BCM Energy Partners Inc. - FORM 10-K

Attached files

file	filename
EX-32 - BCM Energy Partners Inc.	ex32.htm
EX-31.1 - BCM Energy Partners Inc.	ex31-1.htm
EX-31.2 - BCM Energy Partners Inc.	ex31-2.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

þ	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended May 31, 2010

o	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: 333-130344

BCM ENERGY PARTNERS, INC.

(Exact name of registrant as specified in its charter)

Delaware	47-0948014
(State or other jurisdiction of	(I.R.S. Employer Identification No.)
incorporation or organization)

301 St. Charles Ave., Fl 3 New Orleans, LA	70130
(Address of principal executive offices)	(Zip Code)

(504) 525-8299

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None.

Securities registered pursuant to Section 12(g) of the Act: Common stock, $0.0001 per share

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

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 13(d) of the Act. o Yes þ No

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

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). Yes o No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. þ

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 o	Accelerated filer o
Non-accelerated filer o (Do not check if a smaller reporting company)	Smaller reporting company þ

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

At August 30, 2011, the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was $2,267,496. This aggregate market value is estimated solely for purposes of this report and is based on the closing price for the registrant’s common stock on August 30, 2011, as reported on the Over-the-Counter Markets. For the purpose of this report, it has been assumed that all officers and directors of the issuer are affiliates of the registrant. The statements made herein shall not be construed as an admission for determining the affiliate status of any person.

BCM ENERGY PARTNERS, INC.

ANNUAL REPORT ON FORM 10-K

INDEX

		Page
PART I.
Item 1.	Business	3
Item 1A.	Risk Factors	4
Item 1B.	Unresolved Staff Comments	9
Item 2.	Properties	9
Item 3.	Legal Proceedings	10
Item 4.	(Removed and Reserved)	10

PART II.
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchase of Equity Securities	10
Item 6.	Selected Financial Data	11
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	13
Item 8.	Financial Statements and Supplementary Data	13
Item 9.	Changes In and Disagreements with Accountants on Accounting and Financial Disclosure	13
Item 9A(T).	Controls and Procedures	13
Item 9B.	Other Information	15

PART III.
Item 10.	Directors, Executive Officers and Corporate Governance	15
Item 11.	Executive Compensation	16
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	17
Item 13.	Certain Relationships and Related Party Transactions, and Director Independence	17
Item 14.	Principal Accountant Fees and Services	17

PART IV.
Item 15.	Exhibits and Financial Statement Schedules	18

This Annual Report on Form 10-K contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 regarding future events and the future results of BCM Energy Partners, Inc. f/k/a Aeon Holdings, Inc. that are based on current expectations, estimates, forecasts, and projections as well as the beliefs and assumptions of BCM Energy Partners, Inc. f/k/a Aeon Holdings, Inc.’s management. Words such as “outlook,” “believes,” “expects,” “appears,” “may,” “will,” “should,” “anticipates” or the negative or correlations thereof or comparable terminology are intended to identify such forward-looking statements. These forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this Annual Report. We undertake no obligation to revise or update publicly any forward-looking statements.

PART I.

ITEM 1. BUSINESS.

Overview

Aeon Holdings, Inc. was incorporated as Novori Inc., in the State of Delaware, United States on July 26, 2004. Effective July 27, 2004, the Company incorporated a wholly-owned subsidiary, Novori Marketing Inc., in the Province of British Columbia, Canada. Effective October 20, 2008, the Company incorporated a wholly-owned subsidiary, Novori Jewelry Inc., in the State of Delaware. Effective December 22, 2008, the Company incorporated a wholly-owned subsidiary, Aeon Holdings, Inc., in the State of Delaware. On January 6, 2009, the Company merged its operations with its subsidiary, Aeon Holdings, Inc., and changed its name to Aeon Holdings, Inc.

On February 10, 2009, the Company entered into a purchase agreement (the “Purchase Agreement”) with Green Star Energies, Inc. ("Green Star") to acquire Green Star's interest in a number of oil and gas leases located in Beaver County, Pennsylvania. This acquisition is more fully described in Note 2 to the Company’s Consolidated Financial Statements included elsewhere in this Report. As of the date of this Report, the Company had not received title to the oil and gas leases from Green Star and considers the Purchase Agreement to be void. The Company is currently seeking to recover the consideration given to Green Star and its related parties, as they failed to deliver on the terms of the Purchase Agreement. On February 10, 2009, the Company also sold its only subsidiaries, Novori Marketing, Inc. and Novori Jewelry, Inc. The Company has no remaining interest in them.

On December 14, 2010, under a purchase agreement with BCM Energy Partners, LLC ("BCM"), the Company acquired BCM's entire interest in an oil field in Baton Rouge, Louisiana commonly known as University Field. The Company changed its name to “BCM Energy Partners, Inc.” on April 12, 2011. As used in this Report, the “Company”, “we”, “our”, or “us” refers to BCM Energy Partners, Inc.

During its fiscal year ended May 31, 2010, the Company's principal business was intended to be the acquisition and management of oil, gas and alternative energy operations. As of May 31, 2010, the Company had not produced any revenue from oil and gas operations.

The Company’s Consolidated Financial Statements included elsewhere in this Report have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent upon the ability of the Company to acquire oil and gas properties or obtain necessary financing to continue operations, and the attainment of profitable operations. At May 31, 2010, the Company had a working capital deficit of $370,043 and had accumulated losses of $1,532,347. As noted above, as of May 31, 2010, the Company had not produced revenues from oil and gas operations. These factors raise substantial doubt regarding the Company's ability to continue as a going concern. The Company’s Consolidated Financial Statements included elsewhere in this Report do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

The Company's common shares are currently quoted on the OTC Pink market of OTC Markets Group, Inc. under the trading symbol “BCME.”

Employees

As of May 31, 2010, the Company had one employee, Mr. Brandon Toth, who was then the Company’s Chief Executive Officer.

ITEM 1A. RISK FACTORS.

In addition to the other information in this Report, you should carefully consider the risk factors set forth below. The market or trading price of our securities could decline due to any of these risks. In addition, please read “Cautionary Note Regarding Forward-Looking Statements” in this filing, where we describe additional uncertainties associated with our business and the forward-looking statements included or incorporated by reference in this filing. Please note that additional risks not currently known to us or that we currently deem immaterial may also impair our business and operations.

Our securities should be purchased only by persons who can afford to lose their entire investment in us. You should carefully consider the following risk factors and other information in this filing before deciding to become a holder of our securities. If any of the following risks actually occur, our business and financial results could be negatively affected to a significant extent.

Crude oil and natural gas prices are highly volatile in general and low prices will negatively affect our financial results.

Our revenues, operating results, profitability, cash flow, future rate of growth and ability to borrow funds or obtain additional capital, as well as the carrying value of our oil and gas properties, are substantially dependent upon prevailing prices of crude oil and natural gas. Lower crude oil and natural gas prices also may reduce the amount of crude oil and natural gas that we can produce economically. Historically, the markets for crude oil and natural gas have been very volatile, and such markets are likely to continue to be volatile in the future. Prices for crude oil and natural gas are subject to wide fluctuation in response to relatively minor changes in the supply of and demand for crude oil and natural gas, market uncertainty and a variety of additional factors that are beyond our control, including: worldwide and domestic supplies of crude oil and natural gas; the level of consumer product demand; weather conditions and natural disasters; domestic and foreign governmental regulations; the price and availability of alternative fuels; political instability or armed conflict in oil producing regions; the price and level of foreign imports; and overall domestic and global economic conditions.

It is extremely difficult to predict future crude oil and natural gas price movements with any certainty. Declines in crude oil and natural gas prices may materially adversely affect our financial condition, liquidity, ability to finance planned capital expenditures and results of operations. Further, oil and gas prices do not move in tandem.

We have a limited operating history, and we may not be able to operate profitably in the near future, if at all.

We have a limited operating history and businesses such as ours, which are starting up or in their initial stages of development, present substantial business and financial risks and may suffer significant losses from which we cannot recover. We face all of the challenges of a new business enterprise, including but not limited to locating and successfully developing oil and gas properties, locating suitable office space, engaging the services of qualified support personnel and consultants, establishing budgets and implementing appropriate financial controls and internal operating policies and procedures. We will need to attract and retain a number of key employees and other service personnel.

We have limited operating capital.

The amount of capital available to us is limited, it may not be sufficient to enable us to fully execute our capital expenditure program and growth initiatives without additional funding sources. Additional financing may also be required to achieve our objectives and provide working capital for organizational infrastructure developments necessary to achieve our growth plans and reach a level of oil and gas operating activities that allows us to take advantage of certain economies of scale inherent to our business which would provide us the ability to reduce costs on a per unit of production basis. There can be no assurance that we will be able to obtain such financing on attractive terms, if at all.

We may not be able to operate profitably in the near future, if at all.

We will face all of the challenges of a smaller microcap oil and natural gas company that operates in a highly competitive industry, including but not limited to: locating, acquiring and successfully developing oil and gas properties; raising financing to fund our capital expenditure program; attracting, engaging and retaining the services of qualified management, technical and support personnel; establishing budgets and maintaining internal operating policies and procedures; and the design and implementation of effective financial and disclosure controls to meet public company statutory compliance requirements. We have had only net losses and have not been profitable. We can provide no assurance that we will be profitable or, if we are profitable, that we will achieve a level of profitability that will provide a return on invested capital or that will result in an increase in the market value of our securities. Accordingly, we are subject to the risk that, because of these factors and other general business risks noted throughout these “Risk Factors,” we may not be able to profitably execute our plan of operation.

The report of our independent auditor raises substantial doubts about our ability to continue as a going concern.

