Edgar Filing: Management Energy, Inc.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[Mark One]

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

For the quarterly period ended January 31, 2010

¨ 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: 333-152608

Management Energy, Inc.

(Exact name of registrant as specified in its charter)

Nevada	26-1749145
(State of Incorporation)	(IRS Employer Ident. No.)

30950 Rancho Viejo Road, Suite 120 San Juan Capistrano, CA	92675
(Address of Principal Executive Offices)	(Zip Code)

Registrant's telephone number: (949) 373-7282

(Former name or former address, if changed since last

report)

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 x 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 (Section 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 reports) .

Yes x No ¨

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 definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

¨ Large accelerated filer

¨ Accelerated filer

¨ Non-accelerated filer

x Smaller reporting company

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

The number of shares outstanding of each of the issuer’s classes of equity as of March 18, 2010: 39,825,000 shares of common stock, par value $0.001 per share.

MANAGEMENT ENERGY, INC.

	PART I - FINANCIAL INFORMATION

		Page
Item 1.	Financial Statements

	Balance Sheets – January 31, 2010 (Unaudited) and April 30, 2009	1

	Statements of Operations - (Unaudited) Three and Nine Months Ended January 31, 2010 and 2009 and for the period of inception, from May 19, 2005 through January 31, 2010	2

	Statements of Cash Flows - (Unaudited) Nine Months Ended January 31, 2010 and 2009 and for the period of inception, from May 19, 2005 through January 31, 2010	3

	Statements of Stockholders Equity (Unaudited) – For the Period Ended January 31, 2010	4

	Notes to Financial Statements	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16

	Financial Condition and Results	16

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	20

Item 4T.	Controls and Procedures	20

	PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	21

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	21

Item 3.	Defaults Upon Senior Securities	21

Item 4.	Submission of Matters to a Vote of Security Holders	21

Item 5.	Other Information	21

Item 6.	Exhibits	21

Signatures		22

MANAGEMENT ENERGY, INC.

(An Exploration Stage Company)

Balance Sheets

	January 31,			April 30,
	2010			2009
	(unaudited)
ASSETS

Current Assets
Cash and Cash Equivalents	$	79		$	900
Total Current Assets		79			900

Total Assets	$	79		$	900

LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)

Current Liabilities
Accounts Payable	$	158,746		$	41,295
Accrued Expenses		64,541			100,917
Due to Affiliate		5,000			-
Total Current Liabilities		228,287			142,212

Stockholders' Equity (Deficit)
Common Stock, $0.001 par value, 300,000,000 shares authorized,
39,825,000 shares issued and outstanding at January 31, 2010 and,
71,925,000 shares issued and outstanding at April 30, 2009		39,825			71,925
Additional paid-in capital		1,671,511			1,239,411
Deficit accumulated in the exploration stage		(1,939,544	)		(1,452,648	)

Total Stockholders' Equity (Deficit)		(228,208	)		(141,312	)

Total Liabilities and Stockholders' Equity (Deficit)	$	79		$	900

See accompanying notes to financial statements

MANAGEMENT ENERGY INC.

(An Exploration Stage Company)

Statements of Operations

(unaudited)

													For the period
													of Inception,
	For the						For the						from May 19,
	Three Months Ended						Nine Months Ended						2005 through
	January 31,						January 31,						January 31,
	2010			2009			2010			2009			2010

Expenses:

Professional Fees	$	9,336		$	6,500		$	56,386		$	6,500		$	108,186
Consulting		50,834			16,667			260,836			16,667			327,504
Mining Lease		62,541			-			62,541			-			125,082
Stock Based Compensation		-			-			-			-			1,163,500
Other General & Administrative		4,103			329			107,133			329			131,999

Total Operating Expenses		126,814			23,496			486,896			23,496			1,856,271

Operating Loss From Continuing Operations	$	(126,814	)	$	(23,496	)	$	(486,896	)	$	(23,496	)	$	(1,856,271	)

Discontinued operations
Gain (loss) from discontinued operations		-			(36,530	)		-			(60,986	)		(83,273	)

Net Income (Loss)	$	(126,814	)	$	(60,026	)	$	(486,896	)	$	(84,482	)	$	(1,939,544	)

Basic and Dilutive Net Loss From Continuing Operations Per Share	$	(0.0032	)	$	(0.0017	)	$	(0.0055	)	$	(0.0017	)

Basic and Dilutive Net Income From Discontinued Operations Per Share	$	-		$	(0.0027	)	$	-		$	(0.0043	)

Weighted average number of shares outstanding, basic and diluted		39,825,000			13,560,870			88,078,005			14,053,625

See accompanying notes to financial statements

MANAGEMENT ENERGY INC.

(An Exploration Stage Company)

Statements of Cash flows

(unaudited)

							For the period
							of Inception,
	For the						May 19,
	Nine Months Ended						2005 to
	January 31,						January 31,
	2010			2009			2010

Cash Flows from Operating Activities
Net Loss from continuing operations	$	(486,896	)	$	(23,496	)	$	(1,856,271	)
Net Gain (Loss) from discontinued operations		-			(60,986	)		(83,273	)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation expense		-			1,178			1,479
Stock issued to acquire mining lease		-			-			62,541
Stock Based Compensation		-			-			1,163,500

Change in operating assets and liabilities:
Accounts Receivable		-			(14,118	)		(15,118	)
Prepaids		-			-			(1,500	)
Accounts Payable		117,451			-			158,746
Accrued expenses		(36,376	)		22,667			64,541

Net Cash used in Operating Activities		(405,821	)		(74,755	)		(505,355	)

Cash Flows from Investing Activities
Purchase of equipment		-			-			(23,564	)
Net Cash used in Investing Activities		-			-			(23,564	)

Cash Flows from Financing Activities
Proceeds from the sale of Common Stock		400,000			-			523,998
Borrowing from Affiliate		5,000			-			5,000
Repayment of loan from officer		-			(1,750	)		-
Net Cash provided by (used by) Financing Activities		405,000			(1,750	)		528,998

Net Increase (Decrease) in Cash	$	(821	)	$	(76,505	)	$	79

Cash at beginning of period	$	900		$	76,697		$	-

Cash at end of period	$	79		$	192		$	79

Cash paid for
Interest	$	-		$	-		$	-
Income Taxes	$	-		$	-		$	-

Supplemental Disclosue of Non-Cash Disposal of Assets related to Discontinued Operations:

Accounts receivable	$	-		$	15,118		$	15,118
Prepaids		-			1,500			1,500
Property and Equipment		-			22,085			22,085
Common stock		-			(4,000	)		(4,000	)
Additional Paid in Capital		-			(34,703	)		(34,703	)
	$	-		$	-		$	-

See accompanying notes to financial statements

MANAGEMENT ENERGY INC.

