UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
(Mark one)
X QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
- -------------- EXCHANGE ACT OF 1934
(Fee required)
For the quarterly period ended March 31, 2005
or
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
- -------------- ACT OF 1934
For the tranition period from ______________ to _____________
Commission Fie Number: 0-26760
XERION ECOSOLUTIONS GROUP INC.
Colorado 84-1286065
- ------------------------ ------------------------
(State of incorporation) (IRS Employer ID Number)
Suite 905, 102-4369 Main Street
Whistler, BC Canada V0N 1B4
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(Address of principal executive offices)
(604) 902 0178
(Issuer's telephone number)
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Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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
State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date: May 10, 2005 2,841,523 shares.
The SEC maintains an Internet site that contains reports, proxy and information
statements, and other information regarding filings of the Company at
http://www.sec.gov.
Transitional Small Business Disclosure Format (check one): YES NO X
TABLE OF CONTENTS
ITEM NUMBER PAGE
PART 1 - FINANCIAL INFORMATION
1. Financial Statements 1
2. Management's Discussion and Analysis or Plan of Operation 8
3. Controls and Procedures 9
PART 2 - OTHER INFORMATION
1. Legal Proceedings 9
2. Changes In Securities 10
3. Defaults Upon Senior Securities 10
4. Submission of Matters to a Vote of Security 10
5. Other Information 11
6. Exhibits and Reports on Form 8-K 10
Signatures 10
PART 1 - FINANCIAL INFORMATION
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Item 1 - Financial Statements
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Xerion EcoSolutions Group Inc.
(A Development Stage Company)
Balance Sheets
(expressed in U.S. Dollars)
As at As at
March 31, December 31,
2005 2004
$ $
(unaudited) (audited)
ASSETS
Current Assets
Cash 742 2,333
- -------------------------------------------------------------------------------------------------------
Total Current Assets 742 2,333
Property and Equipment (Note 3) 4,118 4,836
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Total Assets 4,860 7,169
=======================================================================================================
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts payable (Note 4(b)) 157,466 142,553
Accrued liabilities 6,500 4,942
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Total Liabilities 163,966 147,495
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Stockholders' Deficit
Preferred stock, 50,000,000 shares authorized, no par value; none issued -- --
Common Stock, 300,000,000 shares authorized, $0.001 par value
2,841,523 shares issued and outstanding 2,842 2,842
Additional Paid-in Capital 10,014,413 10,014,413
Donated Capital 126,000 126,000
Deficit Accumulated During the Development Stage (10,302,361) (10,283,581)
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Total Stockholders' Deficit (159,106) (140,326)
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Total Liabilities and Stockholders' Deficit 4,860 7,169
=======================================================================================================
(The accompanying notes are an integral part of the financial statements)
1
Xerion EcoSolutions Group Inc.
(A Development Stage Company)
Statements of Operations
(expressed in U.S. Dollars)
(unaudited)
Accumulated from For the
November 1, 1985 Three Months
(Date of Inception) Ended
to December 31, March 31,
2004 2005 2004
$ $ $
Revenue -- -- --
- ----------------------------------------------------------------------------------------
Expenses
Depreciation 10,069 718 807
Impairment loss on intangible asset 20,000 -- --
Loss on disposal of property and equipment 7,866 -- 7,866
Management services (Note 4(a)) 1,024,000 15,000 15,000
Mining exploration 54,379 -- --
Professional fees 1,095,755 2,522 4,658
Selling, general and administrative 882,360 540 9,138
Stock-based compensation 1,955,651 -- --
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Total Expenses 5,050,080 18,780 37,469
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Loss from Continuing Operations (5,050,080) (18,780) (37,469)
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Loss from Discontinued Operations (5,252,281) -- --
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Net Loss (10,302,361) (18,780) (37,469)
========================================================================================
Net Loss Per Share - Basic and Diluted (0.01) (0.01)
========================================================================================
Weighted Average Shares Outstanding 2,841,000 2,841,000
========================================================================================
(The accompanying notes are an integral part of the financial statements)
2
Xerion EcoSolutions Group Inc.