The independent auditor's reports on our May 31, 2010 and 2009 Consolidated Financial Statements included elsewhere in this Report states that our results of operations, cash flows and liquidity raise substantial doubts about our ability to continue as a going concern. We cannot assure you that we will be able to generate revenues or maintain any line of business that might prove to be profitable. Our ability to continue as a going concern and to execute our business strategies is subject to our ability to generate a profit or obtain necessary funding from outside sources, including obtaining additional funding from the sale of our securities and/or obtaining additional credit from various financial institutions or other lenders. If we are unable to develop our business, we may have to discontinue operations or cease to exist, which would be detrimental to the value of our common stock. We can make no assurances that our business operations will develop and provide us with significant cash to continue operations. See “Liquidity and Capital Resources” under “Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations.” and the “Going Concern” note to “Item 8. Financial Statements and Supplementary Data.”

We require financing to execute our business plan and fund capital program requirements.

To fund any growth and to fund our business and expansion plans, we will require additional financing. The amount of capital available to us is limited, and may not be sufficient to enable us to fully execute our growth plans without additional fund raising. Additional financing may be required to meet our desired growth and strategic objectives and to provide more working capital for expanding our development and marketing capabilities and to achieve our ultimate plan of expansion and a larger scale of operations. There can be no assurance that we will be able to obtain such financing on attractive terms, if at all. We have no firm commitments for additional cash funding as of the date of this report.

Future acquisitions and development activities may not result in additional proved reserves, and we may not be able to drill productive wells at acceptable costs.

In general, the volume of production from oil and gas properties declines as reserves are depleted. Except to the extent that we acquire properties containing proved reserves or conduct successful development and exploration activities, or both, our proved reserves will decline as reserves are produced. Our future oil and gas production is, therefore, highly dependent upon our ability to find or acquire additional reserves.

The business of acquiring, enhancing or developing reserves is capital intensive. We will require cash flow from operations as well as outside investments to fund our planned acquisition and development activities. If our cash flow from operations is reduced and external sources of capital become limited or unavailable, our ability to make the necessary capital investment to maintain or expand our asset base of oil and gas reserves would be impaired.

We may not be able to acquire producing oil and gas properties which contain economically recoverable reserves.

Competition for producing oil and gas properties is intense, and many of our competitors have substantially greater financial and other resources than we do. Acquisitions of producing oil and gas properties may be at prices that are too high to be acceptable.

We do not intend to pay dividends to our shareholders.

We do not currently intend to pay cash dividends on our common stock and do not anticipate paying any dividends at any time in the foreseeable future. At present, we will follow a policy of retaining all of our earnings, if any, to finance development and expansion of our business.

Our officers and directors have limited liability, and we are required in certain instances to indemnify our officers and directors for breaches of their fiduciary duties.

We have adopted provisions in our Certificate of Incorporation and Bylaws which limit the liability of our officers and directors and provide for indemnification by us of our officers and directors to the full extent permitted by Delaware corporate law. Our Certificate of Incorporation generally provides that our officers and directors shall have no personal liability to us or our shareholders for monetary damages for breaches of their fiduciary duties as directors, except for breaches of their duties of loyalty, acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, acts involving unlawful payment of dividends or unlawful stock purchases or redemptions, or any transaction from which a director derives an improper personal benefit. Such provisions substantially limit our shareholders' ability to hold officers and directors liable for breaches of fiduciary duty and may require us to indemnify our officers and directors.

We face intense competition.

We are in direct competition for properties with numerous oil and natural gas companies, drilling and income programs and partnerships exploring various areas of Texas, Louisiana, and Mississippi. Most competitors are large, well-known oil and gas and/or energy companies, although no single entity dominates the industry. Many of our competitors possess greater financial and personnel resources enabling them to identify and acquire more economically desirable energy producing properties and drilling prospects than us. Additionally, there is competition from other fuel choices to supply the energy needs of consumers and industry. Management believes that a viable market place exists for smaller producers of natural gas and crude oil.

We depend significantly upon the continued involvement of our present management.

Our success depends to a significant degree upon the involvement of members of our management, who are in charge of our strategic planning and operations. We may need to attract and retain additional talented individuals in order to carry out our business objectives. The competition for such persons could be intense, and there are no assurances that these individuals will be available to us.

Our business is subject to extensive regulation.

As many of our activities are subject to federal, state and local regulation, and as these rules are subject to constant change or amendment, there can be no assurance that our operations will not be adversely affected by new or different government regulations, laws or court decisions applicable to our operations.

Government regulation and liability for environmental matters may adversely affect our business and results of operations.

Crude oil and natural gas operations are subject to extensive federal, state and local government regulations, which may be changed from time to time. Matters subject to regulation include discharge permits for drilling operations, drilling bonds, reports concerning operations, the spacing of wells, unitization and pooling of properties and taxation. From time to time, regulatory agencies have imposed price controls and limitations on production by restricting the rate of flow of crude oil and natural gas wells below actual production capacity in order to conserve supplies of crude oil and natural gas. There are federal, state and local laws and regulations primarily relating to the protection of human health and the environment applicable to the development, production, handling, storage, transportation and disposal of crude oil and natural gas, byproducts thereof and other substances and materials produced or used in connection with crude oil and natural gas operations. In addition, we may inherit liability for environmental damages caused by previous owners of property we purchase or lease. As a result, we may incur substantial liabilities to third parties or governmental entities. The implementation of new, or the modification of existing, laws or regulations could have a material adverse effect on us.

Future increases on taxes on energy products, energy service companies and exploration activities may adversely affect our results of operations and increase our operating expenses.

Federal, state and local governments have jurisdiction in areas where the Company operates and impose taxes on the oil and natural gas products sold by the Company. Recently, there have been discussions by federal, state and local officials concerning a variety of energy tax proposals, some of which, if passed, would add or increase taxes on energy products, service companies and exploration activities. Such matters are beyond the Company's ability to accurately predict or control; however, any such increase in taxes or additional taxes levied on the Company by federal, state or local jurisdictions could adversely affect our results of operations and/or increase our operating expenses.

Certain U.S. federal income tax deductions currently available with respect to oil and gas exploration and development may be eliminated as a result of future legislation.

The current administration has proposed legislation that would, if enacted into law, make significant changes to United States tax laws, including the elimination of certain key U.S. federal income tax incentives currently available to oil and natural gas exploration and production companies. These proposed changes include, but are not limited to: the repeal of the percentage depletion allowance for oil and natural gas properties, the elimination of current deductions for intangible drilling and development costs, the elimination of the deduction for certain domestic production activities’, and an extension of the amortization period for certain geological and geophysical expenditures. It is unclear whether any such changes will be enacted into law or how soon any such changes could become effective in the event they were enacted into law. The passage of any legislation as a result of these proposals or any other changes in U.S. federal income tax laws could eliminate certain tax deductions that are currently available with respect to oil and gas exploration and development activities undertaken by the Company, and any such changes could negatively affect our financial condition and results of operations.

The crude oil and natural gas reserves we report in our filings with the Securities and Exchange Commission (“SEC”) are estimates and may prove to be inaccurate.

There are numerous uncertainties inherent in estimating crude oil and natural gas reserves and their estimated values. Any reserves we will report in our filings with the SEC will only be estimates, and such estimates may prove to be inaccurate because of these uncertainties. Reservoir engineering is a subjective and inexact process of estimating underground accumulations of crude oil and natural gas which cannot be measured in an exact manner. Estimates of economically recoverable crude oil and natural gas reserves depend upon a number of variable factors, such as historical production from the area compared with production from other producing areas and assumptions concerning effects of regulations by governmental agencies, future crude oil and natural gas prices, future operating costs, severance and excise taxes, development costs and work-over and remedial costs. Some or all of these assumptions may vary considerably from actual results. For these reasons, estimates of the economically recoverable quantities of crude oil and natural gas attributable to any particular group of properties, classifications of such reserves based on risk of recovery, and estimates of the future net cash flows expected therefrom prepared by different engineers or by the same engineers but at different times may vary substantially. Accordingly, reserve estimates may be subject to downward or upward adjustment. Actual production, revenue and expenditures with respect to our reserves will likely vary from estimates, and such variances may be material and adverse.

Crude oil and natural gas development, re-working of wells from one reservoir to another reservoir, restoring wells to production and drilling and completing new wells are speculative activities and involve numerous risks and substantial and uncertain costs.

Any growth will be materially dependent upon the success of our future development program. Drilling for crude oil and natural gas and reworking existing wells involves numerous risks, including the risk that no commercially productive crude oil or natural gas reservoirs will be encountered. The cost of drilling, completing and operating wells is substantial and uncertain, and drilling operations may be curtailed, delayed or cancelled as a result of a variety of factors beyond our control, including: unexpected drilling conditions; pressure or irregularities in formations; equipment failures or accidents; inability to obtain leases on economic terms, where applicable; adverse weather conditions and natural disasters; compliance with governmental requirements; and shortages or delays in the availability of drilling rigs or crews and the delivery of equipment.

Drilling or reworking is a highly speculative activity. Even when fully and correctly utilized, modern well completion techniques such as hydraulic fracturing and horizontal drilling do not guarantee that we will find crude oil and/or natural gas in our wells. Hydraulic fracturing involves pumping a fluid with or without particulates into a formation at high pressure, thereby creating fractures in the rock and leaving the particulates in the fractures to ensure that the fractures remain open, thereby potentially increasing the ability of the reservoir to produce oil or gas. Horizontal drilling involves drilling horizontally out from an existing vertical well bore, thereby potentially increasing the area and reach of the well bore that is in contact with the reservoir. Our future drilling activities may not be successful and, if unsuccessful, such failure would have an adverse effect on our future results of operations and financial condition. We cannot assure you that our overall drilling success rate or our drilling success rate for activities within a particular geographic area will not decline. We may identify and develop prospects through a number of methods, some of which do not include lateral drilling or hydraulic fracturing, and some of which may be unproven. The drilling and results for these prospects may be particularly uncertain. Our drilling schedule may vary from our capital budget. The final determination with respect to the drilling of any scheduled or budgeted prospects will be dependent on a number of factors, including, but not limited to: the results of previous development efforts and the acquisition, review and analysis of data; the availability of sufficient capital resources to us and the other participants, if any, for the drilling of the prospects; the approval of the prospects by other participants, if any, after additional data has been compiled; economic and industry conditions at the time of drilling, including prevailing and anticipated prices for crude oil and natural gas and the availability of drilling rigs and crews; our financial resources and results; the availability of leases and permits on reasonable terms for the prospects; and the success of our drilling technology.

