corporate governance. These measures are designed to enhance the integrity of corporate management and the securities markets and apply to securities which are listed on those exchanges or the Nasdaq Stock Market. Because we are not presently required to comply with many of the corporate governance provisions and because we chose to avoid incurring the substantial additional costs associated with such compliance any sooner than necessary, we have not yet adopted these measures.

We do not currently have independent audit or compensation committees. As a result, the director has the ability, among other things, to determine his own level of compensation. Until we comply with such corporate governance measures, regardless of whether such compliance is required, the absence of such standards of corporate governance may leave our stockholders without protections against interested director transactions, conflicts of interest and similar matters and investors may be reluctant to provide us with funds necessary to expand our operations.

The costs to meet our reporting and other requirements as a public company subject to the Exchange Act of 1934 will be substantial and may result in us having insufficient funds to expand our business or even to meet routine business obligations.

If we become a public entity, subject to the reporting requirements of the Exchange Act of 1934, we will incur ongoing expenses associated with professional fees for accounting, legal and a host of other expenses for annual reports and proxy statements. We estimate that these costs will range up to $35,000 per year for the next few years and will be higher if our business volume and activity increases but lower during the first year of being public because our overall business volume will be lower, and we will not yet be subject to the requirements of Section 404 of the Sarbanes-Oxley Act of 2002. As a result, we may not have sufficient funds to grow our operations.
 
THE OFFERING

This prospectus relates to the resale by certain selling shareholders of the Company of up to 2,818,800 shares of our common stock.  Of said shares, 118,800 shares were offered and sold by us at a purchase price of $0.25 per share to the selling shareholders in a private placement conducted from July 2010 through June 2011 pursuant to the exemptions from registration under the Securities Act provided by Regulation D the Securities Act. As of June 30, 2011, the Company terminated the offering having sold only 118,800 of the 400,000 shares offered in the private placement and raised $29,700 in gross proceeds. The balance of the shares included in this prospectus (2,700,000 shares) were issued by us to three consultants pursuant to consulting agreements which have currently expired pursuant to their terms.

 
16

 

USE OF PROCEEDS

The selling shareholders are selling shares of common stock covered by this prospectus for their own account. We will not receive any of the proceeds from the resale of these shares. We have agreed to bear the expenses relating to the registration of the shares for the selling shareholders.

DILUTION

The common stock to be sold by the selling shareholders is issued and outstanding.  Accordingly, there will be no dilution to our existing shareholders.
 
DETERMINATION OF OFFERING PRICE

The selling shareholders will be offering the shares of common stock being covered by this prospectus at a fixed price of $0.25 per share until our shares of common stock are quoted on the OTC Bulletin Board, and, assuming we secure this qualification for quotation, thereafter at prevailing market prices or privately negotiated prices. The fixed price of $0.25 has been arbitrarily determined as the selling price based upon the original purchase price paid by the selling shareholders.
 
Such offering price does not have any relationship to any established criteria of value, such as book value or earnings per share. Because we have no significant operating history, the price of our common stock is not based on past earnings, nor is the price of our common stock indicative of the current market value of the assets owned by us. No valuation or appraisal has been prepared for our business and potential business expansion. Our common stock is presently not traded on any market or securities exchange and we have not applied for listing or quotation on any public market.

FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology.  These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled “Risk Factors,” that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

 
17

 

SELLING SHAREHOLDERS

The following table sets forth the shares beneficially owned, as of November 21, 2011, by the selling shareholders prior to the offering contemplated by this prospectus, the number of shares each selling shareholder is offering by this  prospectus and the number of shares which each would own  beneficially  if all such offered shares are sold.

Beneficial ownership is determined in accordance with Securities and Exchange Commission rules. Under these rules, a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or direct the voting of the security,  or investment power, which includes the power to dispose , or to direct the disposition of, such security. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60 days. Under the Securities and Exchange Commission rules, more than one person may be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which he or she may not have any pecuniary beneficial interest. Except as noted below, each person has sole voting and investment power.

None of the selling shareholders is a registered broker-dealer or an affiliate of a registered broker-dealer.  Forty of the selling shareholders acquired his, her or its shares pursuant to a private placement solely for investment and not with a view to or for resale or distribution of such securities.  The shares were offered and sold to the selling shareholders at a purchase price of $0.25 per share in a private placement held from July 2010through June 2011, pursuant to the exemption from the registration under the Securities Act provided by Regulation D of the Securities Act.  Three of the selling shareholders acquired their shares pursuant to their respective consulting agreements.   None of the selling shareholders are affiliates or controlled by our affiliates and none of the selling shareholders are now or were at any time in the past an officer or director of ours or any of any of our predecessors or affiliates.

The percentages below are calculated based on 22,818,800 shares of our common stock issued and outstanding. We do not have any outstanding options, warrants or other securities exercisable for or convertible into shares of our common stock.
 
 
Common Shares owned by the Selling
   
Number of Shares Offered
by Selling
 
Number of Shares and Percent
of Total Issued and Outstanding
Held After the Offering(1)
 
Name of Selling Shareholders
Shareholder 
   
Shareholder
 
# of Shares
   
% of Class
 
               
0
     
*
 
Andrew Vicari
900,000
   
900,000
     
0
     
*
 
RJB Consulting Inc.(2)
900,000
   
900,000
     
0
     
*
 
Stephen Giametta
900,000
   
900,000
     
0
     
*
 
Gordon Shoemaker
  4,800
   
   4,800
     
0
     
*
 
Sempire Corp. (3)
  4,000
   
   4,000
     
0
     
*
 
Joseph Reda
  4,000
   
   4,000
     
0
     
*
 
Joseph Luna
  4,000
   
   4,000
     
0
     
*
 
Michael Stack(3)
  4,000
   
   4,000
     
0
     
*
 
Balaram Stack(3)
  4,000
   
   4,000
     
0
     
*
 
Ravi R. Salickram
  4,000
   
   4,000
     
0
     
*
 
Thomas Allinder
  4,000
   
   4,000
     
0
     
*
 
Daniel Herrera
  4,000
   
   4,000
     
0
     
*
 

 
18

 
 
Timothy Delaney
4,000
   
4,000
     
0
     
*
 
Michael D. Solomon
4,000
   
4,000
     
0
     
*
 
Vincent Alagna
4,000
   
4,000
     
0
     
*
 
Joseph Neglia(4)
2,000
   
2,000
     
0
     
*
 
Peter Neglia(4)
2,000
   
2,000
     
0
     
*
 
Anthony J. Genova Jr.
2,000
   
2,000
     
0
     
*
 
Christopher McNamara
2,000
   
2,000
     
0
     
*
 
John Merkent
2,000
   
2,000
     
0
     
*
 
Gary Kaible
2,000
   
2,000
     
0
     
*
 
Douglas Herber
2,000
   
2,000
     
0
     
*
 
Glenn Lanaia
2,000
   
2,000
     
0
     
*
 
Anthony Dituro
2,000
   
2,000
     
0
     
*
 
Jay Oher
2,000
   
2,000
     
0
     
*
 
Lisa and Joseph Nappi
2,000
   
2,000
     
0
     
*
 
Evan Pomerantz
4,000
   
4,000
     
0
     
*
 
Geraldine Browne(5)
4,000
   
4,000
     
0
     
*
 
Vincent Browne(5)
4,000
   
4,000
     
0
     
*
 
Noel Browne(5)
4,000
   
4,000
     
0
     
*
 
David Dunne
4,000
   
4,000
     
0
     
*
 
Noreen Brouder
4,000
   
4,000
     
0
     
*
 
Bernard A. Fried
4,000
   
4,000
     
0
     
*
 
Barry Margulies
2,000
   
2,000
     
0
     
*
 
Jeff Zeiger
2,000
   
2,000
     
0
     
*
 
Alyssa Cohen(6)
2,000
   
2,000
     
0
     
*
 
Jason Cohen(6)
2,000
   
2,000
     
0
     
*
 
Robert Davis
2,000
   
2,000
      0         *  
Pargie Raiola
2,000
   
2,000
        0         *  
Joseph Fabio
2,000
   
2,000
        0         *  
Alexandra Simonelli
2,000
   
2,000
        0         *  
Barbara Ann C. Getz
2,000
   
2,000
        0         *  
Mitchell Cohen
2,000
   
2,000
        0         *  

* Represents less than one percent of the total number of shares of common stock outstanding as of the date of this filing.
 
(1)   Assumes all of the shares of common stock offered in this prospectus are sold and no other shares of common stock are sold or issued during this offering period and is based on 22,818,800 shares of common stock issued and outstanding as of November 21, 2011.
     
(2)   StuartDavis exercises sole voting and dispositive power with respect to the shares held.
     
(3)   Chris Spencer exercises sole voting and dispositive power with respect to the shares held.
     
(4)   Michael and Balaram are brothers.
     
(5)   Joseph Neglia is the father of Peter Neglia.
     
(6)   Geraldine Browne is the sister of Noel Browne. Vincent Browne is the father of Noel and Geraldine Browne.
     
(7)   Alyssa and Jason Cohen are sister and brother.
 
We may require the selling shareholders to suspend the sales of the securities offered by this prospectus upon the occurrence of any event that makes any statement in this prospectus, or the related registration statement, untrue in any material respect, or that requires the changing of statements in these documents in order to make statements in those documents not misleading. We will file a post-effective amendment to this registration statement to reflect any material changes to this prospectus.

 
19

 
 
PLAN OF DISTRIBUTION

There has been no market for our securities.  Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with FINRA for our common stock to be eligible for trading on the Over the Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application.  There is no guarantee that our common stock will be eligible for trading or quoted on the Over the Counter Bulletin Board.

The selling shareholders will be offering the shares of common stock being covered by this prospectus at a fixed price of $0.25 per share until our shares of common stock are quoted on the Over the Counter Bulletin Board, and, assuming we secure this qualification for quotation, thereafter at prevailing market prices or privately negotiated prices.

 Once a market has been developed for our common stock, the shares may be sold or distributed from time to time by the selling shareholders directly to one or more purchasers or through brokers or dealers who act solely as agents, at market prices prevailing at the time of sale, at prices related to such prevailing market prices, at negotiated prices or at fixed prices, which may be changed. The distribution of the shares may be effected in one or more of the following methods: (a) ordinary brokerage transactions and transactions in which the broker solicits purchasers; (b) privately negotiated transactions; (c) market sales (both long and short to the extent permitted under the federal securities laws); (d) at the market to or through market makers or into an existing market for the shares; (e) through transactions in options, swaps or other derivatives (whether exchange listed or otherwise); and (f) a combination of any of the aforementioned methods of sale.
 
In the event of the transfer by any of the selling shareholders of its common shares to any pledgee, donee or other transferee, we will amend this prospectus and the registration statement of which this prospectus forms a part by the filing of a post-effective amendment in order to have the pledgee, donee or other transferee in place of the selling shareholder who has transferred his, her or its shares.
 
In effecting sales, brokers and dealers engaged by the selling shareholders may arrange for other brokers or dealers to participate. Brokers or dealers may receive commissions or discounts from a selling shareholder or, if any of the broker-dealers act as an agent for the purchaser of such shares, from a purchaser in amounts to be negotiated which are not expected to exceed those customary in the types of transactions involved. Broker-dealers may agree with a selling shareholder to sell a specified number of the shares of common stock at a stipulated price per share. Such an agreement may also require the broker-dealer to purchase as principal any unsold shares of common stock at the price required to fulfill the broker-dealer commitment to the selling shareholder if such broker-dealer is unable to sell the shares on behalf of the selling shareholder. Broker-dealers who acquire shares of common stock as principal may thereafter resell the shares of common stock from time to time in transactions which may involve block transactions and sales to and through other broker-dealers, including transactions of the nature described above. Such sales by a broker-dealer could be at prices and on terms then prevailing at the time of sale, at prices related to the then-current market price or in negotiated transactions. In connection with such resales, the broker-dealer may pay to or receive from the purchasers of the shares commissions as described above.
 
 
20

 
 
The selling shareholders and any broker-dealers or agents that participate with the selling shareholders in the sale of the shares of common stock may be deemed to be "underwriters" within the meaning of the Securities Act in connection with these sales. In that event, any commissions received by the broker-dealers or agents and any profit on the resale of the shares of common stock purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act.
 
From time to time, any of the selling shareholders may pledge shares of common stock pursuant to the margin provisions of customer agreements with brokers. Upon a default by a selling shareholder, their broker may offer and sell the pledged shares of common stock from time to time. Upon a sale of the shares of common stock, the selling shareholders intend to comply with the prospectus delivery requirements under the Securities Act by delivering a prospectus to each purchaser in the transaction. We intend to file any amendments or other necessary documents in compliance with the Securities Act which may be required in the event any of the selling shareholders defaults under any customer agreement with brokers.
  
To the extent required under the Securities Act, a post-effective amendment to this registration statement will be filed disclosing the name of any broker-dealers, the number of shares of common stock involved, the price at which the common stock is to be sold, the commissions paid or discounts or concessions allowed to such broker-dealers, where applicable, that such broker-dealers did not conduct any investigation to verify the information set out or incorporated by reference in this prospectus and other facts material to the transaction.
 
We and the selling shareholders will be subject to applicable provisions of the Exchange Act and the rules and regulations under it, including, without limitation, Rule 10b-5 and, insofar as a selling shareholder is a distribution participant and we, under certain circumstances, may be a distribution participant, under Regulation M. All of the foregoing may affect the marketability of the common stock.
 
