Common use of SUBSEQUENT EVENT Clause in Contracts

SUBSEQUENT EVENT. On December 8, 2005, the Company authorized a forward stock split, and increased the number of issued and outstanding shares on a five-for-one (5:1) basis. All share amounts have been retroactively adjusted for all period's presented. FC FINANCIAL SERVICES, INC. (A Development Stage Company) FINANCIAL STATEMENTS Balance Sheets F-1 Statements of Operations F-2 Statements of Cash Flows F-3 Statements of Stockholders’ Equity F-4 F-i F-ii (A Development Stage Company) (Expressed in US dollars) (unaudited) ASSETS Current Assets Cash 1,024,961 49,963 Prepaid expenses 10,000 – Loan receivable (Note 3) 1,004,110 – Total Current Assets 2,039,071 49,963 Property and Equipment (Note 4) 5,428 6,241 TOTAL ASSETS 2,044,499 56,204 LIABILITIES AND STOCKHOLDERS' EQUITY LIABILITIES Current Liabilities Accounts payable 848 – Accrued liabilities 3,250 8,805 Total Current Liabilities 4,098 8,805 TOTAL LIABILITIES 4,098 8,805 STOCKHOLDERS' EQUITY Common stock 100,000,000 shares authorized, $0.00001 par value, 32,722,750 shares issued and outstanding (Note 6) 327 307 Additional paid-in capital (Note 6) 2,114,158 114,198 Donated capital (Notes 5(b) and (c)) 41,400 27,600 Deficit accumulated during the development stage (115,484 ) (94,706 ) Total Stockholders' Equity 2,040,401 47,399 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 2,044,499 56,204 (A Development Stage Company) (Expressed in US dollars) (unaudited) REVENUE Interest income 4,124 4,112 8 4,116 8 EXPENSES Consulting (Note 4(b)) 36,000 6,000 6,000 12,000 12,000 General and administrative expenses 80,796 6,130 8,835 12,081 29,378 Amortization 1,625 406 – 813 Interest expense 1,187 – 118 – 413 Total expenses 119,608 12,536 14,953 24,894 41,791 NET LOSS (115,484 ) (8,424 ) (14,945 ) (20,778 ) (41,783 ) NET LOSS PER SHARE – Basic and Diluted – – – – $ ( 0.01 ) Weighted Average Number of Common Shares Outstanding 31,049,000 5,871,000 30,887,000 5,440,000 (A Development Stage Company) (Expressed in US dollars) (unaudited) CASH FLOWS TO OPERATING ACTIVITIES Net loss (115,484 ) (20,778 ) (41,783 ) Adjustments to reconcile net loss to net cash used in operating activities Amortization 1,625 813 – Interest on loan receivable (4,110 ) (4,110 ) Donated services and rent 41,400 13,800 13,800 Changes in operating assets and liabilities Prepaid expenses (10,000 ) (10,000 ) – Accounts payable and accrued liabilities 4,098 (4,707 ) 3,001 Net Cash Used In Operating Activities (82,471 ) (24,982 ) (24,982 ) CASH FLOWS TO INVESTING ACTIVITIES Loan receivable (1,000,000 ) (1,000,000 ) – Acquisition of capital assets (7,053 ) – – Net Cash Used In Investing Activities (1,007,053 ) (1,000,000 ) – CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of common stock 2,114,485 1,999,980 114,455 Loan from shareholders – – (22,573 ) Net Cash Provided By Financing Activities 2,114,485 1,999,980 91,882 INCREASE IN CASH 1,024,961 974,998 66,900 CASH, BEGINNING OF PERIOD – 49,963 32 CASH, END OF PERIOD 1,024,961 1,024,961 66,932 Non-cash Investing and Financing Activities – – – Supplemental Disclosures: Cash paid (received) for interest 403 (6 ) – Cash paid for taxes – – – Non-cash Investing and Financing Activities – – – (A Development Stage Company) For the Period from November 19, 2003 (Date of Inception) to May 31, 2006 (Expressed in US dollars) (unaudited interim financial statements) Balance – November 19, 2003 (Date of Inception) – – – – – – Issuance of common stock for cash at $0.00001 per share - November 27, 2003 25,000,000 250 (200 ) – – 50 Net loss for the period – – – – (22,791 ) (22,791 ) Balance – November 30, 2004 25,000,000 250 (200 ) – (22,791 ) (22,741 ) Issuance of common stock for cash – at $0.02 per share 5,722,750 57 114,398 – 114,455 Donated services and rent – – – 27,600 – 27,600 Net loss for the period – – – – (71,915 ) (71,915 ) Balance – November 30, 2005 30,722,750 307 114,198 27,600 (94,706 ) 47,399 Issuance of common shares for cash 2,000,000 20 1,999,960 1,999,980 Donated services and rent – – – 13,800 – 13,800 Net loss for the period – – – (20,778 ) (20,778 ) Balance – May 31, 2006 32,722,750 327 2,114,158 41,400 (115,484 ) 2,040,401 See Note 6 for a forward stock split on a five-for-one basis. (A Development Stage Company) (Expressed in US dollars) (unaudited) 1. NATURE OF OPERATIONS AND CONTINUANCE OF BUSINESS FC Financial Services, Inc. (the “Company”) was incorporated in the State of Nevada on November 19, 2003, where it maintains a statutory registered agent's office. The Company’s principal executive office is located in Ontario, Canada. The Company intends to initiate operations in Canada, and is not subject to any deadlines to obtain U.S. licenses in order to begin operations. The Company is a Development