We cannot assure you that these projects can be successfully developed or that the wells discussed will, if drilled, encounter reservoirs of commercially productive crude oil or natural gas. There are numerous uncertainties in estimating quantities of proved reserves, including many factors beyond our control.

Because of the speculative nature of oil and gas exploration and development, there is substantial risk that we will not find any commercially exploitable oil or gas and that our business will fail.

The search for commercial quantities of oil as a business is extremely risky. We cannot provide investors with any assurance that we will be able to obtain rights to additional producing properties in the future and/or that any properties we obtain rights to will contain commercially exploitable quantities of oil and/or gas. Future exploration and development expenditures made by us, if any, may not result in the discovery of commercial quantities of oil and/or gas in any future properties we may acquire the rights to, and problems such as unusual or unexpected formations and other conditions involved in oil and gas exploration often result in unsuccessful exploration efforts. If we are unable to find commercially exploitable quantities of oil and gas in any properties we may acquire in the future, and/or we are unable to commercially extract such quantities we may find in any properties we may acquire in the future, our financial condition and results of operations could be adversely affected.

Because of the inherent dangers involved in oil and gas exploration, there is a risk that we may incur liability or damages as we conduct our business operations, which could force us to expend a substantial amount of money in connection with litigation and/or a settlement.

The oil and natural gas business involves a variety of operating hazards and risks such as well blowouts, pipe failures, casing collapse, explosions, uncontrollable flows of oil, natural gas or well fluids, fires, spills, pollution, releases of toxic gas and other environmental hazards and risks. These hazards and risks could result in substantial losses to us from, among other things, injury or loss of life; severe damage to or destruction of property, natural resources and equipment; pollution or other environmental damage; cleanup responsibilities; regulatory investigation, and penalties and suspension of operations. In addition, we may be liable for environmental damages caused by previous owners of property purchased and leased by us in the future. As a result, substantial liabilities to third parties or governmental entities may be incurred, the payment of which could reduce or eliminate the funds available for the purchase of properties and/or property interests, exploration, development or acquisitions or result in the loss of our properties and/or force us to expend substantial monies in connection with litigation or settlements. As such, there can be no assurance that any insurance we currently maintain or that we obtain in the future will be adequate to cover any losses or liabilities. We cannot predict the availability of insurance or the availability of insurance at premium levels that justify our purchase. The occurrence of a significant event not fully insured or indemnified against could materially and adversely affect our financial condition and operations. We may elect to self-insure if management believes that the cost of insurance, although available, is excessive relative to the risks presented. In addition, pollution and environmental risks generally are not fully insurable. The occurrence of an event not fully covered by insurance could have a material adverse effect on our financial condition and results of operations.

Minority or royalty interest purchases do not allow us to control production completely.

We sometimes may acquire less than the controlling working interest in oil and gas properties. In such cases, it is likely that these properties would not be operated by us. When we do not have controlling interest, the operator or the other co-owners might take actions we do not agree with and possibly increase costs or reduce production income which may adversely affect our financial condition and results of operations.

Shareholders may be diluted significantly through our efforts to obtain financing and/or satisfy obligations through the issuance of additional shares of our common stock.

We currently have no committed source of financing. Wherever possible, our Board of Directors will attempt to use non-cash consideration to satisfy obligations. In many instances, we believe that the non-cash consideration will consist of restricted shares of our common stock or our preferred stock. Our Board of Directors has authority, without action or vote of the shareholders, to issue all or part of the authorized but unissued shares of common stock. In addition, our Board of Directors is authorized, without shareholder action or vote, to establish various classes or series of preferred stock from time to time and to determine the rights, preferences and privileges of any unissued classes or series including, among other matters, any dividend rights, dividend rates, conversion rights, voting rights, terms of redemption, liquidation preferences, sinking fund terms, the number of shares constituting any such series and the description thereof, and to issue any such shares. Our Board of Directors may, without shareholder approval, issue shares of a class or series of preferred stock with voting and conversion rights that could adversely affect the voting power of the holders of the common stock and may have the effect of delaying, deferring or preventing a change in control of us. These actions will result in dilution of the ownership interests of existing shareholders, and that dilution may be material.

The market price for our common stock may be volatile, and you may not be able to sell our stock at a favorable price or at all.

Many factors could cause the market price of our common stock to rise and fall, including: actual or anticipated variations in our quarterly results of operations; changes in market valuations of companies in our industry; changes in expectations of future financial performance; fluctuations in stock market prices and volumes; issuances of dilutive common stock or other securities in the future; the addition or departure of key personnel; announcements by us or our competitors of acquisitions, investments or strategic alliances; and the increase or decline in the price of oil and natural gas.

It is possible that the proceeds from sales of our common stock may not equal or exceed the prices you paid for it plus the costs and fees of making the sales.

Substantial sales of our common stock, or the perception that such sales might occur, could depress the market price of our common stock.

We cannot predict whether future issuances of our common stock in the open market will decrease the market price of our common stock. The impact of any such issuances of our common stock on our market price may be increased as a result of the fact that our common stock is thinly, or infrequently traded. The exercise of any options or warrants or the vesting of any restricted stock that we may grant to directors, executive officers, employees, and others in the future, the issuance of common stock in connection with acquisitions and other issuances of our common stock could have an adverse effect on the market price of our common stock. In addition, future issuances of our common stock or preferred stock may be dilutive to existing shareholders. Any sales of substantial amounts of our common stock in the public market, or the perception that such sales might occur, could lower the market price of our common stock.

ITEM 1B. UNRESOLVED STAFF COMMENTS.

None.

ITEM 2. PROPERTIES.

As of May 31, 2010, the Company did not own or lease any property.

ITEM 3. LEGAL PROCEEDINGS.

As of May 31, 2010, other than the proceedings described below, we knew of no material pending legal proceedings to which the Company was a party or of which its property was the subject.

On September 21, 2009, a civil lawsuit was filed against Green Star Energies, Inc. (“Green Star”) in State Court in Beaver County, Pennsylvania by Bialy Gas Production Company, LLC, and Jonathan M. Bialy as plaintiffs. The plaintiffs alleged that Green Star breached the terms of its contract to purchase certain oil and gas leases owned by Bialy Gas Production Company, LLC and the terms of a later joint venture agreement between the parties. Alternatively, plaintiffs alleged that they properly and validly terminated both the purchase agreement and the later joint venture agreement. Plaintiffs were seeking a non-monetary declaratory judgment that the purchase agreement and the joint venture agreement were null and void and that Green Star had no interest in the subject oil and gas leases. On November 19, 2009, defendant Green Star filed an answer in the State Court in Beaver County, Pennsylvania, denying plaintiffs’ allegations and counter-alleging that plaintiffs, among other things, intentionally interfered with Green Star's ability to complete the terms of the contracts and that plaintiffs' actions constituted breach on their part sufficient to forestall the right of Bialy Gas Production Company, LLC to the subject oil and gas leases. On February 24, 2010, the plaintiffs filed a praecipe to discontinue the case in State Court in Beaver County, Pennsylvania, which effectively ended the case as of that date. The Company was not a party to this lawsuit; however, it could have been affected by the outcome. If Green Star had been found to have improperly breached the purchase agreement, the court could have granted plaintiffs’ request for a declaratory judgment that Green Star has no right, title or interest to the oil and gas leases that were the subject of the purchase agreement. If that were to happen, then the subsequent sale of Green Star's interest in said oil and gas leases to the Company likely would have been rendered void and a nullity, and the Company would no longer have had ownership of that asset as a legal determination because Green Star could not sell an asset it did not own. This would have eliminated the asset from the balance sheet of the Company as of February 28, 2009.

ITEM 4. (REMOVED AND RESERVED)

PART II.

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

Market Information

Since January 10, 2011, our common stock has been quoted on the OTC Pink market under the symbol “BCME”. Prior to January 10, 2011, our common stock was quoted on the OTC Pink market under the symbol “AEON”.

The quarterly high and low bid information for our common stock for the two fiscal years ended May 31, 2010 are set forth below.

	2010				2009
Quarter	High		Low		High		Low
First	$	0.20	$	0.09	$	4.60	$	1.04
Second	$	0.40	$	0.09	$	1.36	$	0.10
Third	$	1.36	$	0.40	$	0.20	$	0.10
Fourth	$	0.75	$	0.33	$	0.22	$	0.13

Shareholders

As of August 12, 2011, there were approximately 109 record holders of our common stock. The number of holders of record is based upon the actual number of holders registered at such date and does not include holders of shares in “street names” or persons, partnerships, associates, corporations, or other entities identified in security position listings maintained by depositories.

Dividends

We have never paid cash dividends on our common stock and do not anticipate doing so in the foreseeable future. In addition, our current policy is to retain any earnings to finance operations and expand our business.

ITEM 6. SELECTED FINANCIAL DATA.

Not required for smaller reporting companies

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

The following is management’s discussion and analysis of certain significant factors affecting our financial condition, changes in financial condition, and results of operations during the two fiscal years ended May 31, 2010 and should be read with our Consolidated Financial Statements and related notes appearing elsewhere in this Report. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including, but not limited to those set forth in this Report.

Critical Accounting Policies and Estimates

This management’s discussion and analysis is based on our Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these Consolidated Financial Statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent liabilities. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Senior management has discussed the development, selection and disclosure of these estimates with the Board of Directors. Actual results may differ from these estimates.

Management believes that the following critical accounting policies affect its more significant judgments and estimates used in the preparation of its consolidated financial statements.

Revenue Recognition

The Company recognizes oil and natural gas revenue under the sales method of accounting for its interests in producing wells as crude oil and natural gas is produced and sold from those wells. Under the sales method, the Company does not recognize the value of its crude oil inventory in the financial statements. Costs associated with production are expensed in the period incurred.

Results of Operations

Revenues

After accounting for discontinued operations, the Company did not produce any revenue for the year ended May 31, 2009. The Company produced revenue of $1,518,858 for the period from June 1, 2008 through February 10, 2009. This revenue was primarily from the sale of customizable jewelry.