All expenses of the registration statement including, but not limited to, legal, accounting, printing and mailing fees are and will be borne by us. Any commissions, discounts or other fees payable to brokers or dealers in connection with any sale of the shares of common stock will be borne by the selling shareholders, the purchasers participating in such transaction, or both.
 
Any shares of common stock covered by this prospectus which qualify for sale pursuant to Rule 144 under the Securities Act, as amended, may be sold under Rule 144 rather than pursuant to this prospectus.
 
 
21

 
 
Penny Stock Regulations

You should note that our stock is a penny stock. The Securities and Exchange Commission has adopted Rule 15g-9 which generally defines "penny stock" to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and "accredited investors". The term "accredited investor" refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the SEC which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.
 
Blue Sky Restrictions on Resale
 
If a selling shareholder wants to sell shares of our common stock under this registration statement in the United States, the selling shareholders will also need to comply with state securities laws, also known as “Blue Sky laws,” with regard to secondary sales.  All states offer a variety of exemption from registration for secondary sales.  Many states, for example, have an exemption for secondary trading of securities registered under Section 12(g) of the Securities Exchange Act of 1934 or for securities of issuers that publish continuous disclosure of financial and non-financial information in a recognized securities manual, such as Standard & Poor’s.  The broker for a selling shareholder will be able to advise a selling shareholder, which states our common stock is exempt from registration with that state for secondary sales.
 
Any person who purchases shares of our common stock from a selling shareholder under this registration statement who then wants to sell such shares will also have to comply with Blue Sky laws regarding secondary sales.
 
When the registration statement becomes effective, and a selling shareholder indicates in which state(s) he desires to sell his shares, we will be able to identify whether it will need to register or will rely on an exemption there from.
 
 
22

 

DESCRIPTION OF SECURITIES

The following description of our capital stock is a summary and is qualified in its entirety by the provisions of our Articles of Incorporation which has been filed as an exhibit to our registration statement of which this prospectus is a part.

Common Stock
 
We are authorized to issue 100,000,000 shares of common stock, par value $0.0001, of which 22,818,800 shares are issued and outstanding as of November 21, 2011.  Each holder of shares of our common stock is entitled to one vote for each share held of record on all matters submitted to the vote of shareholders, including the election of directors. However, our Bylaws provide that a plurality of votes cast shall elect the directors while all other corporate actions are authorized by a majority of the votes cast. Accordingly, more than half the votes cast can approve or disapprove a corporate action, while the largest number of votes to be received by a candidate will result in having such candidate appointed as a director; a candidate does not necessarily have to obtain a majority of the votes cast in order to be appointed as a director.
 
The holders of shares of common stock have no preemptive, conversion, subscription or cumulative voting rights. There is no provision in our Articles of Incorporation or By-laws that would delay, defer or prevent a change in control of our Company other than as described above.

We are not authorized to issue any shares of preferred stock.
 
Warrants and Options

Currently, there are no warrants, options or other convertible securities outstanding.

INTEREST OF NAMED EXPERTS AND COUNSEL

No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis or had, or is to receive, in connection with the offering, a substantial interest, directly or indirectly, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents, subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer or employee.

 
23

 
 
DESCRIPTION OF BUSINESS

We were incorporated under the laws of the State of Nevada on August 31, 2009.  We were formed to offer energy consulting services to smaller sized middle market companies. The Company will analyze customer’s energy consumption and recommend energy saving solutions. From our inception to date, we have generated minimal revenues and our operations have been limited basically to organizational, start-up, and capital formation activities.  We currently have no employees other than our officers, two of whom are also our directors.  We have never intended and do not intend to be a blank check company. We have a specific business plan and do not intend to engage in any merger, acquisition or business reorganization with any entity.
 
 Our offices are currently located at XR Energy Inc. c/o Anthony Muratore, 373 Smithtown Bypass, Suite 198, Hauppauge, New York 11788. Our telephone number at such address is 631-913-8090. Our website is xrenergy.com. Information contained on our website, or which can be accessed through the website, does not constitute a part of this registration statement.
 
The Company is not a blank check company as defined in Rule 419 of the Securities Act of 1933. Pursuant to Rule 419(a)(2), a blank check company is a development stage company that has no specific business plan or purpose or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies, or other entity or person; and is issuing "penny stock," as defined in Rule 3a51-1 under the Securities Exchange Act of 1934.  Since our inception, we had a specific business plan - we were formed to offer energy consulting services to smaller sized middle market companies. As discussed below, although we have nominal assets and have minimal revenues since inception, we intend to focus on this business and are neither a blank check company nor a development stage company.  
 
 
24

 
 
Business

We intend to provide energy consulting and implementation solutions focused on assisting our clients in the achievement of their energy efficiency goals.  We intend to operate in three specific markets: the commercial and industrial market, the public sector market, and the utility market.  Our clients will include middle-market commercial and industrial businesses, property owners and managers, utilities, government entities and educational institutions.  We will focus on deploying solutions to improve building energy efficiency and reduce energy-related expenditures. Our solutions include recommendations on energy efficient lighting upgrades, energy efficient mechanical and electrical retrofit and upgrade services. We will provide energy efficiency solutions across a range of facilities, from high-rise office buildings, distribution facilities, manufacturing plants, retail sites, mixed use complexes to small, local facilities.
 
We will offer our clients a full range of services to address their energy efficiency goals based on our ability to identify and deliver significant returns on our clients’ investments, maximize their operational savings and reduce their maintenance costs. Our services will include:
 
Energy Consulting and Technical Services:  We intend to analyze each client’s energy consumption and operational needs and develop customized energy efficiency solutions.  Our energy consulting services will include energy auditing and energy price reduction in deregulated markets. Our initial analysis will include a review of historical billing information provided by present utility providers. We will analyze historical usage and consumption patterns to determine the pricing and product spectrum of offerings available from local suppliers.
 
Implementation:  We will provide implementation services for a range of energy efficiency and renewable energy projects, including energy efficient lighting upgrades, energy efficiency mechanical and electrical retrofit and upgrade services. We will consider factors such as current facility infrastructure, best available technologies, building environmental conditions, hours of operation, energy costs, the choice of an energy service company (ESCO), available utility rebates, tax incentives, and installation, operation and maintenance costs of various efficiency alternatives.  This will allow us to provide our clients the most appropriate, effective technologies available in their marketplace.
 
We currently have an agreement with East Coast Power, LLC, which sells electricity and natural gas in the State of New York. Based on this agreement, we will receive $.04 net, per therm for natural gas for any business we refer to East Coast.  When natural gas is delivered, it is measured by the gas utility in 'therms' for billing purposes. A therm is equivalent to 100,000 Btu, or just over 97 cubic feet, of natural gas.  If we refer East Coast Power any clients, we receive four cents for natural gas the client purchases from them.

 
25

 

Competition

Deregulation of the gas and electric market in New York alone has resulted in a large number of energy service companies (ESCOs) competing for customers. NY State has over 100 Energy Service Companies (ESCOs) that offer gas and electric services to business and residential customers. There are many companies providing the same services as XR Energy Inc. that are more established and are better capitalized. The barriers to entry are quite low. We expect that additional competition will be forthcoming.
 
Intellectual Property

We do not own any intellectual property rights.

Governmental Regulations
 
We are required to comply with all regulations, rules and directives of local governmental authorities and agencies  in any jurisdiction which we would conduct activities. However, there is nothing specific to our business as we are providing consulting, advisory services to clients.
 
Employees

We have no employees other than our executive officers, who are also our directors.  All functions including development, strategy, negotiations and administration are currently being provided by our executive officers. Our officers and directors do not work exclusively for us and do not devote all of their time to our operations.  Their other activities prevent them from devoting their full-time to our operations. It is expected that they will only be available on a part-time basis and may devote between 20 and 30 hours per week to our operations on an ongoing basis.  

DESCRIPTION OF PROPERTY

The Company executive offices are located at 373 Smithtown Bypass, Suite 198, Hauppauge, NY 11788. We rent space from Mr. Muratore, our President and a director, under a month-to-month oral agreement. Pursuant to such agreement, we are obligated to pay $175 a month in rent to Mr. Muratore. The Company believes that its current office space will be adequate for the foreseeable future.

 
26

 
 
LEGAL PROCEEDINGS

There are no pending legal proceedings to which the Company is a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of more than 5% of any class of voting securities of the Company, or security holder is a party adverse to the Company or has a material interest adverse to the Company.  
 
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
 
Market Information
 
There has been no market for our securities. Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with the FINRA for our common stock to be eligible for trading on the Over The Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application. There is no guarantee that our common stock will be eligible for trading or quoted on the Over the Counter Bulletin Board or that  a trading market will develop, or, if developed, that it will be sustained. Consequently, a purchaser of our common stock may find it difficult to resell the securities offered herein should the purchaser desire to do so when eligible for public resale.
 
DIVIDEND POLICY

We have not declared or paid dividends on our Common Stock since our formation, and we do not anticipate paying dividends in the foreseeable future. Declaration or payment of dividends, if any, in the future, will be at the discretion of our Board of Directors and will depend on our then current financial condition, results of operations, capital requirements and other factors deemed relevant by the board of directors. There are no contractual restrictions on our ability to declare or pay dividends.

 
27

 
 
SHARE CAPITAL

Security Holders

As of November 21, 2011, there were 22,818,800 common shares issued and outstanding, which are held by 45 shareholders of record.

Transfer Agent

We have not engaged a transfer agent to serve as transfer agent for shares of our common stock.  Until we engage such a transfer agent, we will be responsible for all record-keeping and administrative functions in connection with the shares of our common stock.

Admission to Quotation on the OTC Bulletin Board

We intend to have a market maker file an application for our common stock to be quoted on the OTC Bulletin Board. However, we do not have a market maker that has agreed to file such application.  If our securities are not quoted on the OTC Bulletin Board, a security holder may find it more difficult to dispose of, or to obtain accurate quotations as to the market value of our securities. The OTC Bulletin Board differs from national and regional stock exchanges in that it

(1) is not situated in a single location but operates through communication of bids, offers and confirmations between broker-dealers, and

(2) securities admitted to quotation are offered by one or more broker-dealers rather than the "specialist" common to stock exchanges.
 
To qualify for quotation on the OTC Bulletin Board, an equity security must have one registered broker-dealer, known as the market maker, willing to list bid or sale quotations and to sponsor the company listing. If it meets the qualifications for trading securities on the OTC Bulletin Board our securities will trade on the OTC Bulletin Board. We may not now or ever qualify for quotation on the OTC Bulletin Board. We currently have no market maker who is willing to list quotations for our securities.
 
 
28

 
 
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATION

Certain statements contained in this prospectus, including statements regarding the anticipated development and expansion of our business, our intent, belief or current expectations, primarily with respect to the future operating performance of XR Energy Inc., and the products we expect to offer and other statements contained herein regarding matters that are not historical facts, are "forward-looking" statements. Future filings with the Securities and Exchange Commission, future press releases and future oral or written statements made by us or with our approval, which are not statements of historical fact, may contain forward-looking statements, because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.

All forward-looking statements speak only as of the date on which they are made.  We undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they are made.

Overview

We were formed to offer energy consulting services to smaller sized middle market companies. The Company will analyze customer’s energy consumption and recommend energy saving solutions.

Plan of Operation

Over the next twelve months, the Company intends to focus on the following activities:

In the twelve months, we plan to expand our business operations. During the next three months we plan to hire additional sales people to expand our customer base. If necessary, we intend to acquire additional office space and to locate additional product offerings through trade shows to expand our product base. We intend to look to expand our customer reach through professional recommendations by contacting professionals in strategic industries such as architects and contractors. 
 
The Company estimates that it will require an approximate minimum of $100,000 in the next 12 months to implement its activities.  Such funds will be needed for the following purposes:
 
Purpose
 
Amount
 
Office Expense
  $
12,000
 
Salaries
  $
30,000
 
Printing
  $
1,500
 
Working Capital
  $
21,500
 
Cost of operating as a public company:
       
Legal
 
$
20,000
 
Accounting
   
15,000
 
Total
 
$
100,000
 
 
The Company believes that such funds will be insufficient to fund its expenses over the next twelve months. There can be no assurance that additional capital will be available to the Company. The Company currently has no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources. The officers and directors have agreed to lend funds to the Company in the event funds are required for the operations of the Company. However, there is no guarantee that our officers and directors will lend us sufficient funds to operate.
 
 
29

 
 
Results of Operations

As of September 30, 2011, the Company had $31,945 in cash as compared to $18,413 as of December 31, 2010. We believe that such funds will not be sufficient to effectuate our plans with respect the Company’s proposed operation over the next twelve months. We will need to seek additional capital for the purpose of effectuating our business plan.

Revenues

The Company did not generate any significant revenues during the period from August 31, 2009 (inception) through September 30, 2011. For the nine months ended September 30, 2011, we had $5,917 in income as compared to $1,112 of income for the year ended December 31, 2010. This income was generated from East Coast Power, LLC.
 
Total operating expenses

For the nine months ended September 30,, 2011 total operating expenses were $6,960 which consisted primarily of $4,500 for professional fees and $1,575 for rent and utilities, as compared to $14,500 of operating expenses for the three months ended September 30, 2010 which consisted of $12,375 for professional fees and $1,575 for rent and utilities. During the period from August 31, 2009 (inception) to December 31, 2009, the total operating expenses were $14,625 consisting of professional fees.  The decrease of operating expenses was primarily as a result of a decrease in the professional fees

Net loss

Net loss for the nine month period ended September 30, 2011 was $1,043, as compared to a net loss of $14,500 for the nine month period ended September 30, 2010. During the period from August 31, 2009 (inception) through December 31, 2009, the Company had a net loss of $14,625. The decrease in net loss was primarily the result of a decrease in the amount of professional fees and the $5,917 of income in the nine months ended September 30, 2011.
 