(An Exploration Stage Company)

Statement of Stockholders' Equity (Deficit)

										Accumulated
							Additional			Deficit During
	Common Stock						Paid-in			Exploration
	Shares			Amount			Capital			Stage			Total

Balances at May 19, 2005		-		$	-		$	-		$	-		$	-

Common stock issued for cash on
January 10, 2008 at $0.002 per share		9,000,000			9,000			9,000			-			18,000

Common stock issued for cash on
February 20, 2008 at $0.02 per share		5,300,000			5,300			99,698			-			104,998

Net loss for the year ended April 30, 2008		-			-			-			(23,287	)		(23,287	)

Balances at April 30, 2008		14,300,000		$	14,300		$	108,698		$	(23,287	)	$	99,711

Shares retired in the disposal of assets		(4,000,000	)		(4,000	)		(34,703	)		-		$	(38,703	)

Common stock issued for cash on February 27, 2009 at $0.0002 per share		5,000,000			5,000			(4,000	)		-		$	1,000

Common Stock issued for professional services on April 15, 2009		1,625,000			1,625			1,161,875			-		$	1,163,500

Common Stock issued in acquisition of mining lease on April 15, 2009		60,000,000			60,000			2,541			-		$	62,541

Common Stock issued for professional services on April 16, 2009		2,010,500			2,010			1,465,655			-		$	1,467,665

Shares retired due to termination of consulting agreement		(7,010,500	)		(7,010	)		(1,460,655	)		-		$	(1,467,665	)

Net loss from discontinued operations for the year ended April 30, 2009		-			-			-			(59,986	)	$	(59,986	)

Net loss from continuing operations for the year ended April 30, 2009		-			-			-			(1,369,375	)	$	(1,369,375	)

Balances at April 30, 2009		71,925,000		$	71,925		$	1,239,411		$	(1,452,648	)	$	(141,312	)

Common stock issued for cash on July 24, 2009 at $1.00 per share		400,000			400			399,600			-		$	400,000

Shares retired due to settlement agreement		(32,500,000	)		(32,500	)		32,500			-		$	-

Net loss from continuing operations for the nine months ended January 31, 2010		-			-			-			(486,896	)	$	(486,896	)

Balances at January 31, 2010 (unaudited)		39,825,000		$	39,825		$	1,671,511		$	(1,939,544	)	$	(228,208	)

See accompanying notes to financial statements

Management Energy, Inc.

(An Exploration Stage Company)

Notes to Unaudited Financial Statements

NOTE 1 – BACKGROUND, ORGANIZATION, AND BASIS OF PRESENTATION

Basis of Presentation

The unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and Item 8-03 of Regulation S-X. Accordingly, they do not include all footnote disclosures required by accounting principles generally accepted in the United States of America. These financial statements should be read in conjunction with our audited financial statements and notes thereto for the year ended April 30, 2009 included in our Form 10-K filed with the SEC on August 13, 2009. The accompanying financial statements reflect all adjustments, which, in the opinion of management, are necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods in accordance with accounting principles generally accepted in the United States of America. The results for any interim period are not necessarily indicative of the results for the entire fiscal year.

Organization

The Company was initially incorporated in the State of Nevada on May 19, 2005, as Inkie Entertainment Group, Inc., for the purpose of engaging in the production, distribution and marketing of filmed entertainment products. On January 15, 2008, the Company changed its name to Quantum Information, Inc. In January 2009, the Company announced that it would transition out of the filmed entertainment products business and into the coal business.

As part of that transition, on January 14, 2009, the Company sold all of its assets to Joel Klandrud, the Company’s former officer and director, in exchange for the surrender to the Company by Mr. Klandrud of 4,000,000 shares of the Company’s common stock, and the assumption by Mr. Klandrud all of the Company’s liabilities. The Company also changed its name to MGMT Energy, Inc. on February 5, 2009 and to Management Energy, Inc. on May 28, 2009 to better reflect the Company’s business focus. See Note 7 – Discontinued Operations for further discussion.

On April 13, 2009, the Company entered into a Contribution and Assignment Agreement (the “Contribution Agreement”) with Carbon County Holdings, LLC, a Delaware limited liability company (“CCH”), John P. Baugues, Jr., the Company’s former Chief Executive Officer and director, The John Paul Baugues, Sr. Family Trust, the beneficiaries of which are John P. Baugues, Jr. and his children (the “Baugues Trust”), and Tydus Richards, the former Chairman of the Company’s board of directors. Pursuant to the Contribution Agreement, CCH agreed to contribute and assign to the Company all of CCH’s rights and obligations under that certain Mining Lease, dated on or around January 16, 2009 (the “Bolzer Lease”), between CCH, on the one hand, and Edith L. Bolzer and Richard L. Bolzer, as lessors, on the other hand, for the purpose of mining and removing coal from approximately 6,254 acres located in the vicinity of Bridger in Carbon County, Montana (the “Bolzer Property”). In exchange for the contribution and assignment of the Bolzer Lease, the Company agreed to issue to each of Mr. Baugues, the Baugues Trust, and Mr. Richards, the sole members of CCH, the number of shares of the Company’s Common Stock set forth opposite such member’s name below.

Name of Member	Number of Shares
John P. Baugues, Jr.		15,925,000
The John Paul Baugues, Sr. Family Trust		16,575,000
Tydus Richards		27,500,000
Total		60,000,000

Under the terms of the Bolzer Lease, the Company is required to pay to the lessors (1) a minimum annual payment in an amount equal to $62,541 in each year during the initial ten (10) year term of the Bolzer Lease, subject to increases in future years (the “Minimum Annual Payment”) and (2) a royalty equal to 12.5% of the gross proceeds on all coal mined from the Bolzer Property (the “Royalty”). In addition, unless coal is mined from minerals owned by the lessors, for each ton of coal mined from, stored on or transported across the Bridger Property, the Company is required to pay a damage fee of $0.15 per ton for such coal (the “Damage Fee”). In the event that the Royalty and/or the Damage Fee in any year during the term exceeds twice the Minimum Annual Payment, the Company is not required to make the Minimum Annual Payment for that year.

