APPLICABLE ONLY TO CORPORATE ISSUERS

As of June 22, 2012 the registrant had 78,632,792 shares of common stock, par value $.0001 per share issued and outstanding.

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

RESOURCE EXCHANGE OF AMERICA CORP.*

TABLE OF CONTENTS

Special Note Regarding Forward-Looking Statements

Information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). This information may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Resource Exchange of America Corp. (the “Company”), to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

* Please note that throughout this Quarterly Report, and unless otherwise noted, the words "we," "our," "us," the "Company," or "RXAC" refers to Resource Exchange of America Corp.

PART I - FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

RESOURCE EXCHANGE OF AMERICA CORP.

Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

RESOURCE EXCHANGE OF AMERICA CORP.

Consolidated Balance Sheets

(Expressed in US Dollars)

(The accompanying notes are an integral part of these consolidated financial statements)

RESOURCE EXCHANGE OF AMERICA CORP.

Consolidated Statements of Operations

(Expressed in US Dollars)

(unaudited)

 (The accompanying notes are an integral part of these consolidated financial statements)

RESOURCE EXCHANGE OF AMERICA CORP.

Consolidated Statements of Operations

(Expressed in US Dollars)

(unaudited)

 (The accompanying notes are an integral part of these consolidated financial statements)

RESOURCE EXCHANGE OF AMERICA CORP.

Consolidated Statements of Cash Flows

(Expressed in US Dollars)

(unaudited)

The accompanying notes are an integral part of these consolidated financial statements)

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

1. Nature of Operations and Continuance of Business

Mobieyes Software, Inc. (the “Company”) was incorporated under the laws of the State of Florida on January 15, 2009. On February 23, 2010, the Company changed its name to Resource Exchange of America Corp. The Company’s prior business was a mobile enterprise software company aimed at improving productivity of field service organizations. Upon completion of the acquisition of assets from UTP Holdings, LLC on February 22, 2010, the Company adopted the business of UTP Holdings, LLC. The Company is now engaged in the business of recycling ferrous and nonferrous metals to customers in the United States and abroad.

These consolidated financial statements have been prepared on a going concern basis, which implies that 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 continued financial support from its shareholders, the ability of the Company to obtain necessary debt or equity financing to continue operations, and the attainment of profitable operations. As at September 30, 2011, the Company has a working capital deficit of $2,514,417 and has an accumulated deficit of $2,556,967 since inception. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These 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

It should be noted that as of October 24, 2011 an agreement was made between the majority shareholder Dana J Pekas and BHI Group, Inc. whereby Mr. Pekas has agreed to sell shares of common stock to BHI Group, Inc. Also, as of that date, Mr.Pekas has resigned his position as Director, President and Chief Executive Officer of the Company. Replacing him in this role is Mr. Ken McBride. It also should be noted that this proposed sale of stock and assumption of debt has not been finalized as of the date of this submission.

2. Summary of Significant Accounting Principles

Basis of Presentation

These consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States. The consolidated financial statements include the financial statements of the Company and its’ wholly-owned subsidiary, Sea Lion Ocean Freight, LLC. All inter-company transactions and balances have been eliminated upon consolidation.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

2. Summary of Significant Accounting Principles (continued)

Interim Financial Statements

These interim unaudited consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future.

Use of Estimates

The preparation of these consolidated financial statements in conformity with US generally accepted accounting principles 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. The Company regularly evaluates estimates and assumptions related to the useful life and recoverability of long-lived assets, valuation of convertible debt and derivative liabilities, and deferred tax asset valuation allowances. 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.

Cash and Cash Equivalents

The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

2. Summary of Significant Accounting Principles (continued)

Property and Equipment

Property and equipment, consisting of machinery and equipment, is stated at cost and is amortized using the straight-line method over their estimated lives of five years.

Revenue Recognition

The Company recognizes revenue in accordance with ASC 605, “Revenue Recognition”. Revenue consists of the sale of recycled metals and demolition services. Revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, delivery has occurred or the service has been performed, and collectability is reasonably assured.

Revenues from demolition contracts are recognized on the percentage of completion method. Under this method, revenue is measured by the percentage of costs incurred to date to estimated total costs for each contract. Management considers total cost to be the best available measure of progress on the contracts. Because of the inherent uncertainties in estimating costs, it is at least reasonably possible that the estimates used will change in the near term.