 
30

 
 
Liquidity and Capital Resources
 
As of September 30, 2011, the Company had a cash balance of $31,945.  From June 2010 through July 2011 the Company sold an aggregate of 118,800 shares of its common stock in a private placement and raised gross proceeds of $29,700. The Company believes that such funds will be insufficient to fund its expenses over the next twelve months. There can be no assurance that additional capital will be available to the Company. The Company currently has no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources. The officers and directors have orally agreed to lend funds to the Company in the event capital is required for the operations of the Company. However, there is no guarantee that our officers and directors will lend us the funds we need to commence operations. There is no minimum or maximum amount of funds that the officers and directors have agreed to lend; since they are committed to ensuring that the Company can operate its business, they have each agreed to be responsible for this Company's operating expenses for the next 12 months if outside financing is not available. Notwithstanding that our officers and directors are committed to ensuring that the Company can operate its business, neither Mr. Muratore or Mrs. Muratore are legally or contractually obligated to lend us any money. Since the Company has no such arrangements or plans currently in effect, its inability to raise funds for the above purposes will have a severe negative impact on its ability to remain a viable company.
 
We currently have no commitments with any person for any capital expenditures.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
 
Michael T. Studer CPA P.C. is our auditors. There have not been any changes in or disagreements with accountants on accounting and financial disclosure or any other matter.
 
 
31

 
 
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

Directors and Executive Officers

Set forth below are the names, ages and present principal occupations or employment, and material occupations, positions, offices or employments for the past five years of our current directors and executive officers.

Name and Business Address
 
Age
 
Position
         
Anthony P. Muratore
 
42
 
President and Director
Tara Muratore
 
41
 
Treasurer, Secretary and Director
 
Anthony P. Muratore is the President of the Company. Since 2001, Mr. Muratore been the President of Consumer One Mortgage, arranging loans in both commercial and residential markets. From 2003 through 2007, he was an account executive with GunnAllen Financial Inc. Mr. Muratore graduated SUNY Oneonta in 1991 with a B.S. in Business Economics. We believe that Mr. Muratore's qualifications to sit on our board of directors include his extensive experience analyzing and negotiating loan documentation.

Tara Muratore is the Secretary and Treasurer of the Company. Since 2006, Mrs. Muratore has worked as an accountant at SLP Financial Solutions. Mrs. Muratore graduated LI University C.W. Post in 1992 with a B.S. in Accounting. We believe Mrs. Muratore's qualifications to sit on our board of directors include her many years as a accountant for small, privately held companies.
 
Anthony Muratore and Tara Muratore are husband and wife.  None of our directors or officers is a director in any other reporting companies.  None of our directors or officers has been affiliated with any company that has filed for bankruptcy within the last ten years.  The Company is not aware of any proceedings to which any of the Company’s officers or directors, or any associate of any such officer or director, is a party adverse to the Company or any of the Company’s subsidiaries or has a material interest adverse to it or any of its subsidiaries.

Each director of the Company serves for a term of one year or until the successor is elected at the Company's annual shareholders' meeting and is qualified, subject to removal by the Company's shareholders.  Each officer serves, at the pleasure of the board of directors, for a term of one year and until the successor is elected at the annual meeting of the board of directors and is qualified.

 
32

 
 
Auditors; Code of Ethics; Financial Expert

Our independent registered public accounting firm is Michael T. Studer CPA P.C.

We do not currently have a Code of Ethics applicable to our principal executive, financial and accounting officers. We do not have a “financial expert” on the board or an audit committee or nominating committee.

Potential Conflicts of Interest
 
Since we do not have an audit or compensation committee comprised of independent directors, the functions that would have been performed by such committees are performed by our directors.  Thus, there is a potential conflict of interest in that our directors and officers have the authority to determine issues concerning management compensation and audit issues that may affect management decisions.  We are not aware of any other conflicts of interest with any of our executives or directors.
 
Director Independence

We are not subject to listing requirements of any national securities exchange or national securities association and, as a result, we are not at this time required to have our board comprised of a majority of “independent directors.” We do not believe that any of our directors currently meet the definition of “independent” as promulgated by the rules and regulations of the American Stock Exchange.

EXECUTIVE COMPENSATION

Since our incorporation on August 31, 2009, Anthony Muratore has been our President and a director. We have no formal employment or consulting agreement with Mr. Muratore. On September 8, 2009, Mr. Muratore was issued 12,000,000 shares of our common stock in consideration for his services as an officer to the Company, valued in the amount of $1,200.

Since our incorporation on August 31, 2009, Tara Muratore has been our Treasurer, Secretary and a director. We have no formal employment or consulting agreement with Mrs. Muratore. On September 8, 2009, Mrs. Muratore was issued 8,000,000 shares of our common stock in consideration for her services as an officer to the Company, valued in the amount of $800.

 
33

 

SUMMARY COMPENSATION TABLE
 
Name and principal position
(a)
Year(1)
(b)
 
Salary ($)
(c)
   
Bonus ($)
(d)
   
Stock Awards ($)
(e)
   
Option Awards ($)
(f)
   
Non-Equity Incentive Plan Compensation ($)
(g)
   
Nonqualified Deferred Compensation Earnings ($)
(h)
   
All Other Compensation ($)
(i)
   
Total ($)
(j)
 
Anthony Muratore
(President)
2010
   
0
     
0
     
0
     
0
     
0
     
0
     
0
     
0
 
 
2009
   
0
     
0
     
0
     
0
     
0
     
0
     
0
     
0
 
Tara Muratore (Secretary and Treasurer)
2010
   
0
     
0
     
0
     
0
     
0
     
0
     
0
     
0
 
 
(1)  
On September 8, 2009, Mr. Muratore was issued 12,000,000 shares of our common stock in consideration for his services as an officer to the Company, valued in the amount of $1,200.

(2)  
On September 8, 2009, Mrs. Muratore was issued 8,000,000 shares of our common stock in consideration for her services as an officer to the Company, valued in the amount of $800.
 
Since our incorporation on August 31, 2009, no stock options or stock appreciation rights were granted to any of our directors or executive officers, none of our directors or executive officers exercised any stock options or stock appreciation rights, and none of them hold unexercised stock options. We have no long-term incentive plans.
 
Outstanding Equity Awards
 
Our directors and officers do not have unexercised options, stock that has not vested, or equity incentive plan awards.
 
Compensation of Directors
 
During the period from August 31, 2009 (inception) to September 30, 2011, none of our directors received compensation for services rendered in their capacity as a director.
 
No arrangements are presently in place regarding compensation to directors for their services as directors or for committee participation or special assignments.
 
 
34

 
 
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table lists, as of November 21, 2011, the number of shares of common stock of our Company that are beneficially owned by (i) each person or entity known to our Company to be the beneficial owner of more than 5% of the outstanding common stock; (ii) each officer and director of our Company; and (iii) all officers and directors as a group. Information relating to beneficial ownership of common stock by our principal shareholders and management is based upon information furnished by each person using “beneficial ownership” concepts under the rules of the Securities and Exchange Commission. Under these rules, a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or direct the voting of the security, or investment power, which includes the power to vote or direct the voting of the security. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60 days. Under the Securities and Exchange Commission rules, more than one person may be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which he or she may not have any pecuniary beneficial interest. Except as noted below, each person has sole voting and investment power.

The percentages below are calculated based on 22.818,800 shares of our common stock issued and outstanding as of November 21, 2011.  We do not have any outstanding options, warrants or other securities exercisable for or convertible into shares of our common stock.  Unless otherwise indicated, the address of each person listed is c/o XR Energy Inc., 373 Smithtown Bypass, Hauppauge, NY 11788.
 
Name of Beneficial Owner
Title Of Class
 
Amount and Nature of Beneficial Ownership
   
Percent of Class
 
               
Anthony Muratore
Common
    12,000,000       52.59 %
                   
Tara Muratore
Common
    8,000,000       35.06 %
                   
                   
                   
Directors and Officers as a Group (2 persons)
Common
    20,000,000       87.65 %

 
35

 
 
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

On September 8, 2009, we issued 12,000,000 shares of our common stock to Anthony Muratore. These shares were issued in exchange for services provided to us as an officer of the Company which we valued at $1,200. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended.  Mr. Muratore is a founder of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.

On September 8, 2009, we issued 8,000,000 shares of our common stock to Tara Muratore. These shares were issued in consideration for services provided to us as an officer to the Company which we valued in the amount of $800. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended.  Mrs. Muratore is a founder of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.
 
We rent office space from Mr. Muratore under a month-to-month oral agreement pursuant to which we pay $175 per month. As of September 30, 2011 we owe Mr. Muratore $3,675 for accrued rent.
 
Anthony Muratore and Tara Muratore are husband and wife.

Each of the above persons is considered a "promoter" under the rules and regulations of the SEC. None of the above promoters received, or is to receive, anything from the Company, either directly or indirectly, other than the shares of the Company stated above.
 
EXPENSES OF ISSUANCE AND DISTRIBUTION

We have agreed to pay all expenses incident to the offering and sale to the public of the shares being registered other than any commissions and discounts of underwriters, dealers or agents and any transfer taxes, which shall be borne by the selling shareholders. The expenses which we are paying are set forth in the following table. All of the amounts shown are estimates except the SEC registration fee.

Nature of Expense
 
Amount
 
       
Accounting fees and expenses*
 
$
7,500
 
         
SEC registration fee
 
$
82.24
 
         
Legal  fees  and  other expenses*
 
$
10,000
 
         
Total
 
$
17,582.24
 
*Estimated Expenses.
 
 
36

 
 
LEGAL MATTERS

David Lubin & Associates, PLLC has opined on the validity of the shares of common stock being offered hereby.

EXPERTS

The financial statements included in this prospectus and in the registration statement have been audited by Michael T. Studer CPA P.C. , an independent registered public accounting firm, to the extent and for the period set forth in their report appearing elsewhere herein and in the registration statement, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.
 
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

Our By-laws provide to the fullest extent permitted by law, our directors or officers, former directors and officers, and persons who act at our request as a director or officer of a body corporate of which we are a shareholder or creditor shall be indemnified by us. We believe that the indemnification provisions in our By-laws are necessary to attract and retain qualified persons as directors and officers.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the "Act" or "Securities Act") may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.

WHERE YOU CAN FIND MORE INFORMATION

We have filed a registration statement on Form S-1 under the Securities Act with the SEC for the securities offered hereby. This prospectus, which constitutes a part of the registration statement, does not contain all of the information set forth in the registration statement or the exhibits and schedules which are part of the registration statement. For additional information about us and our securities, we refer you to the registration statement and the accompanying exhibits and schedules. Statements contained in this prospectus regarding the contents of any contract or any other documents to which we refer are not necessarily complete. In each instance, reference is made to the copy of the contract or document filed as an exhibit to the registration statement, and each statement is qualified in all respects by that reference. Copies of the registration statement and the accompanying exhibits and schedules may be inspected without charge (and copies may be obtained at prescribed rates) at the public reference facility of the SEC at Room 1024, 100 F Street, N.E. Washington, D.C. 20549.

You can request copies of these documents upon payment of a duplicating fee by writing to the SEC. You may call the SEC at 1-800-SEC-0330 for further information on the operation of its public reference rooms. Our filings, including the registration statement, will also be available to you on the Internet web site maintained by the SEC at http://www.sec.gov.

 
37

 
 
FINANCIAL STATEMENTS
 
XR ENERGY, INC.
INDEX TO FINANCIAL STATEMENTS
FOR THE PERIOD AUGUST 31, 2009 (INCEPTION) THROUGH DECEMBER 31, 2009
AND FOR THE YEAR ENDED DECEMBER 31, 2010
AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010 (UNAUDITED)
 
Report of Independent Registered Public Accounting Firm     F-2  
         
Balance Sheets as of December 31, 2009 and 2010 and September 30, 2011 (Unaudited)     F-3  
         
Statements of Operations for the period August 31, 2009 (Inception) through December 31, 2009 and for the year ended December 31, 2010 and for the nine months ended September 30, 2010 and 2011 (Unaudited )     F-4  
         
Statements of Stockholders’ Equity for the period August 31, 2009 (Inception) through December 31, 2009 and for the year ended December 31, 2010 and for the nine months ended September 30, 2011 (Unaudited )     F-5  
         
Statements of Cash Flows for the period August 31, 2009 (Inception) through December 31, 2009 and for the year ended December 31, 2010 and for the nine months ended September 30, 2010 and 2011 (Unaudited )     F-6  
         
Notes to Financial Statements     F-7  
 
 
F-1

 
 
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of XR Energy, Inc.

I have audited the accompanying balance sheets of XR Energy, Inc. (the Company) as of December 31, 2010 and 2009 and the related statements of operations, stockholders’ equity, and cash flows for the year ended December 31, 2010 and for the period August 31, 2009 (inception) to December 31, 2009. These financial statements are the responsibility of the Company’s management. My responsibility is to express an opinion on these financial statements based on my audit.

I conducted my audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion.