(A Development Stage Company)
Statements of Cash Flows
(expressed in U.S. Dollars)
(unaudited)
For the Three Months
Ended
March 31,
2005 2004
$ $
Cash Flows to Operating Activities
Net loss (18,780) (37,469)
Adjustments to reconcile net loss to net cash used
in operating activities:
Depreciation 718 807
Loss on disposal of property and equipment -- 7,866
Changes in operating assets and liabilities:
Accounts receivable -- (9,000)
Prepaid expenses -- 451
Accounts payable and accrued liabilities 16,471 586
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Net Cash Used in Operating Activities (1,591) (36,759)
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Cash Flows from Investing Activities
Proceeds from disposal of property and equipment -- 9,000
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Net Cash Provided By Investing Activities -- 9,000
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Cash Flows from (to) Financing Activities
Repayment of related party loan -- (1,014)
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Net Cash Provided By (Used in) Financing Activities -- (1,014)
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Decrease in Cash (1,591) (28,774)
Cash - Beginning of Period 2,333 33,685
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Cash - End of Period 742 4,911
=============================================================================
Non-cash Financing and Investing Activities -- --
=============================================================================
Supplemental Disclosures
Interest paid -- --
Income tax paid -- --
=============================================================================
(The accompanying notes are an integral part of the financial statements)
3
Xerion EcoSolutions Group Inc.
(A Development Stage Company)
Notes to the Financial Statements
(expressed in U.S. dollars)
(unaudited)
1. Nature of Operations and Continuance of Business
Xerion EcoSolutions Group Inc. (the "Company") was incorporated on November
1, 1985 under the laws of the State of Colorado. The shares of the Company
currently trade on the Over the Counter Bulletin Board under the ticker
symbol "XECO".
The Company had entered the business of mine reclamation and environmental
remediation which had focused on serving the mining and coal fired power
plant industries. On March 17, 2003 the Company purchased 67 mining claims
and certain ore and waste processing technologies. In compliance with the
purchase agreements, the vendors were obligated to deliver exploration and
metallurgical data to support the representations made about the processing
technologies and claims. The Vendors neglected to deliver this
documentation. In February 2004 the Company cancelled the purchase
agreements. The cancellation of the purchase agreements results in a
reimbursement of 2.5 million shares to the Company, which substantially
reduced the issued and outstanding shares of the Company.
The Company had been working with a specialist consultant in the field of
hydrometallurgy. This work included a potential research project focused of
developing a viable alternative to cyanide for the gold mining industry.
The consultant has identified specific chemical conditions in the
application of certain non-toxic reagents that could lead to a significant
breakthrough in the development of a replacement for cyanide. The prospects
of developing and bringing to market a technology of this magnitude may
exceed the Company's ability and management is evaluating the possibility
of merging with another, more established company with existing operations
and cash flow.
These financial statements are prepared using generally accepted accounting
principles applicable to a going concern, which contemplates the
realization of assets and liquidation of liabilities in the normal course
of business. However, the Company does not have significant cash or other
material assets, nor does it have an established source of revenues needed
to cover its operating costs and to allow it to continue as a going
concern. As at March 31, 2005, the Company has a working capital deficit of
$163,224 (December 31, 2004 - $145,162) and has an accumulated deficit of
$10,302,361 since its inception. The Company has ongoing overhead expenses
and will require significant capital to execute its business plan. The
Company's ability to meet those obligations and continue as a going concern
is dependent upon raising new capital through issuing debt and/or equity
securities and then to generate revenues and profits. Until these funding
sources materialize the controlling shareholders intend to continue the
funding of necessary expenses to sustain operations.
2. Summary of Significant Accounting Policies
a) Basis of Accounting and Year End
These financial statements are prepared in conformity with accounting
principles generally accepted in the United States and are presented
in U.S. dollars. The Company's fiscal year end is December 31.
b) Use of Estimates
The preparation of 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 assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the periods. Actual results
could differ from those estimates.
c) 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.
d) Property and Equipment
Property and equipment consists of computer equipment recorded at cost
and depreciated on a straight-line basis over the estimated useful
life of three years.
4
Xerion EcoSolutions Group Inc.