The Company has determined that the percentage of completion method is appropriate due to the following: 1) reasonably dependable estimates have been made, 2) the contract clearly specifies the enforceable rights of both the Company and the client, the consideration to be exchanged, and the manner and terms of settlement, 3) the client can be expected to satisfy its obligations under the contract, and 4) the Company can be expected to perform its contractual obligations.

Contract costs include all direct material, labor, equipment rental and subcontractor costs and certain indirect costs related to contract performance such as supplies, tools, repairs and similar costs. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Operating expenses are charged to expense as incurred. Changes in job performance, job conditions, and estimated profitability may result in revisions to costs and revenues in the near term. These changes are recognized in the period in which the revisions are determined.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

2. Summary of Significant Accounting Principles (continued)

Impairment of Long-lived Assets

In accordance with ASC 360, “Property, Plant, and Equipment”, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value.

Foreign Currency Translation

The Company’s functional currency and its reporting currency is the United States. Monetary balance sheet items expressed in foreign currencies are translated into US dollars at the exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are translated at historical rates. Revenues and expenses are translated at average rates for the period. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

2. Summary of Significant Accounting Principles (continued)

Earnings (Loss) Per Share

The Company computes net income (loss) per share in accordance with ASC 260, "Earnings per Share" which 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.

Comprehensive Loss

ASC 220, “Comprehensive Income”, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at September 30, 2011 and 2010, the Company had no items representing comprehensive loss.

Income Taxes

The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, “Income Taxes”. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

Financial Instruments and Fair Value Measures

ASC 820, “Fair Value Measurements and Disclosures” and ASC 825, “Financial Instruments” require an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

2. Summary of Significant Accounting Principles (continued)

Financial Instruments and Fair Value Measures (continued)

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments consist principally of cash, notes receivable, accounts payable, accrued liabilities, accrued interest payable, loans payable, and convertible debt. Pursuant to ASC 820, the fair value of cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets and the fair value of derivative liabilities is determined based on “Level 2” inputs, which consists of inputs (volatility, risk free rate, conversion price, quoted market price) that are observable or can be derived principally from, or corroborated by, observable market data which are used in the Black-Scholes calculation. The recorded values of accounts receivable and accounts payable and accrued liabilities approximate their current fair values because of their nature and respective maturity dates or durations. The carrying amount of the notes receivable approximates fair value based on the interest rate. The carrying amounts of the convertible note payable and lines of credit approximate fair value because they are priced at interest rates consistent with the Company’s current borrowing rates on similar debt based on the security underlying the debt or the conversion features associated with the debt.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

2. Summary of Significant Accounting Principles (continued)

Recent Accounting Pronouncements

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

3. Notes Receivable

On November 24, 2009, the Company entered into two separate note receivable agreements with a Florida salvage company. One note bears interest, beginning March 3, 2010, at 5% per annum. Weekly payments of $881, including principal and interest, were to begin on April 10, 2010 with the note maturing on March 30, 2013. As of September 30, 2011, no payments have been made on this note. The balance on the note as of September 30, 2011 is $127,593 which was written down to $nil in 2010 due to the uncertainty of collection. The second note bears no interest and is due in monthly installments of $373 that began on December 16, 2009 and matures on December 16, 2014. As of September 30, 2011, the balance on the second note is $15,311.

Subsequent to September 30, 2011, the second note was transferred to an outside party to settle an outstanding amount owed to them.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

4. Related Party Transactions

(a) During the nine months ended September 30, 2011, the Company incurred $3,609 (2010 - $4,641) for an automobile leased by the former President of the Company.

(b) During the nine months ended September 30, 2011, the Company incurred $14,000 (2010 - $18,000) in rent to a company controlled by the former President of the Company.

(c) As at September 30, 2011, the Company owed $1,781 (December 31, 2010 - $1,781) to the former President of the Company, which is non-interest bearing, unsecured, and due on demand.

(d) As at September 30, 2011, the Company owed a total of $395,385 (December 31, 2010 - $257,915) to companies controlled by the former President of the Company. The amount owed is unsecured and due on demand.