In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of XR Energy, Inc. as of December 31, 2010 and 2009 and the results of its operations and its cash flows for the year ended December 31, 2010 and for the period August 31, 2009 (inception) to December 31, 2009 in conformity with accounting principles generally accepted in the United States.

The accompanying financial statements referred to above have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company’s present financial situation raises substantial doubt about its ability to continue as a going concern. Management’s plans in regard to this matter are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.


/S/ Michael T. Studer CPA P.C.
Michael T. Studer CPA P.C.
Freeport, New York
November 18, 2011
 
 
F-2

 
 
XR Energy, Inc.
Balance Sheets
As of December 31, 2009 and 2010
and September 30, 2011 (Unaudited)
 
   
September 30,
    December 31,  
   
2011
   
2010
   
2009
 
   
(Unaudited)
             
Assets
                   
Current Assets                  
                   
Cash and Cash Equivalents
  $ 31,945     $ 18,413     $ -  
Prepaid Consulting
    -       -       12,375  
                         
Total Current Assets
    31,945       18,413       12,375  
                         
Total Assets   $ 31,945     $ 18,413     $ 12,375  
                         
Liabilities and Stockholders' Equity
                         
Current Liabilities                        
                         
Accounts Payable and
                       
Accrued Expenses
  $ 3,675     $ 2,100     $ -  
                         
Total Current Liabilities     3,675       2,100       -  
                         
Long-Term Liabilities                        
                         
Due to Officer
    1,250       1,250       -  
                         
Total Liabilities     4,925       3,350       -  
                         
Stockholders' Equity                        
                         
Common Stock, $.0001 par value,
                       
100,000,000 shares authorized,
                       
22,818,800, 22,766,800 and 22,700,000,
                       
respectively, issued and outstanding
    2,282       2,277       2,270  
Additional Paid-In Capital
    54,418       41,423       24,730  
Retained Earnings (Deficit)
    (29,680 )     (28,637 )     (14,625 )
                         
Total Stockholders' Equity
    27,020       15,063       12,375  
                         
Total Liabilities and                        
Stockholders' Equity   $ 31,945     $ 18,413     $ 12,375  
 
See accompanying notes to financial statements

 
F-3

 

XR Energy, Inc.
Statements of Operations
For the period August 31, 2009 (inception) through December 31, 2009
and for the year ended December 31, 2010
and for the nine months ended September 30, 2010 and 2011
(Unaudited)
 
    Nine Months Ended    
Year Ended
   
Period
August 31, 2009
(Inception) Through
 
   
September 30,
   
September 30,
   
December 31,
   
December 31,
 
   
2011
   
2010
   
2010
   
2009
 
   
(Unaudited)
   
(Unaudited)
             
                         
Income
  $ 5,917     $ -     $ 1,112     $ -  
                                 
Total Income
    5,917       -       1,112       -  
                                 
General and Administrative
                               
                                 
Professional Fees
    4,500       12,375       12,375       14,625  
Rent and Utilities
    1,575       1,575       2,100       -  
Filing Fees
    375       550       649       -  
Corporate Income Taxes
    270       -       -       -  
Bank Charges
    240       -       -       -  
                                 
Total General and Administrative
    6,960       14,500       15,124       14,625  
 
                               
                                 
Net (Loss)
  $ (1,043 )   $ (14,500 )   $ (14,012 )   $ (14,625 )
                                 
                                 
Basic and Diluted Income (Loss) per Share
  $ (0.00 )   $ (0.00 )   $ (0.00 )   $ (0.00 )
                                 
                                 
Weighted Average Number of Shares
                               
Outstanding, Basic and Diluted
    22,807,618       22,707,745       22,715,489       22,700,000  
 
See accompanying notes to financial statements

 
F-4

 
 
XR Energy, Inc.
Statements of Stockholders' Equity
For the period August 31, 2009 (Inception) through December 31, 2009 and for the year ended December 31, 2010
and for the nine months ended September 30, 2011 (Unaudited)
 
   
Common Stock
   
Additional
   
Retained
   
Total
 
   
Number of
   
Par
   
Paid-In
   
Earnings
   
Stockholders'
 
   
Shares
   
Value
   
Capital
   
(Deficit)
   
Equity
 
                               
Balance, August 31, 2009 (Inception)
    -     $ -     $ -     $ -     $ -  
                                         
Issuance of Founder Shares
    20,000,000       2,000       (2,000 )     -       -  
                                         
Common Shares Issued For Services
    2,700,000       270       26,730       -       27,000  
                                         
Net (loss) for the period ended
                                       
December 31, 2009
    -       -       -       (14,625 )     (14,625 )
                                         
                                         
Balance, December 31, 2009
    22,700,000       2,270       24,730       (14,625 )     12,375  
                                         
Private Placements of Common Shares
    66,800       7       16,693       -       16,700  
                                         
Net (loss) for the year ended
                                       
December 31, 2010
    -       -       -       (14,012 )     (14,012 )
                                         
                                         
Balance, December 31, 2010
    22,766,800       2,277       41,423       (28,637 )     15,063  
                                         
                                         
Private Placements of Common Shares
    52,000       5       12,995       -       13,000  
                                         
Net (loss) for the nine months
                                       
ended September 30, 2011
    -       -       -       (1,043 )     (1,043 )
                                         
                                         
Balance, September 30, 2011 (Unaudited)
    22,818,800     $ 2,282     $ 54,418     $ (29,680 )   $ 27,020  
 
See accompanying notes to financial statements

 
F-5

 
 
XR Energy, Inc.
Statements of Cash Flow
For the period August 31, 2009 (inception) through December 31, 2009 and for the year ended December 31, 2010
and for the nine months ended September 30, 2010 and June 30, 2011 (Unaudited)
 
    Nine Months Ended    
Year Ended
   
Period
August 31, 2009
(Inception) Through
 
   
September 30,
   
September 30,
   
December 31,
   
December 31,
 
   
2011
   
2010
   
2010
   
2009
 
   
(Unaudited)
   
(Unaudited)
             
Cash Flows from Operating Activities:
                       
                         
Net (Loss)
  $ (1,043 )   $ (14,500 )   $ (14,012 )   $ (14,625 )
                                 
Adjustments to reconcile net income (loss) to
                               
net cash provided by operating activities:
                               
                                 
Issuance of Common Shares for Services
    -       -       -       27,000  
Changes in Operating Assets and Liabilities:
                               
Prepaid Consulting
    -       12,375       12,375       (12,375 )
Accounts Payable and
                               
Accrued Expenses
    1,575       1,575       2,100       -  
                                 
Total Adjustments
    1,575       13,950       14,475       14,625  
                                 
Net cash provided (used) by operating activities
    532       (550 )     463       -  
                                 
                                 
Cash Flows from Financing Activities:
                               
                                 
Increase in Due to Officer
    -       1,250       1,250       -  
Private Placements of Common Shares
    13,000       4,500       16,700       -  
                                 
Net cash provided by financing activities
    13,000       5,750       17,950       -  
                                 
                                 
Net increase in cash and cash equivalents
    13,532       5,200       18,413       -  
                                 
Cash and Cash Equivalents, Beginning of Period
    18,413       -       -       -  
                                 
Cash and Cash Equivalents, End of Period
  $ 31,945     $ 5,200     $ 18,413     $ -  
                                 
                                 
Non-Cash Financing and Investing Activities;
                               
                                 
Issuance of Common Shares for Services
  $ -     $ -     $ -     $ 27,000  
 
See accompanying notes to financial statements
 
 
F-6

 
 
XR ENERGY, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD AUGUST 31, 2009 (INCEPTION) THROUGH DECEMBER 31, 2009
AND FOR THE YEAR ENDED DECEMBER 31, 2010
AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010 (UNAUDITED)
 
(1) Organization and Business Description

XR Energy, Inc. (“XR” or the “Company”) was incorporated under the laws of the State of Nevada on August 31, 2009. XR offers energy consulting services to smaller sized middle market companies in the New York Metropolitan Area. The Company also earns a commission from the related utility for energy services brokered and sold to its customers.

Going Concern Uncertainty

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplates the Company continuing as a going concern. As of September 30, 2011, the Company had cash of $31,945 and working capital of $28,270. For the period August 31, 2009 (inception) through September 30, 2011, the Company had minimal revenues and a cumulative net loss of $29,680. These factors raise substantial doubt as to the ability of the Company to continue as a going concern. However, the Company plans to improve its financial condition by raising additional capital by selling shares of its common stock. Also, the Company plans to pursue new customers and acquisition prospects in order to attain profitable operations. However, there is no assurance that the Company will be successful in accomplishing these objectives. The financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.
 
(2) Summary of Significant Accounting Policies

Use of Estimates

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

Cash and Cash Equivalents

For purposes of reporting within the statement of cash flows, the Company considers all cash on hand, cash accounts not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less to be cash and cash equivalents.

Revenue Recognition

The Company recognizes revenues from consulting fees and commissions earned from various utilities related to sales of energy services to customers in the New York Metropolitan Area. Revenues are recognized for financial reporting purposes when the utility delivers the energy services to the customer, acceptance has been approved by the customer, the fee is fixed or determinable, and collection of the related receivable is probable.

 
F-7

 
 
XR ENERGY, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD AUGUST 31, 2009 (INCEPTION) THROUGH DECEMBER 31, 2009
AND FOR THE YEAR ENDED DECEMBER 31, 2010
AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010 (UNAUDITED)

Loss Per Common Share

Basic loss per share is computed by dividing the net loss attributable to the common stockholders by the weighted-average number of shares of common stock outstanding during the period. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if potentially dilutive common shares (such as stock options and convertible securities) had been issued and if the additional common shares were dilutive. There were no dilutive financial instruments issued or outstanding for the periods presented.

Income Taxes
 
The Company accounts for income taxes under the provisions of Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) 740 “Income Tax”. ASC 740 requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statement carrying amounts and tax bases of certain assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. The deferred tax assets and liabilities are classified according to the financial statement classification of the assets and liabilities generating the differences. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company has adopted the provisions of FASB ASC 740-10-05 “Accounting for Uncertainty in Income Taxes”. The ASC clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. The ASC prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The ASC provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. At September 30, 2011, December 31, 2010 and 2009, the Company had no material unrecognized tax benefits.
Stock-Based Compensation
Stock-based compensation is accounted for at fair value in accordance with FASB ASC 718, “Compensation – Stock Compensation”. The Company recognizes stock-based compensation expense for the fair value of all shares and stock options that are ultimately expected to vest over the requisite service period of the respective awards. To date, the Company has not granted any stock options.

Recent Accounting Pronouncements

Management does not believe that any recently issued, but not yet effective, accounting standard if currently adopted would have a material effect on the accompanying financial statements.
 
(3) Prepaid Consulting

Prepaid Consulting at December 31, 2009 represents the unamortized balance related to three separate agreements dated September 22, 2009 (see Note 6).

 
F-8

 
 
XR ENERGY, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD AUGUST 31, 2009 (INCEPTION) THROUGH DECEMBER 31, 2009
AND FOR THE YEAR ENDED DECEMBER 31, 2010
AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010 (UNAUDITED)
 
(4) Due To Officer

Due to Officer at September 30, 2011 and December 31, 2010 represents monies advanced to the Company by a major shareholder of the Company for the purpose of providing working capital for the business. The amount due is non-interest bearing and is payable on demand. The balance has been classified as a Long-term Liability because a demand for payment is not expected currently.
 
(5) Income Taxes

The provision for (benefit from) income taxes for the nine months ended September 30, 2011 and 2010 and for the year ended December 31, 2010 and for the period August 31, 2009 (inception) through December 31, 2009 are as follows, assuming a combined effective tax rate of approximately 40%:

                     
Period
 
                     
August 31, 2009
 
    Nine Months Ended    
Year Ended
   
(Inception) Through
 
    September 30,    
December 31,
   
December 31,
 
   
2011
   
2010
   
2010
   
2009
 
Federal and state
                       
taxable income
  $ -     $ -     $ -     $ -  
                                 
Total current tax provision
    -       -       -       -  
                                 
Federal and state
                               
loss carryforwards
    (417 )     (5,370 )     (5,605 )     (5,850 )
Change in valuation allowance
    417       5,370       5,605       5,850  
                                 
Total deferred tax provision
    -       -       -       -  
                                 
Total income tax provision
  $ -     $ -     $ -     $ -  
 
The Company had deferred tax income tax assets as of September 30, 2011, December 31, 2010 and December 31, 2009 as follows:

 
F-9

 
 
XR ENERGY, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD AUGUST 31, 2009 (INCEPTION) THROUGH DECEMBER 31, 2009
AND FOR THE YEAR ENDED DECEMBER 31, 2010
AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010 (UNAUDITED)
 
   
September 30,
    December 31,  
   
2011
   
2010
   
2009
 
                   
Loss carryforwards
  $ 11,872     $ 11,455     $ 5,850  
Less: valuation allowance
    (11,872 )     (11,455 )     (5,850 )
                         
Total net deferred tax assets
  $ -     $ -     $ -  
 
The Company has maintained a full valuation allowance against the total deferred tax assets for all periods due to the uncertainty of future utilization.

As of September 30, 2011, December 31, 2010 and 2009, the Company has net operating loss carry forwards of $29,680, $28,637, and $14,625, respectively, which expire in 2029, 2030 and 2031.
 