The Bolzer Lease is effective for a 10 year term. The Company has the right to renew the Bolzer Lease for two additional 10 year terms upon at least 90 days written notice to the lessors prior to the expiration of the then-current term. After 3 years from the effective date, the Company has the right to terminate the Bolzer Lease, on any annual anniversary, upon 90 days prior written notice to the lessors and upon payment of all damage fees, rentals and royalties accrued through the date of termination.

On October 8, 2009, the Company entered into an agreement with Mr. Baugues, for the development of coal mines in an area of Carbon County, Montana known as the Bridger-Fromberg-Bear Mountain project. The project consists of 6,254 acres we have under lease and over 50,000 additional acres we are seeking to lease. Under the terms of the agreement:

Mr. Baugues (or his new entity) will pay to the Company an overriding royalty equal to 2% of the gross selling price of all coal produced from any property that is part of the Bridger-Fromberg-Bear Mountain project.

Mr. Baugues (or his new entity) will pay to the Company an additional overriding royalty equal to 15% of the net profits from the mining and sale of all coal produced from any property that is part of the Bridger-Fromberg-Bear Mountain project.

The Company will have a right of first refusal to acquire up to a 50% interest in any property that becomes part of the Bridger-Fromberg-Bear Mountain project.

Mr. Baugues surrendered to the Company 15,925,000 shares of the Company’s common stock for cancellation and caused to be surrendered 16,575,000 shares of the Company’s common stock held by the John T. Baugues Sr. Trust for cancellation.

Subject to Mr. Baugues (or a new entity to be formed by him) achieving certain development milestones, the Company: (i) will sublease to a new entity to be formed by Mr. Baugues, the Company’s mining lease for the 6,250 acre Bolzer Property and (ii) will not interfere with the development of the Bridger-Fromberg-Bear Mountain project by Mr. Baugues (or his new entity).

To retain the Bolzer Property sublease and other rights under the settlement agreement, Mr. Baugues (or his new entity) will be required to meet certain milestones (over a 15 month period) relating to obtaining financing, completing a drilling program, acquiring sufficient mining rights to constitute a viable development plan for the project, and submitting permitting applications.

Subject to performance of the terms of the settlement agreement, the Company and Mr. Baugues will release each other from any claims that they may have against the other as of the date of the settlement agreement.

On May 28, 2009, the Company completed a five-for-one stock split of the Company’s common stock and an increase in the number of our authorized shares of common stock to 300,000,000. The share and per-share information disclosed within this Form 10-Q reflect the completion of this stock split.

Business Overview

The Company’s business plan is to engage in the exploration, extraction and distribution of coal. The Company is currently considered to be an exploration stage corporation because it is engaged in the search for coal deposits and is not engaged in the exploitation of a coal deposit. The Company has not engaged in the preparation of an established commercially mineable coal deposit for extraction or in the exploitation of a coal deposit. The Company will be in the exploration stage until it discovers commercially viable coal deposits on the Bolzer Property or any other property that the Company acquires, if ever. In an exploration stage company, management devotes most of its activities to acquiring and exploring mineral properties.

The Company currently leases the Bolzer Property for the purpose of mining, removing, marketing and selling coal. Further exploration will be required before a final evaluation as to the economic feasibility of coal extraction on the Bolzer Property can be determined. The Company has done preliminary estimates of the surface seams on the Bolzer Property, and intends to perform phase 1 drilling commencing in calendar year 2010 in order to determine whether it contains a commercially viable coal deposit.

Going Concern

The Company's financial statements are prepared using the accrual method of accounting in accordance with accounting principles generally accepted in the United States of America, and have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The Company incurred a net loss of $486,896 during the nine months ended January 31, 2010, and an accumulated deficit of $1,939,544 since inception. The Company changed its principal business to the coal business in early 2009, but has not yet established an ongoing source of revenues sufficient to cover its operating costs and to allow it to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease development of operations.

In order to continue as a going concern, develop a reliable source of revenues, and achieve a profitable level of operations the Company will need, among other things, additional capital resources. Management’s plans to continue as a going concern include raising additional capital through sales of common stock and or a debt financing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

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

Cash and equivalents

Cash and equivalents include investments with initial maturities of three months or less. The Company maintains its cash balances at credit-worthy financial institutions that are insured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. There were no cash equivalents at January 31, 2010 or April 30, 2009.

Concentration of Credit Risk

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk are cash and cash equivalents. The Company places its cash and temporary cash investments with credit quality institutions. At times, such investments may be in excess of FDIC insurance limits. As of January 31, 2010, there were no deposits in excess of federally insured limits.

Fair Value of Financial Instruments

The Financial Accounting Standards Board (“FASB”) issued a standard on Disclosures About Fair Value of Financial Instruments. The standard requires disclosure of fair value information about financial instruments when it is practicable to estimate that value. The carrying amounts of the Company’s financial instruments as of January 31, 2010 approximate their respective fair values because of the short-term nature of these instruments. Such instruments consist of cash, accounts payable and accrued expenses.

Income Taxes

The Company accounts for income taxes under the standards issued by the FASB. Under those standards, deferred tax assets and liabilities are recognized for future tax benefits or consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided for significant deferred tax assets when it is more likely than not that such assets will not be realized through future operations.

Equipment

Equipment is recorded at cost and depreciated using straight line methods over the estimated useful lives of the related assets. The Company reviews the carrying value of long-term assets to be held and used when events and circumstances warrant such a review. If the carrying value of a long-lived asset is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds the fair market value. Fair market value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. The cost of normal maintenance and repairs is charged to operations as incurred. Major overhaul that extends the useful life of existing assets is capitalized. When equipment is retired or disposed, the costs and related accumulated depreciation are eliminated and the resulting profit or loss is recognized in income.

Issuance of Shares for Non-Cash Consideration

The Company accounts for the issuance of equity instruments to acquire goods and/or services based on the fair value of the goods and services or the fair value of the equity instrument at the time of issuance, whichever is more reliably determinable.

The Company's accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of the standards issued by FASB. The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement.

Stock-Based Compensation

In December of 2004, the FASB issued a standard which applies to transactions in which an entity exchanges its equity instruments for goods or services and also applies to liabilities an entity may incur for goods or services that are based on the fair value of those equity instruments. For any unvested portion of previously issued and outstanding awards, compensation expense is required to be recorded based on the previously disclosed methodology and amounts. Prior periods presented are not required to be restated. The Company adopted this standard as of January 1, 2006 and applied the standard using the modified prospective method. The Company has not issued any stock options.