Stage Company as defined by Statement of Financial Accounting Standard (“SFAS”) No. 7. The Company filed an SB-2 Registration Statement (“SB-2”) with the United States Securities Commission that was declared effective on February 23, 2005. The Company issued 5,722,750 common shares pursuant to the SB-2, at a price of $0.02 per share, for total proceeds of $114,455. On December 8, 2005, the Company authorized a forward stock split and increased the number of issued and outstanding shares on a five-for-one (5:1) basis. All share amounts have been retroactively adjusted for all periods presented. In May 2006, the Directors approved a private placement financing of 5,000,000 units at $1.00 per unit to raise up to $5,000,000, pursuant to Regulation S of the Securities Act of 1933. Each unit will consist of one share and one share purchase warrant entitling the holder to purchase one share of the Company at a price of $1.00 per share during the period ending eighteen months from the date of issue. The Company has received subscriptions under Regulation S for 2,500,000 units. Also in May 2006, the Company signed a term sheet to purchase all of the issued shares of ICP Solar Technologies Inc. (“ICP”), which is engaged in the manufacture and distribution of solar power products, in consideration for 20,000,000 shares in the Company. Concurrent with the closing of the acquisition, the holders of 24,222,750 restricted shares of the Company have agreed to surrender those shares for cancellation. On May 16, 2006, the Company advanced a $1,000,000 bridge loan to ICP, which bears interest at 10% per annum. On July 4, 2006, the Company increased the bridge loan to $1,500,000. Closing of the acquisition is subject to the Company completing a financing of $5,000,000 as described above. The Company is listed on the Over-the-Counter Bulletin Board under the symbol “FCFN”. These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. As of May 31, 2006, the Company had not recognized any revenues and had accumulated losses of $117,984 since inception. The Company’s ability to continue as a going concern is contingent upon the successful completion of additional financing arrangements and its ability to achieve and maintain profitable operations. There is no assurance that any such activity will generate funds that will be available for operations. Management is considering alternatives to its initial business plan. These financial statements do not include any adjustments to the recoverability and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. (A Development Stage Company) (Expressed in US dollars) (unaudited) 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Accounting These financial statements have been reported in US dollars in accordance with accounting principles generally accepted in the United States of America. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. The Company’s policy is to prepare its financial statements on the accrual basis of accounting. The fiscal year end is November 30. (b) Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. (c) Basic and Diluted Net Income (Loss) Per Share The Company computes net income (loss) per share in accordance with SFAS No. 128, "Earnings per Share". SFAS No. 128 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive. (d) Comprehensive Loss SFAS No. 130, “Reporting Comprehensive Income,” establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at May 31, 2006, the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements. (e) Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less at the time of purchase to be cash equivalents. (f) Property and Equipment Capital assets are recorded at cost and annual amortization is provided on a straight-line basis over the estimated useful lives of the assets as follows. One-half of the annual rate is taken in the year of acquisition: Computers 3 years Furniture and fixtures 5 years (A Development Stage Company) (Expressed in US dollars) (unaudited)

SUBSEQUENT EVENT. On December 8, 2005, the Company authorized a forward stock split, and increased the number of issued and outstanding shares on a five-for-one (5:1) basis. All share amounts have been retroactively adjusted for all period's presented. SCHEDULE C to that Share Purchase Agreement among Sass ▇▇▇▇▇▇, The ▇▇▇▇▇▇ Family Trust, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, The ▇▇▇▇ ▇▇▇▇▇▇ Family Trust, Eastern Liquidity Partners Ltd., FC Financial Services Inc., ICP Solar Technologies Inc., Taras Chebountchak, ▇▇▇▇ ▇▇▇▇▇▇▇, and 1260491 Alberta Inc. dated for reference as of the 28th day of September, 2006 FC UNAUDITED FINANCIAL STATEMENTS FC FINANCIAL SERVICES, INC. (A Development Stage Company) CONTENTS FINANCIAL STATEMENTS Balance Sheets F-1 Statements of Operations