UNITED STATES

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2009

[] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ______________

Commission File Number: 333-91190

P2 SOLAR, INC.

(Exact name of registrant as specified in its charter)


Delaware		98-0234680
(State or other jurisdiction of incorporation)		(IRS Employer Identification Number)

Unit 204, 13569 – 76 Avenue Surrey, British Columbia, Canada, V3W 2W3
(Address of principal executive offices)
(888) 945-4440
Registrant’s telephone number, including area code:

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [ X ] Yes [ ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Not Applicable.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting Company. See the definitions of “large accelerated filer,” “accelerated filer” and smaller reporting Company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer [ ]	Accelerated filer [ ]
Non-accelerated filer [ ] (Do not check if a smaller reporting Company)	Smaller reporting Company [ X ]

Indicate by check mark whether the registrant is a shell Company (as defined in Rule 12b-2 of the Exchange Act). [ ]Yes [X ] No

As of August 1, 2009 the Issuer had 37,381,817 shares of common stock issued and outstanding.


			30-Jun		31-Mar
			2009		2009
			(Unaudited)		(audited)
ASSETS
Current Assets
	Cash	$	6,519	$	-
	Accounts Receivable		-		-
	Inventory				-
	Prepaid Assets		2,996		8,209
	Performance Bond		131,750
	Interest Receivable on Loan to PVT		188,363		164,242
	Loan to PVT	$	1,485,000	$	1,485,000
					-
	Total Current Assets		1,814,628		1,657,451

Long Term Assets

	Solar Panel License		1,000,000		1,000,000
	Shares in Lassen Corporation		8,916		8,916

Total Assets		$	2,823,544	$	2,666,367


LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
	Bank Indebtedness (Note 6)	$	-	$	13,513
	Accounts Payable		73,452		63,800
	Lassen License Payable		770,000		800,000
	Accrued Liabilities		67,919		67,919
	Loan Payable		504,471		476,433
	Due to related Parties (Note 7)		750,669		701,880

	Total Current Liabilities		2,166,511		2,123,545

	Total Liabilities		2,166,511		2,123,545



Stockholders' Equity
	Authorized:
	400,000,000 Common Shares,
	with a par value $0.001,
	5,000,000 preferred shares
	with a par value $0.001,
	Issued:
	Common shares – 37,381,817
	(2009 - 36,381,817) respectively
	Paid in Capital -Statement 3		37,381		36,381

	Additional Paid-in Capital -Statement 3		2,626,222		2,626,222

	Share Subscriptions		111,780

	Other Comprehensive Income - Statement 3		(83,888)		(129,826)

	Deficit Accumulated during Development
	Stage		(2,034,462)		(1,989,955)

	Total Stockholders' Equity		657,033		542,822

Total Liabilities and Stockholders' Equity		$	2,823,544	$	2,666,367
			-		-


The accompanying notes are an integral part of these statements

Unaudited


		Three Months Ending	Three Months Ending	Since Inception
		30-Jun	30-Jun	to June 30
		2009	2008	2009

Income
	Sales	$ -	$ -	$ 392,635

	Cost of Sales	-	-	239,602

	Gross Profit	$ -	$ -	$ 153,033

Operating Expenses
	Advertising and Promotion	1,491	1,747	94,450
	Amortization			46,985
	Automotive			37,035
	Bad Debts			8,474
	Bank Charges	411	761	17,969
	Commissions			3,509
	Consulting Fees	8,315		29,328
	Insurance			17,481
	Legal and Accounting	12,195	5,916	442,118
	Office and other	265	823	61,503
	Rent	2,467	2,831	223,827
	Research and Development			105,537
	Salaries and benefits	16,096	18,535	796,400
	Telephone and Utilities	679	1,374	60,617
	Travel and trade shows	13,505		67,408
	Currency Exchange Loss (Gain)	(337)		217

	Total Expenses	55,087	31,987	2,012,858

Net Loss from Operations		(55,087)	(31,987)	(1,859,825)

Other Items
	Interest on PVT Loan	24,121	25,824	188,363
	Other Income			25,389
	Cancellation of Options			49,950


	Interest Expense	(7,522)	(7,361)	(395,091)
		$ 16,599	$ 18,463	$ (131,389)

Loss from Continued operations		(38,488)	(13,524)	(1,991,214)

Net Income (loss) from
discontinued operations				(32,843)

Net Loss before Income Tax		(38,488)	(13,524)	(2,024,057)

	Income Tax	6,019		10,405

Net Loss		(44,507)	(13,524)	(2,034,462)

	Other comprehensive income	45,938	7,803	(83,888)

Net Loss and Comprehensive loss		$ 1,431	$ (5,721)	$ (2,118,350)

Basic and Diluted
(Loss) per Share		$ 0.00	$ (0.01)	$ (0.07)

Weighted Average
Number of Shares		37,381,817	20,447,614	28,465,946



The accompanying notes are an integral part of these statements

Unaudited


			Three Months Ended		Three Months Ended		(Inception)
			June 30		June 30		June 30
			2009		2008		2009
Operating Activities
	Net (Loss)	$	(44,507)	$	(13,524)	$	(2,034,462)
	Adjustments to reconcile Net (Loss)
	Common Stock issued for Services		1,000		-		6,324
	Depreciation		-		-		46,985
	Write off of assets from discontinued operations						32,843
	Interest due to related parties		7,370		7,157		126,450
	Wages accrued to director		16,096		18,535		499,393
	Bad Debts						8,474
	Cancelled stock based compensation		-
	Changes in Operating Assets and Liabilities
	(Increase)/Decrease in Accounts Receivable						-
	Interest receivable		(24,121)		(26,212)		(188,363)
	Inventory		-		-		-
	Prepaid expense		5,213		1,378		(2,996)
	Performance Bond		(131,750)				(131,750)
	Increase/(Decrease) in Accounts Payable		9,652		(20,815)		73,452
	Increase/(Decrease) in Accrued Liabilities		-		(8,333)		67,919
	Net Cash Provided by Operating Activities		(161,047)		(41,814)		(1,495,731)