Exploration-Stage Company

The Company is considered an exploration-stage company, having limited operating revenues during the period presented, as defined by the FASB standard. This standard requires companies to report their operations, shareholders deficit and cash flows since inception through the date that revenues are generated from management’s intended operations, among other things. Management has defined inception as May 19, 2005. Since inception, and more particularly since commencing business in January 2008, the Company has incurred a net loss of $1,939,544. Much of this related to consultants and professional fees, as a means to generate working capital. The Company’s working capital has been generated through the sale of common stock and renting its camera equipment. Management has provided financial data since May 19, 2005, “Inception”, in the financial statements.

Net Loss Per Share

The FASB standard requires presentation of basic earnings or loss per share and diluted earnings or loss per share. Basic income (loss) per share (“Basic EPS”) is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share (“Diluted EPS”) is similarly calculated using the treasury stock method except that the denominator is increased to reflect the potential dilution that would occur if dilutive securities at the end of the applicable period were exercised. There were no potential dilutive securities as of January31, 2010 and 2009.

	For the						For the
	Three Months Ended						Nine Months Ended
	January 31,						January 31,
	2010			2009			2010			2009

Net Income (Loss)	$	(126,814	)	$	(60,026	)	$	(486,896	)	$	(84,482	)

Basic and Dilutive Net Loss From Continuing Operations Per Share	$	(0.0032	)	$	(0.0017	)	$	(0.0055	)	$	(0.0017	)

Basic and Dilutive Net Income From Discontinued Operations Per Share	$	-		$	(0.0027	)	$	-		$	(0.0043	)

Weighted average number of shares outstanding, basic and diluted		39,825,000			13,560,870			88,078,005			14,053,625

The weighted average number of shares included in the calculation above are post-split.

Recent Accounting Pronouncements

In June 2009, the Financial Accounting Standards Board ("FASB") established the FASB Accounting Standards Codification (the "Codification") as the source of authoritative accounting principles recognized by the FASB to be applied by non-governmental entities in the preparation of financial statements in conformity with GAAP. Rules and interpretive releases of the Securities and Exchange Commission ("SEC") under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The introduction of the Codification does not change GAAP and other than the manner in which new accounting guidance is referenced, the adoption of these changes had no impact on the our consolidated financial statements.

In May 2009, the FASB issued a standard on subsequent events. This pronouncement establishes standards for accounting for and disclosing subsequent events (events which occur after the balance sheet date but before financial statements are issued or are available to be issued). It requires an entity to disclose the date subsequent events were evaluated and whether that evaluation took place on the date financial statements were issued or were available to be issued. It is effective for interim and annual periods ending after June 15, 2009. The Company has adopted the standard.

NOTE 3 – RELATED PARTY TRANSACTIONS

On January 10, 2008 the Board authorized the issuance of common stock to two Directors:

Joel Klandrud	4,500,000 shares at a price of $0.002 per share
President and Chief Operating Officer
Director

Sandra Dosdall	4,500,000 shares at a price of $0.002 per share
Director

On January 14, 2009, the Company sold all of its assets to Joel Klandrud, the Company’s former officer and director, pursuant to an Asset Sale Agreement. In exchange, Mr. Klandrud (1) surrendered to the Company for cancellation 4,000,000 shares of the Company’s Common Stock, par value $0.001 per share, and (2) assumed all of the Company’s liabilities. See Note 7 – Discontinued Operations for further discussion.

On January 14, 2009, the Company entered into a Support Services Agreement with Strands Management Company, LLC (“Strands”). Matt Szot, the Company’s Chief Financial Officer, Treasurer, and Secretary, is the Chief Financial Officer of Strands. David Walters, the Company’s Chief Executive Officer and director, owns a 50% interest and is a managing member of Strands. Under the Support Services Agreement, Strands will provide the Company with financial management services, facilities and administrative services, and other services as agreed by the parties. Under the Support Services Agreement, the Company will pay to Strands monthly cash fees of $16,667 for the services. On January 8, 2010, the Support Services Agreement was renewed for an additional twelve months and the monthly cash fee increased to $17,500. The current term of the Support Services Agreement expires January 8, 2011. On April 2, 2009, the Company entered into Amendment #1 to the Strands Agreement. Pursuant to the amendment, the Company agreed to issue to Messrs. Walters and Szot and another principal of Strands an aggregate of 1,625,000 shares of the Company’s common stock as a retainer, in exchange for Strands’ agreement to continue to provide services under the Support Services Agreement. The Company incurred $150,836 and $16,667 under the terms of the agreement for the nine months ended January 31, 2010 and 2009, respectively, which is included in consulting expenses in the accompanying statements of operations. As of January 31, 2010, $134,622 is outstanding under the agreement.

On January 14, 2009, the Company entered into a Placement Agency and Advisory Services Agreement with Monarch Bay Associates (“Monarch Bay”). Monarch Bay is a FINRA member firm. Under the agreement, Monarch Bay will act as the Company’s placement agent on an exclusive basis with respect to private placements of the Company’s capital stock. David Walters, the Company’s Chief Executive Officer and director, owns a 50% interest and is a managing member of Monarch Bay. Pursuant the engagement letter, the Company is required to (1) pay to Monarch Bay 3% of the gross proceeds of any financing from non-Monarch Bay sources and issue to Monarch Bay warrants to purchase that number of shares of our common stock equal to 3% of the number of shares of common stock (including convertible securities) issued in such financing, and (2) pay to Monarch Bay 5% of the gross proceeds of any financing from Monarch Bay sources and issue to Monarch Bay warrants to purchase that number of shares of our common stock equal to 5% of the number of shares of common stock (including convertible securities) issued in such financing. The Company did not incur any expenses under the terms of the agreement during the nine months ended January 31, 2010.

On January 9, 2009, the Company entered into an Acquisition Agreement (the “Acquisition Agreement”) to acquire 100% of the ownership interests in Patoka River Coal Company, LLC, a Delaware limited liability company (“PRCC”), Patoka River Holdings, LLC, a Delaware limited liability company (“PRH”), and Carbon County Holdings, LLC (PRCC, PRH and CCH are collectively referred to herein as the “LLCs”) in exchange for the Company’s agreement to issue a total of 40,000,000 shares of the Company’s common stock to the owners of the LLCs, John P. Baugues, Jr. (the Company’s former Chief Executive Officer and director), the Baugues Trust, and TRX Capital, LLC, a California limited liability controlled by Tydus Richards, the former Chairman of the Company’s board of directors,. At that time, PRCC held an exclusive option to acquire two parcels of land in fee simple, which option expired on January 26, 2009, and CCH held certain leasehold mining rights. On March 31, 2009, the Company entered into a Letter Agreement Regarding Termination of Acquisition Agreement (the “Termination Letter”), pursuant to which the parties agreed to terminate the Acquisition Agreement.