(A Development Stage Company)
Notes to the Financial Statements
(expressed in U.S. dollars)
(unaudited)
2. Summary of Significant Accounting Policies (continued)
e) Long-lived Assets
In accordance with Financial Accounting Standards Board ("FASB")
Statement of Financial Accounting Standards ("SFAS") No. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets", the
carrying value of intangible assets and other long-lived assets is
reviewed on a regular basis for the existence of facts or
circumstances that may suggest impairment. The Company recognizes an
impairment when the sum of the expected undiscounted future cash flows
is less than the carrying amount of the asset. Impairment losses, if
any, are measured as the excess of the carrying amount of the asset
over its estimated fair value.
f) Financial Instruments
Financial instruments which include cash, accounts payable and accrued
liabilities were estimated to approximate their carrying values due to
the immediate or short-term maturity of these financial instruments.
g) Mineral Property Costs
The Company has been engaged in the acquisition, exploration and
development of mining properties. Mineral property acquisition and
exploration costs are expensed as incurred. When it has been
determined that a mineral property can be economically developed as a
result of establishing proven and probable reserves, the costs
incurred to develop such property, are capitalized. Such costs will be
amortized using the units-of-production method over the estimated life
of the probable reserve.
h) Income Taxes
Potential benefits of income tax losses are not recognized in the
accounts until realization is more likely than not. The Company has
adopted SFAS No. 109, "Accounting for Income Taxes", as of its
inception. Pursuant to SFAS No. 109 the Company is required to compute
tax asset benefits for net operating losses carried forward. Potential
benefit of net operating losses have not been recognized in these
financial statements because the Company cannot be assured it is more
likely than not it will utilize the net operating losses carried
forward in future years.
i) Foreign Currency Transactions
The Company's functional and reporting currency is the United States
dollar. Occasional transactions occur in Canadian currency, and
management has adopted SFAS No. 52, "Foreign Currency Translation".
Monetary assets and liabilities denominated in foreign currencies are
translated into United States dollars at rates of exchange in effect
at the balance sheet date. Non-monetary assets, liabilities and items
recorded in income arising from transactions denominated in foreign
currencies are translated at rates of exchange in effect at the date
of the transaction.
j) Stock-based Compensation
The Company has adopted SFAS No. 123 "Accounting for Stock Based
Compensation" which requires that stock awards granted to employees
and non-employees are recognized as compensation expense based on the
fair market value of the stock award or fair market value of the goods
and services received whichever is more reliably measurable.
k) 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 128). SFAS 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 common shares outstanding (denominator)
during the period. Diluted EPS gives effect to all dilutive potential
common shares outstanding during the period including stock options,
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. Loss per share information does not include
the effect of any potential common shares, as their effect would be
anti-dilutive.
5
Xerion EcoSolutions Group Inc.
(A Development Stage Company)
Notes to the Financial Statements
(expressed in U.S. dollars)
(unaudited)
2. Summary of Significant Accounting Policies (continued)
l) 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 March 31, 2005 and 2004, the
Company has no items that represent comprehensive loss and, therefore,
has not included a schedule of comprehensive loss in the financial
statements.
m) Recent Accounting Pronouncements
In December 2004, the Financial Accounting Standards Board ("FASB")
issued SFAS No. 123 (Revised 2004) ("SFAS No. 123R"), "Share-Based
Payment." SFAS No. 123R requires that the compensation cost relating
to share-based payment transactions be recognized in financial
statements. That cost will be measured based on the fair value of the
equity or liability instruments issued. SFAS No. 123R represents the
culmination of a two-year effort to respond to requests from investors
and many others that the FASB improve the accounting for share-based
payment arrangements with employees. The scope of SFAS No. 123R
includes a wide range of share-based compensation arrangements
including share options, restricted share plans, performance-based
awards, share appreciation rights, and employee share purchase plans.
SFAS No. 123R replaces SFAS No. 123, "Accounting for Stock-Based
Compensation", and supersedes APB Opinion No. 25, "Accounting for
Stock Issued to Employees". SFAS No. 123, as originally issued in
1995, established as preferable a fair-value-based method of
accounting for share-based payment transactions with employees.