	Net cash provided by (used in ) Discontinued operations		-				(31,984)

			(161,047)		(41,814)		(1,527,715)
Investment Activities
	Purchase of Equipment		-		-		(62,642)
	Investment in Lassen						-
	Solar Panel License		(30,000)				(230,000)
	Loan to PVC		-		-		(1,485,000)

	Net Cash (Used) by Investment Activities		(30,000)		-		(1,777,642)
Financing Activities
	Bank Indebtedness		(13,513)		1,605		-
	Due to Related party		25,323		(4,753)		124,826


	Loans Payable		28,038		37,159		504,471
	Proceeds from Subscriptions Receivable		111,780		-		111,780
	Proceeds from sale of Common Stock		-		-		2,654,687

	Net Cash Provided by Financing Activities		151,628		34,011		3,395,764

	Foreign Exchange		45,938		7,803		(83,888)

Change in cash and cash equivalents			6,519		-		6,519
Cash, Beginning of Period			-		-		-
Cash, End of Period		$	6,519	$	-	$	6,519

Supplemental Information:
	Interest Paid	$	152	$	204	$	146,181
	Income Taxes Paid	$	6,019	$	-	$	10,405
The accompanying notes are an integral part of these statements

P2 Solar, Inc.

Formerly Natco International Inc

Development Stage Company

Notes to Financial Statements

From Inception to June 30, 2009

Expressed in US Dollars

=======================================================================

1. Nature of Operations and Going Concern

The Company was incorporated as Spectrum Trading Inc. under the laws of the Province of British Columbia, Canada, on November 21, 1990. On May 14, 1999, the Company was discontinued in British Columbia and was reincorporated as Spectrum International Inc. in the State of Delaware, U.S.A. Effective September 3, 2004, the Company changed its name from Spectrum International Inc. to Natco International Inc. On March 11, 2009, the Company changed its name from the Natco International Inc. to P2 Solar, Inc.

The Company had two products, jewelry cleaner and a tire sealant. During the fiscal year ended March 31 2007, the Company discontinued its production of both lines. The Company had signed a binding letter of agreement with Photo Violation Technologies Corp. (PVT), which would have lead PVT to take over the Company in a reverse merger. However, this agreement was cancelled in December 2007. The Company signed another letter of agreement in February 2008 with Lassen Energy, Inc. (“Lassen”) to do a share exchange merger. On November 28, 2008, the Company cancelled the merger agreement with Lassen and instead signed a Licensing agreement with Lassen that gives the Company rights to their products in India, Canada, and Hawaii.

These financial statements have been prepared on the basis of accounting principles applicable to a going concern which assumes that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of operations. The Company has incurred significant operating losses over the past three years and has a substantial stockholders' deficiency and a working capital deficiency. The Company's continued existence is dependent upon its ability to raise additional capital and to achieve profitable operations through the Licensing agreement with Lassen Energy, Inc.

If the going concern assumption were not appropriate for these financial statements, then adjustments would be necessary in the carrying values of assets and liabilities, the reported revenues and expenses and the balance sheet classifications used.

2. Summary of Significant Accounting Policies

a) Fiscal Period

The Company's fiscal year ends on March 31.

b) Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, term deposits and short term highly liquid investments with a term to maturity of less than one year from inception which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of changes in value.

c) Use of Estimates

In conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that could affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the year. Actual results could vary materially from those reported.

d) Foreign Currency Transactions

The Company's functional currency is the Canadian dollar and the reporting currency is the U.S. dollar. Assets and liabilities are translated from the functional to the reporting currency at the exchange rate in effect at the balance sheet date and equity at the historical exchange rates. Revenue and expenses are translated at rates in effect at the time of the transactions. Resulting translation gains and losses are accumulated in a separate component of stockholders' equity - other comprehensive income (loss). Realized foreign currency transaction gains and losses are credited or charged directly to operations.

e) Inventory

Inventory is stated at the lower of cost and net realizable value. Cost includes all costs of purchase, cost of conversion and other costs incurred in bringing the inventory to its present location and conditions, and is calculated using the first-in first-out method. Net realizable value is determined by reference to sales proceeds of items sold in the ordinary course of business after the balance sheet date or by management estimates based on prevailing market conditions.

f) Property, Plant and Equipment

Property, plant and equipment are recorded at cost. Depreciation is provided annually on the diminishing balance method to write-off the assets over their estimated useful lives as follows:

Computer and office equipment - 5 years

Manufacturing equipment - 10 years

g) Income Taxes

Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided for significant deferred tax assets when it is more likely than not that such asset will not be recovered.

h) Fair value of Financial Instruments

The Company's financial instruments consist of accounts receivable, bank indebtedness, accounts payable and amounts due to related parties. Unless otherwise noted, it is management's opinion that this Company is not exposed to significant interest or credit risks arising from these financial instruments. The fair values of these financial instruments approximate their carrying values unless otherwise noted.