After accounting for discontinued operations, the Company did not have any cost of sales for the year ended May 31, 2009. The Company had cost of sales of $1,219,760 for the period from June 1, 2008 through February 10, 2009, resulting in gross profit of $299,098.

Operating Expenses

Our total operating expenses for the year ended May 31, 2010 were $58,243. Operating expenses for the year ended May 31, 2010 consisted of $24,415 in general and administrative expense and $33,828 in professional fees. General and administrative expenses consisted primarily of interest expense associated with convertible notes and bank charges. Professional fees consisted primarily of legal and accounting fees.

Our total operating expenses for the year ended May 31, 2009 not included in discontinued operations were $313,744. Operating expenses for the year ended May 31, 2009 consisted of $214 in depreciation and amortization expense, $149,593 in general and administrative expenses, and $163,937 in professional fees. General and administrative expenses for the year ended May 31, 2009 primarily consisted of bank charges, travel, meals and entertainment, promotional activities, rent, office maintenance, communication expenses (cellular, internet, fax, and telephone), courier, postage costs and office supplies. Professional fees consisted primarily of legal and accounting fees.

Net Income (Loss)

We had a net loss of $112,823 for the year ended May 31, 2010. This loss is primarily attributable to general and administrative expense of $24,415, professional fees of $33,828, and the accretion of discount on convertible notes of $62,544 offset by the gain on change in fair value of conversion feature of $7,964.

After accounting for discontinued operations, the Company had net income of $217,225 for the year ended May 31, 2009. This income is primarily attributable to the income and gain on discontinued operations of $621,041 and the gain on debt settlement of $98,168, which were offset by the loss from operations of $313,744, the loss on change in fair value of conversion feature of $145,711, the accretion of discount on convertible notes of $36,029, and the loss on settlement of a lawsuit of $6,500. There was no tax effect on the income and gain on discontinued operations because of the Company’s net operating loss.

The net gain from discontinued operations of $621,041 for the year ended May 31, 2009 consisted of income from discontinued operations of $134,735 and a gain on disposed of discontinued operations of $486,306.

Liquidity and Capital Resources

As of May 31, 2010, we had a working capital deficit of $370,043 consisting of cash of $1,079 and liabilities of $371,122. Our accumulated deficit of $1,532,347 as of May 31, 2010 was mainly funded by a combination of prior debt and equity financing by way of private placements of our common stock.

We had net cash of $1,079 provided by operating activities for the year ended May 31, 2010.

Obtaining any additional financing will be subject to a number of factors, including market conditions, investor acceptance of our business plan and investor sentiment. These factors may make the timing, amount, terms and conditions of additional financing unattractive or unavailable to us. There can be no assurance that financing will be available to us on favorable terms or at all. If we are unable to obtain additional financing, we may be unable to continue operations.

Off Balance Sheet Transactions

We do not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

New Accounting Pronouncements

In January 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2010-06, “Improving Disclosures about Fair Value Measurements”. ASU 2010-06 requires additional disclosures about fair value measurements including transfers in and out of Levels 1 and 2 and a higher level of disaggregation for the different types of financial instruments. For the reconciliation of Level 3 fair value measurements, information about purchases, sales, issuances and settlements are presented separately. This standard is effective for interim and annual reporting periods beginning after December 15, 2009 with the exception of revised Level 3 disclosure requirements, which are effective for interim and annual reporting periods beginning after December 15, 2010. Comparative disclosures are not required in the year of adoption.

In January 2010, the FASB issued ASU 2010-03, "Oil and Gas Reserve Estimations and Disclosures" (ASU 2010-03). This update aligns the current oil and gas reserve estimation and disclosure requirements of ASC Topic 932 with the changes required by the United States Securities and Exchange Commission (SEC) final rule, "Modernization of Oil and Gas Reporting," as discussed below. ASU 2010-03 expands the disclosures required for equity method investments, revises the definition of oil- and gas-producing activities to include nontraditional resources in reserves unless not intended to be upgraded into synthetic oil or gas, amends the definition of proved oil and gas reserves to require 12-month average pricing in estimating reserves, amends and adds definitions in the Master Glossary that are used in estimating proved oil and gas quantities and provides guidance on geographic area with respect to disclosure of information about significant reserves. ASU 2010-03 must be applied prospectively as a change in accounting principle that is inseparable from a change in accounting estimate and is effective for entities with annual reporting periods ending on or after December 31, 2009.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

Not required for smaller reporting companies.

Item 8. Financial Statements and Supplementary Data

See pages F-1 through F-16.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

On May 9, 2011, the Registrant engaged Anton & Chia, LLP (“Anton & Chia”) as the Registrant’s new independent registered public accounting firm. The appointment of Anton & Chia was approved by the Registrant’s Board of Directors.

On August 11, 2011, BCM Energy Partners, Inc. (the “Registrant”) dismissed Manning Elliot LLP (“Manning Elliot”) as its independent registered public accounting firm. The decision was approved by the Registrant’s Board of Directors.

Item 9A(T). Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures, as defined in Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities Exchange Act of 1934 (the "Exchange Act"), that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act) as of the period covered by this Report. Based on the evaluation of these disclosure controls and procedures, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of May 31, 2010.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a set of processes designed by, or under the supervision of, a company’s principal executive and principal financial officers to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP and includes those policies and procedures that:

·	pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions and dispositions of our assets,

·	provide reasonable assurance our transactions are recorded as necessary to permit preparation of our financial statements in accordance with GAAP, and that receipts and expenditures are being made only in accordance with authorizations of our management and directors, and

·	provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. It should be noted that any system of internal control, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the system will be met. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Under the supervision and with the participation of management, including its principal executive officer and principal financial officer, the Company’s management assessed the design and operating effectiveness of internal control over financial reporting as of May 31, 2010 based on the framework set forth in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on this assessment, management concluded that the Company’s internal control over financial reporting was not effective as of May 31, 2010.

In connection with the assessment described above, management identified the following control deficiencies that represent material weaknesses at May 31, 2010:

The Company failed to maintain an effective control environment and had insufficient oversight of the design and operating effectiveness of the Company’s disclosure controls and internal controls over financial reporting; insufficient oversight to ensure that the 302 sub-certifications were completed; infrequent review of its corporate governance documents, policies and procedures; and lack of proper segregation of duties.

The Company failed to maintain effective controls over the period-end financial reporting process, including controls with respect to journal entries, account reconciliations and proper segregation of duties. Journal entries, both recurring and nonrecurring, were not always accompanied by sufficient supporting documentation and were not adequately reviewed and approved for validity, completeness and accuracy. Account reconciliations over balance sheet accounts were not always properly performed and approved for validity and accuracy of supporting documentation.

·	The Company did not maintain proper segregation of duties. In certain instances, persons responsible to review transactions for validity, completeness and accuracy were also responsible for preparation.

The Company’s financial reporting person did not possess the requisite skill sets, knowledge, education or experience to prepare the consolidated financial statements and notes to consolidated financial statements in accordance with GAAP or to review the financial statements and notes to the financial statements prepared by external consultants and professionals to ensure accuracy and completeness.

·	The Company failed to maintain effective controls within the purchasing and accounts payable function.

·	The Company failed to maintain effective general computer controls, including ensuring proper security access within the financial application and to ensure backups were performed in accordance with generally accepted practices.

The Company failed to design sufficient controls to mitigate risks within the financial reporting, expenditures, equity, and treasury functions. In addition, insufficient corporate governance and general computer controls were designed and operating effectively to provide overriding risk mitigation at the entity level.

This Annual Report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this Annual Report.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the year ended May 31, 2010 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B. Other Information

None.

PART III

Item 10. Directors, Executive Officers and Corporate Governance

As of May 31, 2010, our Board of Directors consisted of one person, Brandon Toth.

Brandon Toth, Chairman, President, and Chief Executive Officer

Mr. Brandon Toth, who was 29 years old as of May 31, 2010, served as Chairman of the Board of Directors, President and Chief Executive Officer from February 10, 2009 to September 20, 2010. Mr. Toth is a director of Green Star (f/k/a Titan Oil and Gas), and he has served on its board of directors and as its President since February 2008. From December 2006 to February 2008 he was Vice President of Communications for Titan Oil and Gas. He has been a consultant for publicly traded companies involved in the natural resource development sector in corporate development and strategic communications since January 2006. Between 2004 and 2006, Mr. Toth directed public relations and marketing communications as well as raw materials sourcing, metal casting, welding and finishing for the Congie Gallery and Bronze Casting Studio. After his role at Congie, Mr. Toth worked in technical support for Cingular Wireless from 2005 to 2006. Throughout this time and since 2003, Mr. Toth also provided technical consulting, web and content development for a number of businesses and organizations.

Vic Devlaeminck, Chief Financial Officer and Director

Mr. Vic Devlaeminck, who was 59 years old as of May 31, 2009, served as Chief Financial Officer and Director of the Company from February 10, 2009 until May 3, 2009. Mr. Devlaeminck was a director and Chief Financial Officer of Green Star from November 1, 2008 to May 3, 2009. Mr. Devlaeminck is an attorney and C.P.A., licensed in both professions in the States of Oregon and Washington. Mr. Devlaeminck has maintained a private law practice specializing in corporate and tax law and has practiced as a C.P.A. in the States of Oregon and Washington for over 20 years. He is a member of the Oregon State Bar Association, the Washington State Bar Association and the Oregon Society of Certified Public Accountants. He is admitted to practice before the U.S. District Court and the U.S. Tax Court.

Family Relationships

There are no family relationships among our Directors or executive officers.

Involvement in Certain Legal Proceedings

Our Directors, executive officers and control persons have not been involved in any of the following events during the past ten years:

any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or

being found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.

Board Leadership Structure

The roles of Chairman and Chief Executive Officer of the Company were held by one person as of May 31, 2010. Mr. Toth serves as Chairman and Chief Executive Officer.