However, that statement permitted entities the option of continuing to
apply the guidance in APB Opinion No. 25, as long as the footnotes to
the financial statements disclosed what net income would have been had
the preferable fair-value-based method been used. Although those
disclosures helped to mitigate the problems associated with accounting
under APB Opinion No. 25, many investors and other users of financial
statements believed that the failure to include employee compensation
costs in the income statement impaired the transparency,
comparability, and credibility of financial statements. Public
entities that file as small business issuers will be required to apply
Statement 123R in the first interim or annual reporting period that
begins after December 15, 2005. The adoption of this standard is not
expected to have a material impact on the Company's results of
operations or financial position.
In December 2004, the FASB issued SFAS No. 153, "Exchanges of
Nonmonetary Assets - An Amendment of APB Opinion No. 29". SFAS No. 153
is the result of a broader effort by the FASB to improve financial
reporting by eliminating differences between GAAP in the United States
and GAAP developed by the International Accounting Standards Board
(IASB). As part of this effort, the FASB and the IASB identified
opportunities to improve financial reporting by eliminating certain
narrow differences between their existing accounting standards. SFAS
No. 153 amends APB Opinion No. 29, "Accounting for Nonmonetary
Transactions", that was issued in 1973. The amendments made by SFAS
No. 153 are based on the principle that exchanges of nonmonetary
assets should be measured based on the fair value of the assets
exchanged. Further, the amendments eliminate the narrow exception for
nonmonetary exchanges of similar productive assets and replace it with
a broader exception for exchanges of nonmonetary assets that do not
have "commercial substance." Previously, APB Opinion No. 29 required
that the accounting for an exchange of a productive asset for a
similar productive asset or an equivalent interest in the same or
similar productive asset should be based on the recorded amount of the
asset relinquished. The provisions in SFAS No.153 are effective for
nonmonetary asset exchanges occurring in fiscal periods beginning
after June 15, 2005. Early application is permitted and companies must
apply the standard prospectively. The effect of adoption of this
standard is not expected to have a material impact on the Company's
results of operations and financial position.
The FASB has also issued SFAS No. 151 and 152, but they will not have
any relationship to the operations of the Company. Therefore, a
description and its impact for each on the Company's operations and
financial position have not been disclosed.
n) Reclassifications
Certain reclassifications have been made to the prior period's
financial statements to conform to the current period's presentation.
6
Xerion EcoSolutions Group Inc.
(A Development Stage Company)
Notes to the Financial Statements
(expressed in U.S. dollars)
(unaudited)
2. Summary of Significant Accounting Policies (continued)
o) Interim Financial Statements
These interim unaudited financial statements have been prepared on the
same basis as the annual 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 period.
3. Property and Equipment
March 31, December 31,
2005 2004
Net Book Net Book
Accumulated Value Value
Cost Depreciation $ $
$ $ (unaudited) (audited)
Computer equipment 9,207 5,089 4,118 4,836
=======================================================================
4. Related Party Transactions
a) The Company accrued $15,000 during the three months ended March 31,
2005 (2004 - $15,000) to the President of the Company for management
services rendered.
b) Included in accounts payable is a balance of $135,000 (December 31,
2004 - $120,000) payable to the President of the Company.
7
Item 2 - Management's Discussion and Analysis or Plan of Operation
Caution Regarding Forward-Looking Information
This quarterly report contains certain forward-looking statements and
information relating to the Company that are based on the beliefs of the Company
or management as well as assumptions made by and information currently available
to the Company or management. When used in this document, the words
"anticipate", "believe", "estimate", "expect" and "intend" and similar
expressions, as they relate to the Company or its management, are intended to
identify forward-looking statements. Such statements reflect the current view of
the Company regarding future events and are subject to certain risks,
uncertainties and assumptions, including the risks and uncertainties noted.
Should one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary materially from
those described herein as anticipated, believed, estimated, expected or
intended. In each instance, forward-looking information should be considered in
light of the accompanying meaningful cautionary statements herein.
General Business Overview
- -------------------------
Xerion EcoSolutions Group Inc. was originally incorporated in Colorado in 1985
as Gemini Ventures, Inc. The name was changed in 1989 to Solomon Trading
Company, Ltd., in 1994 to the Voyageur First, Inc., in 1995 to North American
Resorts, Inc., in 2000 to Immulabs Corp. Effective March 28, 2003, as filed with
the State of Colorado, the Company changed its name to Xerion EcoSolutions Group
Inc. and is currently in the business of developing gold extraction technology
for the mining industry.