i) Stock-Based Compensation

Effective January 1, 2006, the Company adopted the provisions of Statement of Financial Accounting Standards ("SFAS") No. 123(R), "Share-Based Payment", which establishes accounting for equity instruments exchanged for employee services. Under the provisions of SFAS 123(R), stock-based compensation cost is measured at the grant date, based on the calculated fair value of the award, and is recognized as an expense over the employees' requisite service period (generally the vesting period of the equity grant). Before January 1, 2006, the Company accounted for stock-based compensation to employees in accordance with Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees," and complied with the disclosure requirements of SFAS No. 123, "Accounting for Stock-Based Compensation". The Company adopted SFAS 123(R) using the modified prospective method, which requires the Company to record compensation expense over the vesting period for all awards granted after the date of adoption, and for the unvested portion of previously granted awards that remain outstanding at the date of adoption. Accordingly, financial statements for the periods prior to January 1, 2006 have not been restated to reflect the fair value method of expensing share-based compensation. Adoption of SFAS No. 123(R) does not change the way the Company accounts for share-based payments to non-employees, with guidance provided by SFAS 123 (as originally issued) and Emerging Issues Task Force Issue No. 96-18, "Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in conjunction with Selling, Goods or Services".

j) Revenue Recognition

Revenues are recognized when all of the following criteria have been met: persuasive evidence for an arrangement exists; delivery has occurred; the fee is fixed or determinable; and collection is reasonably assured.

k) Advertising Policy

The Company expenses the cost of advertising when incurred.

l) Research and Development

Research and development is expensed as incurred.

m) Shipping and Handling

The Company includes the cost of shipping and handling as a component of cost of sales in accordance with Emerging Issues Task Force ("EITF") Issue No. 00-10,"Accounting for Shipping and Handling Fees and Costs."

n) Long-Lived Assets

The Company monitors the recoverability of long-lived assets, including property, plant and equipment and product rights, based on estimates using factors such as current market value, future asset utilization, business climate and future undiscounted cash flows expected to result from the use of the related assets. The Company policy is to record any impairment loss in the period when it is determined that the carrying amount of the asset may not be recoverable equal to the excess of the asset's carrying value over its fair value.

o) Loss Per Share

The Company computes net loss per common share using SFAS No. 128 "Earnings Per Share." Basic loss per common share is computed based on the weighted average number of shares outstanding for the period. Diluted loss per share is computed by dividing net loss by the weighted average shares outstanding assuming all dilutive potential common shares were issued. There were no dilutive potential common shares at March 31,

2009 and 2008. Because the Company has incurred net losses and has no potentially dilutive common shares, basic and diluted loss per share, is the same. Additionally, for the purposes of calculating diluted loss per share, there were no adjustments to net loss.

p) Obligations Under Capital Leases

Leases are classified as either capital or operating. Leases that transfer substantially all of the benefits and risks of ownership of property to the Company are accounted for as capital leases. At the time a capital lease is entered into, an asset is recorded with its related long-term financing. Payments under operating leases are expensed as incurred.

q) Segmented Reporting

SFAS No. 131, "Disclosures about Segments of an Enterprise and Related Information", changed the way public companies report information about segments of their business in their quarterly reports issued to stockholders. It also requires entity-wide disclosures about the products and services an entity provides, the material countries in which it holds assets and reports revenues and its major customers. The Company's sales are generated in one geographical area, Canada. All revenues consist of interest earned on investment.

r) Comprehensive Income

SFAS No. 130, "Reporting Comprehensive Income", establishes standards for reporting and display of comprehensive income and its components in a full set of general-purpose financial statements.

s) Derivative Financial Instruments

The Company was not a party to any derivative financial instruments during any of the reported fiscal periods.

t) Product Warranty

The Company's policy was to replace tire sealant and jewelry cleaner products if faulty. Products will be replaced within a reasonable time from the date of sale. The Company stopped manufacturing all products January 2007; therefore, there are no warranty issues anymore and no carryover liabilities.

u) Recent Accounting Pronouncements

In July 2006, the Financial Accounting Standards Board (FASB) issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes (FIN 48). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements in accordance with Statement No. 109, Accounting for Income Taxes. FIN 48 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. FIN 48 also provides guidance on de-recognition of tax benefits, classification on the balance sheet, interest and penalties, accounting in interim periods, disclosure, and transition.

In December 2008, the FASB provided for a deferral of the effective date of FIN 48 for certain non-public enterprises to annual financial statements for fiscal years beginning after December 15, 2008. The Company has elected this deferral and accordingly will be required to adopt FIN 48 in its 2009 annual financial statements. Prior to adoption of FIN 48, the Company will continue to evaluate its uncertain tax positions and related income tax contingencies under Statement No. 5, Accounting for Contingencies. SFAS No. 5 requires

the Company to accrue for losses it believes are probable and can be reasonably estimated. Management has not yet determined if the adoption of FIN 48 will have a material effect on the Company’s financial statements.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements, effective for fiscal years beginning after November 15, 2007. This statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. The Company has applied the requirements of SFAS No. 157 on [this is an example - the interest rate swap agreement (note 6)], and in accordance with FASB Staff Position No. FAS 157-2, the Company has elected to delay implementation of SFAS No. 157 for other nonfinancial assets until December 31, 2009. The primary asset(s) (and liabilities) that this deferral impacts is (are) [example – goodwill].