F-2 Statements of Cash Flows F-3 Statements of Stockholders’ Equity F-4 Notes to the Financial Statements F-5 F-i (A Development Stage Company) FINANCIAL STATEMENTS For the Six Months Ended May 31, 2006 and for the Period from November 19, 2003 (Date of Inception) to May 31, 2006 (unaudited) (Expressed in US dollars) F-ii (A Development Stage Company) BALANCE SHEETS (Expressed in US dollars) (unaudited) May 31, November 30, 2006 2005 $ $ ASSETS Current Assets Cash 1,024,961 49,963 Prepaid expenses 10,000 – Loan receivable (Note 3) 1,004,110 – Total Current Assets 2,039,071 49,963 Property and Equipment (Note 4) 5,428 6,241 TOTAL ASSETS 2,044,499 56,204 LIABILITIES AND STOCKHOLDERS' EQUITY LIABILITIES Current Liabilities Accounts payable 848 – Accrued liabilities 3,250 8,805 Total Current Liabilities 4,098 8,805 TOTAL LIABILITIES 4,098 8,805 STOCKHOLDERS' EQUITY Common stock 100,000,000 shares authorized, $0.00001 par value, 32,722,750 shares issued and outstanding (Note 6) 327 307 Additional paid-in capital (Note 6) 2,114,158 114,198 Donated capital (Notes 5(b) and (c)) 41,400 27,600 Deficit accumulated during the development stage (115,484 ) (94,706 ) Total Stockholders' Equity 2,040,401 47,399 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 2,044,499 56,204 (The Accompanying Notes are an Integral Part of These Financial Statements) (A Development Stage Company) STATEMENTS OF OPERATIONS (Expressed in US dollars) (unaudited) Accumulated from November 19, Three months Three months Six months Six months 2003(Date of ended ended ended ended Inception) to May 31, May 31, May 31, May 31, May 31, 2006 2006 2005 2006 2005 $ $ $ $ $ REVENUE Interest income 4,124 4,112 8 4,116 8 EXPENSES Consulting (Note 4(b)) 36,000 6,000 6,000 12,000 12,000 General and administrative expenses 80,796 6,130 8,835 12,081 29,378 Amortization 1,625 406 – 813 Interest expense 1,187 – 118 – 413 Total expenses 119,608 12,536 14,953 24,894 41,791 NET LOSS (115,484 ) (8,424 ) (14,945 ) (20,778 ) (41,783 ) NET LOSS PER SHARE – Basic and Diluted – – – – $ ( 0.01 ) Weighted Average Number of Common Shares Outstanding 31,049,000 5,871,000 30,887,000 5,440,000 (The Accompanying Notes are an Integral Part of These Financial Statements) (A Development Stage Company) STATEMENTS OF CASH FLOWS (Expressed in US dollars) (unaudited) Accumulated from Six months Six months November 19, 2003 ended ended (Date of Inception) to May 31, May 31, May 31, 2006 2006 2005 $ $ $ CASH FLOWS TO OPERATING ACTIVITIES Net loss (115,484 ) (20,778 ) (41,783 ) Adjustments to reconcile net loss to net cash used in operating activities Amortization 1,625 813 – Interest on loan receivable (4,110 ) (4,110 ) Donated services and rent 41,400 13,800 13,800 Changes in operating assets and liabilities Prepaid expenses (10,000 ) (10,000 ) – Accounts payable and accrued liabilities 4,098 (4,707 ) 3,001 Net Cash Used In Operating Activities (82,471 ) (24,982 ) (24,982 ) CASH FLOWS TO INVESTING ACTIVITIES Loan receivable (1,000,000 ) (1,000,000 ) – Acquisition of capital assets (7,053 ) – – Net Cash Used In Investing Activities (1,007,053 ) (1,000,000 ) – CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of common stock 2,114,485 1,999,980 114,455 Loan from shareholders – – (22,573 ) Net Cash Provided By Financing Activities 2,114,485 1,999,980 91,882 INCREASE IN CASH 1,024,961 974,998 66,900 CASH, BEGINNING OF PERIOD – 49,963 32 CASH, END OF PERIOD 1,024,961 1,024,961 66,932 Non-cash Investing and Financing Activities – – – Supplemental Disclosures: Cash paid (received) for interest 403 (6 ) – Cash paid for taxes – – – Non-cash Investing and Financing Activities – – – (The Accompanying Notes are an Integral Part of These Financial Statements) (A Development Stage Company) STATEMENT OF STOCKHOLDERS’ EQUITY For the Period from November 19, 2003 (Date of Inception) to May 31, 2006 (Expressed in US dollars) (unaudited interim financial statements) Deficit Additional Accumulated Paid-in During the Common Capital Donated Development Stock Amount (Discount) Capital Stage Total # $ $ $ $ $ Balance – November 19, 2003 (Date of Inception) – – – – – – Issuance of common stock for cash at $0.00001 per share - November 27, 2003 25,000,000 250 (200 ) – – 50 Net loss for the period – – – – (22,791 ) (22,791 ) Balance – November 30, 2004 25,000,000 250 (200 ) – (22,791 ) (22,741 ) Issuance of common stock for cash – at $0.02 per share 5,722,750 57 114,398 – 114,455 Donated services and rent – – – 27,600 – 27,600 Net loss for the period – – – – (71,915 ) (71,915 ) Balance – November 30, 2005 30,722,750 307 114,198 27,600 (94,706 ) 47,399 Issuance of common shares for cash 2,000,000 20 1,999,960 1,999,980 Donated services and rent – – – 13,800 – 13,800 Net loss for the period – – – (20,778 ) (20,778 ) Balance – May 31, 2006 32,722,750 327 2,114,158 41,400 (115,484 ) 2,040,401 See Note 6 for a forward stock split on a five-for-one basis. (The Accompanying Notes are an Integral Part of These Financial Statements) (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED MAY 31, 2006 (Expressed in US dollars) (unaudited) 1. NATURE OF OPERATIONS AND CONTINUANCE OF BUSINESS FC Financial Services, Inc. (the “Company”) was incorporated in the State of Nevada on November 19, 2003, where it maintains a statutory registered agent's office. The Company’s principal executive office is located in Ontario, Canada. The Company intends to initiate operations in Canada, and is not subject to any deadlines to obtain U.S. licenses in order to begin operations. The Company is a Development Stage Company as defined by Statement of Financial Accounting Standard (“SFAS”) No. 7. The Company filed an SB-2 Registration Statement (“SB-2”) with the United States Securities Commission that was declared effective on February 23, 2005. The Company issued 5,722,750 common shares pursuant to the SB-2, at a price of $0.02 per share, for total proceeds of $114,455. On December 8, 2005, the Company authorized a forward stock split and increased the number of issued and outstanding shares on a five-for-one (5:1) basis. All share amounts have been retroactively adjusted for all periods presented. In May 2006, the Directors approved a private placement financing of 5,000,000 units at $1.00 per unit to raise up to $5,000,000, pursuant to Regulation S of the Securities Act of 1933. Each unit will consist of one share and one share purchase warrant entitling the holder to purchase one share of the Company at a price of $1.00 per share during the period ending eighteen months from the date of issue. The Company has received subscriptions under Regulation S for 2,500,000 units. Also in May 2006, the Company signed a term sheet to purchase all of the issued shares of ICP Solar Technologies Inc. (“ICP”), which is engaged in the manufacture and distribution of solar power products, in consideration for 20,000,000 shares in the Company. Concurrent with the closing of the acquisition, the holders of 24,222,750 restricted shares of the Company have agreed to surrender those shares for cancellation. On May 16, 2006, the Company advanced a $1,000,000 bridge loan to ICP, which bears interest at 10% per annum. On July 4, 2006, the Company increased the bridge loan to $1,500,000. Closing of the acquisition is subject to the Company completing a financing of $5,000,000 as described above. The Company is listed on the Over-the-Counter Bulletin Board under the symbol “FCFN”. These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. As of May 31, 2006, the Company had not recognized any revenues and had accumulated losses of $117,984 since inception. The Company’s ability to continue as a going concern is contingent upon the successful completion of additional financing arrangements and its ability to achieve and maintain profitable operations. There is no assurance that any such activity will generate funds that will be available for operations. Management is considering alternatives to its initial business plan. These financial statements do not include any adjustments to the recoverability and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED MAY 31, 2006 (Expressed in US dollars) (unaudited) 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Accounting These financial statements have been reported in US dollars in accordance with accounting principles generally accepted in the United States of America. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. The Company’s policy is to prepare its financial statements on the accrual basis of accounting. The fiscal year end is November 30. (b) Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. (c) Basic and Diluted Net Income (Loss) Per Share The Company computes net income (loss) per share in accordance with SFAS No. 128, "Earnings per Share". SFAS No. 128 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive. (d) Comprehensive Loss SFAS No. 130, “Reporting Comprehensive Income,” establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at May 31, 2006, the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements. (e) Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less at the time of purchase to be cash equivalents. (f) Property and Equipment Capital assets are recorded at cost and annual amortization is provided on a straight-line basis over the estimated useful lives of the assets as follows. One-half of the annual rate is taken in the year of acquisition: Computers 3 years Furniture and fixtures 5 years F-6 (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED MAY 31, 2006 (Expressed in US dollars) (unaudited)