On April 13, 2009, the Company entered into the Contribution Agreement with Carbon County Holdings, LLC, John P. Baugues, Jr., the Company’s former Chief Executive Officer and director, the Baugues Trust, and Tydus Richards, the former Chairman of the Company’s board of directors. Pursuant to the Contribution Agreement, CCH agreed to contribute and assign to the Company all of CCH’s rights and obligations under the Bolzer Lease in exchange for the issuance to the members of CCH of, the number of shares of the Company’s Common Stock set forth opposite such member’s name below.

Name of Member	Number of Shares
John P. Baugues, Jr.		15,925,000
The John Paul Baugues, Sr. Family Trust		16,575,000
Tydus Richards		27,500,000
Total		60,000,000

On April 13, 2009, the Company entered into a Strategic Consulting Services Agreement with Charles S. Leykum (the Company’s former Board Advisor). Pursuant to the Consulting Agreement, the Company agreed to issue to Mr. Leykum (or Mr. Leykum’s designees) an aggregate of 2,010,500 shares of the Company’s common stock as a payment, in exchange for Charles S. Leykum’s agreement to provide services under the Consulting Agreement. The Consulting Agreement had a term of 24 months. The Company recorded the stock payment of $1,467,665 as a prepaid expense on April 13, 2009 which reflected the numbers shares issued multiplied by the closing trading price on the date of issuance.

On July 13, 2009, the Company agreed to the termination of its Strategic Consulting Services Agreement with Charles S. Leykum. In connection with the termination of the agreement, Mr. Leykum and certain affiliated entities surrendered 7,010,500 shares of the Company’s common stock for cancellation and the parties agreed to a mutual release of all claims. The Company treated the termination and cancellation of shares as a Type 1 subsequent event because the termination provided information that led management to conclude that the prepaid asset no longer had future economic value. Accordingly, the termination of the Consulting Agreement and the related cancellation of shares were recorded as of April 30, 2009. See Note 6 for further discussion.

Effective July 10, 2009, John P. Baugues, Jr. resigned from the Board of Directors of the Company and as the Company’s Chief Executive Officer.

On October 8, 2009, the Company entered into an agreement with Mr Baugues, for the development of coal mines in an area of Carbon County, Montana known as the Bridger-Fromberg-Bear Mountain project. Under the terms of the agreement:

The Company will have a right of first refusal to acquire up to a 50% interest in any property that becomes part of the Bridger-Fromberg-Bear Mountain project.

Subject to Mr. Baugues (or a new entity to be formed by him) achieving certain development milestones, the Company: (i) will sublease to a new entity to be formed by Mr. Baugues, the Company’s mining lease for the 6,250 acre Bolzer property and (ii) will not interfere with the development of the Bridger-Fromberg-Bear Mountain project by Mr. Baugues (or his new entity).

To retain the Bolzer property sublease and other rights under the settlement agreement, Mr. Baugues (or his new entity) will be required to meet certain milestones (over a 15 month period) relating to obtaining financing, completing a drilling program, acquiring sufficient mining rights to constitute a viable development plan for the project, and submitting permitting applications.

On July 23, 2009, the Company entered into a stock purchase agreement with an accredited investor controlled by Tydus Richards, the former Chairman of our board of directors, for the sale of 400,000 shares of its common stock at a purchase price of $1.00 per share. The sale closed on July 24, 2009.

On July 16, 2009, the Company entered into a Consulting Services Agreement with Lotus Asset Management (“Lotus”) controller by Tydus Richards, the former Chairman of our board of directors. Pursuant to the agreement, in consideration for providing certain services to us, Lotus was entitled to a monthly fee in the amount of $20,000. The agreement expired November 16, 2010. The Company incurred $80,000 under the terms of the agreement for the nine months ended January 31, 2010, which is included in consulting expenses in the accompanying statements of operations. As of January 31, 2010, no amounts were outstanding under the agreement.

During the period from May 1, 2009 through January 31, 2010, Tydus Richards, the former Chairman of our board of directors and shareholder, made payments totaling $13,700 on behalf of the Company. The Company reimbursed Mr. Richards $8,700 on September 3, 2009 and the remaining balance of $5,000 remains outstanding.

NOTE 4 - COMMITMENTS AND CONTINGENCIES

Consulting Agreements

The Company has entered into consulting agreements for services to be provided to the Company in the ordinary course of business. These agreements call for expense reimbursement and various payments upon performance of services. See Note 3 for further discussion.

Legal

There were no legal proceedings against the Company.

Operating Leases Commitments

Under the terms of the Bolzer Lease, the Company is required to pay to the lessors (1) a minimum annual payment in an amount equal to $62,541 in each year during the initial ten (10) year term of the Bolzer Lease, subject to increases in future years and (2) a royalty equal to 12.5% of the gross proceeds on all coal mined from the Bridger Property. In addition, unless coal is mined from minerals owned by the lessors, for each ton of coal mined from, stored on or transported across the Bolzer Property, the Company is required to pay a damage fee of $0.15 per ton for such coal. In the event that the Royalty and/or the Damage Fee in any year during the term exceeds twice the Minimum Annual Payment, the Company is not required to make the Minimum Annual Payment for that year.

The future minimum lease payments associated with the Bolzer Lease for the fiscal years ending April 30 are as follows:

April 30, 2010			62,541
April 30, 2011			62,541
April 30, 2012			62,541
April 30, 2013			62,541
April 30, 2014			62,541
Thereafter			312,705
			625,410

NOTE 5 – ACCRUED EXPENSES

Accrued expenses consist of the following:

	January 31,		April 30,
	2010		2009

Accrued Mining Lease		62,541		-
Accrued Consulting Fees		-		66,668
Accrued Audit Fees		2,000		3,000
Accrued Legal Fees		-		10,000
Accrued Travel, Meals & Entertainment		-		21,249
		64,541		100,917

NOTE 6 – CAPITAL STOCK TRANSACTIONS

The Company is authorized to issue up to 300,000,000 shares of its common stock, par value $0.001 per share. At April 30, 2009, there were 71,925,000 shares issued and outstanding. At January 31, 2010, there were 39,825,000 shares issued and outstanding.

On May 28, 2009, the Company completed a five-for-one stock split of the Company’s common stock and an increase in the number of our authorized shares of common stock from 75,000,000 to 300,000,000.

On January 10, 2008, 9,000,000 common shares were issued for cash at $0.002 per share, realizing $18,000.