3. Inventory

All inventory was written off as of March 31, 2007

4. Property, Plant and Equipment

All plant equipment has been written off as of March 31, 2007

5. Solar Panel License and Share Exchange

On November 28, 2008, the Company cancelled the April 18, 2008 agreement and signed a new Licensing agreement with Lassen. This agreement gives the Company the rights to Manufacture and setup power plants in the countries of India, Canada, and State of Hawaii. The consideration to be paid by the Company to Lassen for the Licenses is an initial fee of US $1,000,000 (the “License Fee”) together with a 2% royalty on gross revenues received by the Company from future sales of Lassen Solar Panels. The license does not have defined term and will not be amortized until it is used to the benefit of the Company.

Simultaneously with execution of the License Agreement, the Company also executed a Share Transfer Agreement with Lassen pursuant to which it agreed to issue Lassen a total of 8,915,871 shares of its common stock, representing approximately 25% of the Company’s issued and outstanding common stock, in exchange for the issuance by Lassen to the Company of approximately 25,252,500 shares of common stock of Lassen, representing approximately 25% of the issued and outstanding common stock of Lassen. The shares have been valued at par value ($0.001) for reporting purposes.

As disclosed on a Form 8-K filed with the Securities and Exchange Commission on May 13, 2009, on May 7, 2009, the Company and Lassen entered into an Agreement pursuant to which the parties agreed to terminate the Share Transfer Agreement and return the shares that were transferred under the Share Transfer Agreement. The Company has advised its transfer agent that the 8,915,871 shares issued to Lassen will be cancelled. Upon return of the share certificate from Lassen representing such shares, it will be cancelled, and the 8,915,871 shares represented thereby will be returned to the status of authorized but unissued shares of common stock. Additionally, once the Company receives the share certificate from Lassen, the Company will return the share certificate representing 25,252,500 shares of Lassen common stock to Lassen. A copy of the Agreement terminating the Share Transfer Agreement was attached as Exhibit 10.15 to the Form 8-K filed by the Company on May 12, 2009 and is hereby incorporated by reference.

6. Loan to Photo Violation Technologies Inc

P2 Solar (“P2”) lent Photo Violation Technologies Corp., (“PVT”) $1,485,000.00 USD (the “Loan”). The Loan is the subject of a Loan Agreement and a Promissory Note. PVT has failed to pay any principal or interest on the Loan. P2 has sued PVT for $1,485,000.00 USD. P2 has also sued the Directors of PVT. P2’s action

against the PVT Directors has been stayed pending posting of security for costs. P2’s action against PVT is continuing. Despite the fact that P2 lent PVT $1,485,000.00, PVT is disputing that it owes P2 the $1,485,000.00 it was lent by P2. PVT has filed a Counterclaim, purporting to have claims against P2 and others. PVT made no purported claims against P2 until after P2 sued PVT and PVT's Directors. P2 has a summary judgment application for $1,485,000.00 scheduled. P2 also commenced a second action against PVT for defamation after PVT published what was alleged to be a verbatim ruling from the Court, when, in fact, the ruling had been altered by PVT. The Company believes that this debt is collectable and will be collected.

7. Cash

Details are as follows:



	June 30 2009	March 31 2009
Checks written in excess of funds on deposit	$ -	$ -

HSBC demand revolving loan for a maximum amount of CDN$20,000 (US$15,857), secured by a General Security Agreement on all assets of the Company (first charge) and by personal guarantees made by a director and officer of the Company, interest at bank prime plus 2%	US$ 6,519	(13,153)

		(13,153)
Less: Current Portion		(13,153)

Long-term portion	$ -	$ -

8. Related Party Transactions

Other than as disclosed elsewhere in these financial statements, the following amounts have been recorded as transactions with related parties:

a) Amounts due to related parties are as follows:


	June 30	March 31
	June 30	March 31
	2009	2009
Loans payable to relatives of a director and officer of the Company. The loans are unsecured, are due on demand, and bear no interest	$ 13,030	$ 12,015

Loans payable to a director and officer of the Company. The loans are unsecured, do not have fixed terms of repayment, and bear interest at 8.33% to 11% (2008 - 8.33% to 11%). It is expected that these loans will be repaid within the next 12 months.	191,854	201,457



Wages and bonus payable to a director and officer of the Company. This liability is unsecured, due on demand and non-interest bearing (2009 - nil%).	540,243	483,297

Loan payable to a relative of a director and officer of the Company. The loan is unsecured, due on demand, bears no interest	5,542	5,110
	$ 750,669	$ 701,879
Less: Current portion	(750,669)	(701,879)
Long-term portion	$ -	$ -

b) Interest expense on amounts due to directors and an officer was $7,370 (2009 - $22,059).

c) Salaries and benefits include $16,096 (2009 - $62,774) paid to a director and officer of the Company.

d) As at June 30, 2009, a director and officer of the Company held approximately 20.84% of the issued and outstanding shares of the Company.