(6)Common Stock

In September 2009, the Company issued a total of 2,700,000 shares of restricted common stock related to three separate consulting agreements. Each contract had a term of six months and was valued at $1,500 per month, or $9,000 in total. The aggregate value of these agreements was $27,000, was recorded as a Prepaid Expense upon issuance of the shares and was expensed over the six month term of the respective agreements. All shares were fully vested upon issuance.

During 2010, the Company sold and issued a total of 66,800 shares of restricted common stock in a series of private placements for $.25 per share with gross proceeds of $16,700.

During the nine months ended September 30, 2011, the Company sold and issued a total of 52,000 shares of restricted common stock in a series of private placements for $.25 per share with gross proceeds of $13,000.

There were no dilutive financial instruments issued or outstanding as of September 30, 2011, December 31, 2010 and 2009.
 
(7)Related Party Transactions

Included in Accounts Payable at September 30, 2011 and December 30, 2010 is $3,675 and $2,100, respectively, due to a Company, which is owned by a founding shareholder and officer of XR, for rent and related cost for office space utilized by XR under a verbal month-to-month agreement.

 
F-10

 
 
XR ENERGY, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD AUGUST 31, 2009 (INCEPTION) THROUGH DECEMBER 31, 2009
AND FOR THE YEAR ENDED DECEMBER 31, 2010
AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010 (UNAUDITED)
 
(8)Commitments and Contingencies

Rental Agreement

The Company rents office space from a related party (see Note 7) under a month-to-month agreement which provides for rent of $175 per month.

Planned Registration Statement

The Company plans to file a registration statement on Form S-1 with the Securities and Exchange Commission (“SEC”) to register for sale the 2,818,800 shares of common stock issued to consultants in 2009 and sold to investors in a series of private placements in 2010 and 2011. The Company will not receive any proceeds from the shares sold by the selling shareholders.

On October 13, 2011, the Company executed an agreement with a law firm to assist in the preparation and filing of the registration statement. The agreement provides for payments totaling $10,000; $3,500 upon signing the agreement, $5,000 upon circulation of the initial draft and $1,500 upon filing.

Conflicts of Interests

The Chief Executive Officer of the Company is currently involved in other business activities and may become involved in additional business opportunities in the future. As such, he may face a conflict in selecting between the Company and his other business interests. The Company has not formulated a policy for the resolution of such conflicts.
 
 
F-11

 
 
PART II - INFORMATION NOT REQUIRED IN PROSPECTUS
 
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth the expenses in connection with the issuance and distribution of the securities being registered hereby.  All such expenses will be borne by the Company; none shall be borne by any Selling shareholders.

Securities and Exchange Commission registration fee
 
$
82.84
 
Legal fees and miscellaneous expenses (*)
 
$
10,000
 
Accounting fees and expenses (*)
 
$
7,500
 
Total (*)
 
$
17,582.84
 
 
(*) Estimated.

INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS
 
Our bylaws provide that we will indemnify our directors and officers to the fullest extent permitted by Nevada law; provided, however, that we may modify the extent of such indemnification by  individual contracts with our directors and officers; and, provided, further, that we shall not be required to indemnify any director or officer in  connection  with any  proceeding, or part thereof, initiated by such person unless such indemnification:  (a) is expressly required to be made by law, (b) the proceeding was authorized by our board of directors, (c) is provided by us, in our sole discretion, pursuant to the powers vested in us under Nevada or (d) is required to be made pursuant to the bylaws.

Our bylaws also provide that we may indemnify a director or former director of subsidiary corporation and we may indemnify our officers, employees or agents, or the officers, employees or agents of a subsidiary corporation and the heirs and personal representatives of any such person, against all expenses incurred by the person relating to a judgment, criminal charge, administrative action or other proceeding to which he or she is a party by reason of being or having been one of our directors, officers or employees.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and control persons pursuant to the foregoing provisions or otherwise, we have been advised that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy, and is, therefore, unenforceable.

 
38

 
 
RECENT SALES OF UNREGISTERED SECURITIES
 
On September 8, 2009, we issued 12,000,000 shares of our common stock to Anthony Muratore. These shares were issued in exchange for services provided to us as an officer of the Company which we valued at $1,200. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended.  Mr. Muratore is a founder of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.

On September 8, 2009, we issued 8,000,000 shares of our common stock to Tara Muratore. These shares were issued in consideration for services provided to us as an officer to the Company which we valued in the amount of $800. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended.  Mrs. Muratore is a founder of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.

From June 2010 through July 2011 we issued 118,800 shares of common stock to  40  investors in a private placement made pursuant to the exemption from the registration requirements of the Securities Act provided by Regulation D.  The consideration paid for such shares was $0.25 per share, amounting in the aggregate to $29,700.
 
EXHIBITS

The following exhibits are filed as part of this registration statement:

Exhibit
 
Description
     
3.1
 
Articles of Incorporation of Registrant
     
3.2   By-Laws of XR Energy Inc.
     
5.1
 
Opinion of David Lubin & Associates, PLLC regarding the legality of the securities being registered
     
10.1
 
Form of Regulation D Subscription Agreement
     
10.2
 
Consulting Agreement dated September 22, 2009 between XR Energy Inc. and RJB Consulting Inc.
     
10.3
 
Consulting Agreement dated September 22, 2009 between XR Energy Inc. and Stephen Giametta
     
10.4
 
Consulting Agreement dated September 22, 2009 between XR Energy Inc. and Andew Vicari
     
23.1   Consent of Michael T. Studer CPA P.C.
     
23.2
 
Consent of David Lubin & Associates, PLLC (included in Exhibit 5.1)

 
39

 
 
UNDERTAKINGS
 
The undersigned registrant hereby undertakes:

(a)(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
 
i.  
To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;
 
ii.  
To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement.
 
iii.  
To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
 
(2)  That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
 
(3)  To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
 
(4)   Securities Act of 1933 to any purchaser in the initial That, for the purpose of determining liability of the registrant under the distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
 
(i)  
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
 
(ii)  
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
 
(iii)  
The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
 
(iv)  
Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
 
 
40

 
 
 (5)  That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser, if the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
 
(6)  That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:
 
The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
 
(i)  
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
 
(ii)  
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
 
(iii)  
The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
 
(iv)  
Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
 
Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the “Act”) may be permitted to our directors, officers and controlling persons pursuant to the provisions above, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities, other than the payment by us of expenses incurred or paid by one of our directors, officers, or controlling persons in the successful defense of any action, suit or proceeding, is asserted by one of our directors, officers, or controlling persons in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification is against public policy as expressed in the Securities Act, and we will be governed by the final adjudication of such issue.

 
41

 
 
SIGNATURES
 
Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement on Form S-1 to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Hauppauge, State of New York, on November 23, 2011.
 
 
XR ENERGY INC.
 
       
 
By:
/s/ Anthony Muratore
 
   
Name: Anthony Muratore,
 
   
Title:   President and Director (Principal Executive Officer)
 
 
 
By:
/s/ Tara Muratore
 
   
Name: Tara Muratore,
 
   
Title:   Treasurer, Secretary and Director
             (Principal Financial and Accounting Officer)
 

 
42

 
 
POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Anthony Muratore, his or her true and lawful attorneys-in-fact, with full power of substitution and re-substitution, for him or her and in his or her name, place and stead, in any and all capacities to sign any and all amendments (including post-effective amendments) to this registration statement and to sign a registration statement pursuant to Section 462(b) of the Securities Act of 1933, and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Date:
 
Signature:
 
Name:
 
Title:
             
November 23, 2011
 
/s/ Anthony Muratore 
 
Anthony Muratore
 
President and Director (Principal Executive Officer)
             
November 23, 2011
 
/s/ Tara Muratore    
 
Tara Muratore
 
Treasurer, Secretary  and Director (Principal Financial and Accounting Officer)
             

 
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EXHIBIT 3.1
 
 
 
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2

 
 
 
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EXHIBIT 3.2
 
BY-LAWS
OF
XR ENERGY INC.
 (the “Corporation”)
* * * * * * * * * * *

ARTICLE I
Offices
 
The Corporation may have offices at such other places, both with­in and without the State of Nevada, as the Board of Directors may determine and designate from time to time or the business of the Corporation requires.

ARTICLE II
Books
 
The books and records of the Corporation may be kept (except as otherwise provided by the laws of the State of Nevada) outside of the State of Nevada and at such place or places as may be designated by the Board of Directors.

ARTICLE III
Stockholders
 
Section 1. Place of Meetings, etc. Except as other­wise provided in these Bylaws, all meetings of the stock­holders shall be held at such dates, times and places, within or without the State of Nevada, as shall be determined by the Board of Directors or the President of the Corporation and as shall be stated in the notice of the meeting or in waivers of notice thereof.  If the place of any meeting is not so fixed, it shall be held at the registered office of the Corporation in the State of Nevada.

Section 2. Annual Meetings. The Annual Meeting of stockholders of the Corporation for the election of Directors and the transaction of such other business as may properly come before said meeting shall be held at the principal business office of the Corporation or at such other place or places either within or without the State of Nevada as may be designated by the Board of Directors and stated in the notice of the meeting, on a date not later than 120 days following the close of the fiscal year of the Corporation as designated by the Board of Directors.

Section 3. Special Meetings. Special meetings of the stockholders of the Corporation shall be held whenever called in the manner required by the laws of the State of Nevada for purposes as to which there are special statutory provisions, and for other purposes whenever called by resolution of the Board of Directors, or by the President, or by the holders of a majority of the outstanding shares of capital stock of the Corporation the holders of which are entitled to vote on matters that are to be voted on at such meeting.  Any such Special Meetings of stockholders may be held at the principal business office of the Corporation or at such other place or places, either within or without the State of Nevada, as may be specified in the notice thereof.  Business transacted at any Special Meeting of stockholders of the Corporation shall be limited to the purposes stated in the notice thereof.  The notice shall state the date, time, place and pur­pose or purposes of the proposed meeting.
 
 
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Section 4. Notice of Meetings. Except as other­wise required or permitted by law, whenever the stockholders of the Corporation are re­quired or permitted to take any action at a meeting, written notice thereof shall be given, stating the place, date and time of the meeting and, unless it is the annual meeting, by or at whose direction it is being issued. The notice also shall designate the place where the stockholders’ list is avail­able for examination, unless the list is kept at the place where the meeting is to be held. Notice of a Special Meeting also shall state the purpose or purposes for which the meeting is called.  A copy of the notice of any meeting shall be delivered personally or shall be mailed, not less than ten (10) nor more than sixty (60) days before the date of the meet­ing, to each stockholder of record entitled to vote at the meeting. If mailed, the notice shall be given when deposited in the United States mail, postage prepaid and shall be di­rected to each stockholder at his or her address as it appears on the record of stockholders, unless he or she shall have filed with the Secretary of the Corporation a written request that notices to him or her be mailed to some other address, in which case it shall be directed to him or her at the other address. Notice of any meeting of stockholders shall not be required to be given to any stockholder who shall attend the meeting, except for the ex­press purpose of objecting at the beginning thereof to the transaction of any business because the meeting is not law­fully called or convened, or who shall submit, either before or after the meeting, a signed waiver of notice.  Unless the Board of Directors, after the adjournment of such meeting, shall fix a new record date for an adjourned meeting or unless the adjournment is for more than thirty (30) days, notice of an adjourned meeting need not be given if the place, date and time to which the meeting shall be adjourned is announced at the meeting at which the adjournment is taken.

Section 5.  List of Stockholders. The officer of the Corporation who shall have charge of the stock ledger of the Corporation shall prepare and make, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at said meeting, arranged in alphabetical order and showing the address and the number of shares registered in the name of each stockholder.  Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours for a period of at least ten (10) days prior to the meeting, either at a place specified in the notice of the meeting or at the place where the meeting is to be held.  The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder present at the meeting.
 
 
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Section 6.  Quorum.  Except as otherwise expressly provided by the laws of the State of Nevada, or by the Articles of Incorporation of the Corporation, or by these Bylaws, at any and all meet­ings of the stockholders of the Corporation there must be present, either in person or by proxy, stockholders owning a majority of the issued and out­standing shares of the capital stock of the Corporation entitled to vote at said meeting. At any meeting of stockholders at which a quorum is not present, the holders of, or proxies for, a majority of the stock which is represented at such meeting, may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented.  At such adjourned meeting at which a quorum shall be present or represented any business may be transacted which might have been transacted at the meeting as originally noticed. If the adjournment is for more than thirty (30) days, or if after adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

Section 7.  Organization. The President shall call to order meetings of the stockholders and shall act as Chairman of such meetings. The Board of Directors or the stockholders may appoint any stockholder or any Director or officer of the Corporation to act as Chairman at any meeting in the absence of the President. The Secretary of the Corporation shall act as secretary of all meetings of the stockholders, but in the absence of the Secretary, the presiding officer may appoint any other person to act as secretary of the meeting.

Section 8.  Voting. Except as otherwise provided by the Article of Incorporation of the Corporation or these Bylaws, at any meeting of the stockholders each stockholder of record of the Corporation having the right to vote thereat shall be entitled to one (1) vote for each share of stock outstanding in his or her name on the books of the Corporation as of the record date and entitling him or her to so vote. A stockholder may vote in person or by proxy. Except as otherwise provided by the law of the State of Nevada or by the Article of Incorporation of the Corporation, any cor­po­rate action to be taken by a vote of the stockholders, other than the election of directors, shall be authorized by not less than a majority of the votes cast at a meeting by the stockholders present in person or by proxy and entitled to vote thereon. Directors shall be elected as provided in Sec­tion 1 of Article IV of these Bylaws.  Written ballots shall not be required for voting on any matter unless ordered by the Chairman of the meeting.