5. Loans Payable

(a) As at September 30, 2011, the Company owed $30,555 (December 31, 2010 - $25,555) to a non-related party which is non-interest bearing, unsecured, and due on demand.

6. Convertible Debt

(a) On February 22, 2010, the Company issued a $250,000 promissory note to the former President of the Company. The note bears interest at 10% per annum, is unsecured, and due on December 31, 2011. The holder may convert, at any time, any amount outstanding into shares of common stock of the Company at a conversion price per share equal to 75% of the average of the closing market price of the Company’s common stock during the five trading days immediately preceding the conversion date.

The Company was required to classify the conversion feature contained within the convertible debt as a derivative liability. As such, the Company recorded a derivative liability related to the convertible debt equal to the estimated fair value of the conversions feature of $175,081 with an equivalent discount on the convertible debt. During the nine months ended September 30, 2011, $81,958 has been accreted increasing the carrying value of the convertible debt to $209,671.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

6. Convertible Debt (continued)

The carrying value of the convertible debt as of September 30, 2011 of $209,671 will be accreted to the face value of $250,000 at maturity. During the nine months ended September 30, 2011, the Company recorded a gain on the change in fair value of the conversion option derivative liability of $125,306 and as of September 30, 2011, the fair value of the conversion option derivative liability was $168,402.

(b) On April 13, 2010, the Company entered into a $250,000 draw down promissory note agreement with a non-related party. Amounts drawn on this credit facility bear interest at 8% per annum, are unsecured, and due on April 13, 2011. The holder may convert, at any time, any amount outstanding into shares of common stock of the Company at a conversion price per share equal to 75% of the average of the closing market price of the Company’s common stock during the thirty trading days immediately preceding the conversion date. On October 14, 2010, the conversion price was changed to be fixed at $0.45 per share.

As of September 30, 2011, the outstanding balance is $250,000. The Company was required to classify the conversion feature contained within the convertible debt as a derivative liability. As such, the Company recorded a derivative liability related to the convertible debt equal to the estimated fair value of the conversion feature of $147,140 with an equivalent discount on the convertible debt. During the nine months ended September 30, 2011, $85,195 has been accreted increasing the carrying value of the convertible debt to $250,000. The carrying value of the convertible debt as of September 30, 2011 of $250,000 has been accreted to the face value of $250,000 at maturity. During the nine months ended September 30, 2011, the Company recorded a gain on the change in fair value of the conversion option derivative liability of $8,150 and as of September 30, 2011, the fair value of the conversion option derivative liability was $nil.

(c) Effective January 31, 2005, the former President of the Company entered into a line of credit agreement with a financial institution allowing for borrowings of up to $800,000 with annual interest at prime to be used to fund the operations of the Company. The line of credit is secured by the principal residence of the former President of the Company. Monthly interest-only payments are required. On October 21, 2010, the Company agreed to add a conversion option to the entire balance of principal and interest outstanding at any time on the line of credit. The former President of the Company may elect to convert, at any time, any amount outstanding into shares of common stock of the Company at a conversion price per share equal to 75% of the average of the closing market price of the Company’s common stock during the five trading days immediately preceding the conversion date. The maturity date is December 31, 2011. On August 18, 2011 the company defaulted on the payments owed to Regions Bank. As a result, UTP Holdings LLC was obligated to make the monthly bank payments on behalf of the company. UTP Holdings LLC notified the company of the default and the payments. The company is currently recording the additional amounts due to UTP holdings as a current liability.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

6. Convertible Debt (continued)

As of September 30, 2011, the outstanding balance is $785,103 (December 31, 2010 - $791,815). The Company was required to classify the conversion feature contained within the convertible debt as a derivative liability. As such, the Company recorded a derivative liability related to the convertible debt equal to the estimated fair value of the

conversion feature of $592,991 with an equivalent discount on the convertible debt. During the nine months ended September 30, 2011, $336,532 has been accreted increasing the carrying value of the convertible debt to $593,459. The carrying value of the convertible debt as of September 30, 2011 of $593,459 will be accreted to the current face value of $785,103 at maturity. During the nine months ended September 30, 2011, the Company recorded a gain on the change in fair value of the conversion option derivative liability of $474,548 and as of September 30, 2011, the fair value of the conversion option derivative liability was $455,702.