9. Capital Stock

a) Authorized Stock

The Company has authorized 500,000,000 common shares with a par value of $0.001 per share. Each common share shall entitle the holder to one vote, in person or proxy on any matter on which action of the stockholder of the corporation is sought. The Company has authorized 5,000,000 shares of preferred stock with a par value of $0.001 per share. The holders of preferred stock have no rights except as determined by the Board of Directors of the Company and/or provided by Delaware General Corporate Law.

b) Share Issuances

During the current period, the Company issued total of 1,000,000 common shares from the treasury to

Capital Group Communications in return for services rendered.

c) Share Subscriptions

At June 30, 2009 there were Share Subscriptions of $111,780

d) Warrants

Under FASB Statement 123R, the Company estimates the fair value of each stock award at the grant date by using the Black-Scholes option pricing model with the following weighted average assumptions used for the grants, respectively; dividend yield of zero percent for all periods; expected volatility ranging from 108.79%

and 175%; risk-free interest rates ranging from 3.07% to 3.73%; and expected lives from 1 to 36 months. A summary of the Company’s stock awards for warrants as of June 30, 2009 and changes for the three months ended June 30,2009 is presented below:


	Options and warrants	Weighted average Exercise price	Weighted Average Grant Date Fair Value
Outstanding, March 31, 2009	718,333	0.42	0.42
Granted	384,453	0.42	0.42
Exercised
Expired Cancelled
Outstanding June 30, 2009	1,102,786	0.42	0.42
Exercisable June 30, 2009	1,102,786	0.42	0.42

In conjunction with the Private placement, 718,332 warrants were issued to individuals and companies that participated in the private placement done in January 2009.

On June 13, 2009, the Company conducted a Private Placement Offering, pursuant to which the Company raised $111,780 through the sale of 384,453 Units at a purchase price of $.30 per Unit. Each Unit consisted of one share of common stock and one Warrant. One Warrant entitles the holder thereof to purchase one share of Common Stock at a price of $0.42 per share at any time up until June 13,2012.

e) Stock Options

There are no outstanding options at this time.

The Company has committed to issue to the Chief Executive Officer 67,000 share purchase options every April. These options will be exercisable at $0.10 per share and will expire five years after the date of grant. Further bonus options are available to the Chief Executive Officer. These bonus options entitle the Chief Executive Officer to purchase shares at 20% below the market price up to a value determined by 5% of the amount of annual profits from sales in excess of $2,500,000 up to $3,999,999 and 8% of the amount of annual profits from sales in excess of $4,000,000. To date, sales have not exceeded $2,500,000 and thus no bonus options have been issued.

Until December 31, 2005, the Company accounted for its stock option plan in accordance with the provisions of APB Opinion No. 25, Accounting for Stock Issued to Employees. Effective January 1, 2006, the Company is accounting for stock based compensation using SFAS 123(R) Share Based Payment. Had compensation cost for the stock option plan been determined for the entire fiscal year based on the fair value at the grant date consistent with the method of SFAS No. 123, Accounting for Stock-Based Compensation, the total pro forma

value of stock options expense granted to directors and officers for the year ended March 31, 2009 would be $Nil (2008 - $Nil) Because no options are outstanding at this time.

10. Income Taxes

The Company has accumulated net operating losses for federal income tax purposes of approximately $946,000, which may be carried forward and used to reduce taxable income of future years. These losses expire as follows:



2020	$	180,000
2021		117,000
2022		135,000
2023		141,000
2024		97,000
2025		109,000
2026		138,000
2027		29,000
	$	946,000

The potential future tax benefits of these losses have not been recognized in these financial statements due to uncertainty of their realization. When the future utilization of some portion of the carry forwards is determined not to be "more likely than not," a valuation allowance is provided to reduce the recorded tax benefits from such assets.

11. Commitments

As of September 1, 2007 the Company has leased offices at #204, 13569 - 76^th Avenue, Surrey, BC, Canada. Total space is 750 square feet for total rent of $900.00 per month. This lease will expire on August 31, 2012.

12. Discontinued Operations

The Company discontinued operations of its jewelry cleaners and accessories line due to lack of demand for the product in March 2006. The tire sealant operations were also discontinued in February 2007. There is no property, plant and equipment remaining to produce these operations. There is no accounts receivable, inventory or accounts payable relating to the jewelry cleaners and Tire sealant lines.

ITEM 2.

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

SPECIAL NOTE OF CAUTION REGARDING FORWARD-LOOKING STATEMENTS

CERTAIN STATEMENTS IN THIS REPORT, INCLUDING STATEMENTS IN THE FOLLOWING DISCUSSION, ARE WHAT ARE KNOWN AS "FORWARD LOOKING STATEMENTS", WHICH ARE BASICALLY STATEMENTS ABOUT THE FUTURE. FOR THAT REASON, THESE STATEMENTS INVOLVE RISK AND UNCERTAINTY SINCE NO ONE CAN ACCURATELY PREDICT THE FUTURE. WORDS SUCH AS "PLANS," "INTENDS," "WILL," "HOPES," "SEEKS," "ANTICIPATES," "EXPECTS "AND THE LIKE OFTEN IDENTIFY SUCH FORWARD LOOKING STATEMENTS, BUT ARE NOT THE ONLY INDICATION THAT A STATEMENT IS A FORWARD LOOKING STATEMENT. SUCH FORWARD LOOKING STATEMENTS INCLUDE STATEMENTS CONCERNING OUR PLANS AND OBJECTIVES WITH RESPECT TO THE PRESENT AND FUTURE OPERATIONS OF THE COMPANY, AND STATEMENTS WHICH EXPRESS OR IMPLY THAT SUCH PRESENT AND FUTURE OPERATIONS WILL OR MAY PRODUCE REVENUES, INCOME OR PROFITS. NUMEROUS FACTORS AND FUTURE EVENTS COULD CAUSE THE COMPANY TO CHANGE SUCH PLANS AND OBJECTIVES OR FAIL TO SUCCESSFULLY IMPLEMENT SUCH PLANS OR ACHIEVE SUCH OBJECTIVES, OR CAUSE SUCH PRESENT AND FUTURE OPERATIONS TO FAIL TO PRODUCE REVENUES, INCOME OR PROFITS. THEREFORE, THE READER IS ADVISED THAT THE FOLLOWING DISCUSSION SHOULD BE CONSIDERED IN LIGHT OF THE DISCUSSION OF RISKS AND OTHER FACTORS CONTAINED IN THIS REPORT ON FORM 10-Q AND IN THE COMPANY'S OTHER FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION. NO STATEMENTS CONTAINED IN THE FOLLOWING DISCUSSION SHOULD BE CONSTRUED AS A GUARANTEE OR ASSURANCE OF FUTURE PERFORMANCE OR FUTURE RESULTS.