On February 20, 2008, 5,300,000 common shares were issued for cash at $0.02 per share, realizing $104,998.

On January 27, 2009, the Company entered into a stock purchase agreement (the “Leykum SPA”) with Charles S. Leykum, pursuant to which the Company agreed to sell to Mr. Leykum 1,250,000 shares of the Company’s Common Stock, par value $0.001, for an aggregate price of $250. The issuance and sale of the shares of Common Stock to Mr. Leykum was subject to customary closing conditions as set forth in the Leykum SPA. This issuance was subsequent to the January 14, 2009 change in control and is considered to be founder’s shares. These shares were issued on February 27, 2009. See Note 3.

On January 27, 2009, the Company entered into a stock purchase agreement (the “Master Fund SPA”) with CSL Energy Master Fund, L.P., a Cayman Islands limited partnership (“Master Fund”), pursuant to which the Company agreed to sell to Master Fund 525,000 shares of the Company’s Common Stock, par value $0.001, for an aggregate price of $105. The issuance and sale of the shares of Common Stock to Master Fund was subject to customary closing conditions as set forth in the Master Fund SPA. This issuance was subsequent to the January 14, 2009 change in control and is considered to be founder’s shares. These shares were issued on February 27, 2009. See Note 3.

On January 27, 2009, the Company entered into a stock purchase agreement (the “Energy Fund SPA”) with CSL Energy Fund, L.P., a Delaware limited partnership (“Energy Fund”), pursuant to which the Company agreed to sell to Energy Fund 3,225,000 shares of the Company’s Common Stock, par value $0.001, for an aggregate price of $645. The issuance and sale of the shares of Common Stock to Energy Fund was subject to customary closing conditions as set forth in the Energy Fund SPA. This issuance was subsequent to the January 14, 2009 change in control and is considered to be founder’s shares. These shares were issued on February 27, 2009. See Note 3.

On April 2, 2009, the Company entered into that certain Amendment #1 Support Services Agreement, with Strands Management Company, LLC, David Walters, Matt Szot, and another principal (the “Amendment”), which Amendment amends that certain Support Services Agreement, dated as of January 8, 2009, between the Company and Strands. Pursuant to the Amendment, the Company agreed to issue to Messrs. Walters, Szot and another principal of Strands an aggregate of 1,625,000 shares of the Company’s common stock as a retainer, in exchange for Strands’ agreement to continue to provide services under the Support Services Agreement. The shares were issued on April 15, 2009, accordingly, the Company recorded a stock based compensation charge of $1,163,500 which is included in the statement of operations for the year ended April 30, 2009. See Note 3.

As discussed in Note 1 and Note 3, on April 13, 2009, the Company entered into the Contribution Agreement with Carbon County Holdings, LLC, John P. Baugues, Jr., the Company’s former Chief Executive Officer and director, the Baugues Trust, and Tydus Richards, the former Chairman of the Company’s board of directors. Pursuant to the Contribution Agreement, CCH agreed to contribute and assign to the Company all of CCH’s rights and obligations under the Bolzer Lease in exchange for the issuance to the members of CCH of, the number of shares of the Company’s Common Stock set forth opposite such member’s name below.

Name of Member	Number of Shares
John P. Baugues, Jr.		15,925,000
The John Paul Baugues, Sr. Family Trust		16,575,000
Tydus Richards		27,500,000
Total		60,000,000

The Company has treated the 60,000,000 shares issued pursuant to the Contribution Agreement as founder shares. The Company determined that the first year lease payment of $62,541 was the best indicator of the cost of the acquisition, accordingly, the issuance of the 60,000,000 founder shares were recorded as a mining lease expense of $62,541 during the year ended April 30, 2009.

On April 13, 2009, the Company entered into a Strategic Consulting Services Agreement with Charles S. Leykum. Pursuant to the agreement, the Company agreed to issue to Mr. Leykum (or Mr. Leykum’s designess) an aggregate of 2,010,500 shares of the Company’s common stock as a payment, in exchange for Charles S. Leykum’s agreement to provide services under the agreement. The agreement had a term of 24 months. The Company recorded the stock payment of $1,467,665 as a prepaid expense on April 13, 2009 which reflected the numbers shares issued multiplied by the closing trading price on the date of issuance.

On July 13, 2009, the Company agreed to the termination of its Strategic Consulting Services Agreement with Charles S. Leykum. In connection with the termination of the agreement, Mr. Leykum and certain affiliated entities surrendered 7,010,500 shares of the Company’s common stock for cancellation and the parties agreed to a mutual release of all claims. The Company treated the termination and cancellation of shares as a Type 1 subsequent event because the termination provided information that led management to conclude that the prepaid asset no longer had future economic value. Accordingly, the termination of the agreement and the related cancellation of shares were recorded as of April 30, 2009.

On October 8, 2009, the Company entered into an agreement with Mr. Baugues. Under the terms of the agreement, Mr. Baugues surrendered to the Company 15,925,000 shares of the Company’s common stock for cancellation and caused to be surrendered 16,575,000 shares of the Company’s common stock held by the John T. Baugues Sr. Trust for cancellation.

NOTE 7 – DISCONTINUED OPERATIONS

On January 14, 2009, the Company sold all of its assets to Joel Klandrud, the Company’s former officer and Director. In exchange, Mr. Klandrud (1) surrendered to the Company for cancellation 4,000,000 shares (800,000 pre-split) shares of the Company’s Common Stock, par value $0.001 per share, and (2) assumed all of the Company’s liabilities.

The following schedule shows the assets and liabilities as of January 14, 2009:

Accounts receivable	$	15,118
Prepaids		1,500
Property and Equipment		22,085

The Company’s loss from discontinued operations, for the nine months ended January 31, 2010 and 2009, totaled $0 and $60,986, respectively. The Company’s loss from discontinued operations since inception through January 31, 2010, totaled $83,273. Prior year financial statements have been restated to present the discontinued operations.

NOTE 8 – SUBSEQUENT EVENTS

We failed to make the January 2010 scheduled minimum annual payment of $62,541 under our lease for Bolzer Property. Although, to date, we have not received a notice of default from the lessor of the property, there is no assurance we will not receive one in the future.