Risk Oversight

The Board exercises direct oversight of strategic risks to the Company.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires that our directors and executive officers, and persons who beneficially own more than 10% of a registered class of our equity securities, file with the Securities and Exchange Commission (SEC) initial reports of ownership and reports of changes in ownership of common stock and the other equity securities of the Company. These reporting persons are required by the regulations of the SEC to furnish us with copies of all Section 16(a) forms they file. Based solely on a review of the copies of the forms furnished to us, our review of the reports that have been filed and the representations of the reporting persons, we believe that all filing requirements applicable to these persons were complied with during fiscal year 2010.

Code of Conduct and Ethics

The Company does not have a formal code of conduct and ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller. It is unknown why the Company did not adopt a code of ethics as of May 31, 2010.

Item 11. Executive Compensation

For the year ended May 31, 2010, the Company did not compensate its officers or directors, including its principal executive officer and its principal financial officer.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

As of May 31, 2010, none of the Company’s directors or executive officers owned any of the Company’s common stock, and, to the Company’s knowledge, no person beneficially owned more than five percent of the Company’s common stock.

Item 13. Certain Relationships and Related Transactions, and Director Independence

Brandon Toth served as the Company’s Chairman, President, and Chief Executive Officer from February 10, 2009, the date of the Company’s Purchase Agreement with Green Star, until September 20, 2010. Mr. Toth also served as President from February 2008 to December 2010 and on the Board of Directors of Green Star from February 2008 until February 2011. Vic Devlaeminck served as the Company’s Chief Financial Officer and director of the Company from February 10, 2009 until May 3, 2009. Mr. Devlaeminck also served on the Board of Directors and as the Chief Financial Officer of Green Star from November 1, 2008 to May 3, 2009. During the year ended May 31, 2009, the Company issued to Green Star 9,000,000 shares of the Company’s common stock valued at $1,620,000 under the Purchase Agreement with Green Star. As described elsewhere in this Report, the Company did not receive title to the oil and gas properties described in the Purchase Agreement.

There were no transactions, since the beginning of the Company’s last fiscal year, or any currently proposed transaction, in which the Company was or is to be a participant and the amount involved exceeds $120,000, and in which Mr. Toth or Mr. Devlaeminck had or will have a direct or indirect material interest.

Item 14. Principal Accountant Fees and Services

Audit and Non-Audit Fees

The following table represents fees for the professional audit services and fees billed for other services rendered by the Company’s auditors, Manning Elliott LLP for the audit of the Company’s annual financial statements for the year ended May 31, 2008 and any other fees billed for other services rendered by Manning Elliott LLP during these periods. All fees are paid by US dollars.

	Year Ended May 31, 2009		Year Ended May 31, 2010
Audit fees	$	45,360.00	$	28,478.00
Audit-related fees		-		-
Tax fees		-		-
All other fees		-		-
Total	$	45,360.00	$	28,478.00

Since our inception, our Board of Directors, performing the duties of the Audit Committee, reviews all audit and non-audit related fees at least annually. The Board of Directors as the Audit Committee pre-approved all audit related services in the fiscal year ending May 31, 2010.

PART IV

Item 15. Exhibits, Financial Statement Schedules.

(a) Documents filed as part of the report.

(1) All Financial Statements

Consolidated Balance Sheets as of May 31, 2010 and 2009

Consolidated Statements of Operations and Comprehensive Income (Loss) for the years ended May 31, 2010 and 2009

Consolidated Statements of Changes in Stockholders’ Deficit for the years ended May 31, 2010 and 2009

Consolidated Statements of Cash Flows for the years ended May 31, 2010 and 2009

(2) Financial Statements Schedule

(3) Exhibits

The following documents are filed as exhibits to this Report:

3	Certificate of Amendment to Certificate of Incorporation (incorporated by reference to Exhibit A to the Information Statement on Schedule 14C filed with the SEC on November 10, 2008).

10.1	Purchase Agreement with Green Star dated February 10, 2009 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2009 (Green Star Form 8-K)).

10.2	Management Agreement with Green Star dated February 10, 2009 (incorporated by reference to Exhibit 10.2 to the Green Star Form 8-K).

10.3	Asset Purchase Agreement with Harold Schaffrick and Mark Neild dated February 10, 2009 (incorporated by reference to Exhibit 10.3 to the Green Star Form 8-K).

10.4	Asset Assignment and Assumption of Debt Agreement with Novori Jewelry Inc. dated February 10, 2009 (incorporated by reference to Exhibit 10.4 to the Green Star Form 8-K).

31.1	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.

31.2	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.

32	Section 1350 Certification of Chief Executive Officer and Chief Financial Officer.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: September 1, 2011

	BCM Energy Partners, Inc.


	By:	/s/ Raymond G. Bailey
		Raymond G. Bailey
		Chief Executive Officer
		(Principal Executive Officer)

In accordance with the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signatures	Title	Date



/s/ Raymond G. Bailey	Chairman of the Board of Directors	September 1, 2011
Raymond G. Bailey



/s/ David M. Beach	President, Director	September 1, 2011
David M. Beach



/s/ Charles B. Mathews	Chief Financial Officer	September 1, 2011
Charles B. Mathews



/s/ John H. Counce III	Director	September 1, 2011
John H. Counce III



/s/ Vic Demlaeminck	Director	September 1, 2011
Vic Demlaeminck

Table of Contents

	Page

Report of Independent Registered Public Accounting Firm	F-2

Consolidated Balance Sheets as of May 31, 2010 and 2009	F-3

Consolidated Statements of Operations and Comprehensive Income (Loss) for the Years Ended May 31, 2010 and 2009	F-4

Consolidated Statements of Changes in Stockholders’ Deficit for the Years Ended May 31, 2010 and 2009	F-5

Consolidated Statements of Cash Flows for the Years Ended May 31, 2010 and 2009	F-6

Notes to Consolidated Financial Statements	F-7

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of BCM Energy Partners, Inc.

We have audited the accompanying consolidated balance sheets of BCM Energy Partners, Inc. (the "Company"), as of May 31, 2010 and 2009, and the related consolidated statements of operations and comprehensive income (loss), changes in stockholders’ deficit and cash flows for the years then ended. These financial statements are the responsibility of the

Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits include consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated 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. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of BCM Energy Partners, Inc. as of May 31, 2010 and 2009, and the consolidated results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company has a loss from operations and an accumulated deficit of $1,532,347 at May 31, 2010. As discussed in Note 1 to the consolidated financial statements, the Company has a working capital deficiency, has convertible notes payable and related interest payable past due and has no established commercially viable business. These conditions, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ Anton & Chia, LLP

Newport Beach, California

September 1, 2011

F-2

BCM ENERGY PARTNERS, INC.

Consolidated Balance Sheets

	May 31, 2010			May 31, 2009
ASSETS

CURRENT ASSETS:
Cash	$	1,079		$	-
Total assets	$	1,079		$	-

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
Bank overdraft	$	-		$	13
Accounts payable		103,475			55,000
Accrued liabilities		13,575			2,715
Convertible notes payable		160,629			86,546
Derivative liability		93,443			101,407
Total current liabilities		371,122			245,681

Long-term convertible notes		-			11,539
Total liabilities		371,122			257,220

COMMITMENTS AND CONTINGENCIES (see Note 4)

STOCKHOLDERS' DEFICIT
Preferred stock, $.0001 par value; 20,000,000 shares authorized;
no shares issued and outstanding at May 31, 2009 and 2010.		-			-
Common stock, $.0001 par value; 150,000,000 shares authorized;
2,153,173 shares issued and outstanding at May 31, 2010, and May 31, 2009		215			215
Additional paid-in capital		1,162,089			1,162,089
Accumulated deficit		(1,532,347	)		(1,419,524	)
Total Stockholders' Deficit		(370,043	)		(257,220	)
Total Liabilities and Stockholders' Deficit	$	1,079		$	-

See accompanying notes to the consolidated financial statements.

F-3

BCM ENERGY PARTNERS, INC.

Consolidated Statements of Operations and Comprehensive Income (Loss)

	For the Year Ended			For the Year Ended
	May 31,			May 31,
	2010			2009
REVENUES	$	-		$	-

EXPENSES
Depreciation of equipment		-			214
General and administrative		24,415			149,593
Professional fees		33,828			163,937
Total expenses		58,243			313,744

NET LOSS FROM CONTINUING OPERATIONS		(58,243	)		(313,744	)

OTHER INCOME (EXPENSE)
Gain on debt settlement		-			98,168
Accretion of discount on convertible notes		(62,544	)		(36,029	)
Gain (loss) on change in fair value of conversion feature		7,964			(145,711	)
Loss on settlement of lawsuit		-			(6,500	)
Total other expense		(54,580	)		(90,072	)

NET LOSS BEFORE DISCONTINUED OPERATIONS		(112,823	)		(403,816	)

DISCONTINUED OPERATIONS
Income from discontinued operations		-			134,735
Gain on disposal of discontinued operations		-			486,306
Gain on discontinued operations		-			621,041

NET INCOME (LOSS)	$	(112,823	)	$	217,225

Basic and diluted loss per share, from continuing operations	$	(0.05	)	$	(0.21	)

Basic and diluted income per share, from discontinued operations	$	-		$	0.33

Weighted average shares outstanding - basic and diluted		2,153,173			1,898,876

NET INCOME (LOSS)	$	(112,823	)	$	217,225
Foreign currency translation adjustment		-			11,336
COMPREHENSIVE INCOME (LOSS)	$	(112,823	)	$	228,561

See accompanying notes to the consolidated financial statements.

F-4

BCM ENERGY PARTNERS, INC.