Section 9.  Proxies.  Every proxy shall be executed in writing by the stockholder or by his or her attorney-in-fact.
 
 
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Section 10.  Consent of Stockholders in Lieu of Meeting. Unless otherwise provided in the Articles of Incorporation of the Corporation, whenever the vote of the stockholders at a meeting thereof is required or permitted to be taken in connection with any corporate action by any provisions of the laws of the state of Nevada or of the Articles of Incorporation, such corporate action may be taken without a meeting, without prior notice and without a vote, if a consent in writing, setting forth the action so taken, shall be signed, in person or by proxy, by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote there­on were present and voted in person or by proxy. Prompt notice of the taking of the corporate action without a meet­ing by less than unanimous written consent shall be given to those stockholders who have not consented in writing, but who were entitled to vote on the matter.

ARTICLE IV
Directors
 
Section 1.  Number, Election and Term of Office. The business and affairs of the Corporation shall be managed by the Board of Directors. The number of Directors which shall constitute the whole Board shall be not less than one (1) and not more than nine (9). Within such limits, the number of Directors may be fixed from time to time by vote of the stockholders or of the Board of Directors, at any regular or special meeting, subject to the provisions of the Articles of Incorporation.  The initial board shall consist of three (3) Directors. Directors need not be stockholders. Directors shall be elected at the Annual Meeting of the stockholders of the Corporation, except as provided in Section 2 of this Article IV, to serve until their respective successors are duly elected and qualified. When used in these Bylaws, the phrase "entire Board" means the total number of directors which the Corporation would have if there were no vacancies.

Section 2.  Vacancies and Newly Created Directorships. Except as hereinafter provided, any vacancy in the office of a Director occurring for any reason, and any newly created Directorship resulting from any increase in the authorized number of Directors, may be filled by a majority of the Directors then in office. Directors chosen or elected as aforesaid shall hold office until their respective successors are duly elected and qualified.
 
 
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Section 3.  Removals.  At any meeting of stockholders of the Corporation called for that purpose, the holders of a majority of the shares of capital stock of the Corporation entitled to vote at such meeting may remove from office any or all of the Directors, with or without cause. In addition, the Directors have the right to remove from office any Director, with or without cause.

Section 4.  Resignations.  Any director may resign at any time by giving written notice of his or her resignation to the Corporation.  A resignation shall take effect at the time specified therein or, if the time when it shall become effec­tive shall not be specified therein, immediately upon its re­ceipt, and, unless otherwise specified therein, the acceptance of a resignation shall not be necessary to make it effective.

Section 5.  Place of Meetings. Except as otherwise provided in these Bylaws, all meetings of the Board of Directors shall be held at the principal business office of the Corporation or at such other place, within or without the State of Nevada, as the Board determines from time to time.

Section 6.  Annual Meetings.  The annual meeting of the Board of Directors shall be held either (a) without notice immediately after the annual meeting of stockholders and in the same place, or (b) as soon as practicable after the annual meeting of stockholders on such date and at such time and place as the Board determines.

Section 7.  Regular Meetings.  Regular meetings of the Board of Directors shall be held on such dates and at the principal business office of the Corporation or at such other place, either within or without the State of Nevada, as the Board determines. Notice of regular meetings need not be given, except as otherwise required by law.

Section 8.  Special Meetings.  Special meetings of the Board of Directors may be called by the President or any two Directors on notice given to each Director, and such meetings shall be held at the principal business office of the Corporation or at such other place, either within or without the State of Nevada, as shall be specified in the notices thereof.  The request shall state the date, time, place and purpose or purposes of the proposed meeting.
 
 
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Section 9.  Notice of Meetings.  Notice of each special meeting of the Board of Directors (and of each annual meeting held pursuant to subdivision (b) of Section 6 of this Article IV) shall be given, not later than 24 hours before the meeting is scheduled to commence, by the President or the Secretary and shall state the place, date and time of the meeting. Notice of each meeting may be delivered to a Director by hand or given to a director orally (whether by telephone or in per­son) or mailed or telegraphed to a Director at his or her residence or usual place of business, provided, however, that if notice of less than 72 hours is given it may not be mailed.  If mailed, the notice shall be deemed to have been given when deposited in the United States mail, postage prepaid, and if tele­graphed, the notice shall be deemed to have been given when the contents of the telegram are transmitted to the telegraph service with instructions that the telegram immedi­ately be dispatched. Notice of any meeting need not be given to any Director who shall submit, either before or after the meeting, a signed waiver of notice or who shall attend the meeting, except if such Director shall attend for the express purpose of objecting at the beginning thereof to the trans­action of any business because the meeting is not lawfully called or convened. Notice of any adjourned meeting, includ­ing the place, date and time of the new meeting, shall be given to all Directors not present at the time of the adjourn­ment, as well as to the other Directors unless the place, date and time of the new meeting is announced at the adjourned meeting.

Section 10. Quorum. Except as otherwise provided by the laws of the State of Nevada or in these Bylaws, at all meetings of the Board of Directors of the Corporation a major­ity of the entire Board shall constitute a quorum for the trans­action of business, and the vote of a majority of the Directors present at a meeting at which a quorum is present shall be the act of the Board of Directors.  A majority of the Directors present, whether or not a quorum is present, may adjourn any meeting to another place, date and time.

Section 11. Conduct of Meetings. At each meeting of the Board of Directors of the Corporation, the President or, in his or her absence, a Director chosen by a majority of the Directors present shall act as Chairman of the meeting. The Secretary or, in his or her absence, any person appointed by the Chairman of the meeting shall act as Secretary of the meeting and keep the minutes thereof. The order of business at all meetings of the Board shall be as determined by the Chairman of the meeting.
 
 
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Section 12.  Committees of the Board.  The Board of Directors, by resolution adopted by a majority of the entire Board of Directors, may designate an executive committee and other committees, each consisting of one (1) or more Directors. Each committee (in­cluding the members thereof) shall serve at the pleasure of the Board of Directors and shall keep minutes of its meetings and report the same to the Board of Directors. The Board of Directors may designate one or more Directors as alternate members of any committee. Alternate members may replace any absent or disqualified member or mem­bers at any meeting of a committee. In addition, in the ab­sence or disqualification of a member of a committee, if no alternate member has been designated by the Board of Directors, the mem­bers present at any meeting and not disqualified from voting, whether or not they constitute a quorum, may unanimously ap­point another member of the Board of Directors to act at the meeting in the place of the absent or disqualified member.
 
  Except as limited by the laws of the State of Nevada, each committee, to the extent provided in the resolution establishing it, shall have and may exercise all the powers and authority of the Board of Directors with respect to all matters.

Section 13.  Operation of Committees.  A majority of all the members of a committee shall constitute a quorum for the transaction of business, and the vote of a majority of all the members of a committee present at a meeting at which a quorum is present shall be the act of the committee.  Each committee shall adopt whatever other rules of procedure it determines for the conduct of its activities.

Section 14. Consent to Action. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee may be taken without a meeting if all members of the Board of Directors or committee, as the case may be, consent thereto in writ­ing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors or committee.

Section 15.  Meetings Held Other Than in Person. Unless otherwise restricted by the Articles of Incorporation or these Bylaws, members of the Board of Directors or any committee may participate in a meeting of the Board of Directors or committee, as the case may be, by means of conference telephone or similar communications equip­ment by means of which all persons participating in the meet­ing can hear each other, and such participation shall con­stitute presence in person at the meeting.

Section 16.  Compensation of Directors. Directors, as such, shall not receive any stated salary for their services, but, by resolution of the Board, a fixed sum and expenses of attendance, if any, may be allowed for the attendance at each regular or special meeting of the Board; however nothing herein contained shall be construed to preclude any Director from serving the Corporation in any other capacity and receiving compensation therefore.
 
 
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ARTICLE V
Officers
 
Section 1.  Number, Election and Term of Office. The officers of the Corporation shall be a President, a Treasurer, and a Secretary, and may at the discretion of the Board of Directors include a Chief Executive Officer, a Chief Financial Officer, Chairman of the Board and one or more Vice Presidents, Director of Corporate Development, General Managers, Assistant Treasurers and Assistant Secretaries. The officers of the Corporation shall be elected annually by the Board of Directors at its meeting held immediately after the Annual Meeting of the stockholders, and shall hold their respective offices until their successors are duly elected and qualified. Any two (2) or more offices may be held by the same person. The Board of Directors may from time to time appoint such other officers and agents as the interests of the Corporation may require and may fix their duties and terms of office. Any officer may devote less than one hundred percent (100%) of his or her working time to his or her activities as such.

Section 2.  The President.  The President shall be the chief executive and operating officer of the Corpora­tion, and shall preside at all meetings of the stockholders and of the Board of Directors.  The President shall have general and active manage­ment of the business and affairs of the Corporation, subject to the control of the Board, shall see that all orders and resolutions of the Board are effectuated, and shall have such other powers and duties as the Board assigns to him.  He shall ensure that the books, reports, statements, certificates and other records of the Corporation are kept, made or filed in accordance with the laws of the State of Nevada. He shall cause to be called regular and special meetings of the stockholders and of the Board of Directors in accordance with these Bylaws. He may sign, execute and deliver in the name of the Corporation all deeds, mortgages, bonds, contracts or other instruments authorized by the Board of Directors, except in cases where the signing, execution or delivery thereof shall be expressly delegated by the Board of Directors or by these Bylaws to some other officer or agent of the Corporation or where required by law to be otherwise signed, executed or delivered. He may sign, jointly with the Secretary, an Assistant Secretary, the Treasurer, or an Assistant Treasurer, certificates of stock of the Corporation.  He shall appoint and remove, employ and discharge, and fix the compensation of all servants, agents, employees and clerks of the Corporation other than the duly elected or appointed officers, subject to the approval of the Board of Directors. In addition to the powers and duties expressly conferred upon him by these Bylaws, he shall, except as otherwise specifically provided by the laws of the State of Nevada, have such other powers and duties as shall from time to time be assigned to him by the Board of Directors.
 
 
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Section 3. The Vice President. There may be such Vice Pres­idents as the Board of Directors shall determine from time to time, with duties determined by the Board of Directors.  If there is only one Vice President appointed by the Board, he shall perform, in the absence or dis­ability of the President, the duties and exercise the powers of the President and shall have such other powers and duties as the Board or the President assigns to him.

Section 4. The Secretary. The Secretary may sign all certificates of stock of the Corporation jointly with the President. He shall record all the proceedings of the meetings of the stockholders and the Board of Directors of the Corporation in the books to be kept for that purpose. He shall have safe custody of the seal of the Cor­poration and, when authorized by the Board, he shall affix the same to any corporate instrument, and when so affixed he may attest the same by his signature. He shall keep the transfer books, in which all transfers of the capital stock of the Corporation shall be registered, and the stock books, which shall contain the names and addresses of all holders of the capital stock of the Corporation and the number of shares held by each.  He shall keep the stock and transfer books available during business hours for inspection by any stockholder and for the transfer of stock. He shall notify the Directors and stockholders of the respective meetings as required by law or by these Bylaws of the Corporation.  He shall have and perform ­such other powers and duties as may be required by law or the Bylaws of the Corporation, or which the Board or the Pres­i­dent may assign to him from time to time.

Section 5. Assistant Secretaries. The Assistant Secretaries shall, during the absence or incapacity of the Secretary, assume and perform all functions and duties which the Secretary might lawfully do if present and not under any incapacity.

Section 6.  The Treasurer.  Subject to the con­trol of the Board, the Treasurer shall have the care and cus­tody of the corporate funds and the books relating thereto. He shall perform all other duties incident to the office of Treasurer. He shall have such other powers and duties as the Board or the President assigns to him from time to time. He shall keep full and accurate accounts of all receipts and disbursements of the Corporation in books belonging to the Corporation and shall deposit all monies and other valuable effects in the name and to the credit of the Corporation in such depositories as may be designated by the Board of Directors. He shall disburse the funds of the Corporation as may be ordered by the Board, and shall render to the President or the Directors, whenever they may require it, an account of all his transactions as Treasurer and an account of the business and financial position of the Corporation. The Treasurer shall be the “Treasurer” for purposes of the laws of the State of Nevada.
 
 
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Section 7.  Assistant Treasurers. The Assistant Treasurers shall, during the absence or incapacity of the Treasurer, assume and perform all functions and duties which the Treasurer might lawfully do if present and not under any incapacity.

Section 8.  Transfer of Duties.  The Board of Directors may transfer the power and duties, in whole or in part, of any officer to any other officer, or other persons, notwithstanding the provisions of these Bylaws, except as otherwise provided by the laws of the State of Nevada.

Section 9.  Removals. Subject to his or her earlier death, resignation or removal as hereinafter provided, each officer shall hold his or her office until his or her successor shall have been duly elected and shall have qualified.  Any officer or agent of the Corporation may be removed from office at any time, with or without cause, by the affirmative vote of a majority of the entire Board, at a meeting of the Board of Directors called for that purpose.
 
Section 10.  Resignations.  Any officer or agent of the Corporation may resign at any time by giving written notice of his or her resignation to the Board of Directors or to the President or Secretary of the Corporation. Any such resignation shall take effect at the time specified therein or, if the time when it shall become effec­tive shall not be specified therein, immediately upon its re­ceipt, and, unless otherwise specified therein, the acceptance of a resignation shall not be necessary to make it effective.