On March 8, 2010, the Company closed a note purchase agreement with an accredited investor pursuant to which the Company sold a $50,000 convertible note in a private placement transaction. In the transaction, the Company received proceeds of $35,000 and the investor also paid $15,000 of consulting expense on behalf of the Company. The convertible note is due and payable on December 31, 2010 with an interest rate of 10% per annum. The note is convertible at the option of the holder into our common stock at a fixed conversion price of $0.37, subject to adjustment for stock splits and combinations.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation

In this Quarterly Report on Form 10-Q, unless the context requires otherwise, “we,” “us” and “our” refer to Management Energy, Inc., a Nevada corporation. The following Management’s Discussion and Analysis of Financial Condition and Results of Operation provide information that we believe is relevant to an assessment and understanding of our financial condition and results of operations. The following discussion should be read in conjunction with our financial statements and notes thereto included with this Quarterly Report on Form 10-Q, and all our other filings, including Current Reports on Form 8-K, filed with the Securities and Exchange Commission (“SEC”) through the date of this report.

Forward Looking Statements

This Quarterly Report on Form 10-Q includes both historical and forward-looking statements, which include information relating to future events, future financial performance, strategies, expectations, competitive environment and regulations. Words such as “may,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” and similar expressions, as well as statements in future tense, identify forward-looking statements. Such statements are intended to operate as “forward-looking statements” of the kind permitted by the Private Securities Litigation Reform Act of 1995, incorporated in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). That legislation protects such predictive statements by creating a “safe harbor” from liability in the event that a particular prediction does not turn out as anticipated. Forward-looking statements should not be read as a guarantee of future performance or results and will probably not be accurate indications of when such performance or results will be achieved. Forward-looking statements are based on information we have when those statements are made or our management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. You should review carefully the section entitled “Risk Factors” beginning on page 7 of our Annual Report on Form 10-K for a discussion of certain of the risks that could cause our actual results to differ from those expressed or suggested by the forward-looking statements.

The inclusion of the forward-looking statements should not be regarded as a representation by us, or any other person, that such forward-looking statements will be achieved. You should be aware that any forward-looking statement made by us in this Quarterly Report on Form 10-Q, or elsewhere, speaks only as of the date on which we make it. We undertake no duty to update any of the forward-looking statements, whether as a result of new information, future events or otherwise. In light of the foregoing, readers are cautioned not to place undue reliance on the forward-looking statements contained in this Quarterly Report on Form 10-Q.

Overview

Management Energy, Inc. acquires and develops coal mining projects in the U.S. to provide coal to both domestic and foreign markets. We are currently considered to be an exploration stage corporation because we are engaged in the search for coal deposits and are not engaged in the exploitation of a coal deposit. We will be in the exploration stage until we discover commercially viable coal deposits on the Bolzer Property or any other property that we acquire, if ever. In an exploration stage company, management devotes most of its activities to acquiring and exploring mineral properties.

We currently are developing the Bridger-Fromberg-Bear Mountain project a coal mining project in the vicinity of Bridger in Carbon County, Montana. The project consists of 6,254 acres we have under lease and over 50,000 additional acres we are seeking to lease.

Reserve Estimates

The project is still in the development stage and requires additional drilling and study to establish reliable reserve estimates. Based on similar reserves in proximity and related coal seams, our external consultants have assumed for business planning purposes a reserve size of at least 200 million tons, a heat rate of more than 11,000 Btu, and less than 1% sulfur. However, there is no assurance that a commercially viable coal deposit exists on the project site. Furthermore, there is no assurance that we will be able to successfully develop the project or identify, acquire or develop other coal properties that would allow us to profitably extract and distribute coal and to emerge from the exploration stage.

Development Strategy

Our current strategy is to pursue the Bridger-Fromberg-Bear Mountain project with a development partner. We believe the benefits of this strategy include:

Reduced capital requirements. Our development partner will have responsibility for obtaining funding for the project. We are entitled to an overriding royalty (based on sales and net profits) on the coal produced from the project without making any additional capital investment.

Option to participate in project investment. We have retained the option to participate up to 50% in any acquisition of coal properties that become part of the project.

Access to industry and local market expertise. Our development partner has over 20 years coal industry experience and has successfully developed and exited a coal project in Montana.

In October 2009, we entered into an agreement with a development partner for the development of the Bridger-Fromberg-Bear Mountain Project. The agreement provides that:

Subject to our partner achieving certain development milestones, we will sublease to our partner our mining lease to 6,254 acres in the project

Our partner will pay to us an overriding royalty equal to 2% of the gross selling price of all coal produced from any property that is part of the Bridger-Fromberg-Bear Mountain project.

Our partner will pay to us an additional overriding royalty equal to 15% of the net profits from the mining and sale of all coal produced from any property that is part of the Bridger-Fromberg-Bear Mountain project.

We will have a right of first refusal to acquire up to a 50% interest in any property that becomes part of the Bridger-Fromberg-Bear Mountain project.

To retain its project rights, our development partner must meet certain milestones relating to obtaining financing, completing a drilling program, acquiring sufficient mining rights to constitute a viable development plan for the project, and submitting permitting applications.

As we execute our business plan in the fiscal year ending April 30, 2010, we expect to incur a substantial amount of operating expenses that have not been incurred or reflected in our historical results of operations, including: mining lease expenses and expenses for personnel, operations, and professional fees. We also expect that we will continue to incur stock based compensation charges in future periods as we will likely issue equity awards as a form of compensation to management and other professional service providers.

Results of Operations

Three Months Ended January 31, 2010, Compared to Three Months Ended January 31, 2009

Revenues

We have only recently entered the coal business. Accordingly, we have not generated any revenues from continuing operations. We do not expect to generate any revenues until at least the fourth quarter of calendar year 2010.

Operating Expenses

Operating expenses from continuing operations totaled $126,814 for the three months ended January 31, 2010 compared to $23,496 for the comparable period in the prior year. The current period operating expenses primarily consist of $62,541 of mining lease expenses, $50,834 of consulting fees, as well as $9,336 of other professional fees and $4,103 of other general and administrative expenses. The prior period operating expenses primarily consist of $16,667 of consulting fees, as well as $6,500 of other professional fees and $329 of other general and administrative expenses.

We changed our principal business to the coal business, and expect to continue to incur operating expenses to pursue our business plan.

Gain (Loss) from Discontinued Operations

On January 14, 2009, we sold all of our assets to Joel Klandrud, our former officer and director, pursuant to an Asset Sale Agreement. In exchange, Mr. Klandrud (1) surrendered to us for cancellation 4,000,000 shares of our Common Stock, par value $0.001 per share, and (2) assumed all of our liabilities. We incurred losses from discontinued operations of $36,530 for the three months ended January 31, 2009.