Consolidated Statements of Changes in Stockholders’ Deficit

For the Years Ended May 31, 2010 and 2009

																				Other
											Additional			Common						Comprehensive			Total
	Common Stock				Preferred Stock						Paid-in			Stock			Accumulated			Income			Stockholders'
	Shares		Amount		Shares			Amount			Capital			Subscribed			Deficit			(Loss)			Deficit
Balance – May 31, 2008		1,733,170	$	173		19,000,000		$	1,900		$	1,137,743		$	45,000		$	(1,636,749	)	$	(26,581	)	$	(478,514	)
Reverse split of common 1:20		-		-		-			-			(313	)		-			-			-			(313	)
Common stock issued for cash		20,496		2		-			-			44,998			(45,000	)		-			-			-
Common stock issued for settlement of debt		199,507		20		-			-			41,849			-			-			-			41,869
Common stock issued pursuant to asset purchase agreement		200,000		20		(19,000,000	)		(1,900	)		35,980			-			-			-			34,100
Foreign currency translation adjustment		-		-		-			-			-			-			-			11,336			11,336
Gain on debt settlement		-		-		-			-			(98,168	)		-			-			-			(98,168	)
Net income		-		-		-			-			-			-			217,225			15,245			232,470
Balance – May 31, 2009		2,153,173	$	215		-		$	-		$	1,162,089		$	-		$	(1,419,524	)	$	-		$	(257,220	)
Net loss		-		-		-			-			-			-			(112,823	)		-			(112,823	)
Balance – May 31, 2010		2,153,173	$	215		-		$	-		$	1,162,089		$	-		$	(1,532,347	)	$	-		$	(370,043	)

See accompanying notes to the consolidated financial statements.

F-5

BCM ENERGY PARTNERS, INC.

Consolidated Statements of Cash Flows

	For the Year Ended			For the Year Ended
	May 31,			May 31,
	2010			2009
Operating activities:
Net income (loss)	$	(112,823	)	$	217,225
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Gain on debt settlement		-			(98,168	)
Gain on disposal of discontinued operations		-			(486,306	)
Accretion of discount on convertible notes		62,544			36,029
Inventory reserve		-			(6,487	)
Depreciation of equipment		-			1,410
Change in fair value of conversion feature on convertible notes		(7,964	)		145,711
Changes in operating assets and liabilities:
Inventory		-			37,778
Prepaid expenses and other assets		-			4,189
Accounts payable and accrued liabilities		59,335			(62,517	)
Bank overdraft		(13	)		13
Agreement payable		-			(24,062	)
Other liabilities		-			(10,898	)
Accrued expenses		-			(67,523	)
Derivative liability		-			(83,192	)
Liabilities, net assets, disposed of sale of subsidiary		-			486,306
Net cash provided by operating activities		1,079			89,508

Financing activities:
Due from related party		-			(6,953	)
Due from shareholder		-			(15,000	)
Payments made on long term debt		-			(133,361	)
Proceeds from sale of common stock		-			45,000
Net cash used in financing activities		-			(110,314	)

Net increase (decrease) in cash and cash equivalents		1,079			(20,806	)

Cash , beginning of period		-			20,806

Cash, end of period	$	1,079		$	-

See accompanying notes to the consolidated financial statements.

F-6

BCM ENERGY PARTNERS, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 1 – Description of the Business and Summary of Significant Accounting Policies

On February 10, 2009, the Company entered into a purchase agreement (the “Purchase Agreement”) with Green Star Energies, Inc. ("Green Star") to acquire Green Star's interest in a number of oil and gas leases located in Beaver County, Pennsylvania. This acquisition is more fully described in Note 10 to the Company’s Consolidated Financial Statements. As of the date of this Report, the Company had not received title to the oil and gas leases from Green Star and considers the Purchase Agreement to be void. The Company is currently seeking to recover the consideration given to Green Star and its related parties, as they failed to deliver on the terms of the Purchase Agreement. On February 10, 2009, the Company also sold its only subsidiaries, Novori Marketing, Inc. and Novori Jewelry, Inc. The Company has no remaining interest in them.

On October 15, 2009, the Company incorporated a wholly-owned subsidiary, Aeon Energy, LLC, in the State of Washington.

These consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent upon the ability of the Company to acquire oil and gas properties or obtain necessary financing to continue operations, and the attainment of profitable operations. At May 31, 2010, the Company had a working capital deficit of $370,043 and had accumulated losses of $1,532,347. As noted above, as of May 31, 2010 and 2009, the Company had not produced revenues from oil and gas operations. These factors raise substantial doubt regarding the Company's ability to continue as a going concern. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

The Company's common shares are currently quoted on the OTC Pink market of OTC Markets Group, Inc. under the trading symbol “BCME.”

Basis of Presentation, Fiscal Year, and Principals of Consolidation

These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in U.S. dollars. These consolidated financial statements include the accounts of the Company and its wholly-owned Canadian subsidiary, Novori Marketing Inc. All intercompany transactions and balances have been eliminated. The Company’s fiscal year-end is May 31.

Use of Estimates

The preparation of these consolidated financial statements in accordance with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

F-7

Comprehensive Income (Loss)

The Company adopted Financial Accounting Standards Board (“FASB”) Codification topic 220, Reporting Comprehensive Income, which establishes standards for the reporting and display of comprehensive income and its components in the financial statements. Comprehensive income (loss) consists of net income and other gains and losses affecting stockholder's equity that are excluded from net income, such as unrealized gains and losses on investments available for sale, foreign currency translation gains and losses and minimum pension liability. Since inception, the Company’s other comprehensive income represents foreign currency translation adjustments. For the years ended May 31, 2010 and 2009, the Company’s only component of comprehensive income (loss) was a foreign currency translation adjustment of $0 and a loss of $11,336, respectively. As a part of the discontinued operations, the Company recognized a foreign currency translation adjustment of $15,245 as the Company ceased operation in Canada. As of May 31, 2010 and May 31, 2009, the Company had no components of comprehensive income.

Cash and Cash Equivalents

The Company considers all highly liquid instruments with maturities of three months or less at the time of issuance to be cash equivalents. As of May 31, 2010, the Company had a cash balance of $1,079. As of May 31, 2009, the Company had no cash.. As of May 31, 2010 and 2009, the Company had no cash equivalents.

Financial Instruments and Concentrations

The fair values of financial instruments, which include cash, accounts payable, accrued liabilities, and convertible notes, were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments. The Company’s operations were in Canada resulting in exposure to market risks from changes in foreign currency rates. The financial risk is the risk to the Company’s operations that arose from fluctuations in foreign exchange rates and the degree of volatility of these rates. The Company did not use derivative instruments to reduce its exposure to foreign currency risk. Financial instruments that potentially subject the Company to credit risk consist principally of cash. Cash is deposited with a high quality financial institution.

Foreign Currency Translation

The Company's reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies were translated using the exchange rate prevailing at the balance sheet date. Translation gains (losses) were recorded in accumulated other comprehensive income (loss) as a component of stockholders' equity. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances were included in the determination of income. Foreign currency transactions were primarily undertaken in Canadian dollars. As of May 31, 2010, and 2009, the Company had not entered into derivative instruments to offset the impact of foreign currency fluctuations.

Fair Value of Financial Instruments

The fair value accounting guidance defines fair value as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” The definition is based on an exit price rather than an entry price, regardless of whether the entity plans to hold or sell the asset. This guidance also establishes a fair value hierarchy to prioritize inputs used in measuring fair value as follows:

·	Level 1: Observable inputs such as quoted prices in active markets;

·	Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and

·	Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The estimated fair values of our financial assets and liabilities that are recognized at fair value on a recurring basis, using available market information and other observable data are as follows:

F-8

	May 31, 2010								May 31, 2010
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	Quoted Prices in Active Markets or Identical Assets								Quoted Prices in Active Markets or Identical Assets

			Significant Other Observable Inputs								Significant Other Observable Inputs
					Significant Unobservable Input								Significant Unobservable Input


Liabilities:
Derivative liability	$	-	$	93,443	$	-	$	93,443	$	-	$	101,407	$	-	$	101,407
Total financial liabilities	$	-	$	93,443	$	-	$	93,443	$	-	$	101,407	$	-	$	101,407

The carrying value of accounts payable and accrued liabilities are considered to approximate their fair value due to their short-term nature.

Basic and Diluted Net Income (Loss) per Share

FASB Codification topic 260, Earnings per share, requires dual presentation of basic and diluted earnings per share (EPS) with a reconciliation of the numerator and denominator of the EPS computations. Basic earnings per share amounts are based on the weighted average shares of common stock outstanding. If applicable, diluted earnings per share would assume the conversion, exercise or issuance of all potential common stock instruments such as options, warrants and convertible securities, unless the effect is to reduce a loss or increase earnings per share. Diluted net income (loss) per share on the potential exercise of the equity-based financial instruments is not presented where anti-dilutive.

The table below shows the earnings (loss) per share, basic and diluted, for the years ended May 31, 2010 and 2009:

	2010			2009
Net income (loss)		(112,823	)		217,225
Weighted average common shares outstanding		2,153,173			1,898,876
Earnings per share:
Basic and diluted loss per share, from continuing operations		(0.05	)		(0.21	)
Basic and diluted income per share, from discontinued operations		-			0.33

Income Taxes

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that, some portion or all of the deferred tax asset will not be realized. Deferred tax assets and liabilities are adjusted for the effect of changes in tax laws and rates on the date of enactment.

F-9

Recently Issued Accounting Pronouncements

On July 1, 2009, the Company adopted Accounting Standards Update (“ASU”) No. 2009-01, “Topic 105 - Generally Accepted Accounting Principles - amendments based on Statement of Financial Accounting Standards No. 168, “The FASB Accounting Standards Codification™ and the Hierarchy of Generally Accepted Accounting Principles” (“ASU No. 2009-01”). ASU No. 2009-01 re-defines authoritative GAAP for nongovernmental entities to be only comprised of the FASB Accounting Standards Codification (“ASC”) and, for SEC registrants, guidance issued by the SEC. The Codification is a reorganization and compilation of all then-existing authoritative GAAP for nongovernmental entities, except for guidance issued by the SEC. The Codification is amended to effect non-SEC changes to authoritative GAAP. Adoption of ASU No. 2009-01 only changed the referencing convention of GAAP in Notes to the consolidated financial statements.