Section 11.  Vacancies.  If the office of President, Secretary or Treasurer becomes vacant for any reason, the Board of Directors shall choose a successor to hold such office for the unexpired term. If any other officer or agent becomes vacant for any reason, the Board of Directors may fill the vacancy, and each officer so elected shall serve for the re­mainder of his or her predecessor's term.

Section 12. Compensation of Officers. The officers shall receive such salary or compensation as may be determined by the Board of Directors.
 
 
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ARTICLE V
Contracts, Checks and Notes
 
Section 1.  Contracts.  Unless the Board of Directors shall otherwise specifically direct, all contracts of the Corporation shall be executed in the name of the Corporation by the President, Vice President or chief executive officer of the Corporation.

Section 2. Checks and Notes. All negotiable instruments of the Corporation shall be signed by such officers or agents of the Corporation as may be designated by the Board of Directors.

ARTICLE VI
Provisions Relating to Stock
Certificates and Stockholders
 
Section 1.  Certificates of Stock. Certificates for the Cor­poration's capital stock shall be in such form as required by law and as approved by the Board.  Each certificate shall be signed in the name of the Corporation by the President or any Vice President and by the Secretary, the Treasurer or any Assistant Secretary or any Assistant Treasurer and shall bear the seal of the Corporation or a facsimile thereof.  If any certificate is countersigned by a transfer agent or regis­tered by a registrar, other than the Corporation or its em­ployees, the signature of any officer of the Corporation may be a fac­simile signature.  In case any officer, transfer agent or regis­trar who shall have signed or whose facsimile signa­ture was placed on any certificate shall have ceased to be such officer, transfer agent or registrar before the certifi­cate shall be issued, it may nevertheless be issued by the Corpo­ration with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue.
 
Section 2.  Lost Certificates, etc.  The Corpora­tion may issue a new certificate for shares in place of any certif­icate theretofore issued by it, alleged to have been lost, mutilated, stolen or destroyed, and the Board may re­quire the owner of the lost, mutilated, stolen or destroyed certificate, or his legal representatives, to make an affi­davit of that fact and to give the Corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the Corporation on account of the alleged loss, mutilation, theft or destruction of the certificate or the issuance of a new certificate.
 
 
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Section 3.  Transfer of Stock.  Upon surrender to the Corporation or the transfer agent of the Corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, the Corporation shall issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books.

Section 4.  Record Date.  For the purpose of deter­mining the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to or dissent from any proposal without a meet­ing, or for the purpose of determining stockholders en­titled to receive payment of any dividend or other dis­tribu­tion or the allotment of any rights, or for the purpose of any other action, the Board may fix in advance, a record date, which shall be not more than sixty (60) nor less than ten (10) days before the date of any such meeting, nor more than sixty (60) days prior to any other action.

Section 5. Registered Stockholders. The Corporation shall be entitled to treat the holder of record of any share or shares of stock as the holder in fact thereof and, accordingly, shall not be bound to recognize any equitable or other claim to, or interest in, such share or shares by any other person, whether or not it shall have notice thereof, except as expressly provided by the laws of the State of Nevada.

 ARTICLE VII
General Provisions
 
Section 1.  Dividends.  To the extent permit­ted by law, the Board shall have full power and discretion, sub­ject to the provisions of the Articles of Incorporation of the Corporation and the terms of any other corporate docu­ment or instrument binding upon the Corporation, to determine what, if any, dividends or distributions shall be declared and paid or made. Dividends may be paid in cash, in property, or in shares of capital stock, subject to the provisions of the Articles of Incorporation.  Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sums as the Directors think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the Corporation, or for such other purpose as the Directors think conducive to the interests of the Corporation. The Directors may modify or abolish any such reserve in the manner in which it was created.
 
 
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Section 2.  Seal.  The corporate seal of the Corporation shall have inscribed thereon the name of the Corporation, the year of its organization and the words “Corporate Seal, Nevada.”

Section 3.  Fiscal Year.  The fiscal year of the Corporation shall be as determined by the Board.

Section 4.  Voting Shares in Other Corporations. Unless otherwise directed by the Board, shares in other cor­porations which are held by the Corporation shall be repre­sented and voted only by the President or by a proxy or proxies appointed by him or her.

Section 5.  Indemnification.
 
(a)  The Corporation shall indemnify any person who was, or is threatened to be made, a party to a proceeding (as hereinafter defined) by reason of the fact that he or she (i) is or was a director, officer, employee or agent of the Corporation, or (ii) while a director, officer, employee or agent of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee, agent or similar functionary of another corporation, partnership, joint venture, trust or other enterprise, to the fullest extent permitted under the Revised Statutes of the State of Nevada, as the same exists or may hereafter be amended. Such right shall be a contract right and as such shall run to the benefit of any director or officer who is elected and accepts the position of director or officer of the Corporation or elects to continue to serve as a director or officer of the  Corporation while this Article VII is in effect. The rights conferred above shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, bylaw, resolution of stockholders or directors, agreement or otherwise.
 
(b)  As used herein, the term "proceeding" means any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, any appeal in such an action, suit or proceeding and any inquiry or investigation that could lead to such an action, suit or proceeding.
 
 
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(c)  A director or officer of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director or officer, except for liability (i) for acts or omissions which involve intentional misconduct, fraud or a knowing violation of law; or (ii) for the payment of distributions in violation of the Revised Statutes of the State of Nevada. Any repeal or amendment of this Article VII by the shareholders of the Corporation shall be prospective only, and shall not adversely affect any limitation on the personal liability of a director or officer of the Corporation arising from an act or omission occurring prior to the time of such repeal or amendment. In addition to the circumstances in which a director or officer of the Corporation is not personally liable as set forth in the foregoing provisions of this Article VII, a director or officer shall not be liable to the Corporation or its stockholders to such further extent as permitted by any law hereafter enacted, including, without limitation, any subsequent amendment to the Revised Statutes of the State of Nevada.
 
ARTICLE VIII
Amendments
 
These Bylaws may be adopted, altered, amended or repealed or new Bylaws may be adopted by the stockholders, or by the Board of Directors by the Articles or Incorporation, at any regular meeting of the stockholders or of the Board of Directors or at any special meeting of the stockholders or of the Board of Directors if notice of such alteration, amendment, repeal or adoption of new Bylaws be contained in the notice of such special meeting. If the power to adopt, amend or repeal Bylaws is conferred upon the Board of Directors by the Articles of Incorporation it shall not divest or limit the power of the stockholders to adopt, amend or repeal Bylaws.
 
 
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EXHIBIT 5.1
 
David Lubin & Associates, PLLC
10 Union Avenue
Suite 5
Lynbrook, New York 11563
Telephone: (516) 887-8200
Facsimile: 516-887-8250
david@dlubinassociates.com
 
November 22, 2011


Anthony P. Muratore
XR Energy Inc.
373 Smithtown Bypass, Suite 198
Hauppauge, New York 11788

           Re:  Registration Statement on Form S-1
 
Gentlemen:

We have acted as counsel to XR Energy Inc. (the "Company") in connection with its filing with the Securities and Exchange Commission of a Registration Statement on Form S-1 (the “Registration Statement”), pursuant to the Securities Act of 1933, as amended (the “Act”). The Registration Statement relates to the proposed resale of up to 2,818,800 shares of common stock of the Company (the “Shares”) to be offered pursuant to the prospectus which is part of the Registration Statement.

In connection therewith, we have examined and relied upon original, certified, conformed, photostat or other copies of (a) the Articles of Incorporation, as amended, and Bylaws of the Company; (b) resolutions of the Board of Directors of the Company; (c) the Registration Statement and the exhibits thereto; and (d) such corporate records of the Company, certificates of public officials, certificates of officers of the Company and other documents, agreements and instruments as we have deemed necessary as a basis for the opinions herein contained. In all such examinations, we have assumed the genuineness of all signatures on original documents, and the conformity to originals or certified documents of all copies submitted to us as conformed, photostat or other copies.

Based upon and subject to the foregoing, we are of the opinion that the outstanding Shares are validly issued, fully paid and non-assessable.

We are attorneys admitted to practice in New York. We are familiar with the applicable provisions of the Nevada Revised Statutes, the applicable provisions of the Nevada Constitution and reported judicial decisions interpreting those laws, and we have made such inquiries with respect thereto as we consider necessary to render this opinion with respect to a Nevada corporation. This opinion letter is opining upon and is limited to the federal securities laws of the United States and Nevada law. We express no opinion with respect to the effect or applicability of the laws of any other jurisdiction.
 
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to our firm under the caption "Legal Matters" in the prospectus forming a part of the Registration Statement.  In giving such consent, we do not thereby admit that we are included within the category of persons whose consent is required under Section 7 of the Act or the rules and regulations promulgated thereunder.
 
    Sincerely,  
       
 
  /s/ David Lubin & Associates, PLLC  
    DAVID LUBIN & ASSOCIATES, PLLC  

EXHIBIT 10.1
 
SUBSCRIPTION AGREEMENT

To:
XR Energy, Inc.
 
373 Smithtown BYP
 
Ste 198
 
Hauppauge, NY 11788
 
Gentlemen:

1.           Subscription.

The undersigned (the "Purchaser"), intending to be legally bound, hereby irrevocably agrees to purchase from XR Energy, Inc a Nevada Corporation (the “Company”), the number of shares, set forth on the Signature Page at the end of this subscription Agreement (the “Agreement”) at a purchase price of $0.25 per Share with a minimum investment of $500.00, upon the terms and conditions hereinafter set forth. This subscription is submitted to the Company accordance with and subject to the terms and conditions described in this Agreement and in the Term Sheet dated as of July 15, 2010.

The undersigned is delivering (i) the subscription payment made payable to XR Energy, Inc. (ii) two executed copies of the Signature page at the end of this Agreement, and (iii) one executed copy of Purchaser Questionnaire for Individuals (if appropriate), attached hereto as Exhibit II, to:

XR Energy, Inc.
373 Smithtown BYP
Ste 198
Hauppauge, NY 11788
 
The undersigned understands that the Shares are being issued pursuant to the exemption from the registration requirements of the United States Securities Act of 1933, as amended (the "Securities Act"), provided by Regulation D Rule 506 of such Securities Act. As such, the Shares are only being offered and sold to investors who qualify as “accredited investors," and a limited number of sophisticated investors and the Company is relying on the representations made by the undersigned in this Agreement that the undersigned qualifies as such an accredited or sophisticated investor. The shares of common stock are "restricted securities" for purposes of the United States securities laws and cannot be transferred except as permitted under these laws.

 
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2.          Acceptance of Subscription.

 
The Offering will be open until the earlier to occur of (i) June 15, 2011; or (ii) the sale of all of the common shares, unless extended by us for up to an additional 60 day period, in our sole discretion.

 
Subject to applicable state securities laws, the Purchaser may not revoke any subscription that such Purchaser delivers to the Company. However, the undersigned understands and agrees that the Company, in its sole discretion, may (i) reject the subscription of any Purchaser, whether or not qualified, in whole or in, part, (ii) may withdraw the Offering at any time prior to the termination of the Offering, and (iii) may accept subscription agreements valued below the minimum investment requirement of this offering should the acceptance be in the best interests of the Company. The Company shall have no obligation to accept subscriptions in the order received. This subscription shall become binding only if accepted by the Company.

3.          Term Sheet.

 
The Purchaser hereby acknowledges receipt of a copy of the Term Sheet dated July 15, 2010. (as, the "Term Sheet").

4.          Representations and Warranties.

 
4.1.
The Company represents and warrants to, and agrees with the undersigned as follows, in each case as of the date hereof and in all material respects as of the date of any closing, except for any changes resulting solely from the Offering:

(a) The Company is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation with full power and authority to own, lease, license and use its properties and assets and to carry out the business in which it is engaged as described in the Term Sheet. The Company is in good standing as a foreign corporation in every jurisdiction in which its ownership, leasing, licensing or use of property or assets or the conduct of its business makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the Company.

(b) The authorized capital stock of the Company will consist of 100,000,000 shares of common stock, par value $.0001 per share and there are 22,700,000 shares of common stock outstanding.

Each outstanding share of Common Stock is validly authorized, validly issued, fully paid and non-assessable, without any personal liability attaching to the ownership thereof and has not been issued and is not or will not be owned or held in violation of any preemptive rights of stockholders. There is no commitment, plan or arrangement to issue, and no outstanding option, warrant or other right calling for the issuance of, any share of capital stock of the Company or any security or other instrument which by its terms is convertible into, exercisable for or exchangeable for capital stock of the Company, except, as may be described in the Term Sheet. There is outstanding no security or other instrument which by its terms is convertible into or exchangeable for capital stock of the Company, except as may be described in the Term Sheet.

 
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(c)There is no litigation, arbitration, claim, governmental or other proceeding (formal or informal), or investigation pending or, to the best knowledge of the officers of the Company, threatened with respect to the Company, or any of its subsidiaries, operations, businesses, properties or assets except as may be described in the Term Sheet or such as individually or in the aggregate do not now have and could not reasonably be expected have a material adverse effect upon the operations, business, properties or assets of the Company.

(d) The Company is not in violation of, or in default with respect to, any law, rule, regulation, order, judgment or decree except as may be described in the Term Sheet or such as in the aggregate do not now have and will not in the future have a material adverse effect upon the operations, business, properties or assets of the Company; nor is the Company required to take any action in order to avoid any such violation or default.