(d) Effective March 18, 2010, the Company entered into a line of credit agreement with a company owned by the former President of the Company allowing for borrowings of up to $150,000 bearing interest at 8% per annum. The line of credit is unsecured and all borrowings plus interest are due on demand. On October 21, 2010, the Company agreed to add a conversion option to the entire balance of principal outstanding at any time on the line of credit. The holder may elect to convert, at any time, any amount outstanding into shares of common stock of the Company at a conversion price per share equal to 75% of the average of the closing market price of the Company’s common stock during the five trading days immediately preceding the conversion date.

The balance on the line of credit as of September 30, 2011 is $50,300. The Company was required to classify the conversion feature contained within the convertible debt as a derivative liability. As such, the Company recorded a derivative liability related to the convertible debt equal to the estimated fair value of the conversion feature of $11,523 with an equivalent discount on the convertible debt. During the nine months ended September 30, 2011, the Company recorded a gain on the change in fair value of the conversion option derivative liability of $15,925 and as of September 30, 2011, the fair value of the conversion option derivative liability was $17,808.

(e) On January 20, 2011, the Company issued an 8% convertible note for proceeds of $32,500 which matures on October 24, 2011. The holder may elect to convert, at any time, any amount outstanding into shares of common stock of the Company at a conversion price per share equal to 61% of the average of the three lowest closing market prices during the ten day trading period immediately preceding the conversion date.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

6. Convertible Debt (continued)

The Company was required to classify the conversion feature contained within the convertible debt as a derivative liability. As such, the Company recorded a derivative liability related to the convertible debt equal to the estimated fair value of the conversion feature of $32,500 with an equivalent discount on the convertible debt. During the nine months ended September 30, 2011, $32,500 had been accreted increasing the carrying value of the convertible debt to $32,500. During the nine months ended September 30, 2011, the Company recorded a gain on the change in fair value of the conversion option derivative liability of $32,500 and as of September 30, 2011, the fair value of the conversion option derivative liability was $0.

On July 28, August 2, and August 8, 2011 the holder of this note opted to convert the outstanding amount, including interest, to 3,632,792 shares common stock.

(f) On February 23, 2011, the Company issued an 8% convertible note for proceeds of $37,500 which matures on November 28, 2011. The holder may elect to convert, at any time, any amount outstanding into shares of common stock of the Company at a conversion price per share equal to 61% of the average of the three lowest closing market prices during the ten day trading period immediately preceding the conversion date.

The Company was required to classify the conversion feature contained within the convertible debt as a derivative liability. As such, the Company recorded a derivative liability related to the convertible debt equal to the estimated fair value of the conversion feature of $37,500 with an equivalent discount on the convertible debt. During the nine months ended September 30, 2011, $29,395 has been accreted increasing the carrying value of the convertible debt to $29,395. The carrying value of the convertible debt as of September 30, 2011 of $29,395 will be accreted to the face value of $37,500 at maturity. During the nine months ended September 30, 2011, the Company recorded a loss on the change in fair value of the conversion option derivative liability of $6,036 and as of September 30, 2011, the fair value of the conversion option derivative liability was $43,536.

(g) On March 24, 2011, the Company issued an 8% convertible note for proceeds of $27,500 which matures on December 28, 2011. The holder may elect to convert, at any time, any amount outstanding into shares of common stock of the Company at a conversion price per share equal to 61% of the average of the three lowest closing market prices during the ten day trading period immediately preceding the conversion date.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

6. Convertible Debt (continued)

The Company was required to classify the conversion feature contained within the convertible debt as a derivative liability. As such, the Company recorded a derivative liability related to the convertible debt equal to the estimated fair value of the conversion feature of $27,500 with an equivalent discount on the convertible debt. During the nine months ended September 30, 2011, $18,534 has been accreted increasing the carrying value of the convertible debt to $18,534. The carrying value of the convertible debt as of September 30, 2011 of $18,534 will be accreted to the face value of $27,500 at maturity. During the nine months ended September 30, 2011, the Company recorded a loss on the change in fair value of the conversion option derivative liability of $4,437 and as of September 30, 2011, the fair value of the conversion option derivative liability was $31,937.