Background and Overview

P2 Solar, Inc., (hereinafter referred to as “we”, “us”, the “Company”, or the “Registrant”) has been in existence as a Company (including our predecessor British Columbia Corporation) since 1990. We began to concentrate on chemical manufacturing business activities in 1997; prior to that time we had few shareholders and were primarily dormant. We have never made a profit on chemical manufacturing operations. In the last twelve months, the Company has phased out its chemical manufacturing operations. As discussed more fully below, the Company’s current business operations are focused on the manufacturing, distribution and sales of solar panels and the potential construction of a solar power plant located in Punjab, India.

As disclosed on a Form 8-K filed with the Securities and Exchange Commission on November 26, 2008, on November 21, 2008, in furtherance of its business operations focused on the manufacture, distribution and sales of solar panels, the Company entered into: i) an Agreement (the “Share Transfer Agreement”) with Lassen Energy, Inc. “(Lassen”) a California corporation, for the transfer of shares of common stock; and ii) an Intellectual Property License Agreement (the “License Agreement”) with Lassen, DBK Corporation (“DBK Corp”), a Nevada corporation, and Darry Boyd (“Boyd”) (DBK Corp and Boyd are collectively referred to herein as (“DBK”)). As more fully described below, subsequent to the entry into the Share Transfer Agreement and License Agreement, the parties entered into agreements both terminating the Share Transfer Agreement, and removing the suspension on the Licenses and modifying the payment structure of the License Fee under the License Agreement.

Share Transfer Agreement

On November 21, 2008, the Company entered into a Share Transfer Agreement with Lassen, pursuant

to which, the Company agreed to issue to Lassen a total of 8,915,871 shares of its common stock, representing approximately 25% of the issued and outstanding common stock of the Company, in exchange for the issuance by Lassen to the Company of approximately 25,252,500 shares of common stock of Lassen, representing approximately 25% of the issued and outstanding common stock of Lassen. Closing under the Share Transfer Agreement occurred on January 15, 2009.

License Agreement

On November 21, 2008, pursuant to the License Agreement, Lassen and DBK agreed to provide the Company with several Licenses relating to the use of certain intellectual property necessary for the manufacturing, distribution and sale of the Lassen Solar Panel throughout the Nations of India and Canada, and the State of Hawaii. The consideration to be paid by the Company to Lassen for the Licenses is a fee of US $1,000,000 together with a 2% royalty on gross revenues received by the Company from future sales of Lassen Solar Panels. Pursuant to the terms of the License Agreement, the License Fee is to be paid in two installments. The first $200,000 installment of the License Fee was paid on January 7, 2009. The balance of the License Fee of $800,000, was due and payable on or before March 8, 2009. On April 20, 2009, the Company made a payment of $30,000 towards the $800,000 due and owning under the License Agreement. However, the Company was unable to make any additional payments towards the remaining balance of $770,000 due under the License Agreement. As a result, pursuant to the terms of the License Agreement, the Licenses granted under the License Agreement were temporarily suspended.

On May 7, 2009, the Company, Lassen and DBK entered into an Agreement removing the Licenses from suspension and providing the Company with an extension in which to make the remaining payment of the $770,000 due and owing under the License Agreement. Pursuant to the Agreement, the Company is now required to pay the remaining $770,000, ninety (90) days after the Company receives a report from Lassen indicating that the Lassen Solar Panel has received Intertek Certification and has a power output of a minimum of 1500 watts. A copy of the Agreement extending the payment obligations under the License Agreement was attached as Exhibit 10.14 to the Form 8-K filed by the Company on May 12, 2009 and is hereby incorporated by reference.

The Lassen Solar Panel is still in the developmental stage. Once the Lassen Solar Panels receives Underwriters Laboratories, Inc. (“UL”) Certification indicating that the Lassen Solar Panel is ready for commercial distribution, the Company will begin the process of establishing assembly facilities for the Lassen Solar Panel in the Licensed Territories. The Company anticipates that the facilities will be established and operational within approximately one (1) years of the receipt of UL Certification.

Additional Business Operations

In addition to the Company’s business operations relating to the manufacturing, distribution and sales of solar panels, the Company is currently in negotiations with the government of Punjab, India to build a 200

mega watt power plant in that state. On July 13, 2009, the Company entered into a Memorandum of Understanding (“MOU”) with the Punjab Energy Development Agency (“PEDA”) regarding the construction of a 25 mega watt power plant, which will serve as the first phase of the larger 200 mega watt plant in Punjab, India. No material definitive agreement has been signed regarding the construction of either power plant. Pursuant to the terms of the MOU, the Company is only authorized to prepare and submit a pre-feasibility report for the proposed solar power project to PEDA; the MOU does not provide the Company with the authority to construct the solar power project. The Company must supply the pre-feasibility report to PEDA within 120 days of the execution of the MOU. Once submitted, PEDA will review the pre-feasability report and make a final determination about the feasibility of the proposed solar power project. In the event that PEDA determines that the solar power project is viable, the Company and PEDA will enter into a separate agreement memorializing the terms for the construction of the 25 mega watt power plant.