In November 2000, Immulabs acquired the exclusive rights to purchase
technologies developed by Quest Research Group, Inc. ("Quest") of Boston,
Massachusetts, and to buy up to 100% of that company. Quest's biotech research
had resulted in the development of two technologies of interest to the Company,
which the Company hoped to commercialize. With the exclusive rights to acquire
secured, the Company had been performing its due diligence pursuant to its
option contract with Quest in order to evaluate the technology and develop its
commercialization strategy. The parties entered into a dispute and the Company
contacted Quest to seek mediation or arbitration as provided for in the option
agreement. The Company subsequently learned that Quest had insufficient assets
to warrant litigation and decided at this time not to pursue further legal
action.
In October 2002, the Company retained Ben Traub as President of the company. Mr.
Traub was to identify new business opportunities on behalf of the Company.
On March 17, 2003 the Company purchased 67 mining claims and certain ore and
waste processing technologies. In compliance with the purchase agreements, the
vendors were obligated to deliver exploration and metallurgical data to support
the representations made about the processing technologies and claims. The
Vendors neglected to deliver this documentation. Subsequent to December 31, 2003
the Company has canceled the purchase agreements. The cancellation of the
purchase results in a reimbursement of 2.5 million shares to the company, which
substantially reduced the issued and outstanding shares of the Company.
For over a year the Company has been working with Dr. David Dreisinger (1), a
specialist consultant in the field of hydrometallurgy. This work has included a
research project focused on developing a viable alternative to cyanide for the
gold mining industry. As a result of this consulting project, Dr. Dreisinger has
identified certain chemical conditions in the application of certain non-toxic
reagents that he believes could lead to a significant breakthrough in the
developmentof a replacement for cyanide.
Cyanide is currently used to extract in excess of 80% of the world's gold
production. Cyanide is widely known to be toxic and dangerous to work with (2).
Due to many accidental spills of cyanide into lakes, streams and drinking water,
the use of cyanide has come under close scrutiny by environmental regulators.
Public awareness of the perceived dangers has led to the use of cyanide being
banned or severely restricted in some areas of the world, thus providing a
commercial opportunity for alternative gold extraction systems. For example,
Canyon Resources has a 10.9 million ounce gold deposit that is currently impeded
from development by the anti-mining initiative, I-137, which bans development of
new gold and silver mines which use open-pit mining and cyanide in the treatment
and recovery process in the State of Montana (3). To date, no alternative gold
extraction system has found broad commercial success due to associated problems
with chemistry and/or economics (4). It is Xerion's goal to develop a less toxic
alternative to cyanide for the gold mining industry. There is currently little
market for cyanide alternatives due to the wide use of cyanide and its strong
market dominance. However, due to the current regulatory climate, it is possible
that substantial proof of concept by a less toxic alternative could result in
adoption by the mining industry. Dr. Dreisinger has identified and proposed
certain chemical conditions under which selected non-toxic reagents could
potentially operate economically, at the same time avoid known handicaps
previously associated with such chemistry. A substantial review of related
literature and existing patents has not revealed any other work that has
utilized these proposed chemical conditions. The Company is currently in
discussions with Dr. Dreisinger (5) regarding the necessary bench scale lab work
to prove out Dr. Dreisinger's hypothesis. If an agreement with Dr. Dreisinger is
consummated, research work is anticipated to take place at the University of
British Columbia.
8
(1) www.mmat.ubc.ca/units/bioh/people/dreisinger/dreisinger.html
(2) www.cyanidecode.org/library/cn_facts_health.html
(3) www.canyonresources.com/projects/mcdon.html
(4) http://technology.infomine.com/enviromine/publicat/cyanide.pdf
(5) www.mmat.ubc.ca/research/groups/hydromet.htm
The prospect of developing and bringing to market a technology of this magnitude
may exceed the company's current ability. Management is evaluating the
possibility of merging with another, more established company with existing
operations and cash flow.