In January 2010, FASB issued ASU 2010-06, “Improving Disclosures about Fair Value Measurements”. ASU 2010-06 requires additional disclosures about fair value measurements including transfers in and out of Levels 1 and 2 and a higher level of disaggregation for the different types of financial instruments. For the reconciliation of Level 3 fair value measurements, information about purchases, sales, issuances and settlements are presented separately. This standard is effective for interim and annual reporting periods beginning after December 15, 2009 with the exception of revised Level 3 disclosure requirements, which are effective for interim and annual reporting periods beginning after December 15, 2010. Comparative disclosures are not required in the year of adoption. We adopted the provisions of the standard on January 1, 2010, which did not have a material impact on our financial statements.

In May 2011, the FASB issued a new accounting standard on fair value measurements that clarifies the application of existing guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about fair value measurements. The standard is effective for interim and annual periods beginning after December 15, 2011. Early adoption is not permitted. The Company does not expect the adoption of this accounting guidance to have a material impact on its consolidated financial statements and related disclosures.

F-10

The following discusses non-authoritative accounting standards adopted by various bodies that have been incorporated into the authoritative FASB ASC:

We have implemented all new accounting pronouncements that are in effect and that may impact its financial statements and do not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on our financial position or results of operations.

Note 2 – Convertible Notes and Derivative Liability

On February 10, 2009, the Company issued $180,975 of convertible notes payable to two different note holders, bearing interest at 6% per annum, requiring payment of principal and interest monthly. Any outstanding balance plus accrued interest could be converted into the Company's common stock at a 20% discount to the market at the day of conversion. The conversion features was analyzed under FASB Codification Topic 815, Derivatives and Hedging. Bifurcation of the conversion option from the host contract and accounting for it separately as a derivative may have been necessary if (a) the conversion feature was not clearly and closely related to the host contract, (b) the hybrid instrument is not accounted for at fair value, and (c) a separate instrument with the same terms as the embedded instrument would qualify as a derivative instrument. To determine if the conversion option was indexed to the Company's own stock, the Company applied the two step approach as defined by ASC 815-40. In assessing step 2, by evaluating the conversion instrument's settlement provisions, the Company concluded that, pursuant to the guidance, the number of shares into which the note was convertible was not fixed and accordingly, the Company determined that the conversion feature of the note met the criteria of an embedded derivative and therefore the conversion feature of the debt needed to be bifurcated and accounted for as a derivative. The debt did not meet the definition of “conventional convertible debt” because the number of shares which could have been issued upon the conversion of the debt was not fixed. Therefore, the conversion feature, pursuant to ASC 815-40, was accounted for as a derivative liability. Pursuant to this guidance, the Company adjusts the carrying value of the conversion feature to its fair value at each reporting date. During the year ended May 31, 2010, the Company recognized a loss on the change in the fair value of the conversion feature of $7,964, decreasing the carrying value of the derivative liability to $93,443 as of May 31, 2010. For the year ended May 31, 2010, the Company accreted interest expense of $62,544, increasing the carrying value of the notes to $160,629. For the year ended May 31, 2010 and 2009, the Company recorded accrued expenses of $13,575 and $2,715, respectively, as accrued liabilities.

During the year ended May 31, 2009, the Company recognized a loss on the change in the fair value of the conversion feature of $145,711 increasing the carrying value of the derivative liability to $210,174 prior to the discontinuation of operations. For the year ended May 31, 2009, the Company accreted interest expense of $36,029 increasing the carrying value of the convertible notes to $98,085. At May 31, 2009, accrued interest of $21,232 had been recorded and is included in general and administrative expenses.

The Company calculated the fair value of these instruments using the Black-Scholes pricing model. The significant assumptions used in the calculation of the instruments fair value are detailed in the table below. The initial value of the derivative liability for the embedded conversion features at the date of issuance was $101,509, which was recorded in the accompanying consolidated balance sheet. The value of the derivative liability for the embedded conversion features at May 31, 2009 was $101,407. The offset to this entry was recorded to debt discount which will be amortized over the life of the note using the effective interest rate method.

	For the Year Ended			For the Year Ended
	May 31, 2010			May 31, 2009
Weighted average volatility		73	%		45	%
Expected dividends		0	%		0	%
Expected term	1.4 years			1.4 years
Risk-free rate		0.34	%		0.32	%

These derivative liabilities have been measured in accordance with FASB Codification topic 820 Fair Value Measurements. The valuation assumptions are classified within Level 2 inputs.

F-11

These instruments were not issued with the intent of effectively hedging any future cash flow, the fair value of any asset, any liability or any net investment in a foreign operation. The instruments do not qualify for hedge accounting, and, as such, all future changes in the fair value will be recognized currently in earnings until such time as the instruments are paid down or converted.

On December 8, 2010, the Company issued 2,520,000 shares of common stock to settle one of these notes in the amount of $80,975.

On August 10, 2011, the Company and the second note holder agreed to settle the remaining $100,000 note for cash in the amount of $25,000.

Note 3 – Discontinued Operations

On February 10, 2009, the Company entered into an asset purchase agreement with Harold Schaffrick and Mark Neild to sell the Company’s wholly owned subsidiary, Novori Jewelry, Inc. As of that date the Company discontinued all operations related to the former business of selling diamonds and custom jewelry over the internet.

The following are the results of operations from June 1, 2008 to February 10, 2009:

Revenue	$	1,518,858
Cost of sales		1,219,760
Gross profit		299,098

Expenses
Consulting fees		164,363
Net income from discontinued operations	$	134,735

At the date of disposition, the following are assets sold, liabilities disposed, related equity transactions, and gain on disposal of discontinued operations:

Assets:

Current assets:
Cash
Inventory	$	54,468
Prepaid expenses		4,160
Total current assets		58,628

Property and equipment		1,234
Total assets sold		59,862

Liabilities:

Current liabilities:
Cash overdraft		25,592
Accounts payable		168,757
Accrued liabilities		176,943
Due to related parties		6,953
Due to shareholder		15,000
Deferred revenue		49,690
Derivative liability		38,231
Promissory notes		95,000
Total net liabilities disposed		576,166

Owners' equity:
Preferred stock		(1,900	)
Common stock		20
Additional paid in capital		35,980
Accumulated other comprehensive income		(4,102	)
Gain on disposal of discontinued operations	$	486,306

F-12

Note 4 – Commitments

On August 25, 2008, the Company filed a lawsuit against Incentaclick Media Group Inc. (the “Plaintiff”) in the Supreme Court of British Columbia, Canada. The Company is claiming negligence and breach of contract due to failure to provide services as stipulated under an Agreement between the parties that had a term of 18 months commencing December 2006. Pursuant to the Agreement, the Company paid a monthly fee of $15,000 for custom website search engine optimization services. However, the Company claims that such services were never provided. Beginning December 2007 and for the remaining term of the contract, the monthly fee was reduced to $7,500. On July 28, 2008, the Company received a demand letter for payment of the remaining $67,500 outstanding under the Agreement. The Company proposed a settlement which was rejected, and the Plaintiff countersued for breach of contract, claiming damages of $67,500. On September 19, 2008, the parties settled and the Company agreed to pay $55,000 payable in 16 monthly payments of $3,437 commencing September 30, 2008. As of May 31, 2010, the Company has not made any settlement payments to the Plaintiff. The entire $55,000 liability is recorded in accounts payable as of May 31, 2010.

Note 5 – Contingent Liabilities

On September 21, 2009, a civil lawsuit was filed against Green Star in State Court in Beaver County, Pennsylvania by Bialy Gas Production Company, LLC, and Jonathan M. Bialy as plaintiffs. The plaintiffs alleged that Green Star breached the terms of its contract to purchase certain oil and gas leases owned by Bialy Gas Production Company, LLC and the terms of a later joint venture agreement between the parties. Alternatively, plaintiffs alleged that they properly and validly terminated both the purchase agreement and the later joint venture agreement. Plaintiffs were seeking a non-monetary declaratory judgment that the purchase agreement and the joint venture agreement were null and void and that Green Star had no interest in the subject oil and gas leases. On November 19, 2009, defendant Green Star filed an answer in the State Court in Beaver County, Pennsylvania, denying plaintiffs' allegations and counter-alleging that plaintiffs, among other things, intentionally interfered with Green Star's ability to complete the terms of the contracts and that plaintiffs' actions constituted breach on their part sufficient to forestall the right of Bialy Gas Production Company, LLC to the subject oil and gas leases. On February 24, 2010, the plaintiffs filed a praecipe to discontinue the case in State Court in Beaver County, Pennsylvania. which effectively ended the case as of that date.

Note 6 – Preferred Stock

On June 12, 2007, the Board of Directors of the Company adopted a Certificate of Designation for Series A Convertible Preferred Stock (“Series A Preferred”). The shares of Series A Preferred were convertible into common stock on a one for one basis at any time after June 12, 2009.

On June 12, 2007, the Company entered into shareholder agreements with the President and Chief Financial Officer of the Company pursuant to which each converted 475,000 shares of common stock into 9,500,000 shares of Series A Preferred on a one for one basis. No other consideration was paid in accordance with these transactions.

On February 10, 2009, the Company entered into an assignment and debt assumption agreement with Novori Jewelry, Inc., to transfer certain of the Company's assets to Novori Jewelry, Inc. The sale included the Company's wholly owned Canadian subsidiary, Novori Marketing, Inc., and all of its respective assets in exchange for cancellation of the 19,000,000 shares of Series A Preferred held by Harold Schaffrick and Mark Neild.

Note 7 – Common Stock

On August 5, 2008, the Company issued 20,496 shares of common stock in connection with the remaining $45,000 advance, which was recorded as common stock subscribed, that the Company received on May 20, 2008, pursuant to a prior equity distribution agreement with a lender.

On December 5, 2008, the Company effected a 1:20 reverse stock split of its authorized, issued and outstanding common stock. The authorized share capital was also increased from 100,000,000 shares of common stock to 150,000,000 shares of common stock with no change in par value. All share amounts have been retroactively adjusted for all periods presented. The Company recorded ($313) to additional paid in capital related to this reverse stock split during the year ended May 31, 2009.

On December 12, 2008, the Company issued 308 shares of common stock for the settlement of debt valued at $37.