(e) The Company has all requisite power and authority (i) to execute, deliver and perform its obligations under this Agreement, and (ii) to issue and sell the shares in the Offering.
 
(f) No consent, authorization, approval, order, license, certificate or permit of or from, or declaration or filing with, any United States federal, state, local, or other applicable governmental authority, or any court or any other tribunal, is required by the Company for the execution, delivery or performance by the Company of this Agreement or the issuance and sale of the shares, except such filings and consents as may be required and have been or at the initial closing will have been made or obtained under the laws of the United States federal and state securities laws.

(g) The execution, delivery and performance of this Agreement and the issuance of the Shares will not violate or result in a breach of, or entitle any party (with or without the giving of notice or the passage of time or both) to terminate or call a default under any agreement or violate or result in a breach of any term of the Company's Articles of Incorporation or Bylaws of, or violate any law, rule, regulation, order, judgment or decree binding upon, the Company, or to which any of its operations, businesses, properties or assets are subject, the breach, termination or violation of which, or default under which, would have a material adverse effect on the operations, business, properties or assets of the Company.

(h) The shares of common stock issuable in this Offering are validly authorized and, if and when issued in accordance with the terms and conditions set forth in the Term Sheet and in this Agreement, will be validly issued, fully paid and non-assessable without any personal liability attaching to the ownership thereof, and will not be issued in violation of any preemptive or other rights of stockholders.

(i) The Term Sheet and this Agreement do not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading. Without limiting the generality of the foregoing, there has been no material adverse change in the financial condition, results of operations, business, properties, assets, liabilities, or, to the knowledge of the Company, future prospects of the Company from the latest information set forth in the Term Sheet.

 
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4.2.
The undersigned hereby represents and warrants to, and agrees with, the Company as follows:

(a) The undersigned is an "Accredited Investor" as that term is defined in Rule 501 (a) of Regulation D promulgated under the Securities Act, and as specifically indicated in Exhibit I attached to this Agreement."

(b) The undersigned is a “Sophisticated Investor” as that term is defined in Rule 506(b)(2)(ii) of Regulation D promulgated under the Securities Act.

(c) For California and Massachusetts individuals: If the subscriber is a California resident, such subscriber's investment in the Company will not exceed 10% of such subscriber's net worth (or joint net worth with his spouse). If the subscriber is a Massachusetts resident, such subscriber's investment in the Company will not exceed 25% of such subscriber's joint net worth with such subscriber's spouse (exclusive of principal residence and its furnishings).

(d) If a natural person, the undersigned is: a bona fide resident of the state or non-United States jurisdiction contained in the address set forth on the Signature Page of this Agreement as the undersigned's home address; at least 21 years of age; and legally competent to execute this Agreement. If an entity, the undersigned has its principal offices or principal place of business in the state or non-United States jurisdiction contained in the address set forth on the Signature Page of this Agreement, the individual signing on behalf of the undersigned is duly authorized to execute this Agreement and this Agreement constitutes the legal, valid and binding obligation of the undersigned enforceable against the undersigned in accordance with its terms.

(e) The undersigned has received, read carefully and is familiar with this Agreement and the Term Sheet.

(f) The undersigned is familiar with the Company's business, plans and financial condition, the terms of the Offering and any other matters relating to the Offering, the undersigned has received all materials which have been requested by the undersigned, has had a reasonable opportunity to ask questions of the Company and its representatives, and the Company has answered all inquiries that the undersigned or the undersigned's representatives have put to it. The undersigned has had access to all additional information necessary to verify the accuracy of the information set forth in this Agreement and the Term Sheet and any other materials furnished herewith, and have taken all the steps necessary to evaluate the merits and risks of an investment as proposed hereunder.

(g) The undersigned (or the undersigned's purchaser representative) has such knowledge and experience in finance, securities, taxation, investments and other business matters so as to be able to protect the interests of the undersigned in connection with this transaction, and the undersigned's investment in the Company hereunder is not material when compared to the undersigned's total financial capacity.

 
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(h) The undersigned understands the various risks of an investment in the Company as proposed herein and can afford to bear such risks, including, without limitation, the risks of losing the entire investment.

(i) The undersigned acknowledges that a limited market for the shares of common stock presently exists and that the undersigned may find it difficult to liquidate the investment at a time when it may be desirable to do so, or at any other time.

(j) The undersigned has been advised by the Company that none of the shares of common stock has been registered under the Securities Act, that the common stock will be issued on the basis of the statutory exemption provided by Rule 506 of the Securities Act or Regulation D promulgated thereunder, or both, relating to transactions by an issuer not involving any public offering and under similar exemptions under certain state securities laws; that this transaction has not been reviewed by, passed on or submitted to any federal or state agency or self-regulatory organization where an exemption is being relied upon; and that the Company's reliance thereon is based in part upon the representations made by the undersigned in this Agreement.

(k) The undersigned acknowledges that the undersigned has been informed by the Company of or is otherwise familiar with, the nature of the limitations imposed by the Securities Act and the rules and regulations thereunder on the transfer of the shares of common stock. In particular, the undersigned agrees that no sale, assignment or transfer of any of the shares of common stock shall be valid or effective, and the Company shall not be required to give any effect to such a sale, assignment or transfer, unless (i) the sale, assignment or transfer of such shares of common stock is registered under the Securities Act, it being understood that the shares of common stock are not currently registered for sale and that the Company has no obligation or intention to so register the shares of common stock, except as contemplated by the terms of this Agreement or (ii) such shares of common stock is sold, assigned or transferred in accordance with all the requirements and limitations of Rule 144 under the Securities Act (it being understood that Rule 144 is not available at the present time for the sale of the shares of common stock), or (iii) such sale, assignment or transfer is otherwise exempt from registration under the Securities Act, including Regulation S promulgated thereunder. The undersigned further understands that an opinion of counsel and other documents may be required to transfer the shares of common stock.

(l) The undersigned acknowledges that the shares of common stock shall be subject to a stop transfer order and the certificate or certificates evidencing any shares of common stock shall bear the following or a substantially similar legend or such other legend as may appear on the forms of shares of common stock and such other legends as may be required by state blue sky laws:

 
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THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE "ACT") OR. APPLICABLE STATE SECURITIES LAWS, AND SUCH SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH SALE OR TRANSFER IS EXEMPT FROM SUCH REGISTRATION REQUIREMENTS OF THE ACT AND APPLICABLE STATE SECURITIES LAWS.
 
(m) The undersigned will acquire the shares of common stock for the undersigned's own account (or for the joint account of the undersigned and the undersigned's spouse either in joint tenancy, tenancy by 'he entirety or tenancy in common) for investment and not with a view to the sale or distribution thereof or the granting of any participation therein, and has no present intention of distributing or selling to others any of such interest or granting any participation therein.

(n) No representation, guarantee or warranty has been made to the undersigned by any broker, the Company, any of the officers, directors, stockholders, partners, employees or agents of either of them, or any other persons, whether expressly or by implication, that:

(I) the Company or the undersigned will realize any given percentage of profits and/or amount or type of consideration, profit or loss as a result of the Company's activities or the undersigned's investment in the Company; or
 
(II) the past performance or experience of the management of the Company, or of any other person, will in any way indicate the predictable results of the ownership of the shares of common stock or of the Company's activities.

(o) No oral or written representations have been made other than as stated in the Term Sheet, and no oral or written information furnished to the undersigned or the undersigned's advisor(s) in connection with the Offering were in any way inconsistent with the information stated in the Term Sheet.

(p) The undersigned is not subscribing for the Shares as a result of or subsequent to any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or broadcast over television or radio, or presented at any seminar or meeting, or any solicitation of a subscription by a person other than a representative of the Company with which the undersigned had a pre-existing relationship in connection with investments in securities generally.

(q) The undersigned is not relying on the Company with respect to the tax and other economic considerations of an investment.

(r) The undersigned understands that the net; proceeds from all subscriptions paid and accepted pursuant to the Offering (after deduction for commissions, discounts and expenses of the Offering) will be used in all material respects for the purposes set forth in the Term Sheet.

(s) Without limiting any of the undersigned's other representations and warranties hereunder, the undersigned acknowledges that the undersigned has reviewed and is aware of the risk factors described in the Term Sheet.

(t) The undersigned acknowledges that the representations, warranties and agreements made by the undersigned herein shall survive the execution and delivery of this Agreement and the purchase of the Shares.

(u) The undersigned has consulted his own financial, legal and tax advisors with respect to the economic, legal and tax consequences of an investment in the Shares and has not relied on the Term Sheet or the Company, its officers, directors or professional advisors for advice as to such consequences.

 
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5.          Indemnification.

 
The Purchaser understands the meaning and legal consequences of the representations and warranties contained in Section 4.2, and agrees to indemnify and hold harmless the Company and each member, officer, employee, agent or representative thereof against any and all loss, damage or liability due to or arising out of a breach of any representation or warranty, or breach or failure to comply with any covenant, of the Purchaser, whether contained in the Term Sheet or this Subscription Agreement. Notwithstanding any of the representations, warranties, acknowledgments or agreements made herein by the Purchaser, the Purchaser does not thereby or in any other manner waive any rights granted to the Purchaser under federal or state securities laws.

6.          Provisions of Certain State Laws.

IN MAKING AN INVESTMENT DECISION INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE ISSUER AND THE TERMS OF THE OFFERING INCLUDING THE MERITS AND RISKS INVOLVED. THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED TIE ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.

THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE NEW YORK UNIFORM SECURITIES ACT AND, THEREFORE, CANNOT BE RESOLD UNLESS THEY ARE REGISTERED UNDER THE ACT OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE.

7.          Additional Information.

 
The Purchaser hereby acknowledges and agrees that the Company may make or cause to be made such further inquiry and obtain such additional information as they may deem appropriate, with regard to the suitability of the undersigned.

8.          Irrevocability; Binding Effect.

The Purchaser hereby acknowledges and agrees that the Subscription hereunder is irrevocable, that the Purchaser is not entitled to cancel, terminate or revoke this Subscription.  Agreement or any agreements of the undersigned thereunder and that this Subscription Agreement and such other agreements shall survive the death or disability of the Purchaser and shall be binding upon and inure to the benefit of the parties and their heirs, executors, administrators, successors, legal representatives and assigns.  If the Purchaser is more than one person, the obligations of the Purchaser hereunder shall be joint and several and the agreements, representations, warranties and acknowledgments herein contained shall be deemed to be made by and be binding upon each such person and his heirs, executors, legal representatives and assigns.

 
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9.          Modification.

 
Neither this Subscription Agreement nor any provisions hereof shall be waived, modified, discharged or terminated except by an instrument in writing signed by the party against whom any such waiver, modification, discharge or termination is sought.

10.        Notices.

 
Any notice, demand or other communication which any party hereto may be required, or may elect, to give to any other party hereunder shall be sufficiently given if (a) deposited, postage prepaid, in a United States mail box, stamped registered or certified mail, return receipt requested, addressed to such address as may be listed on the books of the Company, or (b) delivered personally at such address.

11.        Counterparts.

 
This Subscription Agreement may be executed through the use of separate signature pages or in any number of counterparts and each such counterpart shall, for all purposes, constitute one agreement binding on all parties, notwithstanding that all parties are not signatories to the same counterpart.

12.        Entire Agreement.

 
This Subscription Agreement contains the entire agreement of the parties with respect to the subject matter hereof and there are no representations, covenants or other agreements except as stated or referred to herein.

13.        Severability.

 
Each provision of this Subscription Agreement is intended to be severable from every other provision, and the invalidity or illegality of any Portion hereof shall not affect the validity or legality of the remainder hereof.

14.        Assignability.

This Subscription Agreement is not transferable or assignable by the Purchaser.

 
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15.        Applicable Law.

 
This Subscription Agreement shall be governed by and construed in accordance with the laws of the State of Nevada as applied to residents of that State executing contracts wholly to be performed in that State.

16.        Choice of Jurisdiction.

 
The parties agree that any action or proceeding arising, directly, indirectly or otherwise, in connection with, out of or from this Subscription Agreement, any breach hereof or any transaction covered hereby shall be resolved within the County, City and State of Nevada. Accordingly, the parties consent and submit to the jurisdiction of the United States federal and state courts located within the County, City and State of Nevada.

IN WITNESS THEREOF, the undersigned exercises and agrees to be bound by this Subscription Agreement by executing the Signature Page attached hereto on the date therein indicated.

 
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SUBSCRIPTION AGREEMENT
SIGNATURE PAGE

By executing this Signature Page, the undersigned hereby executes, adopts and agrees to all terms, conditions and representations of this Subscription Agreement and acknowledges all requirements are met by the purchaser to purchase shares in the Company.

Number of Shares Subscribed at $0.25 per Share:  ____________________

Aggregate Purchase Price: $ ____________________

Type of ownership:                             ____________        Individual
____________        Joint Tenants
____________        Tenants by the Entirety
____________        Tenants in Common
____________        Subscribing as Corporation or Partnership
____________        Other

IN WITNESS WHEREOF, the undersigned Purchaser has executed this Signature Page this __________ day of __________________________ , 2010.
 
_____________________________                             ______________________________
Exact Name on Shares.                                                        Exact Name on Shares.
 
 
_____________________________                             ______________________________
Signature                                                                               Signature

_____________________________                             ______________________________
Print Name                                                                             Print Name

_____________________________                             ______________________________
Tax Identification Number:                                                 Tax Identification Number

_____________________________                             ______________________________

_____________________________                             ______________________________
Mailing Address