Results of Operations

Nine Months Ended January 31, 2010, Compared to Nine Months Ended January 31, 2009

Revenues

Operating Expenses

Operating expenses from continuing operations totaled $486,896 for the nine months ended January 31, 2010 compared to $23,496 for the comparable period in the prior year. The current period operating expenses primarily consist of $62,541 of mining lease expenses, $260,836 of consulting fees, as well as $56,386 of other professional fees and $107,133 of other general and administrative expenses. The prior period operating expenses primarily consist of $16,667 of consulting fees, as well as $6,500 of other professional fees and $329 of other general and administrative expenses.

We recently changed our principal business to the coal business, and expect to continue to incur operating expenses to pursue our business plan.

Gain (Loss) from Discontinued Operations

Liquidity and Capital Resources

The accompanying financial statements have been prepared assuming that we will continue as a going concern. As shown in the accompanying financial statements, we incurred losses of $486,896 for the nine months ended January 31, 2010 and have an accumulated deficit of $1,939,544 at January 31, 2010. At January 31, 2010, we had cash and cash equivalents of $79 and no other assets.

We have not yet established a source of revenues to cover our operating costs and to allow us to continue as a going concern. We do not expect to generate any revenues until at least the fourth quarter of calendar year 2010. In order to continue as a going concern, develop a reliable source of revenues, and achieve a profitable level of operations, we will need, among other things, significant additional capital resources. Accordingly, management’s plans to continue as a going concern include raising additional capital through sales of common stock and other securities.

The business of exploring, extracting and distributing coal is capital intensive. Execution of our business strategy will require substantial capital investment in the short-term and in future periods. We require capital for, among other purposes, identifying and acquiring additional reserves and developing acquired reserves.

Our current funding is not sufficient to continue our operations for the remainder of the fiscal year ending April 30, 2010. Due to our insufficient funding levels, we failed to make the January 2010 scheduled minimum annual payment of $62,541 under our lease for Bolzer Property. Although, to date, we have not received a notice of default from the lessor of the property, there is no assurance we will not receive one in the future.

On March 8, 2010, we sold a $50,000 convertible note to an accredited investor in a private placement transaction. In the transaction, we received proceeds of $35,000 and the investor also paid $15,000 of consulting expense on our behalf. The convertible note is due and payable on December 31, 2010 with an interest rate of 10% per annum. The note is convertible at the option of the holder into our common stock at a fixed conversion price of $0.37, subject to adjustment for stock splits and combinations.

We will require additional debt and/or equity financing to continue our operations and meet our contractual commitments (including under the Bolzer Property lease). We cannot provide any assurances that additional financing will be available to us or, if available, may not be available on acceptable terms.

If we are unable to obtain adequate capital, we could be forced to cease or delay development of our operations, sell assets or our business may fail. In each such case, the holders of our common stock would lose all or most of their investment.

Off-Balance Sheet Arrangements

As of January 31, 2010, we did not have any significant off-balance sheet arrangements, as defined in Item 303 of Regulation S-K.

Critical Accounting Policies and Estimates

Our financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles used in the United States. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. These estimates and assumptions are affected by management’s application of accounting policies. We believe that understanding the basis and nature of the estimates is critical to an understanding of our financials.

Use of Estimates

Issuance of Shares for Non-Cash Consideration

Recently Issued Accounting Pronouncements

In June 2009, the FASB established the FASB Accounting Standards Codification (the "Codification") as the source of authoritative accounting principles recognized by the FASB to be applied by non-governmental entities in the preparation of financial statements in conformity with GAAP. Rules and interpretive releases of the Securities and Exchange Commission ("SEC") under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The introduction of the Codification does not change GAAP and other than the manner in which new accounting guidance is referenced, the adoption of these changes had no impact on the our consolidated financial statements.

In September 2006, the FASB adopted a standard for fair value measurements. This standard establishes a framework for measuring fair value and expands disclosure about fair value measurements. Specifically, this standard establishes that fair value is a market-based measurement, not an entity specific measurement. As such, the value measurement should be determined based on assumptions the market participants would use in pricing an asset or liability, including, but not limited to assumptions about risk, restrictions on the sale or use of an asset and the risk of nonperformance for a liability. The expanded disclosures include disclosure of the inputs used to measure fair value and the effect of certain of the measurements on earnings for the period. The adoption of this standard related to financial assets and liabilities did not have a material impact on the Company's financial statements. We are currently evaluating the impact, if any, that this standard may have on our future financial statements related to non-financial assets and liabilities.

In October 2008, the FASB issued a standard for determining the fair value of a financial asset when the market for that asset is not active. We have concluded that the application of this standard did not have a material impact on our financial position and results of operations as of and for the three and nine months ended January 31, 2010.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

None.

Item 4T. Controls and Procedures.

Evaluation of Disclosure and Procedures

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended, as of the end of the period covered by this report (the “Evaluation Date”). Based on this evaluation, our principal executive officer and principal financial officer concluded as of the Evaluation Date that our disclosure controls and procedures were effective such that the information relating to us required to be disclosed in our Securities and Exchange Commission (“SEC”) reports (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and (ii) is accumulated and communicated to management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Control Over Financial Reporting

During our most recent fiscal quarter, there has not occurred any change in our internal control over financial reporting (as such term is defined in Rule 15d-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II

OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

On March 8, 2010, we entered into a note purchase agreement with an accredited investor pursuant to which we sold a $50,000 principal amount convertible note in exchange for $50,000. The note is convertible at the option of the holder into our common stock at a fixed conversion price of $0.37, subject to adjustment for stock splits and combinations. Our securities were offered and sold solely to an accredited investor in reliance on the exemption from registration provided by Section 4(2) of the Securities Act of 1933, as amended, since the issuances did not involve a public offering, the recipient took the securities for investment and not resale and we took appropriate measures to restrict transfer.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Submission of Matters to a Vote of Security Holders.

None.

Item 5. Other Information.

None.

Item 6. Exhibits.

No.		Description

Exhibit 31.1		Certification by the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

Exhibit 31.2		Certification by the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

Exhibit 32.1		Certification by the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

Exhibit 32.2		Certification by the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

SIGNATURES

Pursuant to the requirements 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.

Dated: March 19, 2010

Management Energy, Inc.

By:	/s/ David Walters
	David Walters, Chief Executive Officer

By:	/s/ Matt Szot
	Matt Szot, Chief Financial Officer

EXHIBIT INDEX

No.		Description

Exhibit 31.1		Certification by the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

Exhibit 31.2		Certification by the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

Exhibit 32.1		Certification by the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

Exhibit 32.2		Certification by the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*