On December 24, 2008, the Company settled one-half of the amounts of a then-outstanding promissory note having a principal value of $50,000 by issuing the lender 33,330 shares of its common stock with a fair value of $6,999.

On December 24, 2008, the Company settled one-half of the amounts of a then-outstanding promissory note having a principal value of $30,000 by issuing the lender 23,143 shares of its common stock with a fair value of $4,860.

On December 24, 2008, the Company settled the entire amount of a then-outstanding promissory note having a principal value of $100,000 by issuing the lender 142,726 shares of its common stock with a fair value of $29,973.

F-13

On February 10, 2009, the Company issued 200,000 shares of its common stock in settlement of $36,000 of debt associated with an assignment and debt assumption agreement with Novori Jewelry, Inc., to transfer certain of the Company's assets to Novori Jewelry, Inc. The sale included the Company's wholly owned Canadian subsidiary, Novori Marketing, Inc., and all of its assets in exchange for cancellation of the 19,000,000 shares of Series A Preferred held by Harold Schaffrick and Mark Neild.

Note 8 – Income Taxes

Income taxes are provided in accordance with FASB Codification topic 740, Accounting for Income Taxes. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss-carry forwards. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that, some portion or all of the deferred tax asset will not be realized. Deferred tax assets and liabilities are adjusted for the effect of changes in tax laws and rates on the date of enactment. As of May 31, 2010, Company had a net operating loss carryforward of approximately $1,125,000 available to offset taxable income in future years, which commence expiring in fiscal 2013. Pursuant to ASC 740, the potential benefit of the net operating loss carryforward has not been recognized in the consolidated financial statements because the Company could not be assured that it is more likely than not that such benefit will be utilized in future years.

The Company is subject to United States federal and state income taxes at an approximate aggregate rate of 43%. The reconciliation of the provision for income taxes at the United States federal statutory rate compared to the Company’s income tax expense as reported is as follows:

	May 31, 2010			May 31, 2009
Income tax recovery at statutory rates	$	189,850		$	141,336
Permanent differences		302,467			302,467
Valuation allowance change		(492,317	)		(443,803	)
Provision for income taxes	$	-		$	-

The items accounting for the difference between income taxes computed at the federal statutory rate and the benefit for income taxes were as follows:

	For the Year Ended May 31,
	2010			2009
Federal statutory rate		34.00	%		34.00	%
State tax, net of federal benefit		9.00	%		9.00	%
Valuation allowance		(43.00	%)		(43.00	%)
Effective income tax rate		0.00	%		0.00	%

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred income taxes arise from temporary differences in the recognition of income and expenses for financial reporting and tax purposes. The significant components of deferred income tax assets and liabilities are as follows:

	May 31, 2010			May 31, 2009
Net operating loss carryforward	$	788,610		$	730,367
Valuation allowance		(788,610	)		(730,367	)
Net deferred income tax asset	$	-		$	-

The Company has recognized a valuation allowance for the deferred income tax asset since the Company cannot be assured that it is more likely than not that such benefit will be utilized in future years. The valuation allowance is reviewed annually. When circumstances change and which cause a change in management's judgment about the realizability of deferred income tax assets, the impact of the change on the valuation allowance is generally reflected in current income.

F-14

Note 9 – Purchase of Oil and Gas Properties

On February 10, 2009, the Company executed a Purchase Agreement to purchase the interest in 13 leases of oil and gas properties located in Beaver County, Pennsylvania from Green Star.

In consideration for the purchase of the leases from Green Star, the Company was required to issue and deliver to Green Star: (1) 9,000,000 restricted shares of the Company's common stock; (2) warrants to purchase 2,000,000 shares of the Company's stock at a price of $0.10 per share, exercisable until February 10, 2011; (3) warrants to purchases 4,000,000 shares of the Company's common stock at a price of $0.15 per shares, exercisable until February 10, 2011; and (4) warrants to purchase 1,000,000 shares of the Company's common stock at a price of $0.20 per share, exercisable until February 10, 2011. Additional consideration for the purchase of the joint venture interest required the Company to (i) enter into a management agreement with Green Star dated February 10, 2009; (ii) execute promissory notes covering $180,975 of the Company's outstanding debt obligations; (iii) enter into an asset purchase agreement with Harold Schaffrick and Mark Neild dated February 10, 2009 to sell the Company's wholly owned subsidiary, Novori Jewelry, Inc., to Mr. Schaffrick and Mr. Neild; (iv) enter into an assignment and debt assumption agreement with Novori Jewelry, Inc., dated February 10, 2009, to transfer certain of the Company's assets to Novori Jewelry, Inc. and (v) issue and deliver 700,000 restricted shares of the Company's common stock as consideration for arranging and negotiating the transactions contemplated by the Purchase Agreement. The sale described in (iv) included the Company's wholly-owned Canadian subsidiary, Novori Marketing, Inc., and all of its respective assets in exchange for the cancellation of all preferred shares of Company held by Harold Schaffrick and Mark Neild.

In accordance with the Purchase Agreement with Green Star, the Company issued and delivered all of the consideration described in the foregoing paragraph. However, Green Star failed to transfer to the Company title of Green Star’s interest in the 13 leases of oil and gas properties located in Beaver County, Pennsylvania. As a result, the Company has determined this transaction to be void. The Company is currently seeking to resolve the matter with Green Star and other parties related to the consideration given by the Company under the Purchase Agreement.

Note 10 – Related Party Transactions

Note 11 – Subsequent Events

On October 15, 2009, the Company incorporated a wholly-owned subsidiary, Aeon Energy, LLC, in the State of Washington.

On December 8, 2010, the Company issued 2,520,000 shares of common stock, valued at $80,975, as settlement of an outstanding convertible note.

On December 25, 2010, the Company incorporated a wholly-owned subsidiary, BCM Energy Louisiana, LLC, in the State of Louisiana.

On December 14, 2010, the Company entered into a purchase agreement with BCM Energy Partners, LLC to acquire its interest in an oil lease. The Company issued to BCM Energy Partners, LLC, 4,800,000 shares of preferred stock with a 20 for 1 conversion feature related to this agreement.

On January 21, 2011, the Company issued 1,000,000 shares of common stock, valued at $180,000, to Karuk Holdings related to a service agreement.

F-15

On February 9, 2011, the Company issued 273,616 shares of common stock, valued at $46,515, to Vic Devlaeminck, a director of the Company, for services.

On February 15, 2011, the Company issued 45,000 shares of common stock, valued at $1,395, to a consultant for services.

On March 29, 2011, the Company issued 403,225 shares of common stock, valued at $250,000, to Kodiak Capital Group LLC related to a financing facility.

On April 12, 2011, the Company changed its name to “BCM Energy Partners, Inc.” and began trading under the symbol BCME on the OTC Pink Market of OTC Markets Group, Inc.

On April 13, 2011, the Company issued 165,000 shares of common stock, valued at $5,000, to a consultant for services.

On May 25, 2011, the Company issued 705,000 shares of common stock, valued at $42,300, to certain employees, executives and directors of the Company.

On May 30, 2011, BCM Energy Partners, LLC converted its 4,800,000 shares of preferred stock into 96,000,000 shares of common stock.

On May 31, 2011, the Company incorporated a wholly-owned subsidiary, BCM Energy Texas, LLC, in the State of Texas.

On August 10, 2011, the Company and a convertible note holder agreed to settle a $100,000 note for cash in the amount of $25,000.

On August 10, 2011, the Company incorporated a wholly-owned subsidiary, BCM Energy EOR, LLC, in the State of Delaware.

On August 15, 2011, the Company held a Special Meeting of Stockholders to approve the adoption of the Company’s Restated Certificate of Incorporation to effect a fifty to one reverse stock split. The proposal was approved by a major of the stockholders of the Company and will be effective on August 16, 2011.

On August 17, 2011, the Company’s wholly-owned subsidiary, BCM Energy Texas, LLC (“BCM Energy Texas”), entered into a Purchase Agreement with Drum Oil & Gas, Inc. (“Drum O&G”) to acquire 90% of Drum O&G’s 18 net revenue interests in oil and gas wells located in Liberty County, Texas in exchange for $967,742 in cash, subject to ordinary adjustments. Drum O&G also granted to BCM Energy Texas a one-year option to acquire 90% of Drum O&G’s 17 net revenue interests in oil and gas wells located in Liberty County, Texas. In addition, BCM Texas also entered into a Purchase Agreement with Drum Equipment, Inc. to acquire 90% of Drum Equipment’s 27 net revenue interests in oil and gas wells also located in Liberty County, Texas in exchange for $1,617,512 in cash, subject to ordinary adjustments. Drum Equipment also granted to BCM Energy Texas a one-year option to acquire 90% of Drum O&G’s 19 net revenue interests in oil and gas wells located in Liberty County, Texas.

F-16

Exhibit Index

The following exhibits are filed herewith or incorporated herein pursuant to Regulation S-K, Item 601:

Exhibit

3	Certificate of Amendment to Certificate of Incorporation (incorporated by reference to Exhibit A to the Information Statement on Schedule 14C filed with the SEC on November 10, 2008)

10.1	Purchase Agreement with Green Star dated February 10, 2009 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2009 (Green Star Form 8-K)).

10.2	Management Agreement with Green Star dated February 10, 2009 (incorporated by reference to Exhibit 10.2 to the Green Star Form 8-K).

10.3	Asset Purchase Agreement with Harold Schaffrick and Mark Neild dated February 10, 2009 (incorporated by reference to Exhibit 10.3 to the Green Star Form 8-K).

10.4	Asset Assignment and Assumption of Debt Agreement with Novori Jewelry Inc. dated February 10, 2009 (incorporated by reference to Exhibit 10.4 to the Green Star Form 8-K).

31.1*	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.

31.2*	Rule 13a-14(a)/15d-14(a) Certification of, Chief Financial Officer.

32*	Section 1350 Certification of Chief Executive Officer and Chief Financial Officer.

* Filed herewith.

BCM Energy Partners Inc. - FORM 10-K - September 1, 2011

Attached files

BCM Energy Partners Inc. Reports