In conjunction with the entry into the MOU, the Company has paid a refundable interest free security deposit to PEDA of RS 62.5 Lakhs (approximately US $131,750) in the form of a bank guarantee / demand draft in favor of PEDA. The performance security deposit shall be refunded upon either the commission of the solar power project, or the PEDA’s failure to accept the Company’s pre-feasibility report.

In anticipation of moving forward with the solar power project in Punjab, the Company formed a wholly-owned subsidiary corporation named Solarise, Inc. in the State of Nevada (“Solarise”) for the purposes of facilitating the construction of the 25 Mega Watt power plant. It is anticipated that once a material definitive agreement setting forth the terms and conditions for the construction of the 25 mega watt power plant is established, subject to PEDA’s approval, the Company will cause the agreement to be entered into by its wholly-owned subsidiary, Solarise. As a result, the Company currently plans to conduct operations, if any, relating to the construction of the power plant through Solarise. Furthermore, on July 13, 2009, Solarise entered into a non-binding Letter of Intent (“LOI”) with LDK Solar Europe Holding SA, a corporation with a seat in Luxembourg (“LDK”) regarding a potential joint venture between LDK and Solarise pursuant to which LDK, would, following the execution of necessary agreements, assist Solarise with the manufacture and assembly of the 25 mega watt power plant in Punjab, India.

As noted above, no material definitive agreements have been entered into regarding the construction of the 25 mega watt power plant in Punjab, India; the Company and its subsidiary have only entered into a non-binding MOU and LOI. The MOU and the LOI are both conditional and there is no guarantee that the Company will be able to meet the conditions of either the MOU or LOI. The foregoing is an explanation of the preliminary steps that the Company has taken with regards to the potential entry into material definitive agreements and construction of the power plant in Punjab, India.

During the fiscal year ending March 31, 2010, the Company anticipates that it will continue to pursue the development of the solar power plant in Punjab, India. Additionally, in the event that the Lassen Solar Panel is ready for commercial applications when the Company begins construction on the power plant, and the Company is able to meet the financial requirements of the License Agreement, the Company anticipates utilizing the Lassen Solar Panel in the project. However, if the Lassen Solar Panel is not yet ready for commercial applications, the Company will utilize currently available commercial solar panels for the construction of the project.

Results of Operation

As of June 30, 2009, the Company remained in the development stage and had not generated any revenue from operations. As a result, no meaningful comparison is possible regarding results of operation for the three months ended June 30, 2009 as compared to the three months ended June 30, 2008.

Liquidity and Capital Resources

The following discussion and analysis provides information that we believe is relevant to an assessment and understanding of our financial condition for the three months ended June 30, 2009. The following summary should be read in conjunction with the financial statements and accompanying notes to them included elsewhere in this report. Our financial statements are stated in US Dollars and are prepared in accordance with generally accepted accounting principals of the United States (“GAAP”).

During the three months ended June 30, 2009, the Company did not have any sales or generate any revenues. As of June 30, 2009, the Company’s unaudited balance sheet reflects total assets of $2,814,628 which primarily consist of: i) a Loan to Photo Violations Technology Inc. in the principal amount of $1,485,000; ii) the License Agreement with Lassen valued at $1,000,000; iii) an interest receivable on the loan in the amount of $188,363; and iv) a Performance Bond ledger with the Punjab Government in the amount of $131,750. As of June 30, 2009, the Company’s unaudited balance sheet reflects total liabilities of $2,166,511. The Company has cash on hand of $6,519 and a deficit accumulated in the development stage of $2,033,462.

The Company does not have sufficient assets or capital resources to pay its on-going expenses. Additionally, the Company does not currently have the $770,000 to cover the final payment that will need to be paid pursuant to the terms of the License Agreement. The Company has financed its operations through equity investment from investors, shareholder loans, and credit facilities from Canadian chartered banks and increases in payables and share subscriptions. Most of the financing has been debt financing from related and un-related parties. Currently, our estimated fixed costs at this time are approximately $5400 per month; that figure does not include the legal expense of law suit against PVT, but does include $900 for lease payments, $500 for utilities, $3,000 for loan interest and principle payments, and $1,000 for miscellaneous expenses. We will have to raise approximately $5400 per month to cover operating expenses, and an additional $770,000 to cover the payment under the License Agreement. We are currently suing PVT for the money it owes us ($1,485,000) plus Interest and damages.

On December 18, 2009, the Company initiated a Private Placement Offering, which was subsequently closed on January 8, 2009, pursuant to which the Company raised $215,500 through the sale of 718,333 Units at a purchase price of $.30 per Unit. Each Unit consisted of one share of common stock (the “Common Stock”) and one Warrant (the “Warrants”). One Warrant entitles the holder thereof to purchase one share of Common Stock at a price of $0.42 per share at any time up to January 9, 2012. Subsequent to the period ended December 31, 2009, the Company used the proceeds that it collected from the Private Placement Offering to make the Initial Payment of $200,000 pursuant to the License Agreement discussed above.

Additionally, the Company anticipates that it will attempt to raise 2 to 3 million dollars through the sale of the Company’s securities to both cover the Company’s operating expenses, and to make the $770,000 payment pursuant to the License Agreement. If successful in our anticipated fundraising efforts, we will be able to pay all of the Company debt, comply with the terms of the License Agreement, and have additional working capital. We have had negotiations with a number of groups regarding both a smaller and larger financing; we are hopeful that we will be able to complete one or both financings. However, there is no guarantee that we will be successful in raising any additional capital. If we are unable to finance the Company by debt or equity financing, or a combination of the two, we will have to look for other sources of funding to meet our requirements. That source has not been identified as yet.