Results of Operations for the Three Months Ended March 31, 2005
- ---------------------------------------------------------------
Revenues. The Company currently has no revenues from operations, and the Company
does not anticipate that it will generate any revenues in the near future.
The Company incurred a net loss of $18,700 compared to $37,469 in the comparable
quarter of 2004. The decrease was due to the fact the Company has had limited
funds to incur business development expenses.
Liquidity and Capital Resources. The primary source of the Company's cash has
been through the sale of equity. Our cash decreased to $742 at March 31, 2005
from $2,333 at December 31, 2004. As at March 31, 2005, the Company has a
working capital deficit of $163,224 as compared to $145,162 at December 31,
2004.
Future expenses will be either be financed by the President of the Company or in
the form of private placements
The Company believes its current available cash position and access to capital
is sufficient to meet its cash needs on a short-term basis. The Company's
ability to continue as a going concern is dependent upon the Company's ability
in the near future to (i) raise additional funds through equity financings, and
(ii) loans from significant shareholders.
Item 3 - Controls and Procedures
- --------------------------------
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. The Company's Chief Executive
Officer and Chief Financial Officer have evaluated the effectiveness of the
Company's disclosure controls and procedures (as such term is defined in Rules
13a-15 and 15d-15 under the Exchange Act) as of the end of period covered by
this quarterly report (the "Evaluation Date"). Based on such evaluation, such
officers have concluded that, as of the Evaluation Date, the Company's
disclosure controls and procedures are effective.
CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING. During the most recent
fiscal quarter, there have not been any significant changes in the Company's
internal controls over financial reporting or in other factors that have
materially affected, or are reasonably likely to materially affect internal
controls over financial reporting.
PART 2 - OTHER INFORMATION
- --------------------------
Item 1 - Legal Proceedings
- --------------------------
To the best knowledge of the Officers and Directors of the Company, neither the
Company nor any of its Officers and Directors are parties to any legal
proceeding or litigation other than as described below. Further, the Officers
and Directors know of no threatened or contemplated legal proceedings or
litigation other than as described below.
The current Management learned in late 2002 that the Company is in dispute over
its purchase of a shuttle bus in 1998. The owners of the bus lost the vehicle in
bankruptcy and are looking to recoup $97,508.58 plus associated costs, through
litigation, due to their losses, however, the title of the bus was never
transferred to the Company and the Company was looking to recoup some $15,000 in
payments made towards the purchase. The Company is now relying on former
directors of the Company dba North American Resorts Inc. as well as the estate
of the Company's former attorney to cover any associated costs that might arise
from this matter. These parties have signed a Hold Harmless Agreement
indemnifying the Company from any costs arising from previously undisclosed
liabilities. An attorney representing the former management informed the Company
that they had worked out a potential alternative settlement with the Claimants
that would absolve the Company of any liability. That attorney is waiting for
his legal fees to be paid to complete these transactions and advised the Company
in 2002 that a payment of $10,000 would clear the matter within thirty days. The
Company has made no payments and no invoice for payment or demand to pay has
been received by the Company and in the event that this occurs the Company will
be pursuing former Directors for payment in this matter. If this situation
escalates and the Company cannot collect from its indemnifiers, the Company may
have to pay any money that becomes due.
9
Item 2 - Changes in Securities
- ------------------------------
None
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 and Reports on Form 8-K
- -----------------------------------------
Exhibits
- --------
31.1 Certification of Principal Executive Officer pursuant to Rule 13a-14 and
Rule 15d-14(a) promulgated under the Securities and Exchange Act of 1934, as
amended
31.2 Certification of Principal Financial Officer pursuant to Rule 13a-14 Rule
15d-14(a) promulgated under the Securities and Exchange Act of 1934, as amended
32.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 (Principal Executive Officer)
32.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 (Principal Financial Officer)
Reports on Form 8-K
- -------------------
None
SIGNATURES
In accordance with the requirements of the Securities Exchange Act, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized on this 18th day of May, 2005
Xerion EcoSolutions Group Inc.
/s/ Ben Traub
- ------------------------------------
Ben Traub, President, Chief Executive Officer and Director
/s/ Robert Skanes
- ------------------------------------
Robert Skanes, Chief Financial Officer, Secretary and Director