(h) On May 25, 2011 the Company issued an 8% convertible note for proceeds of $27,500 which matures on February 27, 2012. The holder may elect to convert, at any time, any amount outstanding into shares of common stock of the Company at a conversion price per share equal to 61% of the average of the three lowest closing market prices during the ten day trading period immediately preceding the conversion date.

The Company was required to classify the conversion feature contained within the convertible debt as a derivative liability. As such, the Company recorded a derivative liability related to the convertible debt equal to the estimated fair value of the conversion feature of $27,500 with an equivalent discount on the convertible debt. During the nine months ended September 30, 2011, $13,750 has been accreted increasing the carrying value of the convertible debt to $13,750. The carrying value of the convertible debt as of September 30, 2011 of $13,750 will be accreted to the face value of $27,500 at maturity. During the nine months ended September 30, 2011, the Company recorded a loss on the change in fair value of the conversion option derivative liability of $4,631 and as of September 30, 2011, the fair value of the conversion option derivative liability was $32,131.

If all of the convertible debt were converted into shares at September 30, 2011, the number of shares would exceed the authorized amount at September 30, 2011 as well as the increased amount of authorized shares in 2012. In 2012, the Company increased the authorized shares to 500,000,000 consisting of two classes to be designated as common stock and preferred stock. The total number of common stock shares authorized was increased to 400,000,000 and preferred stock shares totaling 100,000,000 were authorized.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

7. Derivative Liabilities

The conversion options of the convertible debt disclosed in Note 7 are required to record derivatives at their estimated fair values on each balance sheet date with changes in fair values reflected in the statement of operations.

The Company uses the Black-Scholes valuation model to calculate the fair value of the derivative liabilities. The following table shows the weighted average assumptions used in the calculation of the conversion options:

8. Segmented Information

The Company is organized into segments based on operations. These operating segments have been aggregated into three reportable business segments: sales and ocean freight export services. The reportable segments were determined in accordance with the way that management of the Company develops and executes the Company’s operations.

In accordance with ASC 280, “Segment Reporting”, for purposes of business segment performance measurement, the Company does not allocate to the business segments items that are of a non operating nature or corporate organizational and functional expenses of a governance nature. Corporate expenses consist of corporate office expenses including compensation, automobile, occupancy, depreciation, and other administrative costs.

RESOURCE EXCHANGE OF AMERICA CORP.

Notes to the Consolidated Financial Statements

September 30, 2011

(Expressed in US dollars)

(unaudited)

8. Segmented Information (continued)

Assets of the sales segment consist of cash and notes receivable. Assets of the ocean freight export services segment consists of cash. All other assets including property and equipment are allocated to corporate and other.

For the nine months ended September 30, 2011:

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION

FORWARD-LOOKING STATEMENTS

This Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) contains forward-looking statements that involve known and unknown risks, significant uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, or implied, by those forward-looking statements.  You can identify forward-looking statements by the use of the words may, will, should, could, expects, plans, anticipates, believes, estimates, predicts, intends, potential, proposed, or continue or the negative of those terms.  These statements are only predictions. In evaluating these statements, you should consider various factors which may cause our actual results to differ materially from any forward-looking statements.  Although we believe that the exceptions reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.  Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements.  We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

RESULTS OF OPERATIONS

Working Capital

Cash Flows

Operating Revenues

Operating revenues for the Nine Months Ended September 30, 2011 were $49,257.

Operating revenues for the Nine Months Ended September 30, 2010 were $412,443.

Operating revenues for the Three Months Ended September 30, 2011 were $-.

Operating revenues for the Three Months Ended September 30, 2010 were $65,947.

Operating Expenses and Net Loss

Operating expenses for the Nine Months Ended September 30, 2011 were $309,693 and is comprised of depreciation of $75, selling, general, and administrative of $51,912, and professional fees of $257,706. Operating expenses for the Three Months Ended September 30, 2011 were $62,322 and is comprised of selling, general, and administrative of $10,424, and professional fees of $51,898.

Operating expenses for the Nine Months Ended September 30, 2010 were $410,113 and is comprised of depreciation of $120, selling, general, and administrative of $254,734, and professional fees of $155,259. Operating expenses for the Three Months Ended September 30, 2010 were $141,983 and is comprised of depreciation of $76, selling, general, and administrative of $27,842, and professional fees of $114,065.