Our financial statements have been prepared on the going concern basis under which an entity is considered to be able to realize its assets and satisfy its liabilities in the ordinary course of business. Operations to date have been primarily financed by long-term debt and equity transactions as well as increases in payables and related party loans. Our future operations are dependent upon the identification and successful completion of additional long-term or permanent equity financing, the continued support of creditors and shareholders, and, ultimately, the achievement of profitable operations. There can be no assurance that we will be successful. If we are not, we will be required to reduce operations or liquidate assets. We will continue to evaluate our projected expenditures relative to our available cash and to seek additional means of financing in order to satisfy working capital and other cash requirements.

Off Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not Applicable.

ITEM 4T.

CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

The Securities and Exchange Commission defines the term “disclosure controls and procedures” to mean a Company's controls and other procedures of an issuer that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. The Company maintains such a system of controls and procedures in an effort to ensure that all information which it is required to disclose in the reports it files under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified under the SEC's rules and forms and that information required to be disclosed is accumulated and communicated to principal executive and principal financial officers to allow timely decisions regarding disclosure.

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are designed to provide reasonable assurance of achieving the objectives of timely alerting them to material information required to be included in our periodic SEC reports and of ensuring that such information is recorded, processed, summarized and reported within the time periods specified. Our chief executive officer and chief financial officer also concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report to provide reasonable assurance of the achievement of these objectives.

Changes in Internal Control over Financial Reporting

There was no change in the Company's internal control over financial reporting during the period ended June 30, 2009, that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

PART II-OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS.

In May 2007 the Company took a local brokerage house to court on behalf of itself and its shareholders. This action was taken because the Company and some shareholders had a reason to believe that this particular Brokerage house was lending the shares to another broker Dealer for the purpose of shorting. When the shareholders demanded that their shares be converted to share certificates, the brokerage house did not produce the certificates in a reasonable time period. The Company went to Supreme Court of British Columbia to force them to a) deliver the share certificates to shareholders, b) to stop lending out our shares, c) to stop shorting of the Company's shares. The Company managed to accomplish all three because the judge agreed with the Company and an order was issued to deliver the shares to shareholders immediately.

On December 12, 2007, the Company commenced legal proceedings in British Columbia Supreme Court against Photo Violation Technologies Corp. ("PVT") and its president, Fred Mitschele (aka Fred Marlatt), claiming punitive, exemplary and consequential damages and other remedies arising from breach of contract and wrongful conduct on the part of Mitschele. In the Action, the Company claimed PVT has breached the agreement among the Company, PVT and Mitschele entered into on or about March 16, 2007, which provided for the completion of a reverse merger between the Company and PVT. The Company also claimed in Court documents that Mitschele engaged in a number of wrongful acts, including inducing breach of contract, attempting to divert prospective investors from Company to PVT, failing to provide financial statements and other necessary documents. In February 2008, the Company extended the law suit to include, the other two directors and one employee. In March PVT countersued the Company, One director of the Company and two associates of the Company, claiming breach of contract. In November 2008, the Company launched another law suit against PVT for spreading misinformation about the Company through a number of websites.

ITEM 1A.

RISK FACTORS.

Not Applicable.

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

On May 12, 2009, the Company issued at total of 1,000,000 shares of its common stock pursuant to the terms of a Compensation Agreement and the Consulting Agreement entered into between the Company and Capital Group Communications and a Compensation Agreement entered into between the Company and Capital Group Communications. The consideration for the issuance of the shares was the provision of consulting services by Capital Group Communications. The shares were issued in reliance upon the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for transactions not involving a public offering. No underwriters were used, nor were any brokerage commissions paid in connection with the above share issuances.

share issuances, the shares were not registered under the Securities Act in reliance upon the exemptions from registration contained in Regulation S of the Securities Act of 1933 (the “1933 Act”). No underwriters were used, nor were any brokerage commissions paid in connection with the above share issuances.

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None.

ITEM 5.

OTHER INFORMATION.

None.

ITEM 6.

EXHIBITS.

(a)

The following exhibits are filed herewith:

31.1

Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1

Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2

Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

In accordance with Section 13 of the exchange act, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

P2 Solar, Inc.

By: /s/ Raj-Mohinder S. Gurm

-----------------------------------

Name: Raj-Mohinder S. Gurm

Date: August 14, 2009

Title: Chief Executive Officer & CFO


INDEX TO FINANCIAL STATEMENTS:	Page

Balance Sheet	3-4

Statements of Operations	5-6

Statements of Stockholders’ Equity (Deficit)	7

Statements of Cash Flows	8-9

Notes to Unaudited Financial Statements	10 - 18



	Common		Common		Additional		Shares	Other		Deficit			Total
	Shares		Shares		Paid-In		Subscribed	Comprehensive
	(Number)		(Amount)		Capital			Income (Loss)
Balance (deficiency) March 31, 2009	36,381,817	$	36,381	$	2,626,222	$	0	$	(129,826)	$	(1,989,95)	$		542,822


Issuance of Shares	1,000,000		1,000											1,000
Share subscription	-		-		-		111,780		-		-			111,780
Change in foreign currency translation adjustment									45,938					45,938
Net loss											(44,507)			(44,50)

Balance (deficiency) June 30, 2009	37,381,817	$	37,381	$	2,626,222	$	111,780	$	(83,888)	$	(2,034,46)	$		657,033