Net Loss for the Nine Months Ended September 30, 2011 was $295,663 which is mainly attributed to the $641,325 gain on change in fair value of derivative liabilities

offset by the convertible debt accretion expense of $597,864 and a loss from operations of $301,064 due to a winding down of business activities. Net Loss for the Three Months Ended September 30, 2011 was $553,718 which is mainly attributed to the $276,542 loss on change in fair value of derivative liabilities as well as the convertible debt accretion expense of $223,505 and a loss from operations of $62,322 due to a winding down of business activities.

Net Loss for the Nine Months Ended September 30, 2010 was $351,107 which is mainly attributed to the $22,641 gain on change in fair value of derivative liabilities

offset by the convertible debt accretion expense of $56,663 and a loss from operations of $280,383 due to a winding down of business activities. Net Loss for the Three Months Ended September 30, 2010 was $192,812 which is mainly attributed to the $25,313 loss on change in fair value of derivative liabilities as well as the convertible debt accretion expense of $29,917 and a loss from operations of $120,404 due to a winding down of business activities.

Liquidity and Capital Resources

As at September 30, 2011, the Company’s cash and total asset balance was $15,940 compared to $189,957 as at December 31, 2010. The decrease in total assets is mainly attributed to the winding down of operations of the business and the payment of outstanding invoices.

As at September 30, 2011, the Company had total liabilities of $2,519,528 compared with total liabilities of $2,431,682 as at December 31, 2010. The increase in total liabilities is mainly attributed to the increase in convertible debt due to accretion of the discounts.

As at September 30, 2011, the Company had a working capital deficit of $2,514,417 compared to $2,256,477 as at December 31, 2010.

Cashflows from Operating Activities

During the nine months ended September 30, 2011, the Company used $153,926 of cash for operating activities compared to $240,390 cash used by operating activities during the nine months ended September 30, 2010.

Cashflows from Investing Activities

During the nine months ended September 30, 2011, the Company received $3,361 of cash from investing activities compared to $2,237 for the nine months ended September 30, 2010. The proceeds were received from the note receivable.

Cashflows from Financing Activities

During the Nine Months Ended September 30, 2011, the Company used $16,783 of cash in financing activities compared to $242,491 received for the nine months ended September 30, 2010. The Company repaid loans payable of $183,232, convertible debt of $4,515 offset by proceeds of $125,000 received from the issuance of convertible debt and proceeds of $45,964 from loans payable.

Going Concern

We have not attained profitable operations and had been dependent upon obtaining financing to pursue any extensive acquisitions and activities. For these reasons, our auditors stated in their report on our audited financial statements that they have substantial doubt that we will be able to continue as a going concern without further financing.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

Future Financings

We will continue to rely on debt and equity sales of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of the equity securities or arrange for debt or other financing to fund our operations and other activities.

Critical Accounting Policies

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

Recently Issued Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 4.  CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management carried out an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 ("Exchange Act"). Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures were not effective as of September 30, 2011, due to the material weaknesses resulting from the Board of Directors not currently having any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K, and controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Please refer to our Annual Report on Form 10-K as filed with the SEC on April 15, 2011, for a complete discussion relating to the foregoing evaluation of Disclosures and Procedures.

Changes in Internal Control over Financial Reporting

Our management has also evaluated our internal control over financial reporting, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of our last evaluation.

The Company is not required by current SEC rules to include, and does not include, an auditor's attestation report. The Company's registered public accounting firm has not attested to Management's reports on the Company's internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which our director, officer or any affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

ITEM 1A. RISK FACTORS

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 

On July 28, August 2 and August 8 of 2011, a holder of the Company’s 8% convertible note with the maturity date of October 24, 2011, elected to convert all outstanding balances of such note into an aggregate of 3,632,792 shares of Common Stock.

This issuance was effectuated pursuant to the exemption from the registration requirements of the Securities Act of 1933 (the “Act”), as amended, provided by Section 4(2) of the Act and/or Regulation D promulgated thereunder.  

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.   MINE SAFETY DISCLOSURE

Not applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

SIGNATURES

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